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THE SITUATION ROOM

Republicans Scale Back Day One of Convention; Gustav Pounds Gulf Coast

Aired September 1, 2008 - 18:00   ET

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


WOLF BLITZER, CNN ANCHOR: And, with that, day one here at the Republican National Convention here in Saint Paul is about to come to a close, an abbreviated first day because of the hurricane in the Gulf Coast.
And, as a result of that abbreviated session, they are now deciding what to do tomorrow, day two. They have not yet announced what their plans are because of the hurricane. I think they are waiting for more information, how significant the damage, the destruction is, before they go ahead and announce what they are doing on day two, day three and day four.

On day four, John McCain is scheduled -- is scheduled to accept the Republican presidential nomination. On day three, Sarah Palin, the governor of Alaska, is scheduled to accept the vice presidential nomination.

We are watching all of this here at the Republican Convention. Across the nation, people are watching what's happening along the Gulf Coast as well, including some growing hope right now that Hurricane Gustav is not necessarily the mother of all storms after all. That was the fear. The worst, though, may not be over yet.

The Gulf Coast is still on high alert right now for flooding. Officials in New Orleans say there is water spilling over the top of the some of the levees. More than 700,000 homes and offices across Louisiana lost power today. Gustav is expected to be in northeast Texas tomorrow, while a new hurricane, Hurricane Hanna, is forecast to hit the Georgia state line perhaps -- Georgia-South Carolina state line on Friday, as early as Friday.

And there's yet another tropical storm that is brewing in the Atlantic. It's called Ike. It's formed in the far eastern Atlantic.

Let's go to Brian Todd right now. He's in Baton Rouge, where it's been very, very hard-hit. The winds are intense.

Brian, set the scene for us in the Louisiana capital.

BRIAN TODD, CNN CORRESPONDENT: Wolf, I'm standing here on a levee by the Mississippi River. We are just getting pounded here. I was going to try to walk a few feet, but I don't think I can right at the moment. We have got a wall of water behind us. Our cameraman, Mark Raven (ph), is going to pan to my right and to his left to show you some of the trees getting really pounded here. And the bridge over there, the I-10 connector from Baton Rouge to the west bank of the Mississippi (AUDIO GAP) vehicles still going over that bridge, but it is pretty dangerous to be up there. It's about 300 feet off the water and it is fairly dangerous driving at the moment.

They did not order a mandatory evacuation for this city, Wolf, but right now we are getting the brunt of the storm and it hit has this city for the last hours with a fury.

(BEGIN VIDEOTAPE)

TODD (voice-over): Don't tell folks here this is a weakening storm. Gustav was still in a fighting mood when it hit Baton Rouge at midday Monday, knocking out power lines, battering trees, tossing debris into the streets.

As the hurricane-force winds approached his city, we caught Mayor Kip Holden at his emergency command center and asked him what worried him the most.

KIP HOLDEN, MAYOR OF BATON ROUGE: Again, the more rain you have, the more evacuation you are going to have to have because we are watching local tributaries right now that are already at their crest. And since they are at their crest, we are going to have to move people out or assist other places in moving people out to help find shelter for them.

TODD: To measure Gustav's force, we went to one of the highest points in the city.

(on camera): We are the bridge connecting (AUDIO GAP) Baton Rouge to the port on the opposite side of the Mississippi River. The winds are starting to kick up very, very high right now, a lot of battering rain on this bridge. This city right now is getting pounded. You can see down the river, the storm surge is starting to wash up on some of those barges down there.

Dutchtown High School outside Baton Rouge is now a Red Cross shelter. About 500 people from the Baton Rouge and New Orleans areas are here from infants to the elderly.

Angela Coleman brought four small children.

ANGELA COLEMAN, SHELTER EVACUEE: We're scared the most of tornadoes, tornadoes coming up -- so, I'm not worried about the wind or the rain. It's just tornadoes, because that's the most thing that can destroy everything.

(END VIDEOTAPE)

TODD: So, Angela Coleman and many others with her are anxiously waiting out this storm that is not going to leave here for several hours, Wolf.

About 50,000 customers in this area and as you mentioned, about three-quarters of the state are without power. An official here told us that they cannot even get out to try to restore power until the winds die down under 30 miles an hour. As you can see, Wolf, that is not going to happen for several hours.

BLITZER: Stand by, Brian, if you can, and be careful over there because I'm really concerned about flying debris.

Chad Myers is at the CNN Weather Center, hurricane headquarters, we're calling it.

Tell us how strong and powerful these winds in Baton Rouge really are right now.

CHAD MYERS, CNN METEOROLOGIST: They are still over 60 miles per hour and gusting to 65 now. There is a 64 mile per hour gust, in the 50s as well. So up and down. You can see the wind coming and going there on Brian's live shot. And that's out of the east really.

The wind that is out of the southeast is here from Metairie and New Orleans all the way back down into the Gulf of Mexico. And that southeast breeze is the problem for the levees. Talking about levees that we were talking about here, well up here to near Braithwaite, what's happening is here.

Now, this is New Orleans way up there, so kind of give you -- and then the river goes all the way down into the Gulf of Mexico. Because the wind has been coming this way for so long, we have pushed water into this wetland and pushing water into that wetland has pushed it all the way up to an earthen levee, a private levee, not an Army Corps levee, that is all the way up near and into Braithwaite and into Saint Bernard.

That's the area right there where the water has pushed up and now it's right up against what is this levee, this earthen levee right there. It is breaching the levee here and also near Braithwaite, breaching the levee right there. That's the area. Kind of agricultural area for the most part, but there are still many homes here especially out near Saint Bernard and also (INAUDIBLE) So, we will watch to see how much this is, but the president there said this is a losing battle, Wolf. He said there is just no way for this to get fixed even with sandbags.

BLITZER: Well, I don't know if you saw the video. Our affiliate has just released some video of people with the sandbags. They're trying to save this levee in Plaquemines Parish right now. We will queue that video up.

But it's a source of great concern, because there a lot of people who live in Plaquemines Parish. And so many of them left after Hurricane Katrina. But a huge percentage actually came back and live in this area and obviously we're very worried, Chad, about it.

MYERS: Well, we had overtopping of levees earlier today and those were the Army Corps. And you showed just those videos over and over where the water just kind of splashed over. And that's OK because that big wall was concrete and it held all that water back. But the earthen levees through here, the dirt, basically they're big dirt mounds in a big long line. Well, the dirt has eroded away so the water is washing over it and then washing away that dirt levee in a couple of spots here. And that's why the president of that parish was so concerned.

BLITZER: And while I have you, Chad, update us on Hurricane Hanna which is moving in the Atlantic and it's moving towards that Georgia-South Carolina border. What do we know about Hanna?

MYERS: Hanna is forecast to be a 90-mile-per-hour storm and maybe more before this whole thing stops and it could probably make landfall from anywhere North Carolina to central Florida. This is not going to be an easy storm to forecast because it's going to give a wide berth. We're still five days from this. Not only is there Hanna, but there is also Ike that could make another landfall sometime Sunday or Monday. And we are just trying to stop and get our breath here, Wolf.

BLITZER: Yes, you are going to be busy. All of us are going to be busy. Thanks very much.

I want to go to Christine Romans right now. She's in Alexandria, watch -- Alexandria, Louisiana, at a shelter with, what, a couple thousand people, Christine, are there?

CHRISTINE ROMANS, CNN CORRESPONDENT: That's right, Wolf, about 2,700 now.

About 70 percent came in a bus, 30 percent by car. They are still coming in. As you can see, the outer bands of the storm are rolling in here now. We are north and west of New Orleans and Baton Rouge.

And I have got to tell you, I was inside the shelter talking to a lot of the folks there and they are all very curious about this storm. I told them it was now a Category 1 and a roar of approval went through here, because folks don't want to be spending another week or two weeks away from home like they were for Katrina.

But this is definitely not the Superdome, which is the shelter scene we all remember from Katrina. Inside here, there rows and rows of cots. There are three cavernous rooms, one of them for first- responders, some 500 there just waiting, kind of staging, getting ready to go and get in these lines and lines of ambulances once the storm passes, so they can go as first-responders.

And then there is another big room with lots of families and separate areas for single men and single women, big dormitory kind of situation here.

I want to tell you that there a lot of children here in this shelter, a lot of families. And we have been asking a lot of people how tough it is try to to keep some semblance of normalcy when this storm is raging outside and they are away from home. There are a lot of activities for the kids. But when you talk to the parents, I tell you, they're worried very near term, day to day, what they're going to do next and they're worried about the storm, but they're also wondering what's happening at home.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Phone lines ain't going through. I don't know what's going back (INAUDIBLE)

(END VIDEO CLIP)

ROMANS: Her little boy is 10 years old, Wolf, and he is so concerned about his dogs that he told his mom he doesn't think he was going to eat until he gets home and makes sure that his dogs are OK.

The wind is picking up here. Some of the kids are having a lot of fun. It's almost like a sleepover for them. They haven't even gone 24 hours yet. Older kids are a little bit more concerned, but this is really just the beginning of it for a lot of folks from the Gulf, a lot of these families who are on the move, and now they are waiting in these shelters, again, about 2,700 people here -- Wolf.

BLITZER: All right, thanks, Christine. And our best to all those folks where you are in Alexandria, Louisiana.

The other -- the big story we are watching right now are the levees in -- and all the barriers in New Orleans. Want to make sure that the water does not come through, that those levees and those barriers pulled up. But there is this one barrier, this one levee in Plaquemines Parish.

You see people there. This is with videotape that we got from our affiliate. They are putting sandbags there right now. Actually, these are live pictures coming into THE SITUATION ROOM. They are putting sandbags there. There's real serious concern that this privately-owned levee is going to give way and that water would come through that area into Plaquemines Parish.

General Russel Honore, the retired U.S. Army general, is with us who knows a great deal.

Give us some sense of perspective. We are looking at these live pictures. They are bringing in the sandbags. They are doing everything they possibly can to beef up this one levee, General, to make sure it doesn't give way.

LIEUTENANT GENERAL RUSSEL HONORE, COMMANDER, FIRST U.S. ARMY: Yes.

And we have seen this play out time and again before, the construction of those levees basically being attacked by that flow of water from the Gulf, Wolf, is really putting a lot of pressure on this levee that was primarily designed to deal with rainwater, not to be able to deal with the tidal surges we are seeing right now. Over.

BLITZER: And so you think that -- based on what you are seeing right now, knowing the extent of what's going on, this emergency work, that bulldozer there bringing sandbags and dirt, trying to reinforce this levee, does that look like it is going to work? Because the president of that parish, he was not very upbeat.

HONORE: Yes.

And, now, I hope his assessment is wrong. You see the troops there are doing the best they can. God bless them, but the bigger impact here is, you see this storm attacking. It's basically closed down the Port of New Orleans. Now we have got this event going on in Plaquemines Parish.

And Baton Rouge itself will be without power for four or five days, Wolf. And the oil industry is stopped. And the storm is going through the agricultural area. Big economic impact on Louisiana, the way I see it in the next few days.

BLITZER: All right, General, stand by for a moment, because I want to get some reaction from folks is live in that area, especially in Baton Rouge, who are here in Saint Paul at the Republican Convention.

Ed Henry is on the floor in the Louisiana delegation.

My heart goes out to these folks, Ed. What are they saying?

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: Well, Wolf, we are with a very special delegate, Vickie Davis. She is a first-time delegate. She has even got an elephant charm around her neck, as well as elephant earrings.

You are very happy now, but you were telling me that you had a very heart-wrenching story. You had left your four children with your 83-year-old mother in Louisiana before you came here. And over the last couple of days, you were very nervous.

VICKIE DAVIS, LOUISIANA DELEGATE: Yes, we came up Thursday and the hurricane was not even in the Gulf yet. And so we felt confident that we can come and if it got really bad, we could just fly back or Rick could fly back.

What we decided to was wait to find out where it was going to head. And when we saw it heading straight for New Orleans, Baton Rouge, my husband said we need to bring the kids here.

HENRY: And the McCain campaign offered up a charter plane. And so your husband last night went to Mississippi to get your children. Your 17-year-old son drove from Louisiana to Mississippi with your kids and your 83-year-old mom.

(CROSSTALK)

DAVIS: It took five hours.

HENRY: They are here in the upper rafters, I understand.

DAVIS: Yes. HENRY: How happy are you now and relieved that they're out of harm's way?

DAVIS: I'm elated. McCain is my hero.

(LAUGHTER)

HENRY: And also you just heard from first lady Laura Bush. This morning, she came to a Louisiana delegation breakfast, along with Mrs. McCain. Talk about what they said and whether that comforted you.

DAVIS: Oh, they were very compassionate. They understood the anguish of us being here and our loved ones being at home and in harm's way. And we were just elated. We were comforted by their presence. I'm so glad they came. We were able to offer up a thank you to them. And just what else can we do? What else can we say but thank you?

HENRY: Just as a last thing, what kind of reports have you been thing on the ground from your friends are still there? We have been having news reports all day about how it's still a very serious situation. What are you hearing?

DAVIS: I have friends and family from Prairieville to Baton Rouge, Walker, Watson, and they all say the wind is very bad, the rain is very bad. And there is no power anywhere.

HENRY: But how do you feel the Republican Convention should move forward over the next couple of days? Do you think that Senator McCain is striking the right balance right now?

DAVIS: Absolutely. I am very glad that we adjourned. I'm very glad that we were given this time to pray and just find out how the people are doing. The hurricane is hopefully diminishing down to a Category is what I have heard. So...

(CROSSTALK)

HENRY: Well, thank you for your time.

Wolf, you are watching a very relieved mother right here right now. She told me she was very worried, but she is very happy now -- Wolf.

BLITZER: Well, good for that. I hope that everything turns out well in that hurricane, because we are really worried about that one levee in Plaquemines Parish right now. They are desperately trying to beef it up with sandbags.

We're monitoring the situation and we will watch it for you.

We are also watching a political story here at the Republican Convention. The 17-year-old daughter of the governor of Alaska, vice presidential running mate of John McCain, Sarah Palin, we now have been told by Governor Palin and her husband that their 17-year-old daughter is pregnant, will go forward and have the baby, five months pregnant, and hopes to marry the father. We are going to watch that story as well.

Much more of our coverage coming up right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: We are watching this levee in Plaquemines Parish in New Orleans, where volunteers and others are working feverishly. They are bringing in sandbags and dirt to try to reinforce this one levee to make sure it doesn't come down. We spoke to the president of Plaquemines Parish just a little while ago. He fears for the worst as far as this one levee is concerned. We will go back there and we will update you on what's going on with Hurricane Gustav. That's coming up shortly.

But I want to move on to some other breaking news we are following right now involving Senator McCain's running mate, the governor of Alaska, Sarah Palin, the news involving her teenage daughter.

Let's go to Dana Bash. She's here on the floor of the Republican Convention.

Dana, for viewers who are just tuning in right now and may not necessarily have been following a political story as a result of all the attention on Hurricane Gustav, some surprising information coming out today from Governor Palin's family.

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Some surprising information, that is absolutely correct. Look, the reality is before last Friday, nobody on in a national level, almost nobody, knew very much at all about the Alaska governor, Sarah Palin.

But the news that we got today, this is something that even people here in her Alaska delegation, it took them by surprise, too.

(BEGIN VIDEOTAPE)

BASH (voice-over): Behind Sarah Palin at her V.P. announcement last week, her family, 17-year-old daughter Bristol held her 4-month- old brother. Unknown then, Bristol was hiding a secret. She is five months pregnant, and intends to keep the baby and marry the father.

John McCain's campaign dropped that bombshell as Hurricane Gustav dominated the news. In a statement to reporters, Sarah Palin and her husband, Todd, said: "We are proud of Bristol's decision to have her baby and even prouder to become grandparents. As Bristol faces the responsibilities of adulthood, she knows she has our unconditional love and support."

Top McCain aides insist to CNN that McCain found out early in Palin's vetting process that her teenage daughter was expecting a baby and say Palin herself told McCain in a conversation last week.

STEVE SCHMIDT, MCCAIN CAMPAIGN SENIOR ADVISER: Senator McCain knew that it probably eventually, you know, would become public, as did Governor -- Governor -- Governor Palin. You know, obviously, people -- people would know, because she's going to have a baby, that she was -- that she was pregnant.

BASH: McCain advisers say they decided to make Bristol's pregnancy known now to dispel rampant and inaccurate Internet rumors on liberal blogs, like the Daily Kos, that Sarah Palin's 4-month-old baby, who has Down syndrome, is really Bristol's child.

McCain aides insist they got so many calls, they decided to get the truth out about Bristol's pregnancy.

SCHMIDT: What we want to see happen is the privacy of Governor Palin's daughter respected.

(END VIDEOTAPE)

BASH: And, Wolf, we are here in the Alaska delegation.

I have with me Bill Knoll (ph), who actually has worked with Sarah Palin in Alaska politics for sometime, or at least -- maybe since she hasn't been in politics, maybe not that long, but at least since she started in politics.

So, my question first for you is, what's your reaction to the news?

UNIDENTIFIED MALE: My reaction? Love. The operative word in a situation like this has got to be love. You have got to walk up to that lady, that little girl, and say, honey, here's a hug. Sit down. How can we help you? That's the reaction.

BASH: But the reality is obviously we are in a very high stakes political campaign and this is news that was pretty surprising.

UNIDENTIFIED MALE: It was surprising. It was surprising to me. And to happened to my family years ago. My own daughter, my youngest daughter, was not married yet and she came up pregnant. And you know what? I have an 18-year-old granddaughter starting college this year, the greatest thing in my life.

BASH: Now, to people who are looking at Sarah Palin and saying we don't know a lot about her and this is one of the first things that we have learned about her in terms of her family, you, you know her well. What did you think actually when you first heard about the fact that her daughter was pregnant and that she knew about it? And obviously this is something that she had to deal with in talking to Senator McCain before she and he made the final decision about whether she would be on the ticket.

UNIDENTIFIED MALE: My reaction? I said, god bless her and good luck. Been through it myself. I would walk up here today and say, you know what, share this with America.

We have a big state, physically a big state, but a small in terms of population. And that Sarah Palin has an 80 percent approval rating all throughout. And I am here to tell you, I will bet you a nickel before this is all done, in this campaign, about 80 percent of America is going to say, I like that woman. She is the real deal. She speaks from the heart. She is a person of the soil, if you will, great American tradition. She is not from the Senate. She's not from big government. She is from America.

BASH: Now, you and other people here in the delegation earlier were telling me that you believe that this is and should be a private matter. But the reality is, she is now a very highly public figure.

UNIDENTIFIED MALE: In this day and age, whether you go to entertainment or whatever you will, people become a public property, if you will, and it's pretty hard to remain totally private.

All you can do is try to set a good example, live life the way you think it should be led and love one another. That's the operative commandment. As they use to say in religion, what is the commandant of all? Love one another. That's the rule of the day for me.

BASH: Now, one last question just in terms of the policies that she supported back in the state of Alaska.

UNIDENTIFIED MALE: Sure.

BASH: She actually did say in a questionnaire that she did not think that sex education should be taught and said abstinence should be taught in schools. How does that square with what's going on at her own house right now?

UNIDENTIFIED MALE: I bet this is an experience that is shared throughout America without doubt. People walk up to their kids and they say, boy or girl, be careful, practice abstinence and son.

But then you know what? Life happens. Life happens. And in the reaction to life is the most important thing you can do, whether it's be a national emergency, like in the Gulf Coast, a personal emergency like, you know what? Bristol's pregnant. The reaction to that and what we do next is the most important thing, Dana.

BASH: OK. Thank you very much for your time. I appreciate it, Bill Knoll (ph), a delegate from Alaska, Wolf.

And what he here -- what he just said is something that we are hearing on the floor as well. Another point that Bill didn't make, but others have made to me, is that they understand that one of the reasons why she is appealing politically is that she is a social conservative.

And what social conservative groups and even delegates here on the floor have said today is, the fact that she and her family decided to keep the baby, that is proof to them that she is somebody who they can continue to rally around.

So, that's the word from the floor, particularly from those who actually do know her, a few people who do know her well on the floor. We just talked to somebody who is one of them -- Wolf. BLITZER: Dana, what about this other story? We learned today and you reported it that she has now hired an attorney to help her deal with this investigation into charges she inappropriately, maybe even illegally, tried to get her brother-in-law fired -- he is a state trooper -- as a result of a bitter divorce, custody battle. What do we know about this part of the story?

BASH: Well, we know the new development in that part of the story, Wolf, is that Sarah Palin has actually hired an attorney to deal with this issue. She hired an attorney, we're told, by one of her spokeswomen about weeks ago.

Now, you remember when news first broke about Sarah Palin, about the fact that she would be John McCain's running mate, this was one of the first things we heard about from Democrats, the fact that, wait a minute, John McCain is saying that she is somebody who fought corruption back in Alaska, but she seems to be caught up in a bit of a corruption scandal of her own with this trooper-gate story that you were talking about.

Now, the McCain campaign immediately fired back saying that there's no there there. but the fact of the matter is we did learn that Sarah Palin did hire an attorney to deal with whatever legal matters that she is potentially dealing with back home in Alaska as of course the McCain campaign tries to deal with whatever political issues there may or may not be with this issue -- Wolf.

BLITZER: There's a formal investigation of her under way right now.

Let's assess what we have just heard from Dana and her guest.

James Carville is joining us from Washington, our Democratic. Alex Castellanos is here in Saint Paul. He is our Republican strategist.

James, first of all, your reaction to these developments that Dana was just reporting on?

JAMES CARVILLE, CNN POLITICAL ANALYST: Well, first of all, I agree with Senator Obama and Secretary Bennett. I would not want my parents held accountable for anything I did in my youth. And that don't really -- has much to do with her running for president.

But what we do in terms of this trooper scandal and other things that came out, I think, if you look at this like this like there's a levee and there's a lot of water building up on the levee about Governor Palin as we are finding things out, Senator McCain only talked to her 15 minutes and there's lot of stories about she wasn't thoroughly vetted. And I think the Republicans are quite -- appropriately quite nervous about what else is coming out.

So, it's an interesting story. And I think that we are just going to have to wait and see how this thing plays out. I'm a little mystified by the pick of Governor Palin. It just doesn't add up to me. And now we find out that she went to visit the Alaska National Guard troops in Iraq, which was a commendable thing, that she had to get a passport to do it. I don't know if she has been to another country besides Canada. That would be an interesting question for someone to ask.

BLITZER: She went and got a passport before she went to visit the Alaska National Guard troops in Kuwait.

CARVILLE: Right.

BLITZER: And then she went to visit troops in Germany as well.

Alex Castellanos, based on what you know -- and you are a Republican strategist -- did they do a good job vetting this governor?

ALEX CASTELLANOS, REPUBLICAN CONSULTANT: The campaign says it did a good job vetting the governor, that it asked the right questions. And they've vetted quite a few candidates. So, you have to take them at their word on that.

But now, you know, we need this convention differently than we did before. This was an opportunity for Republicans to go out there and draw differences with the Democrats and for the McCain people to sharpen their message. Now they need this convention to introduce Sarah Palin, because she's being introduced very differently than they had hoped.

So, you know, the camp -- she is the point guard, really, now, of the McCain message -- hey, we're going to change Washington. This is the change -- the reform team. And that's what they were hoping to do.

And the problem with this is this is noise. This distracts. This clouds that message. And I think the Republicans are going to need a successful week here.

BLITZER: Alex and James, I want both of you to listen to what Senator Obama said earlier today when he was asked about the reports -- the confirmation from Sarah Palin that her 17-year-old daughter is pregnant.

And here's the exchange that Senator Obama had reporters earlier.

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA (D), PRESUMPTIVE NOMINEE: I've heard some of the news on this. And so let me be as clear as possible. I have said before and I will repeat again, I think people's families are off limits and people's children are especially off limits. This shouldn't be part of our politics. It has no relevance to Governor Palin's performance as a governor or her potential performance as a vice president.

And so I would strongly urge people to back off these kinds of stories.

You know, my mother had me when she was 18. And, you know, how a family deals with issues and, you know, teenage children, that shouldn't be the topic of our politics. And I hope that anybody who is supporting me understands that's off limits, all right?

QUESTION: Senator Obama?

OBAMA: Sure.

QUESTION: An unnamed McCain adviser is quoted on Reuters as saying: "The despicable rumors have been spread by liberal blogs, some even with Barack Obama's name in them."

Have you issued...

OBAMA: You know what...

QUESTION: Have you issued any directive to your...

OBAMA: I am offended by that statement. There is no evidence at all that any of this involved us. I hope I'm as clear as I can be. So in case I'm not, let me repeat. We don't go after people's families. We don't get them involved in the politics. It's not appropriate and it's not relevant.

Our people were not involved in any way in this and they will not be. And if I ever thought that there was somebody in my campaign that was involved in something like that, they would be fired.

(END VIDEO CLIP)

BLITZER: All right, James, what he was referring to -- and you've been listening and watching these on these liberal blogs for the past two days -- the insinuation that Sarah Palin and Todd Palin's 4-month- old son Trig really isn't their son, but is really their grandson and that she was covering up their daughter having had the baby. We now know that the daughter, Bristol, is five months pregnant. The baby was born in April. So that story is obviously false.

But you saw Senator Obama clearly passionate in responding to those insinuations, those rumors, the allegations and making his point crystal clear.

CARVILLE: Yes. I completely agree with him. And I think he's absolutely right. Secretary Bennett is absolutely right.

But Alex is a smart guy and he made a very interesting point, is that they're introducing -- actually, Sarah Palin has now become a more compelling or interesting person than maybe even Senator Obama, for the moment. And they're going to have to introduce her. And these first two days have not gone well, because you're having all of these different stories coming out.

And they have to get her up on the stage pretty quickly and sort of tell the American people who she is. Because right now, the information is that the levee is leaking. And they've got to hurry up and get some sandbags in their quick, because this is not going all that great for them right now.

And I think -- to compliment Alex for making a very good point. And I also compliment Senator Obama. This really doesn't -- like I say, I wouldn't want my parents held accountable for what I did and I don't think that that's really an issue here.

BLITZER: All right. Alex, go ahead.

CASTELLANOS: No. I think,, also, now, we're going to see the October 2nd debate -- the vice presidential debate is going to be critical for us, too. You know, it's going to come almost 20 years to the day, October 5th, of the Quayle-debates. And how Sarah Palin performs there is going to be very important for the Republican ticket.

CARVILLE: Yes. The Republican -- the vice presidential debate may out rate the presidential debate in this election.

BLITZER: But, Alex, the investigation she's under -- involved in right now over the firing of -- the supposed pressure she put on a state commissioner to fire a state trooper who happened to have been her ex-brother-in-law. And there was a bitter divorce and custody battle underway. And she says she never did any -- made any phone calls.

CASTELLANOS: Sure.

BLITZER: She never was engaged in any illegal or inappropriate pressure. The commissioner says, yes, she was.

That's a legitimate subject for investigation.

CASTELLANOS: Of course it is and I'm sure that was well vetted by the campaign or they wouldn't have picked her. And so they're -- and she says there's nothing there, so there's nothing there.

But, of course, when you get in the national spotlight like this and you're on the griddle, you're going to hire an attorney and you're going to do everything you can to put that story to rest.

But now this is a time for the campaign to get aggressive. You know, otherwise this election is going to turn into a country song here. This is the most insane election I think I've ever seen in 30 years of doing this.

CARVILLE: Yes.

CASTELLANOS: We have -- you know, who -- if someone had told you about two years ago that a young man who had just finished paying off his college loans was going beat Hillary Clinton, that John McCain would come back from the political graveyard, that the last candidate vice presidential candidate would have an affair, that John McCain would pick a moose hunter for a vice president and then we'd have a hurricane, that -- you couldn't sell that script to Hollywood.

BLITZER: All right. James Carville, the trooper story, I suspect, you think is a much more serious situation than the pregnant daughter.

CARVILLE: Well, she has something to do with the trooper story. She has nothing to do with the pregnant daughter. Anybody, you know, anybody who has had young children understands that.

And the question on the trooper story is, as I understand it, that the results of the investigation can come out prior to the election. And this is -- the whole thing is that if they have phone records and if they have other witnesses or anything. I don't know what the result of this is going to be.

But it would not be a very good story for Governor Palin if it comes out that she did try to get her ex-brother-in-law fired. I mean this looks like some kind of a -- you know, some kind of a family feud going on here -- the Hatfields and the McCoys, where she was...

BLITZER: Well, let...

CARVILLE: ...trying to -- we've got to see what the result of this investigation is.

BLITZER: Let's get some perspective from the McCain campaign right now.

Nancy Pfotenhauer is here with us.

Nancy, thanks very much for coming in.

You're a senior adviser to Senator McCain's campaign.

On this trooper story, the governor says she didn't do anything wrong, didn't do any inappropriate. The commissioner says, yes, she did, she tried to convince him -- she tried to pressure him into firing this state trooper, her former -- her ex-brother-in-law.

Did you thoroughly vet this story before Senator McCain decided she would be the appropriate running mate?

NANCY PFOTENHAUER, MCCAIN CAMPAIGN ADVISER: Of course. You know, all of these issues that are so-called news right now, that are under the glare of the spotlight, were brought out and discussed and thoroughly researched. And Senator McCain and Governor Palin have both built their reputations as reformers and as people who are anti- corruption, if you will.

And so I think that Senator -- that Governor Palin's, rather -- approach, she said hold me accountable, look into this, I have taken no inappropriate action -- is, in fact, what occurred, and that that's what will -- that will rule the day eventually.

BLITZER: John...

(CROSSTALK)

BLITZER: Go ahead.

BORGER: Isn't it a problem, though, for the McCain campaign that we're sitting here and we're talking about Governor Palin instead of talking about the serve -- the them of service and what the Republicans are trying to do at this convention... PFOTENHAUER: This is always what you all were going to do, regardless of whatever vice -- whoever was chosen as vice president.

BORGER: No, she's new...

PFOTENHAUER: There was...

BORGER: ...on the scene, though. She's...

PFOTENHAUER: No, no, but she's new on the scene to Washington and New York media types. She is not new on the scene. In fact, she is a hero. That's why, for many Americans, and particularly for many Republicans, that's why there was such an overwhelming outpouring of support. You saw poll numbers go up for Senator McCain. You saw the dollars came in the door like we -- you know, like we've almost never seen it before, because Governor Palin is, in fact, pretty well-known, just not well known -- not in the Northeastern liberal corridor, if you will.

BLITZER: John King has got a question.

KING: At some point, whether the campaign likes it or not -- you call it the New York/Washington media -- but I think any media, whether it's in small town America, right here at this convention or Washington, D.C. , when they get a chance to sit down face-to-face with Governor Palin, we're going ask her about this -- tell me your side of the investigation...

PFOTENHAUER: Sure.

KING: ...explain how your family dealt with this difficult situation with your daughter.

When will that happen?

PFOTENHAUER: Well, they...

KING: She's obviously just joined the ticket, but when will we have...

PFOTENHAUER: Let me agree and disagree with you -- agree on point one and disagree with you on point two. I think -- I think the whole topic with Governor Palin's daughter is just -- it's just a private family matter. And that's what most Americans -- how most Americans would like to see this treated. And, so, really, it needs to be -- people just need to stand down on it.

And I think the American people understand that. I have five teenagers myself, although -- the oldest one is turning 21 next week. Maybe I'm back down to four teenagers.

But it's -- that's real life and it happens. And the family has responded to that challenging situation with love and support. So I don't think that that's going to continue to get much attention.

As far as the first issue, my guess is that it will get some attention and that Governor Palin will step forward and explain her actions like she has before.

Remember, this woman's career was launched and then almost killed because she took a stand against corruption among her own party. And when she could and when she went in and reported that a fellow commissioner, who was a Republican, had taken actions that she did not think were appropriate, she was told she -- you know, basically, they weren't going to do anything about it, she couldn't speak out against it, she was precluded by law. And she resigned rather than continue to serve and condone that behavior.

This is not someone who does anything but walk the straight and narrow.

KING: But when do we get that opportunity?

When do we get the opportunity to put the questions to her?

PFOTENHAUER: Well, I think she's -- we're very focused on the hurricanes right now. And, obviously, we'd love to have Governor Palin here. You've got a crowd full of people who adore her...

(CROSSTALK)

PFOTENHAUER: ...who adore her, who would love to see her. It would electrify the crowd to have her here.

But, you know, we are focused and you know, because you all are here, too. We've really transitioned our efforts and our energies behind trying to use everything we've got from a material standpoint, from a resource standpoint, to try to get help to the coastal regions. And that's exciting, but a challenge.

BLITZER: Have you made decisions on what you're going to do tomorrow at this convention?

PFOTENHAUER: If they have, Wolf, they haven't told me yet.

BLITZER: They haven't told us yet, either.

PFOTENHAUER: No. I think it's going to be a day by day and, in some instances -- yesterday, it was almost an hour by hour situation, as we waited to hear what was happening. And, of course, now we've got the second storm coming.

So the way we -- what we've worked out as far as working on getting those 80,000 comfort packages that, you know, we're -- we were very focused on that. We were working with FedEx, as I'm sure you know. We're working with Target. We've got volunteers signed up to serve in 75 minute increments at about 200 a pop in order to try to get these things out -- you know, put together and out the door into the region. And we're working very hard on getting folks to raise money, too.

BLITZER: Nancy, I know you've got to get going.

We'll leave it right there. I'll just point out that on that trooper story, the Alaska media has been obsessed with that trooper story. They're not exactly part of the New York and Washington liberal news media, I can assure you.

PFOTENHAUER: All right. Well, I -- although when the issue happens in your state, you can understand that. And I do believe that the facts will bear this out. This is the woman of character, courage and grit. And as -- has been called someone who has eye-popping integrity. Somehow I don't think that would have been sacrificed for anything like this.

BLITZER: We're looking forward to meeting her and I'm sure you'll bring her here sooner rather than later.

BORGER: I've asked for her myself.

BLITZER: We'll be ready -- we'll be ready to talk with her.

Nancy Pfotenhauer from the McCain campaign.

PFOTENHAUER: Thank you.

BLITZER: Thanks very much for coming in.

Candy Crowley is up on the podium right now.

She's watching what's going on here at this Republican Convention.

What are we seeing, what are we hearing from your perspective -- Candy?

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Well, what's interesting to me on a couple of subjects. First, there is obviously a bit of tentativeness on the part of those that have come up here and passed by and talked, because they don't really know what's going to happen tomorrow, although they suspect that gradually, over the course of the next couple of days, they will get back on track.

But in terms of what you've been talking about, with the number two on the ticket and her 17-year-old pregnant daughter, I have to tell you that everyone that came up here said, listen, we think this is a private matter. And what does matter here is the fact that she is going to keep that child. They really see this as a non-issue. They talked about a number of antiabortion groups that are behind this, saying listen, the important part, again, is that she is going to keep this child.

So I don't hear any worry -- any concern from anyone I've talked to about this revelation, because, again, this Alaska governor is someone who plays very well among conservatives. And this doesn't seem to have dampened their enthusiasm at all.

I've also seen, actually, a lot of enthusiasm for this convention. And it doesn't seem to be both. They seem to see a real chance that this ticket has been rejuvenated by McCain's selection and that they have a real chance in November -- Wolf.

BLITZER: All right, Candy.

Stand by.

We're going to continue our coverage.

We're also going to go back and see what's happening with that levee at Plaquemines Parish.

Is it withstanding the pressure?

Take a look at the these live pictures. These troops are coming in, the volunteers are coming in. They're bringing the sandbags. But the president of Plaquemines Parish -- you heard it live here in THE SITUATION ROOM -- told us just a little while ago he fears all of this effort will be unsuccessful and that levee could give way.

We're hoping and praying it doesn't. We're watching this part of the story.

Stay with us.

Much more of our coverage right after this.

(COMMERCIAL BREAK)

BLITZER: We've been deeply concerned about that levee in Plaquemines Parish in New Orleans. We saw the pictures. They're bringing sandbags. They're working desperately to reinforce it. The president of the parish earlier told us he was deeply concerned it could give way.

Our producer, Kay Jones, is on the scene.

She's on the phone.

What do we know -- Kay?

KAY JONES, CNN PRODUCER: What we know, Wolf, is they're trying to do everything they can to shore up the levee on both sides, which includes Plaquemines Parish, as well as St. Bernard Parish.

The levee is over topped. It's flooded about a quarter of a mile into St. Bernard Parish. There is a levee lock that's seeping and that is what they're trying to sandbag up right now.

BLITZER: All right. And, as of now, there's no definitive word whether it will be saved or whether it will give way?

It's still a work in progress, isn't that right, Kay?

JONES: Absolutely. It's still a work in progress. Sheriff's officials from St. Bernard Parish tell me that they will be out here as long as they possibly can. They've brought in some prisoners from the parish prison, as well as Plaquemines Parish prisoners, to help shore up the levee with sandbags.

But what they're using instead of sand is mud right now. So they're trying to stack them up as high as possible and keep the levee from breaking.

But the levee has already over topped here and it is the levee that connects the MRGO -- the Mississippi River Gulf Outlet -- with the Mississippi River. So that is what they're trying to do right now and save both sides of this canal, both in Plaquemines Parish and St. Bernard Parish.

BLITZER: All right, Kay, stand by.

Get us more information as it comes in.

Fran Townsend is our homeland security consultant, a former adviser on homeland security to President Bush.

It still doesn't look like New Orleans definitely has dodged a bullet.

It's too early to say that, Fran, isn't it?

FRANCES FRAGOS TOWNSEND, CNN NATIONAL SECURITY CONTRIBUTOR: That's right, Wolf.

And this is why the evacuation was so important. We had concerns. We expected there to be some over topping of the levees due to the storm surge, but whether or not they would hold has always been a concern. And it made the good evacuation that we saw pre-landfall that much more important.

BLITZER: Are you upbeat or -- I'm sure you're upbeat about the cooperation between the federal, state and local levels. But based on what you're seeing now, several hours after the hurricane hit the ground, what do you think?

TOWNSEND: Well, look, I think we've seen very good signs that there is increased coordination, as you mentioned. The next real test is the search and -- urban search and rescue. We've got more than double the number of teams since Katrina. The administration had seven in Katrina. They have 18, I'm told, search and rescue teams.

After that are the areas where FEMA had problems last time. It's housing. It's returning people. It's debit cards. All those issues, we have yet to see how the government will do. They've got better plans in place. Now it's time for implementation.

BLITZER: All right, Fran, stand by.

John Zarrella is in Lafayette, Louisiana.

He's watching what's unfolding.

What are you seeing now? JOHN ZARRELLA, CNN CORRESPONDENT: Well, Wolf, overall, we're being told by emergency managers that they believe the worst is certainly over here. You can see, not much wind, no rain. It's really blown by us very quickly here.

But on the flip side, they are also telling us that in North Lafayette, several homes damaged by fallen trees. And in one instance, the emergency operation officials are telling us that one elderly man has been killed by a tree that came through his house. That's according to the emergency operation officials here in Lafayette.

Now, of course, our big concern, Wolf, here now has always been the rising water. Take a look down here. This is the Vermilion River. And you remember when we last talked, it was down a few feet. It is completely up, in some places right to the edge of the grass there. So it's up about six feet.

Way down in the distance back there, of course, is Vermilion Bay. So the water is still being pushed up Vermilion Bay, up Vermilion River. And the concern, of course, is how much higher is this water going to get?

But overall, good news in Lafayette. First responders are now going to get out on the street, according to the EOC, and start taking a look around and seeing and assessing what the damage is.

But, again, sadly, it appears, according to EOC, one elderly man killed when a tree went through his home -- Wolf.

BLITZER: All right. Thanks, John.

Let's go to Abbi Tatton.

She's monitoring the I-Reports that are coming in.

We're getting a lot of them -- Abbi.

Give us an update on that front.

ABBI TATTON, CNN INTERNET REPORTER: Yes, Wolf, our I-Reporters have been updating us on the situation they're going through right now.

This is Lafayette, Louisiana. We're getting these pictures from all along the Gulf Coast. This video here sent in by David Shindell (ph). He's out of power right now, running on a generator. He sends these pictures of some of the damage that he's been experiencing there in Biloxi, Mississippi here.

Take a look at this picture here of the flooding. This is Highway 90 along the coast there. The storm surge coming right up to the casinos.

And now we can go even more further afield. Take a look at this picture right here. Now we're going to go the Turks and Caicos. This is not Gustav. This is Hurricane Hannah -- upgraded to a hurricane today. These pictures are being sent in from people on vacation who are there right now.

That hurricane -- they're under a hurricane warning there today. These pictures were all sent in to iReport.com.

Wolf, we're hearing that people are using their generators to be able to send us these pictures.

But we say all the time, please send them in with the utmost care. If you're in a dangerous situation, just wait it out -- Wolf.

BLITZER: And I can only imagine -- I can only imagine how terrified those people are who are on vacation in the Turks and Caicos and they find themselves in the midst of this Hurricane Hannah right now, just finishing Gustav off right now. Hannah on the way, maybe going to be hitting the South Carolina/Georgia coast. And then Ike is brewing in the Atlantic, as well.

How many I-Reports, approximately, are we getting in?

TATTON: Well, we've got dozens today, Wolf, not just in Louisiana. We've seen them from Mississippi, as well, from Alabama. We've seen them as far afield as Pensacola, Florida. People are sending them into us with their updates. And we've been calling them back every couple of hours and saying what's the situation now?

In Lafayette, that was -- the pictures there, that was from the beginning of the storm, when it started to move through. But then we talked to David just a couple of hours later. And at that point, all the power had been lost. But he said he was safe. He was boarded up. He just couldn't tell us if there was anymore damage outside, because they were, at that point, watching kind of from the safety through one window that they could see through, Wolf.

So we're just keeping in constant contact with these I-Reporters who have been giving us valuable information from along the Gulf Coast.

BLITZER: All right. Abbi, thanks very much.

And our coverage will continue right after this.

(COMMERCIAL BREAK)

BLITZER: There are a lot of reporters out there that are drenched. They've been buffeted, tethered and rendered hatless. They and their crews plant themselves in the path of a hurricane. And with Gustav now in full force, they're at it once again.

Here's CNN's Jeanne Moos.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN CORRESPONDENT (voice-over): An ominous pulsating blob, jiggling drops on the lens -- time once again for reporters to vie for the title of most weather-beaten.

UNIDENTIFIED MALE: Hurricane Gustav is coming ashore right now.

UNIDENTIFIED MALE: There was no sense in (INAUDIBLE) good grief.

UNIDENTIFIED MALE: But the big concern, flooding where I am...

(VIDEO CLIP)

UNIDENTIFIED FEMALE: Whoa. There's some debris starting to blow around and we want to get out of the way.

MOOS: Out of the way, but not out of camera range.

UNIDENTIFIED FEMALE: Not of lot of commercials.

MOOS: With so much danger and damage, weatherman Al Roker was lucky to lose just his hat.

AL ROKER: And, of course, right now the -- sorry. Well, then, so much for that hat.

MOOS: CNN's Ali Velshi's very first hurricane.

ALI VELSHI, CNN CORRESPONDENT: Boy, what's it feel like?

(VIDEO CLIP)

MOOS: It came back later to Ali's deserted position.

JOHN ROBERTS, CO-ANCHOR, "AMERICAN MORNING": We assure you that he did not blow away.

MOOS: Actually, he couldn't blow away, he was tethered.

UNIDENTIFIED FEMALE: We heard Ali talking a little bit earlier, Chad, about, you know, the shrimp.

MOOS: Ali wasn't the only one hanging on for dear life.

UNIDENTIFIED MALE: I've got to anchor myself for this one. Right. OK.

MOOS: Geraldo Rivera was out with his wind gauge.

GERALDO RIVERA: Over 50, 56 gusts here. You can see into the eye of this coming storm. I don't want to get that lens too wet, but...

MOOS: All day, camera people were wiping...

UNIDENTIFIED FEMALE: Rob Marciano, of course, on there.

MOOS: Wiping, wiping.

UNIDENTIFIED MALE: All right, let's get back.

MOOS: Wiping. Geraldo spotted a guy in the water.

RIVERA: You see right there (EXPLETIVE LANGUAGE). There's a person stranded. There's a person stranded.

I'm telling the cops here.

He's swimming. Oh, he's got a life line. He's got a life line. Oh my god.

MOOS: It turns out the swimmer had intentionally gone in the water to attach a line to a propane tank to keep it from causing damage.

Geraldo was fearless or foolhardy, take your pick -- charging up to levees as waters gushed over the top. He eventually retreated.

RIVERA: We're trying to get out.

UNIDENTIFIED FEMALE: Back to you. This is going to hurt. This hurts a lot.

(CROSSTALK)

UNIDENTIFIED FEMALE: OK, back to you guys.

MOOS: Some wind blown reporters...

UNIDENTIFIED MALE: Let's have a look.

MOOS: ...pointed out other wind blown reporters in shorts.

UNIDENTIFIED MALE: Quite honestly, I'm having trouble standing up.

MOOS: Beware of unidentified flying cardboard.

UNIDENTIFIED MALE: Oh, watch out.

UNIDENTIFIED FEMALE: Oh.

MOOS: Better flying cardboard than flying reporters.

UNIDENTIFIED MALE: If I wasn't holding onto this pole, I'd probably be in the Mississippi River by now.

(VIDEO CLIP)

MOOS: Jeanne Moos, CNN, New York.

(END VIDEO TAPE)

BLITZER: Jeanne Moos.

We're going to have extensive coverage throughout the night on Hurricane Gustav; also, what has happened here at the Republican Convention.

This important programming note for our viewers. "ANDERSON COOPER 360" will be live tonight from New Orleans. And Senator Barack Obama will be joining Anderson to talk about Hurricane Gustav's impact and a lot more. That airs tonight 10:00 p.m. Eastern, "ANDERSON COOPER 360."

We'll be back here at the Republican Convention tomorrow in St. Paul.

Thanks very much for joining us.

I'm Wolf Blitzer in THE SITUATION ROOM.

Up next, a breaking news Election Center special with Campbell Brown -- Campbell.

CAMPBELL BROWN, CNN ANCHOR: All right, Wolf.

Thanks very much.

Wolf is right, we do have a breaking news special to bring you all the very latest on Hurricane Gustav.

We've been tracking it for you all day today -- all eyes on Gustav.

And here is the very latest.