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Former IMF Chief Out on Bail; President Obama Meets With Israeli Prime Minister

Aired May 20, 2011 - 18:00   ET



Happening now: President Obama gets a blunt lecture from Israel's prime minister after calling for Israel to roll back to boundaries to what looks like they -- the boundaries that they looked like before the 1967 war, with adjustments.

The former head of the International Monetary Fund is released from jail. But he faces home detention under tight security ahead of his next court appearance for sex crime charges.

And a nationwide warning that al Qaeda is interested in attacking U.S. oil and natural gas targets, it comes as some cities in the United States learn they will soon learn lose their anti-terrorism funding from the federal government.

Breaking news, political headlines all straight ahead.

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

But let's begin now. In no uncertain terms, Israel's prime minister today let President Obama know exactly what he thinks of the call for Israel to make huge territorial concessions to the Palestinians. The president had urged Israel to negotiate a peace deal based largely on the boundaries that existed before the 1967 Arab-Israeli war.

In a White House meeting that appeared awkward and tense, the prime minister, Benjamin Netanyahu, gave his answer and he added that, as of now, Israel may not have a partner for negotiations. Listen to this.


BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER: While Israel is prepared to make generous compromises for peace, it cannot go back to the 1967 lines, because these -- these lines are indefensible, because they don't take into account certain changes that have taken place on the ground, demographic changes that have taken place over the last 44 years.

Remember that, before 1967, Israel was all of nine miles wide. It was half the width of the Washington Beltway. Israel cannot negotiate with a Palestinian government that is backed by Hamas. Hamas, as the president said, is a terrorist organization committed to Israel's destruction. It's fired thousands of rockets on our cities, on our children.


BLITZER: All right, let's get a closer look at what the prime minister is talking about. We are hearing a lot about the 1967 lines.

Tom Foreman is here with a little closer explanation.

What exactly are they talking about?

TOM FOREMAN, CNN CORRESPONDENT: Well, Wolf, you know this better than anybody else here. This was 1967, before 1967, what it looked like in Israel.

In that year, the Six Day War broke out. What happens, there was a tremendous amount of pressure, Egypt down here, Jordan, Syria up here. A lot of pressure grew because there was a sense that a war was about to break out. What happened at the beginning of that war, as you well know, Israel struck out very quickly with excellent air attacks on Egypt and then on into Jordan, over into Syria up here.

And the result was a sweeping victory. It was almost unbelievable what happened. Look at the result. This was Israel before the Six Day War. And at the end of the war, this was their territory. They had increased the size of their country threefold in a very short period of time.

They took the Sinai Peninsula down here, the Gaza Strip, the West Bank, the Golan Heights up here, massive, massive change. And, of course...

BLITZER: That was all done in six days.

FOREMAN: That's right, massive, unbelievable victory for the Israelis back then and of course a huge shockwave through the Arab world.

By 1979, a deal was done and so, at that point, if you look at what we have today, the Sinai was given back to Egypt as part of a peace deal. But the rest of it, East Jerusalem, the West Bank, Golan Heights, Gaza Strip, Hamas now controls the Gaza Strip over here, East Jerusalem, Palestinian- and Israeli-controlled. And Israel controls the Golan Heights.

If we bring up East Jerusalem here, you can see what part of the problem is. Wolf, you understand this. And you can explain this to us a little bit more. Israeli settlements, Palestinian settlements, big changes in terms of where people live now.

When the war happened, about a million Arabs were swept under Israeli control who previously had not lived under that control. This is the problem, isn't it? BLITZER: It's -- look, it is a huge, complex issue. And it's going to have to be resolved in negotiations.

The question that the Israelis have is, should the president of the United States have basically said at this point -- even though everyone understand those pre-'67 lines are the basis for any deal between the Israelis and the Palestinians, should the president have said that publicly at this time, given the sensitivities and also the fact that the Palestinian Authority now has brought Hamas into the equation?


FOREMAN: What do you do with all the people? You have lots and lots of people living out here. Are you going to give that land back? And if so, what...


BLITZER: This is Jerusalem.

And they did work out a deal involving Jerusalem in 2000 at the final moments of the Clinton administration, also in 2008, the final weeks of the Bush administration, although they were close -- I should say they were close to a deal involving not only getting close to the '67 lines, including East Jerusalem as a joint capital for the Palestinians and for the Israelis.

But, in the end, obviously, it didn't work out. And the president has been trying for two, two-and-a-half years now. Not working out yet, unlikely to work out any time soon.

FOREMAN: But that's the challenge. You look at that map, here it is. There it is today. And there it was back in 1967. They have talked about that. This is where it is today. How do you get to the compromise?

BLITZER: Yes. Well, it's not going to be easy.


BLITZER: Tom, thanks very much.

Did the president go too far when he asked Israel to go back to the '67 lines with some adjustments that are mutually acceptable?

Did he take a step toward jump-starting peace negotiations or did he pull the plug on further peace talks?


BLITZER: And joining us now, Republican senator, Lindsey Graham, of South Carolina.

He's on the Armed Services Committee.

Senator Graham, thanks very much for coming in.


Thank you.

BLITZER: It didn't look like there was a -- a -- a great rapport there between the president of the United States and the prime minister of Israel today when they sat in the Oval Office.

What was your assessment?

GRAHAM: That's why they pay you the big bucks.


GRAHAM: It was pretty bad.


GRAHAM: Well, you know, put yourself in the prime minister of Israel's shoes. You're coming to meet -- speak to the Congress.

President Obama, I think, has this mind-set that if I publicly scold Israel or I push them on settlements and borders, I somehow get street credibility in the Arab world or with the Palestinian people. It doesn't work. It just makes our relationship with Israel more difficult.

And it was overall a good speech, but why in the world you would insist on the '67 borders under these conditions, I don't know.

BLITZER: Well, he also had a caveat, an important caveat...

GRAHAM: Land swaps.

BLITZER: -- with -- with mutually agreed swaps...

GRAHAM: Here's...

BLITZER: -- land swaps.

GRAHAM: -- here's the problem. When you think about settlements, everybody in the region will highlight Israel's problem with settlements. When you think about borders and not giving up the right to return, one -- it's one thing to change the borders, well, the Palestinian people insist on the right to return, which is a way of destroying the Israeli state.

Look at it from an American point of view. We're providing $200 million a year in aid to the Palestinian people. Some of that aid has done great things in the West Bank. Ramallah is a different town.

But Hamas is now in a coalition government with the Palestinian Authority.

Why should an American politician give aid to the Palestinian coalition government until they publicly say, we acknowledge the state of Israel as a Jewish state that has the right to exist?

I'm not going to vote for any more aid to the Palestinian people until this new coalition government acknowledges that Israel has the right to exist as a Jewish state.

BLITZER: Is -- do you see any chance that Hamas will change its attitude...

GRAHAM: Probably...

BLITZER: -- and formally acknowledge Israel's right to exist?

GRAHAM: Well, why -- if they don't, we're -- I have never seen it any more screwed up than it is today.

Why would you negotiate with someone who has, as their ultimate goal, your demise?

President or prime minister -- President Abbas and Prime Minister Fayyad are good agents of peace. Hamas is a terrorist organization.

For some reason, they have come back together and our government, we're broke, why would you fund a partial group of people who want to destroy your best ally?

The only way I see peace coming about is for both sides to acknowledge the other's right to exist. Every politician in Israel, right, middle, left, acknowledges the Palestinian people have a proper legitimate desire to have an independent state where they control their destiny.

BLITZER: But President Abbas, the Palestinian Authority president, and Prime Minister Fayyad ---


BLITZER: -- as you point out, they say they'll resume the -- the peace negotiations with Israel if Israel freezes its settlement activity.

GRAHAM: No. Forget about -- we can come up with capitals. We can deal with settlements. We can deal with boundary lines. All of these are details. But the one thing you've got to get out of the way, is it the agenda of Hamas and part of the Palestinian people to destroy the state of Israel?

Until that's off the table, everything else makes no sense to me.

Why would you negotiate borders if the people on the other side of the border have as their ultimate goal to destroy you?

So if I'm Israel, if I'm the American taxpayer, I don't provide any more aid, I don't negotiate until you will tell me to my face, as a joint statement of Hamas and the Palestinian Authority, you don't want to kill me. BLITZER: Because President Abbas says even if Hamas is part of his government, he speaks for the Palestinians and he supports a two- state solution, Israel and Palestine living alongside each other.

GRAHAM: I want the entire -- what would -- what would the Palestinians say if Likud said, OK, we agree that the Palestinian people have a right to an independent state, but the major party in Israel said we don't agree.

Would you negotiate with a divided government, a house divided?

The Palestinian people have to decide among themselves which way they want to go. And if Hamas is going to be part of the coalition government, if I were Israel, I would not enter into peace negotiations until Hamas changed their charter and acknowledged that I have a place on the planet as a Jewish state.

You're wasting your time and we're wasting our money until that is taken care of.

BLITZER: And do you think -- are you going to introduce legislation to cut off aid to the Palestinians or what's going to happen?

GRAHAM: Well, you know, we're broke. I have got to go to South Carolina and say here's why I'm giving money to the Palestinian people. I think the aid we've provided to -- to the Palestinian Authority has been well spent. Ramallah is a different place. Their security forces in the West Bank are getting better by the day.

But Hamas has been in control of the Gaza Strip. they have done nothing but shell Israel. They -- they will not acknowledge the right of the Jewish people to exist as a nation, a -- a Jewish state.

So I don't think we need to move any further in the peace process and we don't need to provide any more aid until we get that issue dealt with.

BLITZER: What did you think of what President Obama said yesterday and today on Syria?

GRAHAM: Good. I -- that's why I liked the speech. You know, Assad needs to get with a program or -- or go. The president did a good job of explaining the Arab spring. Now is the time for a broke nation like the United States to invest in this new election in Egypt. Every 6,000 years, you get a chance at democracy in Egypt.

When you look at it, this is the first time in 6,000 years Egypt has moved toward democracy. If Egypt will adopt democratic principles, the rule of law, tolerance, a role for women, it changes the Arab world.

So to President Obama, I will help you provide aid to Egypt, Tunisia. I will help you keep troops in Iraq, if that's the best way to secure Iraq. I will help stand by you to make sure we get it right in Afghanistan. But it won't come -- when it comes to Israel and the Palestinian problem, Mr. President, you're doing a lot of damage to the process by singling out individual issues like the settlement and borders.

I don't think the president quite understands that the Israeli people are more uncomfortable than at any time that I have been going to Israel. The Israeli people and their political leaders really question whether or not this new coalition government could ever deliver. And I understand why they question that.

BLITZER: Lindsey Graham, the senator from South Carolina.

Thanks for coming in.

GRAHAM: Thank you.


BLITZER: At that meeting with the prime minister, President Obama was firm in insisting U.S. support for Israel will remain.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Obviously, there are some differences between us in the precise formulations and language, and that's going to happen between friends. But what we are in complete accord about is that a true peace can only occur if the ultimate resolution allows Israel to defend itself against threats, and that Israel's security will remain paramount in U.S. evaluations of any prospective peace deal.


BLITZER: The former head of the International Monetary Fund has just been released from jail in New York, free on $1 million cash bail.

CNN's Susan Candiotti is standing by with new information.

And possible terror plots targeting oil tankers and drilling rigs, new revelations from the material found in Osama bin Laden's compound in Pakistan.

And one of the -- one of candidate Obama's strongest supporters now a very, very sharp critic of President Obama and making some stinging charges.


UNIDENTIFIED MALE: My dear bother Barack Obama often says he is president of all America, not black America. But to say that often means low priority for poor and working people, even lower priority for black poor and working people.



BLITZER: The former head of the International Monetary Fund is out of jail. But Dominique Strauss-Kahn won't be awaiting trial on sex assault charges at the luxury apartment he had planned on using for his house detention.

Let's go to New York. CNN's national correspondent, Susan Candiotti, has the latest.

What's going on, Susan?


Dominique Strauss-Kahn is free on bail tonight. But it wasn't an easy path out of Rikers Island jail today. A plan to release him hit a snafu when the place where he was planning to live wouldn't let him stay there. That led to a court hearing this afternoon to discuss the issue.

The judge agreed to allow the former IMF chief to live in a temporary location for a few days until a more permanent apartment can be arranged. Why wasn't he allowed to stay at the first place?

Here's Strauss-Kahn's lawyer.


WILLIAM TAYLOR, ATTORNEY FOR DOMINIQUE STRAUSS-KAHN: The reason that he had to move is because members of the press attempted to invade his private residence and interfered with his family's privacy.


CANDIOTTI: There certainly has been a lot of media interest in this story. The only clue about where he will be staying is that it will be near Ground Zero.

Prosecutors were concerned about that in today's court hearing, but, again, ultimately, the judge ruled that he would grant bail -- Wolf.

BLITZER: He's out on bail, obviously, right now, but he's not free to simply do whatever he pleases.

CANDIOTTI: That's right. In fact, he's more restricted than he would have been had his original plan played out. The only reason he's now allowed to leave is for a medical emergency. Otherwise, he needs to stay put.

Now, once he moves to a permanent location, he can leave only for pre-approved reasons, but he needs to give prosecutors six hours' notice of his plans. He will be monitored, likely with an ankle bracelet, and he will also have security outside his apartment. And that's at his own expense estimated at, at least $200,000 a month.

BLITZER: Wow, $200,000 a month. From the very beginning, we have been hearing about the investigation on what happened that last Saturday afternoon at that hotel, the Sofitel Hotel. What are you learning? What else are you learning right now?

CANDIOTTI: Well, a law enforcement source with knowledge of the case says, following interviews with staff after Saturday's alleged incident at the Sofitel Hotel, investigators began piecing together a timeline of what happened.

The maid who was allegedly assaulted by Strauss-Kahn wasn't the only one who apparently thought the hotel room was empty before the alleged sex attack occurred. A room service attendant entered the suite a short time before that -- that maid arrived and also did not think anyone was in the suite.

The attendant used a pass key to let himself in to retrieve some room service items, and he told police that he left the door ajar. So, when the maid later showed up, she noticed the door was already open. The room service attendant, who was still there, told the maid to come on in. And then he left.

And in the course of talking with employees at the hotel, police have picked up some other interesting details about Strauss-Kahn's stay. Not long after his check-in on Friday, May 13, a law enforcement source with knowledge of the case says that Strauss-Kahn apparently wanted some company. He allegedly phoned the front desk from his room and asked the receptionist who had greeted him if she wanted to join him for a drink. She declined -- Wolf.

BLITZER: Wow. OK. Thanks very much for that, Susan Candiotti, reporting from New York.

So, what's next for Dominique Strauss-Kahn? I asked CNN's senior legal analyst, Jeffrey Toobin.


JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: The most important thing that is next is the investigation has to proceed.

There is a lot that needs to be looked at here, especially in terms of scientific forensic evidence. Was there DNA left at the crime scene? Is there hair and fiber at the crime scene? What do the videos, the surveillance videos in that area show? What about the time cards of when people went in and out of that hotel room?

All that has to be looked at. And experts from both sides have to have the opportunity to look at the evidence. It could take a long time.

BLITZER: Will his own attorneys be looking for a speedy trial, rushing to trial? Or do they want this to drag on?

TOOBIN: Delay, delay, delay, especially in a case like this, where passions are high, there is a lot of attention. And that's also why this bail decision is so important, because if he had been in Rikers Island for the months prior to trial, he would be telling his attorneys: I can't stand this. Get me to trial.

Now he's going to be in a relatively comfortable apartment, which will certainly be cramped and frustrating to him because he can't live his normal life. But he will be eating normal food. He will be sleeping in a normal bed. He will be able to see people. He will not be pressing his lawyers to go as fast as he would be if he were in Rikers Island.

BLITZER: And he does have some excellent attorneys. Benjamin Brafman, for example, he's very well-known in New York. You know him.

TOOBIN: Absolutely.

I mean, if you were to ask people in the know in New York City who is the best trial lawyer in New York City, I think Ben Brafman would get more votes than anyone else. Now, it remains -- it is still true that he's not undefeated. He's not more important in a case than the evidence is, but, certainly, he's going to have the best defense that Strauss-Kahn could have found anywhere.

BLITZER: But I think it is fair to say those New York prosecutors are pretty good as well.

TOOBIN: Very good. And this case will get a lot of attention.

This is the first really big case that Cyrus Vance Jr. has had as the new -- relatively new Manhattan district attorney. He knows that his reputation is going to rise and fall, at least initially, based on this case. So those prosecutors are going to have all the resources they need.

BLITZER: He's the son of the former Secretary of State Cyrus Vance.

TOOBIN: He is, indeed.

BLITZER: Got the same name.

Here's a question. It goes to trial. Let's say it goes to trial six months from now, a year from now, whenever it goes to trial, in New York City. Can he get a fair trial in New York, a jury trial, given all the publicity that is out there, the tabloids in New York, some of whom have already convicted him, for all practical purposes? What's the argument in terms of keeping the trial in New York or moving it to another location?

TOOBIN: Well, you know, we in the news media, I think, we always have this question. Everybody is following this so closely. How can he get a fair trial?

When you actually get to jury selection, I think I am always surprised at how much people are not following big cases. And I think that will be particularly true in a case like this. If you were to ask most people in Manhattan two weeks ago, who is Dominique Strauss- Kahn, I think you would get 99 out of 100 saying they never heard of him.

Now it would be less -- more people would have heard of him, but I still don't think this is a big obsession here in New York. So, I don't think picking a jury in this case will be all that difficult. And I don't think this trial is going to be moved.

BLITZER: All right. We are going to watch it together with you, Jeffrey. Thanks very much.

Jeffrey Toobin is our senior legal analyst.


BLITZER: Afghanistan after bin Laden -- could the al Qaeda leader's death encourage the Taliban to make peace? Stand by for that.

And a day after the president spoke about the Arab spring, dozens are gunned down brutality in Syria. We are going to tell you about the latest bloody Friday.

Stay with us. You are in THE SITUATION ROOM.


BLITZER: Osama bin Laden is dead, but U.S. troops remain at war in Afghanistan, mainly fighting the Taliban. Will the killing of the al Qaeda leader make a difference on the ground?

Our Pentagon correspondent Chris Lawrence has been looking into this for us.

What are you finding out, Chris?

CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT: Well, Wolf, as much optimism as there is out there, we got a chance to hear from the military commander who runs the reintegration cell there in Afghanistan. And he says not quite yet. Here's why.

He says that this talk of reconciliation still sounds too much like surrender to some of these low-level fighters. He says their honor and dignity as sort of the fighting men of their communities just isn't ready to take it quite yet. He also says that they are still worried about joining some of these reconciliation programs publicly because they are worried that the Taliban leadership that is still based in Pakistan still has a reach into an Afghanistan to hurt them or their families.

And, so, they normally are trying to do this reconciliation silently.


LAWRENCE (voice-over): Some think the Taliban could break up with al Qaeda and reconcile with NATO and the Afghan government.

ROBERT GATES, U.S. SECRETARY OF DEFENSE: But I think that the elimination of bin Laden is a potential game-changer in Afghanistan.

LAWRENCE: Defense Secretary Robert Gates says we will know for sure in the next six months.

GATES: You may actually, next winter, have the potential for reconciliation talks that are actually meaningful in terms of going forward.

LAWRENCE: Why the optimism? Because bin Laden swore an oath to Taliban leader Mullah Omar.

MICHAEL O'HANLON, SENIOR FELLOW IN FOREIGN POLICY STUDIES, BROOKINGS INSTITUTION: The personal relationship was 15-years-old. And it was really a, you know, blood brotherhood. It was a blood bond.

LAWRENCE: Brookings' Michael O'Hanlon says Omar does not have that bond with al Qaeda's number two, Ayman al-Zawahiri. And while the U.S. had to insist the Taliban denounce bin Laden, his death allows American officials to be more flexible with the Taliban.

O'HANLON: And be able to say, you know, well, as long as you don't actively support al Qaeda, maybe that's good enough. In other words, there is a little more wiggle room for us.

LAWRENCE: But O'Hanlon says there is no evidence the Taliban have become more moderate.

O'HANLON: ... to people who are tired of the war and to say, well, let's just negotiate, as if wishing it so would make it so.


LAWRENCE: Now, Secretary Gates says, if the troops can keep up the pressure on the Taliban through the summer and into the fall, that, combined with bin Laden's death, could open up room for negotiations by the end of the year -- Wolf.

BLITZER: Chris Lawrence at the Pentagon, thank you.

Let's dig deeper on this important question.

Joining me are CNN national security analyst Peter Bergen and our national security contributor Fran Townsend. Fran serves on the Homeland Security and CIA external advisory boards.

Peter, with bin Laden gone, where does it leave the Taliban in Afghanistan?

PETER BERGEN, CNN NATIONAL SECURITY ANALYST: This is a tremendous opportunity for the Taliban to do something they haven't done in the last ten years, which is reject bin Laden, reject al Qaeda and say 9/11 was a bad idea. And if we don't hear from that, from the Taliban, I think skepticism about the reconciliation process is well deserved.

I am personally quite skeptical. Mullah Omar has had a lot of opportunities to say the things we want him to say. And he hasn't.

BLITZER: Mullah Mohammed Omar, the leader of the Taliban. But isn't he hiding someplace in Pakistan right now? He's not in Afghanistan.

BERGEN: Right. He's hiding in Pakistan. But that doesn't prevent him from saying, you know, "I reject bin Laden and all his works."

BLITZER: He can still be in operational control, if you will.

BERGEN: Also he's made a number of public statements. We hear from him routinely. If they don't take this as an opportunity, I think it will be -- you know, very indicative of where they're really coming from.

BLITZER: As you know, Fran, there are a lot of folks out there who are desperately hoping the Taliban see the light and say, "You know what? It's all over. Let's negotiate a peaceful settlement."

FRAN TOWNSEND, CNN NATIONAL SECURITY ANALYST: That's right, Wolf. But we've got to remember the Taliban were there before al Qaeda really was a strong presence. It was al Qaeda that went to Taliban to make -- forge this alliance, and the Taliban has remained post bin Laden, and so they've got a lot vested. They were this political renegade for us inside Afghanistan. And they continue to be so.

And so, if you want to negotiate with them, they're going to look for -- not that we want to give it to them but they're going to look for some incentive to do that.

And Peter's quite right. Mullah Omar could show leadership. He could issue a statement that would give direction to the Taliban commanders inside Afghanistan that yes, he would support such negotiations. Until he does that I think it's unlikely. I, too, am skeptical. Have you heard these murmurings, as I have, that the Pakistanis, in order to make nice to the U.S., might hand over Mullah Mohammed Omar?

TOWNSEND: It would -- look, they could do themselves as world of good if they would do that. I mean, probably the most important, in addition to Omar, is the Hakani network. And the Hakanis have been responsible for killing U.S. soldiers, and so they really want to do themselves -- on top of my list would frankly be the Hakani.

BLITZER: The president went over to the CIA, to Leon Panetta's operation over there, the outgoing CIA director. He was in the lobby, both in there were stars are (ph). He thanked the CIA for helping him not only in the war on terror but in getting bin Laden. Listen to this.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Today every terrorist in the al Qaeda network should be watching their back, because we're going to review every video, we are going to examine every photo, we're going to read every one of those millions of pages. We're going to pursue every lead. We are going to go wherever it takes us. We're going to finish the job. We are going to defeat al Qaeda.


BLITZER: Millions of pages. Someone said this is like a small library, if you will. That's what you've heard, millions of pages?

BERGEN: I, you know, terabytes of material, and I think a terabyte would be the equivalent of 5 million pages. Now a lot of -- of course, some of this is video material, and we've heard some of it's pornography. And that takes up quite a lot of bandwidth.

However, clearly it is a huge amount of information. In a way this is interesting, because at the same time you got Admiral Mullen saying we should be talking about this operation less. Some of the operational details. You've got the president sort of saying look, we've got all this material. So there is a sort of information aspect of this useful against al Qaeda to get them scared, get them running. You know, what do they know that we -- you know...

BLITZER: The president said, "We are going to finish the job. We are going to defeat al Qaeda." He made that commitment. Let's see what happens next.

Guys, thanks very much for coming in.

In Syria today, security forces fired on anti-government protesters. Human rights activists report at least 34 people killed during demonstrations across the country that followed Friday prayers on the Muslim holy day.

Syria state media denies security forces were involved. It says armed groups are exploiting -- exploiting -- the violence (ph). Officials in Syria (ph).

Thousands of people living along the Mississippi River could be facing a disaster that lasts for weeks. High water may be around until mid-June. We're live in the flood zone. Stand by for this report.

And a former supporter is now heaping huge criticism on President Obama, some of it deliberately inflammatory.


CORNEL WEST, PROFESSOR, PRINCETON UNIVERSITY: No, I don't think he has a fear of black men. I think he has a certain distance from free black men who are willing to speak the truth both about America and about himself.


(COMMERCIAL BREAK) BLITZER: Mississippi River floodwaters may be around a while. Government forecasters are now warning it could be weeks before the high water recedes. The low flood stage along some portions of the river.

CNN's Brian Todd is joining us now live from Mississippi with more.

Brian, I know you just got there a little while ago. What are you seeing?

BRIAN TODD, CNN CORRESPONDENT: Wolf, we're seeing razor-thin margins around here for people between having their homes or farms flooded out and not having them flooded out. We're going to show you what we mean.

In the middle of the cornfield here, this stretch of it is relatively dry. But you come down here and you walk a few feet, and you're in floodwaters. Our photojournalist John Persons (ph) is going to pan down there and show you that some of the crops here are already flooded out. They've got soy, cotton, corn here, all being wiped out.

This in a year when a lot of farmers around here thought they were going to catch a break. They thought they were going to have good crops and maybe be able to recover from some lean years and actually turn a profit. For a lot of them, because of these floodwaters, that's not going to happen right now.

We have to talk about cresting because that's at key stages right now. Near here in Vicksburg, Mississippi, it crested on Thursday, but that crest is expected to hold at least until Saturday at its t op levels.

Now here and in Natchez, Mississippi, south of here, the water levels are still rising. They're going to get to record levels probably tomorrow. But in Vicksburg it's critical. At a key flood stage right now, a record crest that's going to hold until tomorrow.

And as you mentioned, Wolf, what we're told now is that the Mississippi River is going stay out its banks, won't recede to within its flood banks until mid-June. So it's going to be a very slow and painful recovery for the people here, the people in Vicksburg, Mississippi, not far from here, just that way.

And what we're told by authorities in Vicksburg is that they're patrolling the streets night and day now to make sure that abandoned homes and businesses are not looted, are not broken into because, again, the flood waters are going to stay around for several weeks. So it is a very slow and painful process. It is cresting here near Yazoo City, Mississippi, and then Natchez further south. That's going to crest probably tomorrow. Record levels, Wolf. And it's -- you know, no signs of ebbing any time soon.

BLITZER: We'll stay in close touch. Brian, thank you. Brian Todd on the scene for us. A likely GOP presidential candidate taking some heat from conservatives for praising his former boss, the president of the United States. Also another boss, Secretary of State Hillary Clinton. We're going to hear from Jon Huntsman.

And tensions between the U.S. and Israel laid bare. The spokesman for Israel's prime minister will join John King right at the top of the hour.


BLITZER: Another Republican is making the rounds in the key primary state of New Hampshire. As he gets closer to making a decision on a presidential run. We're talking about Jon Huntsman, the former Utah governor, who served as President Obama's ambassador to China.

CNN's John King is joining us now from New Hampshire with more.

You had a chance to speak with the former governor, former ambassador today. How did that go, John?

JOHN KING, CNN CORRESPONDENT: Wolf, what an interesting Republican campaign this is. A month ago he called President Obama boss. Now he's running in the Republican Party that has the Tea Party, that has the birther movement. And yet, listen to this candidate who's not afraid. Not only to praise his former boss, Barack Obama. But also Bill and Hillary Clinton.


KING: I have been at this a while. And I don't remember any Republican running for the nomination who is on record saying the current Democratic president has brilliant analysis of world events and is honored to work with Hillary Clinton. You worry about that? How do you get -- how do you get conservative Republicans to think I want this guy as my guy?

JON HUNTSMAN (R), FORMER UTAH GOVERNOR: Well, occasionally, you write thank-you notes, which I think is, for a lot of people, an important tradition. I also believe in civility. I believe that we ought to have a civil discourse in this country. You're going -- you're not going to agree with people 100 percent of the time. But when they succeed and do things that are good, you can compliment them on it.

I think we need to come together more on the issues that really do matter. I believe in civility. And I believe in complimenting people when they do a good job.


KING: Again, Wolf, he's running for the nomination of America's Conservative Party. And yet, Jon Huntsman says he doesn't like labels. He calls himself a pragmatic problem solver. One break with the president he did make today, making very clear that, if he were president of the United States, he would not have gotten the United States involved in Libya in any way at all, Wolf.

BLITZER: And you've go a full interview with him coming up at the top of the hour. We'll be watching.

John is on the scene for us in New Hampshire. Stand by for his show.

In less than a month CNN will host the New Hampshire -- New Hampshire Republican presidential debeet [SIC] -- debate, I should say, on Monday, June 13. Join us as Republican hopefuls gather to size one another up and debate the serious issues. The New Hampshire Republican presidential debate, Monday night, June 13, only here on CNN.

Dozens of U.S. cities are losing millions of dollars earmarked for fighting terror, even as we learn that al Qaeda is interested in attacking energy supplies. What's going on? Stand by.

And why one former supporter is now an outspoken critic of President Obama and accuses him of being, quote, "a black puppet of Wall Street."


BLITZER: Practical authorities have issued a nationwide warning that al Qaeda is interested in attacking U.S. oil and natural gas targets. At the same time, more than 30 cities have found out they will lose federal funding for anti-terrorism programs.

Let's go to Mary Snow. She's working the story. She has the latest development.

MARY SNOW, CNN CORRESPONDENT: Wolf, the Department of Homeland Security says it has no information of any imminent terrorist threat to the maritime or energy sectors. But along with the FBI it did warn police departments across the U.S. about the intelligence it's gathered. And it comes one day after dozens of cities learned that anti-terror grants are being cut.


SNOW (voice-over): A new threat found in a trove of al Qaeda intelligence inside Osama bin Laden's compound. The Department of Homeland Security says the terror organization continues to have interest in targeting oil tankers and commercial oil infrastructure at sea.

DHS stresses there's no specific or imminent threat. And it's unclear if any further planning has been conducted since mid last year. The news comes one day after 33 U.S. cities learned they are losing federal anti-terrorism grants. Grants used for things like police training and communication systems.

New Orleans is on that list. And a city official questions the logic, saying that the city is one of the busiest ports to the refining and production of domestic energy. DEPUTY MAYOR JERRY SNEED, NEW ORLEANS: It is very, very hard for us to understand how they could do this. Again, I understand that the DHS took about a 20 percent cut. In my view -- and, again, I'm just one person -- why not take a 20 percent cut across the board for all of us instead of whacking out various cities?

SNOW: The Department of Homeland Security says Louisiana gets other grants for port security. And it said money eliminated to cities is the result of Congress' $780 million budget cuts, adding, "The highest risk cities in our country continue to face the most significant threats, and consistent with the recommendations from the 9/11 Commission, the fiscal year 2011 homeland security grants focus the limited resources that were appropriated to mitigating and responding to these evolving threats."

That means New York, Washington, D.C., Los Angeles, and other major cities will keep their grant money. Smaller cities like Buffalo, right across the border from Canada, Salt Lake City and Indianapolis will not.

Republican Congressman Peter King, chairman of the homeland security committee, agrees with the DHS, saying main terror targets need the funds.

REP. PETER KING (R), NEW YORK: I see all the analyses. I see all the threats. And clearly, that money could not be spread all over the country. Otherwise, it serves no purpose. If you give everyone something, you may as well give them nothing.

SNOW: But in New Orleans one official says that's not fair.

SNEED: Immediately I started questioning that, wondering why. How is one city more important than any of the rest of them?


SNOW: Now, even though Congressman King agreed with the way the anti-terror grants were distributed, he did say he feels that more money, not less, should be spent on homeland security. And he says he's concerned about proposed cuts in next year's budget for funding these kinds of grants -- Wolf.

BLITZER: These grants, Mary, how are they used?

SNOW: Primarily to train first responders. But in the case of New Orleans, for example, they get $5.4 million a year in these grants, and the city has used, it says, this money for communication systems after learning after Hurricane Katrina how crucial it was to have first responders being able to communicate. It says that's what it -- that's where it's put its money for this.

BLITZER: Mary Snow in New York for us. Thank you, Mary.

He's a prominent African-American activist, the scholar at Princeton University who once strongly backed President Obama. But now he's lobbing verbal bombshells at the president of the United States. Professor Cornel West tells us why.


BLITZER: Let's take a look at today's "Hot Shots."

Near Lebanon's northern border, a Syrian refugee takes humanitarian potatoes for his family.

In France at the Cannes Film Festival, a journalist uses her scarf to shield her laptop screen from the sun.

In Ireland, the queen's helicopter lands near the Rock of Cashel as she tours the country.

And in Brazil, look at this: a surfer rides a wave, hoping to qualify for a tournament.

"Hot Shots," pictures come in from around the world.

Blistering criticism of President Obama on issues of race and class, all coming from one prominent African-American activist and scholar who was once one of the president's most vocal supporters. CNN's Lisa Sylvester's here. She's got the details.

We're talking about Professor Cornel West of Princeton University. What's he saying?

LISA SYLVESTER, CNN CORRESPONDENT: Well, Wolf, you know, as you well know, African-Americans overwhelmingly support President Obama. There's no question about it: 95 percent voting for him. But there are some African-Americans who believe that President Obama hasn't done enough for the poor and working class, and activist Cornel West had a stinging critique of the president.


SYLVESTER (voice-over): January 2008 in South Carolina. Democratic candidates prepare to debate. Princeton University Professor Cornel West strongly endorsed then-Senator Barack Obama.

WEST: I think he's got the vision. He's got the newness. He's got the freshness.

SYLVESTER: Fast-forward to this week. West is now strongly criticizing President Obama, calling him, quote, "a black puppet" and "black mascot of Wall Street."

WEST: Well, when I look at the mass unemployment, mass underemployment, mass incarceration, especially in the black community, but I'm talking about poor and working people across the board, it seems they have a very low priority. It seems to be an afterthought. That's what I mean when I say one becomes a puppet for corporate plutocrats and a mascot for Wall Street oligarchs.

SYLVESTER: West tells, quote, "I think my dear brother, Barack Obama, has a certain fear of black men. It's understandable. As a young brother who grows up in a white context, brilliant African father, he's always had to fear being a white man with black skin."

I asked West what he meant.

WEST: I don't think he has a fear of black men. I think he has a certain distance from free black men who are willing to speak the truth both about America and about himself.

SYLVESTER: West's comments are outright inflammatory. But he admits he has a personal issue with Mr. Obama. He says he campaigned for Mr. Obama but never got a thanks and couldn't get tickets to the inauguration. But West says he doesn't want that to distract from a larger message, that black people are being left behind even under a black president.

The issue is there, says Politico's Carrie Budoff Brown.

CARRIER BUDOFF BROWN, POLITICO: That, I think, scratches at a very real disappointment that exists right now in the liberal base, the base of the Democratic Party, towards the president, that he is not or has not been the strong progressive that they imagined he would be.

SYLVESTER: President Obama, while campaigning on a message of change, has surrounded himself with old Washington hands. And the unemployment rate for African-Americans is 16 percent.

We asked the White House to comment, but they declined. But Obama's supporters say sure, it's easy for outsiders to criticize the president. Roland Martin says the president isn't a professor or a social activist, and he does have multiple constituencies.

ROLAND MARTIN, CNN POLITICAL ANALYST: Is he black enough? Is he Christian enough? Is he -- you know, what is it? So to me that is a waste of time. But I think what also has to be recognized is that you're dealing with somebody who is a politician, who has a much different role and responsibility.


SYLVESTER: Now, administration supporters say the president hasn't just ignored the plight of the poor and the working families. And they highlight some of the accomplishments of the administration: from reforming Wall Street to the health-care law to the Ledbetter Act that gave equal pay to men and women, Wolf.

BLITZER: Good report. This controversy will continue. Lisa, thanks very much.

That's it for me. Thanks very much for watching. I'm Wolf Blitzer in THE SITUATION ROOM.

"JOHN KING USA" starts right now.