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THE SITUATION ROOM

Midwest Fights to Keep Floods at Bay; Senate Probes Interrogations; Can McCain Match Obama's Michigan Turnout?; What Gore Brings to Obama

Aired June 17, 2008 - 17:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


WOLF BLITZER, CNN ANCHOR: And to our viewers, you're in THE SITUATION ROOM.
Happening now, the worst natural disaster to hit the United States since Hurricane Katrina. Record flooding as rivers overflow and levees give way. And the worst may still lie ahead.

Also, sexual humiliation, excruciating poses, even waterboarding -- who authorized these harsh interrogations of terror suspects?

Now lawmakers are demanding answers. There's new information coming into THE SITUATION ROOM.

Plus, John McCain walking a fine line as he tries to respect ahead of the Republican Party, who also happens to be one of the most unpopular presidents in decades.

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

It's a natural catastrophe of serious proportions still in the making. And for those living downstream on the rising Mississippi River, the worst is yet to come. The federal government says 27 -- 27 levees are in danger of overflowing. One has already overflowed on the other side of the river near that breach in Burlington, Iowa.

And as CNN's Sean Callebs reports, the situation there seems to be getting worse. Let's go to Sean right now.

Sean, what's the latest, because there's a race against the clock.

SEAN CALLEBS, CNN CORRESPONDENT: There certainly is. That's a perfect way to put it. It has been a very anxious day here in Burlington, Iowa. You can see what the water has done -- the big muddy, the Mississippi jumping its banks, swamping this area of the downtown.

We have a couple of cameras set up, as we look across the river here. If you look out beyond that second tree line, the Mississippi is usually out in that area. But, boy, have things changed. We have some tremendous aerial pictures we want to go to that came from WQAB, just coming in. Now those pictures actually show across the river from Burlington is the town of Gulfport, Illinois And a levee there was breached, allowing the river to just pour into that section of Illinois. It has been a horrific day for people over there. But Illinois' misfortune has been somewhat of a silver lining here in Iowa, Wolf. Because as soon as that levee gave way, the water here basically began to stay stable.

If you look, you can see on the side of this building where I am now where the waterline was. It's actually come down just a little bit. But folks worry, Wolf, as this begins to crest -- I mean as this begins to stabilize over in Illinois -- that the river is going to continue coming up in this area -- Wolf.

BLITZER: Sean, you've seen this flooding since the beginning. You were also back -- you were there in Iowa in '93.

What's your personal impression how bad it is this time?

CALLEBS: Well, it's bad. I think the one caveat, because they've done so much work to the levee system since 1993, we're not seeing this widespread flooding that we saw basically from the Dakotas all the way out through Iowa down all the way down to Memphis, if you remember. But the flooding is very, very bad in some areas. And we certainly can't say that it's not historic in the sense that it's not as widespread as it was last time.

A couple of things, Wolf. You talked to the FEMA chief in "Late Edition" on Sunday. And he talked about this being the worst natural disaster since Hurricane Katrina. A lot of people here in this area, a town of 25,000, they're worried that so much of the federal attention is going to go to larger cities like Cedar Rapids, Des Moines, where they're rushing in water, trying to take care of the tens of thousands of people who are evacuated. Once the water leaves this area, they're going to have a big clean up here in their economic linchpin. And they're worried that they're going to be overlooked.

So that's something we'll have to keep an eye on in the coming days, weeks, even months ahead -- Wolf.

BLITZER: Sean will stay on the scene for us.

Sean, thank you.

As the mighty Mississippi flows, so flows this disaster. Some riverside communities are beginning to clean up, while others are still preparing for the worst.

Brian Todd is looking at the big picture for us.

Brian, some say this -- this flooding is taking on epic proportions.

BRIAN TODD, CNN CORRESPONDENT: It seems to have done that, Wolf. And a huge concern is what's going to happen in the coming days, when these floodwaters start to rise further and further down the Mississippi River. We're going to show you just what we're up against here in some of these graphics.

Take a look at this -- Cedar Rapids, Iowa. Look at this image -- people just sifting through the debris from what was left of their homes. Right now that's eight feet above flood stage. It crested at 18 feet above flood stage this past Friday. So they may be out of the woods, at least as far as the floodwaters there may be receding a little bit.

Now, Clarkesville, Missouri. Let's take a look at what we're up against there in Clarkesville. This is, again, moving further downstream along the Mississippi River. Now 10 feet above flood stage. It is expected to crest at about 13 feet above flood stage by Friday evening.

Moving further down the Mississippi River to St. Louis, Missouri. Again, not a huge problem now, but it's getting to that point. Six feet above flood stage right now in St. Louis, Missouri. Expected to crest at about 10 feet above flood stage by Monday and at least hold there for some time.

Now, all along the Mississippi River, these towns have one tried and true method for trying to stave off the floodwaters. It has worked for the most part so far, but it may not hold for the rest of the week.

(BEGIN VIDEOTAPE)

TODD (voice-over): Sandbagging in Clarkesville, Missouri -- the only thing keeping this and so many towns along the Mississippi River from being overwhelmed.

PETE WILSON, BURLINGTON, IOWA: If this river comes up to 26 feet, it's going to be clear to the top of our levee here and I don't know if we're going to be able to hold it.

TODD: With several major tributaries of the Mississippi overflowing their banks, an official with the Army Corps of Engineers warned that water could spill over more than two dozen levees along the Mississippi, unless they're topped with enough sandbags.

RON FOURNIER, ARMY CORPS OF ENGINEERS: All those cities have the potential to have the water go over the top of the flood protection system. So that's why they're beefing them up, to meet the projections. And, you know, the projections change every day, depending on rainfall and where it's coming in from the tributary.

TODD: One levee near Gulfport, Illinois has already been breached. Several hundred people were evacuated and thousand of acres are threatened. One bridge has been closed connecting Illinois to Iowa. In Cedar Rapids, Iowa, where floodwaters from the Cedar River had inundated hundreds of city blocks, there's some relief, but also heartbreak. The waters have receded and people are starting to return to their homes. But now they're assessing whether their houses are habitable.

UNIDENTIFIED MALE: Well, in the last half hour, I've been able to get about four inches out of my basement. Currently, I still have about four-and-a-half down here. TODD: And the commercial impact is massive -- grain elevators underwater, train tracks flooded. Three major Amtrak routes have been disrupted.

(END VIDEOTAPE)

TODD: Those routes are serving cities like Kansas City, Missouri, Chicago, St. Paul, Minnesota and Denver. And it's forced Amtrak to use busses to bypass those flooded tracks -- Wolf.

It is a huge problem now affecting commerce, as well.

BLITZER: And a major problem is what's in that water, as well.

TODD: That's right. You know, it's a big concern. Health experts are saying there are a lot of chemicals in this water. A lot of these areas flooded is farm -- are farm land. So that you've got chemicals from pesticides, manure just flowing around the place, people wading around. They say that the massive amounts of water are actually a good thing because it can dilute some of these chemicals. But there's still a health risk there.

BLITZER: And I know the president is heading out there on Thursday.

TODD: That's right.

BLITZER: We'll watch that, as well.

Thanks, Brian.

Brian Todd reporting.

The Senate Armed Services Committee, meeting here in Washington, is demanding answers in a hearing on what are described as very harsh interrogation techniques. They've been used on terror suspects, some of whom were stripped, forced into stress positions for hours, humiliated, even waterboarded.

Let's go to our senior Pentagon correspondent, Jamie McIntyre. He's joining us live.

What are we learning today -- Jamie?

JAMIE MCINTYRE, CNN SENIOR PENTAGON CORRESPONDENT: Well, Wolf, at issue here is how did the U.S. military's SEAR training -- that's short for Survival, Evasion, Resistance and Escape -- which is supposed to help U.S. soldiers withstand abuse, become the basis for what critics charge have been abusive interrogations?

(BEGIN VIDEOTAPE)

MCINTYRE (voice-over): The man in the hot seat was the Pentagon's former top lawyer, William Haynes.

WILLIAM HAYNES, FORMER PENTAGON GENERAL COUNSEL: Did I ever discuss SEAR techniques with others in the administration?

The answer is yes.

SEN. CARL LEVIN (D), ARMED SERVICES COMMITTEE: And what was the gist of those conversations?

HAYNES: I don't remember them any more clearly than what I've -- what I've just said and I cannot discuss it further without getting into classified information.

MCINTYRE: Techniques used in POW resistance training, like what soldiers routinely go through at Fort Bragg, include tactics like sensory deprivation, sleep disruption, stress positions, slapping and even waterboarding. But the retired military officer who ran the SEAR program testified mostly the tactics were standard tricks of the trade.

LT. COL. DANIEL BAUMGARTNER (RET.), FORMER JOINT PERSONNEL RECOVERY AGENCY: They're used by police. They're used by priests. They're used by your mom and dad. I mean good cop/bad cop.

MCINTYRE: The Pentagon lawyer whose private concerns prompted then Defense Secretary Donald Rumsfeld to curtail the roughest procedures says to call them harsh or enhanced is misleading.

ALBERTO MORA, FORMER NAVY GENERAL COUNSEL: The legally correct adjective is cruel.

MCINTYRE: Among the documents uncovered by the Senate Armed Services Committee, minutes of an October 2002 meeting, where it seems clear the top lawyer for Guantanamo has reservations about detainee treatment: "We may need to curb the harsher operations while the International Committee of the Red Cross is around," Lieutenant Colonel Diane Beaver is quoted as saying.

Officially, it is not happening. Now retired, Beaver testified she didn't recall what she said at the meeting six years ago, but denied any cover-up.

One question left unanswered -- who is accountable?

UNIDENTIFIED FEMALE: We would like to hold someone responsible and it's like trying to cast shadows here.

(END VIDEOTAPE)

MCINTYRE: Senator Levin's conclusion is that Senator Bush administration officials sought these techniques and then twisted the law to make them seem legal. Republican Lindsey Graham called it "One of the most irresponsible and short-sighted legal analysis ever provided the U.S. military."

The White House said, look, we are treating detainees humanely and trying to get information from them that will protect America -- Wolf.

BLITZER: Jamie, thank you.

Jamie McIntyre with that report.

Let's go back to Jack for "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: Independent voters are crucial in presidential elections. That's like somebody's rule one. You can bet that John McCain and Barack Obama are doing everything in their power to get Independent support.

A new "Washington Post"/ABC News poll shows that McCain and Obama are even among Independents, which suggests a shift toward McCain over the last month.

When it comes to the issues, Independents see McCain as more credible on fighting terrorism and they're split evenly on who's the stronger leader and who is better on the war in Iraq. But 62 percent of Independents polled say the Iraq War is not worth fighting.

Obama has a double digit advantage among Independents on a lot of domestic issues, including the economy -- the nation's number one issue; gas prices, health care, global warming and women's issues.

In recent elections, Democratic and Republican voters have overwhelmingly supported their party's candidate.

That makes sense.

This time around, though those identifying themselves as Democrats far outnumber Republicans. And that could spell trouble for McCain. It means he'll have to attract a larger percentage of Independent voters if he's going to win.

A couple of other factors to consider that are working against McCain in this poll. People are more unhappy than ever with the direction the country is going. Eighty-four percent say we are seriously on the wrong track.

Also, when asked which party they favor for Congress in the fall, 52 percent say Democrat. Only 37 percent say Republicans.

So here's the question: What will John McCain and Barack Obama have to do in order to win over Independent voters?

Go to CNN.com/caffertyfile and post a comment on my blog -- Wolf.

BLITZER: Good question, Jack, again.

Thank you.

Barack Obama is known for bringing in huge crowds. Up to 20,000 showed up last night in Michigan.

Can John McCain hope to do the same?

I'll ask a key supporter of his, the Minnesota governor, Tim Pawlenty. He's standing by live.

Plus, do big endorsement really matter?

You're going to find out how a heavy hitter like Al Gore might lend some weight to Barack Obama's campaign.

And a gruesome discovery on a Canadian beach. Police cannot believe what continues to wash onshore there five times in less than a year. We'll tell you what's going on.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: It was a shot across the Republicans' bow when Senator Barack Obama held a huge rally after clinching the Democratic presidential nomination. That rally was held in St. Paul, Minnesota, drawing a crowd of about 17,000 people. And that was to the site of this summer's Republican presidential convention.

Joining us now is the governor of this important battleground state, Minnesota. Governor Tim Pawlenty is a Republican. He's a strong supporter of Senator McCain.

Senator -- Governor, thanks very much for coming in.

GOV. TIM PAWLENTY (R), MINNESOTA: Happy to do it, Wolf.

Thanks for having me on the show.

BLITZER: Can John McCain do in Minnesota -- let's say if he were to show up or the week after, go to that convention site in St. Paul -- do you think he'd get an attendance as Barack Obama did?

PAWLENTY: Well, he's going to be here on Thursday of this week, Wolf. He's not doing a big arena demonstration or rally, but he is doing a panel discussion and a town hall meeting and a fundraiser. He would get a -- he's going to get a good turnout and a good reception.

BLITZER: But that's usually in the hundreds. We're talking thousands. Sometimes Obama generates tens of thousands of people to show up for his rallies. And I wonder -- you know your state as well as anyone.

Could McCain do that in Minnesota?

PAWLENTY: Well, maybe. But you also have to look at the polls, which show the rallies are interesting, they're entertaining and I know the press likes to cover them. But the fact of the matter is the race is essentially tied. So you have to look at levels of support, not just who shows up at rallies as an entertainment experience.

BLITZER: And so, in other words, you think that these people are going to be entertained by Barack Obama.

They wouldn't necessarily be entertained by Senator McCain? PAWLENTY: What I'm saying is the best sermons are lived, they're not preached. And Senator Obama gives an interesting speech. But when you look at the life, the experience, the abilities to be the commander-in-chief, the leader of the free world and somebody who has actually bridged the bipartisan divide -- or the partisan divide in Washington -- it's John McCain, not Barack Obama.

BLITZER: Do you -- people in Minnesota pay a lot for a gallon of gas. I think it's even higher than the national average, which is just over $4 a gallon, am I right?

PAWLENTY: That's right.

BLITZER: So the question is this, the big oil companies -- and we're going to be speaking with the chairman and CEO of Chevron here in THE SITUATION ROOM. That's coming up later.

Do the big oil companies like Exxon Mobil and Chevron and the others, do they deserve additional tax breaks right now?

PAWLENTY: Well, in fact, if you look at the 2005 energy bill that Dick Cheney and George Bush helped promote, President Bush and Vice President Cheney, Barack Obama voted in favor of that bill. John McCain voted against it because it, in his view, gave away too many additional tax breaks to oil companies and traditional energy and didn't emphasize renewable and clean energy enough. So John McCain has been the one out talking about a different, more revolutionary energy future.

I'll also tell you that...

BLITZER: Let me interrupt, governor, because I asked the question...

PAWLENTY: Yes?

BLITZER: Because right now there's a major difference between Obama and McCain on the corporate tax structure for big oil. Obama wants a windfall profits tax on Exxon Mobil and Chevron and these other big companies, because he says their profits right now are record profits, in the billions and billions of dollars each quarter. McCain wants a reduction in the corporate tax rate structure, including on big oil, which would reduce their tax rate right now.

So there's a huge difference right now between these two presidential candidates. So let me rephrase the question.

Does big oil right now deserve an additional tax break, as Senator McCain is recommending?

PAWLENTY: Senator McCain believes that by reducing tax burdens on companies across the United States, including energy companies, that that will encourage them to reinvest. Now, don't take my word for it or Senator McCain's word for it or Barack Obama's word for it. Go look at the nonpartisan and highly respected Congressional Research Service, which has done a paper on the effects of additional taxation on oil companies. And what they concluded is a decreased production in the United States and discouraged additional oil exploration in our country.

John McCain has been a critic of excessive pay for oil company executives, but he doesn't believe that we should be putting additional energy taxes on energy companies at a time we need more oil exploration and more energy production.

BLITZER: He's speaking, Senator McCain, on this very subject right now. Bear with me for a moment. Standby. I want to listen to Senator McCain and then we'll discuss.

Listen to this.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: A third nation plans to build enough nuclear plants to meet one quarter of all the electricity needs of its people -- a population of more than a billion people. These three countries -- China, Russia and India -- and if they have the vision to set and carry out great goals in energy policy, then why don't we?

(APPLAUSE)

MCCAIN: So taking stock of our energy situation, it's time we draw a few sensible conclusions of our own. Is there some effect to the American economy, the policies of our government could hardly have left us more dependent had they been designed to do precisely that. This vulnerability is clear in many ways and never more than when American leaders are reduced to supplicating for lower prices before the sheikhs and princes of OPEC. Of course, they're unmoved by our troubles. They regard even the need to ask as a sign of weakness. And in the end, they take their cues not from our entreaties for relief, but from our failure to diversify and to produce.

Quite rightly, I believe we confer a special status on some areas of our country that are best left undisturbed. When America set aside the Arctic National Wildlife Refuge, we called it a refuge for a reason. But the stakes are high for our citizens and for our economy. And with gasoline running at more than $4 a barrel -- a gallon -- a gallon. I wish the good old days.

(LAUGHTER)

MCCAIN: ...$4 a gallon, many do not have the luxury of waiting on the far off plans of futurists and politicians.

(END VIDEO CLIP)

BLITZER: All right. So there he is, Senator McCain making some points in his speech. It's a major energy speech.

Let's go back to Governor Pawlenty, who's joining us from Minnesota.

Governor Pawlenty, do you favor building new nuclear power plants in your state of Minnesota right now?

PAWLENTY: Yes, I do. We have a law that prohibits it, but I'd like to change that. And, clearly, Wolf, part of our energy future has to be reopening the debate and moving forward on additional nuclear energy. It's not the only thing, but it's one of the things that will help us.

BLITZER: And do you agree with Senator McCain, it would be a mistake to go ahead and drill in Alaska, in the Alaskan National Wildlife Refuge?

PAWLENTY: Well, I support Senator McCain. His view on ANWAR is we shouldn't drill there because it's a refuge. I think with the advance of technology, that may change, at least in my view, in terms of how you might access that in the future. But his view clearly is we should not and he does not support drilling in ANWAR, as he just mentioned. But he does support aggressive domestic energy exploration and oil production, including offshore drilling, with the concurrence and cooperation of the states, with some modest exceptions, like he mentioned the Everglades and a few other places.

BLITZER: All right. Senator Pawlenty, thanks very much for coming in.

One quick question before I let you go: Has anyone from the McCain campaign started to vet you yet as a vice presidential running mate?

PAWLENTY: They have not. I haven't been asked. I don't expect to be asked. But you're always kind to inquire about that -- Wolf.

BLITZER: Hey, governor, appreciate it very much. You're on the short list. That's what everyone says.

PAWLENTY: Well, my wife says I'm on a different kind of list. But thank you, nonetheless.

BLITZER: Governor Tim Pawlenty.

PAWLENTY: All right.

BLITZER: The governor of Minnesota. He's going to be hosting the Republican convention in St. Paul. We'll see you in September, governor.

PAWLENTY: Very good. Very well.

Thank you for having me on the show.

BLITZER: Thank you very much.

And keeping close, at arm's length. We're showing to show you how John McCain is trying to separate himself from President Bush and at the same embrace some of his key policies.

Plus, record high gas prices who's really to blame? I'll be speaking with the head of one the country's largest energy companies. We'll have an exclusive interview.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Carol Costello is monitoring some on they are important stories incoming into THE SITUATION ROOM right now.

Carol, what's going on?

CAROL COSTELLO, CNN CORRESPONDENT: Well, Wolf, a very gruesome discovery in Canada. Police say for the fifth time since August, a severed human foot washed ashore on the western Canadian coast of Vancouver, British Columbia. This one was a left foot. All of the others reportedly have been right feet. The latest foot was taken to a local coroner for DNA testing to try to determine identity and any connection to the other remains.

Charges dismissed against the highest ranking officer accused in a notorious case -- the killing of 24 Iraqis, many of them civilians, in the town of Haditha in 2005. Marine Lieutenant-Colonel Jeffrey Chessani was accused of failing to investigate the incident. But a military judge today ruled that the general in charge of prosecuting the case was improperly influenced by one of the investigators.

And some unexpected traffic for motorists on Interstate 95 in Ormond Beach, Florida today. Yes, take a look. A small plane that suffered engine trouble made an emergency landing right on the highway. It was piloted by an instructor and a student. No one was hurt. The roadway remained open through the whole thing. The plane was undamaged. Later, the plane and its pilot took off again without difficulties.

They just had a little detour -- Wolf.

BLITZER: Carol, thank you.

And to our viewers, you're in THE SITUATION ROOM.

Happening now, Al Gore back in the political arena. Now that he's endorsed Barack Obama, we'll take a closer look at how big an impact he might have on Obama's White House aspirations.

Senator Chris Dodd on the offensive -- once a contender for the presidential nomination, Dodd is now fighting off charges that he got special treatment by a mortgage lender.

And a possible breakthrough in the Middle East in the form of a truce between Israel and Hamas. The militant leadership in Gaza saying a cease-fire should take hold in a matter of days.

All that coming up. We're watching these stories.

I'm Wolf Blitzer. You're in THE SITUATION ROOM. An emotionally riveting moment for many Democrats, as a man they believe should have been president throws his support to the man they hope will be president. But Al Gore has much more to offer Barack Obama than just another endorsement.

CNN's Carol Costello is working this story for us -- Carol, what can Al Gore do for Barack Obama?

COSTELLO: Well, you know, Wolf, a lot of political types say endorsements don't matter. But this one's a little different. Al Gore is much admired and he's putting his money where his mouth is when it comes to Barack Obama.

(BEGIN VIDEOTAPE)

COSTELLO (voice-over): Al Gore, the adored. Back in the day, you know, like last year, many pundits wrote of Democratic voters begging Al Gore to run for president in '08. For some voters, the dream team was Gore/Obama. Today, it's Obama/Gore.

JAMES CARVILLE, CNN CONTRIBUTOR, CLINTON SUPPORTER: If I were him, I would ask Al Gore to serve as vice president and energy czar in his administration to reduce our consumption and reliance on foreign energy sources.

COSTELLO: Democratic insiders say no chance. They're actually more concerned about Obama's slim lead over John McCain at a time the Republican brand has weakened. So a big Democratic gun like Gore matters.

MARK PRESTON, CNN POLITICAL EDITOR: Having Al Gore, this elder, this leader, come out and endorse Barack Obama, and to do so in Michigan, a state where Barack Obama was not even on the ballot, I think it's pretty significant.

COSTELLO: And if you have a perceived foreign policy experience problem, what better way to assure nervous voters than with support from friends in the know, like former Vice President Al Gore? Gore can also help Obama by raising money. For the first time, Gore is asking his own supporters to donate to another Democrats' war chest.

PRESTON: I can't get inside the guy's head but, you know, there's something to be said about, you know, I'm going to make sure that Democrats take back the White House.

COSTELLO: It's certainly something Gore hinted at as he endorsed Obama.

AL GORE, FMR. VICE PRESIDENT OF THE UNITED STATES: I can tell you that we have already learned one important fact since the year 2000. Take it from me, elections matter.

COSTELLO: To voters, Al Gore is practically synonymous with hanging Chad.

UNIDENTIFIED MALE: There is the swinging door Chad. COSTELLO: He's a living reminder to get out and vote in droves if you want your guy to win. And, of course, there's Gore's reputation as captain planet.

UNIDENTIFIED MALE: The power is yours!

COSTELLO: Global warming is a hot issue, not only among young voters, but among some evangelicals, too, a voting block Obama is actively courting.

(END VIDEOTAPE)

COSTELLO: But with all the good, there's got to be bad, too, right? Is Gore just old news in a campaign promoting change? Well, Wolf, most analysts say, at least among Democrats and Independents, it's all good. Of course, that all depends on how much actual campaigning Gore does for Obama.

BLITZER: Carol, thanks very much for that.

And certainly while Senator Obama draws close to Al Gore, John McCain is making a concerted effort to distance himself from President Bush. At least partially.

Let's go to Mary Snow. She's looking at this story for us.

How is McCain doing this, Mary?

MARY SNOW, CNN CORRESPONDENT: Wolf, he's doing it with a new ad this morning in battleground states and it highlights his differences with President Bush on the environment. It also comes at a time when Democrats try to link McCain with the president whose approval rating now stands at 29 percent.

(BEGIN VIDEOTAPE)

SNOW: It's a message Democratic presidential hopeful, Senator Barack Obama, hopes will stick.

SEN. BARACK OBAMA (D), PRESIDENTIAL CANDIDATE: On issue after issue, John McCain is offering more of the same policies that have failed for the last eight years.

SNOW: But a new McCain campaign ad works to paint a different picture.

UNIDENTIFIED FEMALE: Greenhouse gas emissions.

SNOW: The campaign is highlighting differences between John McCain and President Bush on global warming policies.

UNIDENTIFIED FEMALE: John McCain stood up to the president and sounded the alarm on global warming five years ago.

SNOW: The League of Conservation Voters, a political advocacy group which grades candidates on environmental records, says there is a difference between McCain and Bush. It gives Bush the lowest marks on record.

GENE KARPINSKI, LEAGUE OF CONSERVATION VOTERS: To his credit, Senator McCain has been better than President Bush on global warming, but of course that's a very low bar.

SNOW: McCain supports a mandatory cap on carbon emissions. President Bush supports a voluntary one.

Another area where McCain splits from the Bush administration in recent weeks, arms control. McCain called to work more closely with Russia on nuclear disarmament.

But there are similarities between McCain and President Bush on policies. The economy is one of them. While McCain once opposed the president's tax cuts, he now favors them.

MCCAIN: I believe that we should make the tax cuts permanent.

SNOW: On social security, McCain supports personal savings accounts as does president Bush. McCain supported the initial invasion in Iraq in 2003 but he was critical of the administration's handling of the war. One Republican strategist says a key task for McCain is to define himself before his opponent does.

RICH GALEN, REPUBLICAN STRATEGIST: The advantage that Obama really has in this campaign in terms of the additional money that he's got in his war chest is the ability to run negative ads against McCain in places where McCain might not be able to counter that as we get closer to Election Day.

(END VIDEOTAPE)

SNOW: Republican strategist Rich Galen also adds that the McCain camp's timing on the new ad on global warming is also seen contrasting McCain's announcement today saying that he supports a ban on lifting the ban on offshore oil drilling, a move certainly putting McCain at odds with environmentalists -- Wolf.

BLITZER: Mary, thanks for that, Mary Snow reporting.

There were questions about an alleged sweetheart loan, but now the chairman of the Senate Banking Committee, the onetime Democratic presidential candidate, Chris Dodd, is speaking out. You're going to hear what he's saying.

And you're looking at these pictures. These are pictures coming in from the courthouse in San Francisco. We're going to take you live to San Francisco, to California, where the first full day of legal same-sex marriages is unfolding right now. Hundreds and hundreds of people are waiting in line to get married in California. We'll show you what's happening right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: On Capitol Hill, just a short while ago, Senator Chris Dodd spoke out about the controversy surrounding a loan he got from Country Wide Financial Corporation. Dodd is the chairman of the Senate Banking Committee that oversees the banking and mortgage industry, and he reportedly got a cut-rate deal from Country Wide not available to the general public. It was reported last week that the CEO of Country Wide directed staffers to give lower interest rates and points to influential people.

Kate Bolduan is watching this story on Capitol Hill.

And Senator Dodd came out swinging today, defending himself. What did he say?

KATE BOLDUAN, CNN CORRESPONDENT: He sure did, Wolf.

Well, Senator Chris Dodd, he flatly denies he did anything wrong. He did face some tough questions today, though, regarding preferential loans he received through Country Wide Financial, but Senator Dodd said he never asked for and never expected any special treatment.

(BEGIN VIDEO CLIP)

SEN. CHRIS DODD (D), BANKING CMTE. CHAIRMAN: As a member of the United States Senate over these many years, the idea of asking for seeking any kind of financial preference whether it's in home mortgages or anything else is something I completely reject in any offer that ever would be made I would terminate immediately any suggestion of it.

(END VIDEO CLIP)

BOLDUAN: According to Portfolio.com, the Connecticut senator received two loans from Country Wide back in 2003, one for $563,000 to refinance his Washington, D.C. townhouse, the second for $275,000 to refinance a home in Connecticut. And Portfolio reports that Country Wide waived $2,700 in costs and reduced the interest rate, which would have saved the senator $75,000 over the life of the loan.

Now, all of this is allegedly part of a VIP program within Country Wide Financial. Senator Dodd says that he was told and did know he was being put into this VIP program, but he says he thought it was simply a courtesy for having existing mortgages with Country Wide, having an existing relationship with Country Wide.

Now, Democratic Senator Kent Conrad, he also received some special loans through Country Wide, and he also vehemently denies that he had any knowledge of special treatment of these special deals and he has offered to donate the money that he allegedly saved.

Now, in the face of this, in light of all this, Wolf, House Republicans are calling for an investigation into these loans. Because they say they want to find out exactly what happened here. And the Senate Ethics Committee chair today strongly suggested that their committee would do exactly that. They'd be looking into it, Wolf.

BLITZER: All right, we'll see what happens.

Thanks very much, Kate, for that.

Officials with Hamas say a six-month truce between Israel and Hamas leaders in Gaza will take effect Thursday. Those officials for Gaza's militant ruling party announced the deal today. Egypt has been brokering efforts to stop a cycle of Palestinian rocket attacks and deadly Israeli retaliations. As for Israel, confirmation coming in slow.

CNN's Atika Shubert has more from Jerusalem.

(BEGIN VIDEOTAPE)

ATIKA SHUBERT, CNN CORRESPONDENT: Israeli officials have declined to say when exactly the truce will go into effect. But they do confirm that the negotiations are proceeding forward. According to Israeli officials, that cease-fire, that truce, will come in stages. First, a period of calm in which both sides will respect a cease-fire. If that is successful, Israel will then gradually begin to open the boarder crossings between Israel and Gaza. But the critical point for Israel is that eventually Hamas must release Corporal Gilad Shalit. That is the Israeli soldier that Hamas kidnapped about two years ago. This is a critical part of the truce deal, say Israeli officials.

Now, this does seem to be a step forward to at least temporarily resolve the violence that's been happening in and around Gaza. But, of course, it all depends on whether both sides respect a cease-fire in the coming days and weeks.

Atika Shubert, CNN, Jerusalem.

(END VIDEOTAPE)

BLITZER: Today, hundreds of people, dozens of protests, and one major change in the law. This was the scene today as hundreds of people today became legally married, but there were protests as well. We'll go live to San Francisco. This is the first day same-sex marriages are legal in California.

What happened?

Plus, billions in profits while you pay record prices for gas; my exclusive interview with the chairman and CEO of Chevron. That's coming up. I'll ask him to explain why we're paying so much at the pump.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: California courthouses are flooded with flowers and people filing in two-by-two today. California now the second state to sanction same-sex marriage. And a day after that became official, gay and lesbian couples are lining up by the hundreds right now to make their unions official.

Let's go to San Francisco. CNN's Ted Rowlands is standing by.

This is an historic day out in California. How is it coming along, Ted?

TED ROWLANDS, CNN CORRESPONDENT: Well, Wolf, no problems here, a steady stream of people coming out of city hall today with a state- sanctioned marriage license. Same-sex couples around the state are getting married and are getting recognized by the state of California today. And so far, we haven't heard of any problems. There have been some protesters in some cities. But at least here in San Francisco, no problems and statewide we haven't heard of any major issues.

Of course, looming here is November. And in November, Californians will go to the polls and they will vote on a possible amendment to the state constitution which would define marriage as between a man and a woman. If voters pass that in November, that could make all of these marriage certificates, marriage licenses, null and void. Still, folks we talked to say they are very, very happy to have an opportunity to marry the person that they love.

JIM WINSTEAD, JUST MARRIED: It feels good to know that we're on equal footing with everyone else. We're never asking for anything special as people like to say. We're just asking for the same things, the same rights, as everyone else.

GLEN LAVY, ALLIANCE DEFENSE FUND: For a couple that already had a domestic partnership in California, it really wouldn't make much difference. So, that raises the question, why would they go ahead and get a marriage license when they know that this issue is up for a vote in November? That raises the issue for a lot of people of whether this whole push to have thousands of same-sex marriage licenses issued right away is simply manipulation of the Democratic process.

ROWLANDS: The second individual you heard is Glen Lavy. He's the attorney that argued in front of the state supreme court. He was hoping that California would put these marriages on hold until November. The state Supreme Court said no to that.

One thing that folks across the country should note. This is different than Massachusetts and these marriages could and most likely will affect all of the states in this country eventually, because what is expected to happen because California is allowing people from across the country to come here and have their unions recognized.

When they take those marriage certificates back to their home states and want to be recognized and in most cases, in some cases will be denied, it could throw more legal -- it could throw more cases into the state courts around the country and the feeling is eventually this is going to be a national debate that gets to the national level again, because of what's happening here in California.

BLITZER: So, unlike in Massachusetts, Ted, you don't necessarily have to be a California resident to get married in California, starting today.

ROWLANDS: Yes, they're encouraging people from across the country to come here. In fact, UCLA came out with an estimate that they predicted about 60,000 couples from across the country will come to California in the next three years. That's if voters vote against this constitutional change. But they're expecting a flood of people, and that, of course, is going to bring a flood of lawsuits across the country, and basically bring this issue back into the national debate.

BLITZER: And just to be precise, that constitutional amendment, if it passes in November, banning same-sex marriage, it would be retroactive. All these marriages that are going on right now until November, those would be null and void, is that what you're saying?

ROWLANDS: Well, that -- that's the good point. And it depends on who you talk to, as it usually does in these types of things. But the wording in the constitutional amendment doesn't talk about what is happening now. So, proponents are hoping they would still be valid. Opponents of same-sex marriage, though, are confident if the state constitution changes, then the validity of these marriage licenses would change along with it. That will also have to be sorted out.

Bottom line here is this is the next stage in the ever-evolving same-sex marriage controversy and debate in this country and specifically here in California.

BLITZER: Ted Rowlands in San Francisco. This is an important, historic day, out in California -- thank you.

The battle for Independents only just beginning. Jack Cafferty wants to know, what will John McCain and Barack Obama have to do to win over the Independents?

Jack, with your e-mail. That's coming up.

And did Cindy McCain really steal the recipe? Jeanne Moos investigates what's being called the great cookie scandal of this 2008 election.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Check in with Jack once again for "The Cafferty File" -- Jack.

CAFFERTY: Wolf, the question this hour is: What will John McCain and Barack Obama have to do in order to win over Independent voters considered key in any presidential election?

Kay in West Virginia writes: "Independents will favor the candidate who speaks truth and talks about the hard choices and pain that we will have to go through in order to get the country heading in the right direction once again. The more either candidate speaks of quick fixes or bread and circuses, the more Independents will tend to pull away from them."

J.T. writes: "McCain's best chance of getting support from Independents is to be an Independent. He used to be a maverick, an independent thinker, but then he started going after the far right and following party line. For Obama, it will be easier."

Elaine writes: "I am an Independent. I'm voting for John McCain. Obama's inexperience, associates of the past 20 years and his extremely liberal views frighten me."

Ellena writes: "I am an Independent and the main issues to me are: securing the border, I live in Arizona, fixing our economy, improving our image in other parts of the world and fixing health care."

Nancy in Michigan writes: "Obama has to sit back and let McCain keep talking. People will soon realize how out of touch McCain is and how mixed up he gets the facts. He will show himself to be Bush all over again. Obama will win by a landslide."

Tiffany writes: "If Barack Obama is going to win over Independents, he will have to be able to address people's concerns with his lack of experience by presenting a workable, detailed plan regarding Iraq and helping the economy with widespread bipartisan support. His choice of a foreign policy strong vice president will also be critical."

And Curtis in Udall, Kansas, writes: "Simple really, Jack. They'll both have to demonstrate that they love their country more than their political party. So far, I'm not sure either one has done that."

If you didn't see your e-mail here, you can go to my blog at CNN.com/CaffertyFile. Look for your e-mail there among hundreds of others -- Wolf.

BLITZER: We're going to discuss this with Mr. Independent, Lou Dobbs, in a moment, too, Jack.

Thanks very much.

Also, the price you pay at the pump. Is it pouring into big oil's pockets? I'll go straight to the source. Stay with us for my exclusive one-on-one interview with the man at the top of one of the nation's largest oil companies.

Stay with us right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: On our Political Ticker today, our brand new CNN poll of polls shows Barack Obama now leading John McCain by five points among registered voters nationwide. We averaged together those three brand new surveys and found Obama with 46 percent support, McCain with 41 percent. This is the first poll of polls, that's our average, in which all the surveys were conducted after Hillary Clinton dropped out of the Democratic presidential race and endorsed Obama.

Let's check in with Lou to discuss the Independents out there. You like to say you're Mr. Independent. What do you think? Right now in our poll, we show a pretty even split between Obama and McCain among Independents.

LOU DOBBS, HOST, "LOU DOBBS TONIGHT": Yes, and isn't it crazy? "The Washington Post" didn't point that out in their own poll. But the fact that the Independents right now can't decide between these two, and it's interesting, both have pretty significant negative ratings here amongst Independents. Obama does slightly better than McCain, but overall, Independents aren't too impressed with these two candidates right now.

BLITZER: But if the Independents are split, let's say evenly, given the fact that more people say they support Democrats than Republicans right now, that would seem to suggest in our snapshot right now Obama has an advantage.

DOBBS: It would seem to suggest that, and I think there's no question that Obama does have an advantage. He's leading, although it is barely, in nearly every case it's just outside the margin of error. I think there's no question that John McCain is the underdog. He acknowledges as much, Wolf, as you know. And Senator Obama, you know, has the lead. What's remarkable to me, though, is whether one is talking about Independents or any other category of voter in this country right now, is that McCain, with everything going on in the Republican Party, the Bush White House, that he is this close is a remarkable development, I think, and one that should be very worrisome.

BLITZER: I think you make an excellent point, Lou.

Thanks very much.

DOBBS: Thank you.

BLITZER: And to our viewers, you're in THE SITUATION ROOM.