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Well Testing Under Way; U.K. Prime Minister Comes to the White House; Racially Charged Resignation

Aired July 20, 2010 - 17:00   ET


WOLF BLITZER, CNN ANCHOR: Thanks very much, Rick.

Happening now, it's officially three months since that massive rig exploded in the Gulf of Mexico.

After days with no oil gushing from the ruptured well, could a new option now being considered being a permanent fix? Stand by. New information coming in right now.

Plus two allies sitting down for the first time. Will the looming crisis in the Gulf of Mexico and a host of other highly contentious issues sour the budding relationship between newly elected British Prime Minister David Cameron and President Obama? Stand by.

And a former African-American government employee suggests the White House and the NAACP threw her under the bus for making some racially-charged comments she says were taken totally out of context.

Did the heated political debate over race in America force her to resign?

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

It was three months ago today when the Deepwater Horizon oil rig exploded in the Gulf of Mexico, triggering the worst environmental disaster in U.S. history.

Look at these underwater cameras monitoring efforts at the rig site. For the sixth straight day now you can see there is no leak -- repeat, no leak coming from the well. The National Incident commander, Thad Allen, just moments ago says critical testing on the well is now set to continue for at least another 24 hours.

The news comes as BP considers a new option that could potentially seal the leak.

David Mattingly is monitoring all of these developments for us.

So what's the latest on what's being called the static kill that would once and for all end this nightmare even before those relief wells are completed?

DAVID MATTINGLY, CNN CORRESPONDENT: Wolf, a lot of talk and a lot of questions today about that static kill. It's a process by which BP would pump mud into the well, effectively killing that well and improving their odds once they finish the relief well.

They say they're studying this idea, they're coming up with a plan, and they're going to present it to government scientists for final approval just in the next couple of days. But at this point that static kill sounds a lot like the top kill procedure they used before, only this time it's going to be easier for them since the well is now shut in and the pressure is static.

That's why they call it the static kill. So now they're looking at that option to give them the means to end this threat a little more quickly. Here's what Admiral Allen had to say about it.


UNIDENTIFIED REPORTER: -- well integrity is damaged.

ADM. THAD ALLEN, NATIONAL INCIDENT COMMANDER: Well, what you're doing is you're putting mud down and you're not putting hydrocarbons into the formation. You're putting mud into the formation. So the question would be at that point what that would tell you.

I know we'd have to analyze the data associated with that. If we thought there was a problem with well integrity we could at that point start going to containment or vent. But I think we need to have detailed discussions understanding what the actual procedures would be based on the results as they do that. Those discussions are under way right now.


MATTINGLY: And while they haven't made a decision, Admiral Allen, not having anything bad to say about the static kill. He says actually if they put the mud in there and find out that this well has a leak somewhere that will actually help them in the days to come when they finally try that final kill and submitting it with the relief well -- Wolf?

BLITZER: David, as you know, there's a fine, a huge fine that BP is going to have to pay to the U.S. government for all the oil that went out.

Here's the question. Are they going to have to reopen that well to determine precisely the flow rate in order to assess how much BP owes the federal tax payers?

MATTINGLY: Admiral Allen talking about that very thing today, saying that is one of the big decisions on his plate that he has to work through. And right now they're looking at ways they can possibly determine an accurate flow rate using temperature readings that they're learning now, using pressure readings that they're learning now to help them get an accurate flow rate.

If they can't do that, and the option of possibly opening this well back up so that they can actually count the number of barrels per hour that come out of there, that is still on the table. They haven't reached a decision on that yet. BLITZER: And what's the latest on the weather? Because that could certainly be a complicating factor. If there's severe weather or a tropical storm or a hurricane, for example, that might be moving in your direction.

MATTINGLY: That's right. Everyone right now keeping a very close eye on that system that's in the Caribbean right now. Looks like it might be headed for Florida. But right now they're just watching it. They know that it could have an affect on so many things.

It could affect the drilling operation of the relief well. It could affect the monitoring that they're doing now. It could affect the collection efforts that they're doing right now. So a very close eye on that system.

And no one at this point is ready to say, yes, we have enough confidence in this well to leave it shut in during a hurricane. That's a decision they would have to make closer to that time.

BLITZER: Let's hope it doesn't happen. All right, David, thank you.

The BP crisis in the Gulf was just one of many critical issues on the agenda today. In the first meeting between the newly elected British Prime Minister David Cameron and President Obama. In particular, the oil giant's potential involvement in the controversial release of the convicted Lockerbie bomber.

Let's bring in our White House correspondent Suzanne Malveaux for more on this very important meeting today -- Suzanne.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, he was only prime minister since May so it's been very recent. And this is his first official visit here to Washington to the White House as the new British prime minister.

What was fascinating and interesting to watch in that press conference is really how comfortable these two leaders are with each other. It was not like the relationship we saw with President Obama and the former Prime Minister Gordon Brown.

And all of this brings up questions whether or not this is going to make a difference and looking forward with the BP oil spill. Weather or not there's going to be justice for the Lockerbie bombing victims, and whether or not this means that the war in Afghanistan is going to wrap up any faster.


MALVEAUX (voice-over): They called each other about Barack and David. First-name friends. Vowing unwavering loyalty.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The U.S. has no closer ally and no stronger partner than Great Britain. MALVEAUX: But the BP oil leak in the Gulf Coast has tested that alliance. Oil giant British Petroleum has capped the leak but it continues to wreak havoc. A point the new prime minister was quick to make.

DAVID CAMERON, BRITISH PRIME MINISTER: I completely understand the anger that exists right across America. The oil spill in the Gulf of Mexico is a catastrophe.

MALVEAUX: Cameron also addressed a growing controversy over whether BP had a role in arranging the release of Libyan bomber, Ali Muhammad al-Megrahi.

CAMERON: Releasing the Lockerbie bomber and mass murderer of 270 people -- the largest act of terrorism ever committed in the United Kingdom -- was completely wrong. So in my view, neither should that callous killer have been given that luxury. That wasn't a decision taken by BP. It was taken by the Scottish government.

MALVEAUX: Al-Megrahi was convicted in the 1988 Pan Am 103 bombing over Lockerbie, Scotland that killed 270 people, mostly Americans. The Scottish government released al-Megrahi on compassionate grounds after doctors said he had terminal prostate cancer and just three months to live.

President Obama said that was a mistake, and Cameron agreed. Cameron said he would provide information for a U.S. congressional investigation but didn't think the U.K. needed to pursue one of its own.

Both leaders pledged their commitment to the Afghanistan war, glossing over any differences over how soon to pull out troops.

Today, it was mostly big smiles. Jokes about the beers they shared after U.K. and U.S. tied in the World Cup.

CAMERON: While at the World Cup, our teams could only manage a score draw I believe our relationship can be a win-win.

MALVEAUX: And even admiration for President Obama's children.

CAMERON: I was most impressed by how tidy your children's bedrooms were.


MALVEAUX: Wolf, for the British prime minister, it really was a very delicate balancing act. Obviously on the one hand showing empathy and sympathy for the victims of the BP oil spill. At the same time not allowing Americans to vilify this company that is so important economically to both countries -- Wolf.

BLITZER: Special relationship, the U.S.-U.K. relationship. That clearly was underscored today, Suzanne. Thank you.

Her resignation is raising new questions right now about the politics of race in America. Was a former African-American government employee judged unfairly by the Obama administration? We're doing some fact-checking for you.

Plus, a controversial new ad slamming plans for an Islamic community center and mosque near ground zero in New York. We'll talk to the producer.

And it's a CNN exclusive. Our own Amber Lyon in a Navy blimp with a firsthand look at the oil disaster.

Lots of news happening today right here in THE SITUATION ROOM.


BLITZER: Jack Cafferty is here with "The Cafferty File." Jack.

JACK CAFFERTY, CNN ANCHOR: Wolf, after weeks of haggling the Senate is a step closer tonight to extending unemployment benefits. Two Republicans joined the Democrats in breaking the GOP filibuster against extending the benefit through November.

Republican leaders had earlier blocked the votes several times. They argued that any benefit extension should be offset by spending cuts. And they have a point, I suppose.

The nation is heading down the road to insolvency, in case you haven't notice. We're $13 trillion in debt. And because the Democrats didn't bother to offer a way to pay for this benefit's extension, another $34 billion will simply be added to the deficit.

President Obama tore into the Republicans ahead of this vote. He argued that they were operating on a misguided notion that a new bill would discourage people from looking for work.

Mr. Obama says the unemployed are not looking for a handout, that they desperately want to work. The president described the GOP as hypocrites for voting for these benefits under President Bush but not now.

But Republicans insist it's all about fiscal responsibility. They say they're not against unemployment benefits. They've said they will support the bill but only if it's paid for.

More than 2.5 million Americans have run out of unemployment benefits since the deadline passed in June. The national unemployment rate hovering just below 10 percent. And a lot of the experts say it's going to stay high well into next year.

Between the states and the federal government, it's now possible to collect unemployment benefits for 99 weeks. That's almost two years.

So here's the question. Should unemployment benefits be extended without a way to pay for them?

Go to and post comment on my blog -- Wolf? BLITZER: All right, Jack. Thanks very much.

Let's get back to that critical first meeting between the newly elected British Prime Minister David Cameron and the president of the United States earlier today.

Let's discuss with our senior political analyst, David Gergen.

David, thanks very much for coming in. I'm going to play a little clip of what Cameron said at this joint news conference with the president on this sensitive issue whether there needs to be another investigation of Scotland or the British government's decision, I should say, to release the convicted Lockerbie bomber to Libya.


CAMERON: I don't need an inquiry to tell me what was a bad decision. It was a bad decision. And if you like the big fact that's changed over the year that makes it an even worse decision is the fact that, of course, Megrahi is still free at liberty in Libya rather than serving the prison sentence in Scotland as he should be doing.


BLITZER: Supposedly he had only three months to live but he's apparently doing rather well as a freeman in Libya right now. What do you think of the way these two leaders -- the president and the British prime minister -- are dealing with this sensitive issue?

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: I can understand why both leaders want to maintain a good relationship with each other. But clearly this was a botched decision by the Scottish government.

And the question does linger, did BP pressure the Scottish government into trading off this bomber in order to get oil contracts in Libya?

And I think Chuck Schumer and the other -- both senators from New York and from New Jersey, or most of the victims of course, came from those two states. They have every reason to press forward for a congressional investigation certainly into what the particulars were about BP's relationship with that decision by the Scottish government.

Because so clearly he was released on humanitarian grounds because he was going to die. Here he is a year later. The guy is flourishing, he's living a hero's life. Americans have a right to be outraged about that and get to the bottom of it.

BLITZER: But what happens to U.S.-U.K. relations, David, if the Scottish government and the British government, for that matter, don't provide the documents, the information that this Senate inquiry wants to get?

GERGEN: Well, I understand why -- I think David Cameron was -- he was turning out to be, by the way, a very good prime minister. He was pretty deft at saying blame BP for the oil spill but let's not go overboard and just assume they did something wrong on the Scottish government's decision about the bomber.

Nobody is assuming that. What we'd like to do is get the facts. And I think that the British government withholds the facts. The Scottish government withholds the facts. In the minds of a lot of Americans, that's going to be an issue. And this is going to strain the relationship.

This relationship is very important to both countries. The president and the prime minister got off to a very good personal start. Today you'll be talking with the British prime minister later on yourself. And you'll see, I think they got off to a very good start today.

BLITZER: Yes. It looked like all the body language, everything they were saying about each other was very positive, although this issue of BP could throw a monkey's wrench into that U.S.-U.K. relationship.

GERGEN: Absolutely right. And you know, Americans don't trust BP now anyway. But this is a particular sore issue. We lost a lot of people in that bombing. And yes, Scotland had jurisdiction. And yes, Scotland -- the Scottish government made the decision.

But America has the right to understand what happened. And it does seem to me that Congress to push forward on an investigation and let's get to the bottom of this is worthwhile and the right thing to do.

BLITZER: All right. David, thanks very much.

GERGEN: Thank you.

BLITZER: We're going to continue to follow up on this story.

What a difference a day makes. Yesterday allegations of racism. Today a white farmer comes to the defense of the African-American government official who was fired for supposedly not helping him. You're going to hear his response and a lot more. Stand by.

And will there be a permanent ban on drilling for oil off the Florida coast? There's been a decision at least for now.

We're going to talk about that and much more with one of the men who wants to be Florida's next U.S. senator, Marco Rubio, the Republican candidate. He's here in THE SITUATION ROOM.


BLITZER: Lisa Sylvester is monitoring some of the other top stories in THE SITUATION ROOM right now.

What do you have, Lisa?

LISA SYLVESTER, CNN CORRESPONDENT: Hi, Wolf. This weekend the Korean Peninsula will be the site of some major military activities. The United States will hold large-scale exercises with the South Koreas that Defense Secretary Robert Gates says will improve readiness and send a signal to North Korea.

Eight thousand U.S. Army and Navy personnel will take part with 20 ships and 200 aircraft.

This comes almost four months after an international investigation blamed North Korea for sinking a South Korean warship that killed 46 sailors.

Lawmakers in Florida adjourned a special session today without accomplishing what the governor hoped. He had hoped to set up a permanent drilling ban off Florida's coastline.

Governor Charlie Crist wanted to make it a proposed constitutional amendment that voters could decide on this November. Opponents say the special session was a waste of money.

And Supreme Court nominee Elena Kagan has cleared approval from the Senate Judiciary Committee and she picked up one Republican vote along the way. Lindsey Graham of South Carolina broke ranks to support her.

He was also the lone Republican on the committee to support Justice Sonia Sotomayor's nomination last year. The full Senate is expected to vote early next month.

Government officials in the United Kingdom have decided 11,000 pages of tax code, well, that is just too much. So they have launched the Office for Tax Simplification. British leaders say taxes there too complicated. Making the system less competitive than it should be and they hope simplification will attract more foreign business -- Wolf.

BLITZER: We could use some simplification here as well.

SYLVESTER: I think so.

BLITZER: That would be nice, don't you think?

SYLVESTER: I think a lot of people would agree with that one.

BLITZER: All right, Lisa, stand by. I know you're working on a big story.

Her resignation is triggering a brewing controversy over race in America. Did the Obama administration judge an African-American government employee without having all the facts? Lisa is doing a fact-check for us.

And a controversial new ad calls plans for a new Islamic community center and mosque near ground zero in New York a, quote, "celebration of the Americans killed on 9/11."

(COMMERCIAL BREAK) BLITZER: It's a growing, growing political controversy now raising new questions about the politics of race in America.

Were both the Obama administration and the NAACP simply too quick to judge an African-American government employee after a videotape surfaced linking her to some racially charged comments? She said her words were taken totally out of context.

We asked our own Lisa Sylvester to do some fast-checking for us.

Lisa, what are you finding out?

SYLVESTER: Wolf, this is a story that has had so many twists and turns. The NAACP sharply criticizing Shirley Sherrod saying it was appalled by her actions but later in the day announcing that it would take a closer look.


SYLVESTER (voice-over): Here's part of the YouTube clip that set off the firestorm.

SHIRLEY SHERROD, STATE DIRECTOR FOR USDA RURAL DEVELOPMENT: And here I was faced with having to help a white person save their land. So I didn't give him the full force of what I could do.

SYLVESTER: USDA official Shirley Sherrod admitting remarks at an NAACP event that she did not do everything she could to help a white farmer. That she took him to a white lawyer so, quote, "his own kind," would take care of him.

Conservative news outlets pounced. NAACP headquarters Monday called her actions shameful and her bosses at the Department of Agriculture forced her to resign.

But were they quick to judge? She says yes.

SHERROD: No, I did not discriminate against him. And in fact I went all out. I had to -- I had to frantically look for a lawyer at the last minute because the first lawyer we went to was not doing anything to really help him.

SYLVESTER: We did some fact-checking. The incident in question happened more than two decades ago. Sherrod was not working for the government at the time, but a nonprofit called the Federation of Southern Cooperatives Land Assistance Fund. And the Internet clips were heavily edited.

And what about not doing enough to help the white farmer because he seemed to have a, quote, "superior attitude"?

Elle Louise and Roger Spooner credit her for helping save their farm.

ROGER SPOONER, GEORGIA FARMER: I know she did. I know that in my mind. UNIDENTIFIED REPORTER: Did she give you credit?

SPOONER: Surely did. I give her all the credit.

SYLVESTER: So why did she say the things that she did? Sherrod says in her speech she was reflecting on the past, the moment when she realized black and white farmers were facing the same plight.

SHERROD: This was my first time dealing with -- trying to help save a white -- have a white farmer save his land. I wasn't really sure what I could do. Because at that time I thought they had the advantages. I learned that that was not the case in working with this farmer.

SYLVESTER: The head of the nonprofit where Sherrod worked for more than two decades says that over the years she has helped all kinds of people.

RALPH PAIGE, FEDERATION OF SOUTHERN COOPERATIVES LAND ASSISTANCE FUND: Certainly she has not -- is not a racist. She did not discriminate against the woman and the family that she helped. And this was 26 years ago.

Shirley's always been a very dedicated person, dedicated to helping people. You know, and that is regards to race, color, clan, or whatever.

SYLVESTER: But the USDA is not backing down, citing its zero tolerance policy.

TOM VILSACK, AGRICULTURE SECRETARY: When I saw the statements and the context of the statements, I determined that it would make it difficult for her to do her job as a rural development director and that it would potentially compromise our capacity to close a chapter on civil rights cases.

I didn't want anything to jeopardize her job in terms of getting the job done and getting people to work in Georgia.


SYLVESTER: Now one person who attended the NAACP Freedom Fund Banquet was the mayor of Douglas, Georgia who is white. And she says that she left shortly before the speech, but she told us that there were no mumblings in the community afterwards about it being a racist speech.

Mayor Jackie Wilson says that in fact she has interacted and dealt with Shirley Sherrod on several occasions and Wilson says Sherrod treated people fairly -- Wolf?

BLITZER: Lisa, thank you very much.

Let's dig deeper right now. Joining us our two CNN political contributors, the Democratic strategist Donna Brazile and the Republican strategist Mary Matalin. Let me go to you, Donna, first. Was Shirley Sherrod treated fairly by the Obama administration?

DONNA BRAZILE, DEMOCRATIC STRATEGIST: No. First of all, Wolf, I listened to the tape. I took time-out today to listen to the entire tape, unedited, in context. And I can tell you that her statement was taken out of context.

This is a woman who gave a very moving speech about her own experience growing up in the south, the segregated Deep South, in case people have forgotten, about her father being murdered. The decisions she had to make as a young girl of whether to stay in the south and then decided that she would stay and devote her life to helping people.

She went on to say that her life was about -- not about black and the white but the haves and the havenots. And that she wanted to help people. And one day this man -- the Spooner. Mr. Spooner came in asking for help.

Now I agree that the words she used to describe what she thought at the time about helping this man, perhaps they were not the right words. When you listen to her speech and listen to the Spooners, she went out of her way to help this man save his farm just like she helped many black farmer save their land as well.

Listen to the entire speech. The NAACP will put it on its Web site along with a new statement. And I hope this clears up some of the controversy.

BLITZER: Well, are they going to change their mind? Because you heard Tom Vilsack, the Agriculture secretary, Donna. He's doubling down. He's saying, You know what? We made the right decision forcing this woman to resign. What about the NAACP? They made a statement last night that seemed to suggest she should go, as well.

BRAZILE: Everyone reacted because someone deliberately put an edited tape out on the Internet and scored (ph) this woman, smeared her good name before listening to the entire tape. If you saw the statement out of context, I understand why the government and the NAACP may have overreacted.

But listen to the tape. We all make mistakes. In our own experiences, we've made bad statements. But Mrs. Sherrod deserve an opportunity to express herself. She's done that today. We should listen to the tape before, you know, coming to judgment. They should have placed her on administrative leave.

I don't speak for the government. I don't speak for the Obama administration. I just listened to the tape. And may God continue to bless her...

BLITZER: All right...

BRAZILE: ... and her family, as well as the Spooners.

BLITZER: Mary, what do you think about all of this? Was this woman unfairly smeared?

MARY MATALIN, REPUBLICAN STRATEGIST, CNN POLITICAL CONTRIBUTOR: You know, the government slandered her. The NAACP slandered her, just like they slandered the tea party people, this hurling around of charges of racism where it doesn't exist.

You know, of all the things that Donna and I don't agree on, we certainly have sought and have received forgiveness for things we said a quarter of a century ago. We believe in forgiveness. We believe in healing. We believe in redemption.

And this woman's story has got to be true. I did what Donna did today and actually looked into it before opining on it, and the evidence that it is true and that she was a healer, was that the Spooners to this day, and on this day, said she wasn't racist. It was her efforts that helped them keep the farm. And they're friends to this day and they feel terrible about it.

We have to stop this. We have to stop hurling around these charges of racism for political purposes. And somebody I have admired, although not agreed with, Mary Frances Berry, said today that to use -- to charge your opponents with racism is preferable (ph) much better than talking about joblessness. We must stop! We have had a horrific -- disputably horrific history in this country. But Donna and I are working on things to this day that are -- will result in an indisputably bright future. This has got to stop.

BLITZER: You know...

MATALIN: It's got to stop now. And the NAACP and the administration and everybody has to stop.

BLITZER: And you know what? She said...


BRAZILE: We cannot just put the NAACP and the Obama administration -- what the NAACP -- repudiate all of it. It has to stop. We have to draw the line.

BLITZER: You know, Donna, what she said in the interview earlier today with Tony Harris, Shirley Sherrod -- one of the points she said, when she got the call, the third call from her manager, the deputy undersecretary of agriculture, saying, Pull over to the side of the road and you've got to resign right now because they're worried at the White House about what Glenn Beck might say on Fox News. It sounded pretty amazing to me, but I don't suspect this woman, Shirley Sherrod, would make up something like that.

BRAZILE: You know, Wolf, I don't know. I wasn't on the call. But I can tell you this much. We're overreacting to what we hear and see on the Internet without getting the facts, without really looking into the person's record or background. What we have seen and what we've heard today from some of the people from that area, the people who've worked with her, tells me that she's a good Christian woman. BLITZER: Do you buy the story, Mary, that the White House is putting out and that Tom Vilsack, the secretary of agriculture, is putting out that this was strictly his decision, he had no input from the White House, from White House officials, it was his decision to force this woman to resign?

MATALIN: Well, it doesn't matter because he's acting in a culture that the Obama White House is perpetrating. This president could, he should, and he promised he would get us past racism, and at every turn where there's a teaching moment, he has had a backwards reaction, from the beer summit and Gates to this.

The White House should call Vilsack and say, Look, we know there's zero tolerance, but there's no evidence that she has done anything remotely discriminatory in her job at the USDA. Stop it. This is a teaching moment which this president promised he would take advantage of...

BLITZER: All right...

MATALIN: ... and he isn't.

BLITZER: Donna, what do you...


MATALIN: ... evidence of what's the story?

BLITZER: What do you want the president of the United States to do to fix this right now, Donna?

BRAZILE: Absolutely nothing. Absolutely nothing. President Obama is president of all of the American people. And I would hope that Mr. Vilsack and those who are responsible, the regional commissioner, the Office of Civil Rights -- I tried to call the Office of Civil Rights, the Department of Agriculture.

Reopen this case. Let the -- let -- let -- read the speech. Listen to her words. Do not just summarily fire this woman simply because you saw something on the Internet, not when you saw the Spooners today come out and say that she told them to go to Americus. I'll meet you there. I'll help you save your land.

This woman has an incredible story. Listen to it. Some of her words were clearly from 24 years ago. We said some things -- I know I've said some things and I've asked for forgiveness.

Please, let us all find ways to work together. We can't solve our problems by simply saying the president of the United States is responsible for making things better. It starts with all of us.

BLITZER: All right, Donna Brazile reaching out to Tom Vilsack, the agriculture secretary, to rethink his position. We're going to invite him to join us, see if he wants to join us on the phone and see if he'll react, Donna, to your powerful words. Donna, thanks very much. Mary, thanks to you, as well. We're going to be all over this story in the next hour, as well.

It's been six days since the gusher in the gulf was capped, but how far has the oil spread? We're on the scene in a boat and on the beach and in a blimp. Stand by.

And today, the newest and youngest U.S. senator tried to fill the shoes of the late Robert Byrd. How did Carte Goodwin do?

And he's an Iranian nuclear scientist who claims to have been kidnapped by the United States, but now there's word of a movie deal. What's going on?


BLITZER: Mid-term elections are only a few months away, just a little bit more than a hundred days or so. Some races, though, are already heating up big-time. A couple of hard-hitting political Web videos have just been released, and they're pitting the administration of the president, Barack Obama, against the policies of the former president, George W. Bush.

Our senior political analyst, Gloria Borger, is here to tell us a little bit about some of these new ads. Let's play part of the first Web video -- this is from the DNC -- for our viewers.


UNIDENTIFIED MALE: We need to go back to the exact same agenda.

UNIDENTIFIED MALE: The exact same agenda that put big oil, insurance companies and Wall Street ahead of Main Street...

UNIDENTIFIED MALE: ... the exact same agenda...

UNIDENTIFIED MALE: ... championed by George W. Bush.

UNIDENTIFIED MALE: ... the exact same agenda...

UNIDENTIFIED MALE: With no new ideas, Republicans are going...

UNIDENTIFIED MALE: ... back to the exact same agenda.


BLITZER: All right. That's a pretty tough ad.

GLORIA BORGER, CNN SR. POLITICAL ANALYST: Well, you know, Congressman Sessions today, by the way, said that what he was referring to was a business roundtable report which said that the president needs to engage the business community. But that doesn't matter because the Democrats are going to be hitting on this, Wolf, because they want to reframe the debate at the mid-term election.

Usually, mid-term elections are a referendum on the current president. What they want to do is turn this mid-term election into a choice between Barack Obama's policies and the policies of -- you got it -- George W. Bush. And they think, look, it worked for them in 2006. It worked for them in 2008. Why not try it a third time?

BLITZER: Will it work in 2010?

BORGER: Well, you know, there's a big assumption here, and that is the assumption that people believe that a Republican Congress would return to the policies of the former president. And a Democratic firm just recently did a poll on this, Wolf, in which they found out that only one of four people actually believe that that's the case. They believe that a Republican Congress would pursue its own policies.

BLITZER: Now, the Republican candidate for the U.S. Senate, Roy Blunt, in Missouri has this ad. I'll play it for our viewers.


UNIDENTIFIED FEMALE: July 8, 2010, Barack Obama's raising Monday for Robin Carnahan. Why?

OBAMA: I need another vote. It'd be helpful.

UNIDENTIFIED FEMALE: He knows Robin Carnahan will rubber stamp the Pelosi-Reid-Obama liberal agenda.


BLITZER: Democratic candidate for the U.S. Senate in Missouri.

BORGER: Right.

BLITZER: What do you think about that?

BORGER: Well, we're used to hearing about Nancy Pelosi and Harry Reid, but we haven't heard a lot of ads talking about Barack Obama because, of course, right now, Barack Obama still remains personally popular.

This is an interesting ad that we ought to keep an eye on because, of course, it's running in a swing state, Missouri. Blunt does have a Republican primary, but he's the overwhelming favorite there right now. And if this ad succeeds in raising Carnahan's negatives, then you might see lots of other Republicans starting to lump in the president with Reid and Pelosi. And that's something that they would think might be effective in the future. So we have to keep an eye on it because if it works for him, other people are going to try it.

BLITZER: With Reid and Pelosi, especially among Republicans, not very popular.

BORGER: Very -- not very popular.

BLITZER: So will this be effective nationally?

BORGER: Well, we'll have to see. And this is a good test case because Missouri is such an important swing state. And if it's effective in Missouri and he continues to use it in the general and it works, you're going to see it in a lot of other states. As I say, so goes Missouri, so goes the country.

BLITZER: Yes, well, the president lost Missouri barely...

BORGER: Barely, right.

BLITZER: ... the last time, but he did become president of the United States.

BORGER: Right. But mostly.

BLITZER: But mostly...


BLITZER: ... Missouri is -- is a bellwether. That's correct. Thank you, Gloria.

A mosque near Ground Zero in New York. The producer of a provocative ad says a proposed Islamic center celebrates the 9/11 attacks. And now that the massive oil spill has been stopped, at least for now, where's the oil? We have reporters on the scene, on the water and in the air.


BLITZER: Is it to be a place of peace or a monument celebrating 9/11 terror attacks on the United States? Our senior correspondent, Alan Chernoff, talks to the producer of a provocative TV ad that opposes building an Islamic holy site in the shadow of Ground Zero -- Alan.

ALAN CHERNOFF, CNN CORRESPONDENT: Wolf, Scott Wheeler turned his passion for political ads into a campaign against an Islamic center and mosque near Ground Zero. He wrote and produced the ad, but he's been unable to sell it. Have a look and you'll see it's anything but subtle.


(voice-over): NBC and CBS turned down this ad opposing a mosque near Ground Zero.

UNIDENTIFIED MALE: And to celebrate that murder of 3,000 Americans, they want to build a monstrous 13-story mosque at Ground Zero!

CHERNOFF: Those are the words of ad producer Scott Wheeler.

SCOTT WHEELER, AD CREATOR: We know that in the past, Muslims have established mosques at locations where they want to declare dominion.

CHERNOFF: Wheeler, who served a year-and-a-half in the Army, runs a small political action committee, the National Republican Trust PAC. It has no ties to the Republican Party, no full-time staff. When he learned about plans to build an Islamic community center that would include a mosque two blocks north of Ground Zero, he says he had to send a warning, a mosque would be a victory for the terrorists.

(on camera): The people establishing this facility, you think they're celebrating the murder of 3,000 people?

WHEELER: I think so.

CHERNOFF: How are they celebrating it?

WHEELER: Well, by erecting a mosque to their martyrs, which they have traditionally done all over the world.

CHERNOFF (voice-over): Those martyrs, claims Wheeler, are the 19 hijackers of the 9/11 planes.

WHEELER: You can also look how many Muslims see mosques. They see them as military barracks.

CHERNOFF (on camera): Do you think this will be a military barracks?

WHEELER: Well, they call the faithful their "soldiers."

CHERNOFF: The fact is, this building has been functioning as a prayer space since last fall. For the Friday mid-day prayer, the most important for Muslims, this place is packed with more than 400 worshipers.

(voice-over): Those congregants -- just a handful come on most days -- say Wheeler's claims are outrageous.

ZAED RAMADAN, CONGREGANT: It's tremendously offensive, as a Muslim New Yorker and an American, that anyone would make the attempt to associate myself, who's a proud American, whose family served as first responders...

CHERNOFF: The property developer and the imam, waiting for approval from New York's Landmarks Commission to erect a new building here, say their intent is to provide a community center that can improve realizes with non-Muslims. But Scott Wheeler, who is using the ad controversy to try to raise funds for his PAC, maintains there is a connection to the 2001 attack.

(on camera): Can you show us any proof that the people behind this community center have ties to al Qaeda?

WHEELER: I think there's been proof in the media already. Well, not to al Qaeda. Why do you keep asking about al Qaeda? I said we don't know. I said we...


CHERNOFF: Weren't they the ones behind 9/11?


CHERNOFF: Scott Wheeler may not have proof that al Qaeda or its backers are behind the Islamic center, but he does have some support. A majority of New Yorkers, according to a recent Quinnipiac poll, are opposed to a mosque near Ground Zero -- Wolf.

BLITZER: Alan Chernoff, thanks very much for that report.

Should unemployment benefits be extended without a way to pay for them? That's Jack Cafferty's question. Stand by for your e-mail.


BLITZER: Jack's back with "The Cafferty File" -- Jack.

CAFFERTY: The question this hour, Wolf, is: Should unemployment benefits be extended without a way to pay for them?

Mike in Sonoma, California, writes: "Republicans have no problem re-extending the tax cuts without paying for them, which would increase the deficit to a far greater degree. From their perspective, it's OK to give more money to the top 1 percent that don't need it, but not to help the bottom 99 percent, which frequently does really need help through no fault of their own."

Mark writes: "I think it's about time that we draw the line on unemployment benefits at 99 weeks. Enough is enough, especially given the fact that Democrats have not found way to pay for these benefits other than tacking them onto our massive debt. Studies have proven that extending unemployment benefits merely extends the duration of the unemployment as people become less motivated to find a job."

George writes: "Yes, the benefits only increase the debt by a small increment. Glad to read that the Republicans want to reduce the deficit. I'm sure the GOP doesn't want to waste time and energy on such small potatoes as unemployment benefits. I'm waiting for their major plan to cut the Defense budget from $800 billion to $500 billion per year. Still waiting."

Carl writes: "Nobody wants people to go hungry, but my anecdotal evidence is, indeed, that people with six months unemployment coming don't run out the door looking for a new job. They look at it as a breather, and why not take advantage of a program that they feel they have paid into? Then when there's a month or two left, they start looking in earnest."

Larry in Wisconsin writes: "There are many areas where cutbacks could cover the cost of this benefit, and to not apply them is criminal. The apparent goal of Obama Land is to get the people to a point where they have no choice but to rely on the government. Most people aren't intelligent to understand what's taking place here. It's called socialism, and we are headed down that path."

And Cindy writes from Rahway (ph), New Jersey: "Jack, ask somebody who has no food to put on the table through no fault of their own. I would guess that they would say yes."

If you want to read more about this -- got a lot of e-mail -- go to my blog, They start looking for a job in earnest. Do you know where that is, Earnest?



CAFFERTY: Just asking.

BLITZER: Someplace. All right, Jack. Thank you.

Prowling the skies, looking for oil on the water. You're going to get a blimp's-eye view. Stand by.

And the African-American official sacked over allegations of discrimination -- she is fighting back. Donna Brazile is supporting her against accusations from the Obama administration. What is going on here? You're going to be hearing her side of the story. That's coming up.


BLITZER: The communities along the Gulf Coast are dealing with a double whammy. First it was Hurricane Katrina, now it's the BP oil disaster. But our Tom Foreman has been prowling the Mississippi coastline, looking for small businesses that are building up America, and he's found one -- Tom.

TOM FOREMAN, CNN CORRESPONDENT: You know, Wolf, the number one question in any tourist location is, Where's a good restaurant? And that's always true on the coast, where the answer used to always be, Well, down on the beach. Just ride along. You'll find something. Not so much anymore. But some people here are really trying to change that.


FOREMAN (voice-over): The Trapani family restaurant has great cooks, loyal customers. The owners, Jolynne and Tony, are dedicated, hard-working.

TONY TRAPANI, RESTAURANT OWNER: These crab cakes right here have no bread in them whatsoever.

FOREMAN: But situated far from the water, they lack one thing -- location, location, location.

TONY TRAPANI: This place needs to be on the beach. This whole area is all about boating and water and fishing and everything. Now, we're doing OK, but we can't stay here forever. We have to move back to that beach in order to help the community out.

FOREMAN: For a dozen years, the Trapanis' place was right on the waterfront, and they had lots of company. This whole area out here was filled with businesses.


TONY TRAPANI: It had businesses, and all of this was businesses, and that was a coffee shop and...

FOREMAN: Plenty of restaurants have opened since Katrina. There are now more on this coast than before the storm, but they are building inland, not on the water, and especially not now, with the danger of oily tides in the mix. So the Hospitality and Restaurant Association is offering classes for aspiring restaurateurs, helping with business plans, running special promotions to attract customers, all because they know they need businesses on the beach to build up their part of the gulf.

RICHARD CHENOWETH, MISSISSIPPI HOSPITALITY AND RESTAURANT ASSN.: It's just like having a wheel with all the gears in it. You know, you have the little sprockets going around, and if one of those goes, then you start slipping like this and -- and, you know, it kind of goes down.

FOREMAN (on camera): You need them all.

CHENOWETH: We need them all.

FOREMAN (voice-over): The Trapanis have made up their minds. Soon they will break ground, rebuilding right back where Katrina took them down and where the oil still threatens.

(on camera): Why is it so important for you to be back here again?

JOLYNNE TRAPANI: We always knew that this is a big puzzle -- piece of the puzzle that we can replace to bring back this community.

TONY TRAPANI: We are determined to rebuild this thing.

FOREMAN (voice-over): Because they are convinced if they build it, not only customers but other businesses will come, too.


FOREMAN: It's really a simple equation. Everyone knows that when the tourists come to the shore, they want to be on the shore. That's why this push goes on, Wolf, to get more businesses back on the beach.

BLITZER: And you're in THE SITUATION ROOM. Happening now, a USDA official forced to resign over racially-charged remarks she made decades ago, remarks she says were taken totally out of context. This hour, the raging controversy, plus exclusive reaction from her now former boss, the agriculture secretary, Tom Vilsack.