Return to Transcripts main page


Syria's Bloody Day of Prayer; Stocks Tumble, Add to August Losses; Checking Rick Perry's Facts; Flash Mob Crime on the Rise; Grandma Fights Eviction; The Richest Members of Congress

Aired August 19, 2011 - 17:00   ET


WOLF BLITZER, HOST: Brooke, thanks very much.

Happening now, Syria's bloody day of prayer and protest -- the Assad regime shows no sign of backing down.

President Obama says the Syrian leader must go, but where?

Also this hour, some mainstream Republicans venting their fears about the presidential candidate, Rick Perry. After a string of controversial comments, one former Bush administration official is calling the Texas governor -- and I'm quoting him now -- "an idiot."

And it keeps happening -- mobs of young people suddenly show up and steal.

So what's behind this frightening new teen trend?

I'm Wolf Blitzer.


But we begin in Syria -- another mass outpouring of anti- government anger on this Friday, the weekly day of prayer, unleashing a new round of protests and bloodshed.


BLITZER: At least 23 more deaths reported in Syria a day after President Obama and several U.S. allies finally called on President Bashar al-Assad to step aside.

CNN's Arwa Damon is covering all the unrest from Beirut, because Syria is restricting journalists' access to that country. Another Friday, a day of prayer, but it was a day of brutal violence as well -- Arwa.


And it would most certainly seem that the Syrian government is not lets up in its efforts to try to use violence to quell these voices of dissent.

Some pretty dramatic footage emerging from Damascus, in Nidan (ph) neighborhood there. It's in the center of the city. And in the clip that emerged on YouTube -- we could not independently verify its authenticity, of course -- but it just shows you how intense the gunfire was. And you can hear the fear in the people's voices on the recording.

Now, we spoke to an eyewitness, a person who says he was at that demonstration. And just as they were leaving the mosque, he says security forces began firing on them from all sides. People scattered into the alleyways. Some of them stood their ground and tried to use rocks to keep the security forces away.

In the southern province Dara and in a number of towns there, again, the very same scenario unfolded. And there, we were hearing that the people who were wounded were being treated in these secret clinics because they're too afraid to go to hospitals because the security forces, they fear, will pick them up from the hospitals themselves.

And, even though all of this unfolded during the day, at night, Wolf, nighttime demonstrations still going on. People are still taking to the streets. We just received an update from one of the activist networks again reporting gunfire. Loud explosions being heard in areas like Homs, in Damascus itself and in Dara.

BLITZER: Arwa, the -- the whole day after the president of the United States, the leaders of several European countries, Canada, they came out and said that Bashar al-Assad must step aside, he must go.

Is there any indication at all in Syria, in Damascus, that he's listening to them, that he's ready to -- to go?

DAMON: Well, he's probably listening, Wolf. But I highly doubt that he's paying any attention to it. You also have to remember that Russia came out and said that, no, he should not go, that he should be given enough time to try to implement these reforms.

So the government is aware that the international community is still fairly divided over this issue. And for it to be able to put enough pressure on him, where that would even be something that, perhaps, he and his government would begin to contemplate, they really have to try to build up a much stronger international consensus.

Now, I was speaking to a number of activists about these declarations that the president should go. And they were saying that it actually helped boost their morale. And they're saying that it also made them realize, in listening to the debate, that the international community wasn't going to come in militarily, because this certainly, they say, is not what they want to see take place. They do appreciate the growing pressure, but they also say, at the end of the day, that they are the ones that are going to be bringing down the Syrian government.

And that's why, Wolf, they're actually planning on going out and demonstrating even more and in even greater numbers.

BLITZER: These are very courageous people, indeed. Arwa Damon in Beirut for us.

And if you want to check out what I wrote on my blog today, I write about Syria and President Bashir Assad on this day after the president of the United States said he must go.

Here in the United States, a painful end to a painful week for the U.S. stock markets. Dow Jones Industrials closing down more than 172 points after a volatile day and a late sell-off. All three major indices way, way down for the month. The Dow has lost more than 10 percent of its value in August. And the S&P 500 has lost 13 percent of its value. The NASDAQ has tumbled 15 percent.

CNN's Alison Kosik is over at the New York Stock Exchange -- I think a lot of people are happy this week, Alison. It is finally over with.


BLITZER: It was a rough, rough week.

KOSIK: Everybody is a exhausted here on Wall Street, Wolf. And, you know, you saw all that selling happen in the final hour of trading today. You know, investors, clearly, they don't want to hold their stocks through the weekend. You know, everyone is worried about a negative surprise, because this has really been a market that's been driven by every news headline that -- that's came out. You know, you see the market moves based on that.

We didn't necessarily see that today. The trade today was more of an emotional reaction to the fear and uncertainty in the economy. Any gains that happen -- and we did see some earlier today -- they really aren't sticking. And, you know what traders are saying?

They're saying there's nothing out there to support the market. One trader telling me, Wolf, give me a reason to buy. And he says I just don't see any positive reason to do so -- Wolf.

BLITZER: So what are we bracing for for next week.

What are the traders there saying?

KOSIK: Well, the second quarter -- the second estimate of second quarter GDP comes out on Friday. Now, last month's estimate showed very slow growth in the U.S., just 1.3 percent. And there are a lot of signs showing that growth is slowing, not expanding.

So what the market does is it looks at this number very closely, especially after first quarter GDP was revised even lower, to .4 percent. That's almost no growth in this country.

The other big event that investors are going to be keeping their eye on, Fed Chairman Ben Bernanke, he heads to Jackson Hole, Wyoming for an annual conference of central bankers. Actually, this is closed to the media, but we're going to be really listening to what he has to say, because at last year's conference, he hinted at a new round of federal stimulus. And that caused a nine month rally in the stock market.

So the big question this year, of course, you know, are we going to see a repeat performance?

Will he hint at any stimulus measures?

Will he hint at anything that the Fed can do at this point to come to the rescue again, to come to the rescue of the economy -- Wolf.

BLITZER: I'm sure Governor Rick Perry will be watching what Ben Bernanke has to stay very, very closely.

KOSIK: I'm sure.

BLITZER: All right, Alison.

Thanks very much.

And for more on the economy, please be sure to watch our Saturday edition of THE SITUATION ROOM. You'll see my in depth interview with President Obama, the full interview. He talks at length about jobs, the pressure on his reelection bid. He warns the Texas governor, Rick Perry, to watch what he says. Tomorrow night, 6:00 p.m. Eastern -- 6:00 p.m. Eastern, only here on CNN.

President Obama isn't the only person raising red flags about Rick Perry's comments. Less than a week after the Texas governor formally announced his presidential bid, some mainstream Republicans are venting their concerns about him in public, even more so in private. Today, one former Bush administration pounced -- pounced on Perry's suggestion that the Federal Reserve chairman would be committing treason if he pumped more money into the economy and help President Obama get reelected.

Bruce Bartlett spoke on CNN's "AMERICAN MORNING".


BRUCE BARTLETT, FORMER TREASURY DEPARTMENT OFFICIAL: Rick Perry is an idiot and -- and I don't think anybody would disagree with that. But the -- the thing is that the -- the politics of the Fed itself are really a more serious problem.


BLITZER: All right. Let's bring in CNN's Athena Jones.

She's been looking into Perry's controversial statements, including some statements about global -- global warming causing a bit of an uproar out there -- Athena, what are you finding out?

ATHENA JONES, CNN CORRESPONDENT: Well, that's right, Wolf. The Texas governor, Rick Perry, has been making news nearly every day since he entered the race. So we thought today we'd take a closer look at one of his latest statements. This time, it's about the cost of efforts to slow down climate change.


JONES (voice-over): Rick Perry is not afraid to say what's on his mind. He's bashed Federal Reserve Chairman Ben Bernanke.

GOV. RICK PERRY (R), TEXAS: Printing more money to play politics at this particular time in American history is almost treacherous -- or treasonous.

JONES: He's also criticized steps to reduce global warming.

PERRY: The cost to the country and to the world of implementing these -- these anti-Corbin programs is in the billions, if not trillions of dollars, at the end of the -- of the day.

JONES: Perry said global warming was a theory that hasn't been proven. His doubts about global warming aren't new. In his book, "Fed Up," the governor called the science of climate change "a contrived, phony mess."

And he isn't alone. According to a Yale Poll, the percentage of Americans who believe the earth is getting warmer has fallen since 2008.

But leaving aside arguments about whether global warming exists -- and the majority of experts believe it does -- how true is Perry's statement about the cost to the nation of efforts to combat it?

Proponents of measures to reduce greenhouse gases say he has it wrong.

DANIEL LASHOF, NATURAL RESOURCES DEFENSE COUNCIL: The reality I saw, e should be investing millions of dollars in reducing global warming pollution, but we're not.

JONES: In fact, the impact on federal taxpayers is minimal. Lawmakers have not passed national comprehensive climate change legislation. The Obama administration has set new fuel-efficiency standards for vehicles, but automakers have years to comply. Companies may eventually invest billions of dollars developing technology to meet new standards and households may spend more on energy-efficient cars or see higher electric bills as plants cut emissions.

But some argue the higher costs are worth it.

ADELE MORRIS, BROOKINGS INSTITUTION: Suppose we are spending billions on anti-carbon approaches, that doesn't mean it's a bad idea. If, indeed, the science is compelling, as most scientists believe, then billions might be a good investment.

(END VIDEO TAPE) JONES: Now, Governor Perry's doubts about global warming put him at odds with GOP rivals like Mitt Romney and Jon Huntsman, who both believe the Earth is getting warmer.

I reached out to the Perry campaign to try to find out what the governor based his remarks about global warming and its costs on, but I didn't hear back -- Wolf.

BLITZER: All right, Athena.

If you get anything, let us know.

We'll come back to you.

Athena Jones reporting.

We're going to talk more about Rick Perry in our Strategy Session. That's coming up later this hr. We'll discuss whether Democrats would love to see him face President Obama next fall. Stand by for that.

Plus, local governments are trying to crack down on criminal flash mobs. We're going to show you what they're up against. And an 82-year-old grandma becomes the face of foreclosure. She says she's been treated unfairly and she's now fighting back.


BLITZER: Law enforcement officials here in Washington are reviewing this surveillance video from last night. Reports from the scene say a flash mob quickly gathered to rob a convenience store.

Our Mary Snow has been looking into what's become a growing problem for law enforcement across the country -- Mary, what are you learning?

MARY SNOW, CNN CORRESPONDENT: Well, Wolf, these flash mob crimes that are surfacing are fairly new. And it's unclear just what's causing them and whether there's a copycat effect as they gain more attention. But they are posing a challenge to law enforcement.

Now, the DC incident you just mentioned comes on the heels of a flash mob in Germantown, Maryland last weekend that gained a lot of attention. More than two dozen young people went into a convenience store around 1:30 in the morning and started grabbing things, stealing them off the shelves.

In this case, police say they didn't find evidence these young people used social media to plan this, because many of them had just gotten off a bus, returning from a county fair.

But in other cities, including Philadelphia, there has been organizing on social media that's led to violence.

Now, Philadelphia, of course, gained a lot of attention with its curfew on young people. But some call that curfew ineffective. One professor specializing in youth crimes say police are in uncharted territory. And he says not helping matters is the fact that there's a generational gap.


PROF. SEAN VARANO, ROGER WILLIAMS UNIVERSITY: The police can close that gap, but the reality is a lot of police departments are laying off, they're letting officers go. And the reality is, the people that are going to be let go will probably be younger officers who might be more inclined to engage in social media and have a better understanding of social media.

So I think there's an internal problem of police developing the internal capacity to monitor and to respond to social media.


SNOW: And to try to get an understanding of the problem, the National Retail Federation surveyed 106 retailers. It found that one out of 10 reported being victims of flash mob tactics -- Wolf.

BLITZER: A very disturbing trend, unfortunately.

Mary, thank you.

Now to the enormous foreclosure problem in the United States. Sadly, Americans get booted from their homes every, every day.

But what if -- what if authorities tried to evict a feisty 82- year-old woman who refused to budge?

CNN national correspondent, Susan Candiotti, is following this dramatic showdown in New York.


UNIDENTIFIED PROTESTERS: We want justice for our people!

UNIDENTIFIED MALE: Honk your horn.

SUSAN CANDIOTTI, CNN CORRESPONDENT (voice-over): Early Friday, supporters rallied outside the home of 82 -year-old Mary Ward. A marshal was due any minute to evict her from the only home she's known since 1969.

MARY LEE WARD, FIGHTING EVICTION: Well, it means everything because I have put everything into this house all these years.

CANDIOTTI: Ward ran into trouble in the mid-1990s when she refinanced in order to raise cash to fight for custody of her great granddaughter. She was hoping to cash out $10,000.

WARD: I turned them and I turned and looked at the check when they handed it to me, I almost passed out -- $1,476.51.

CANDIOTTI: Far less than the $10,000 she expected. She still has a copy of that check.

WARD: And that very next day, I went to the district attorney's office because I didn't know what to do.

CANDIOTTI: The lender turned out to be shady. But Ward could not have the loan rescinded and the house fell into foreclosure. After a long legal battle, her home was sold at an auction three years ago. The new owner wants her out.

WARD: I have no intention of leaving. Now, if they break in and take me, I won't resist.

CANDIOTTI: CNN was inside Ward's home mid-morning, when her local assemblywoman interceded, setting up a meeting with Ward and the new owner.

ANNETTE ROBINSON, NEW YORK STATE ASSEMBLY: The marshal will not be taking any action today.

CANDIOTTI: After the closed door meeting, CNN caught up exclusively with the owner. He told us he's considering a proposal from Ward's lawyers to hand the property over to a non-profit that would allow Ward to stay in her home.

SHAMEEM CHOWDHURY, BUILDING OWNER: And we tried to work out together as much as we could.

UNIDENTIFIED MALE: And you couldn't come to a -- a resolution upstairs?

Why -- why not?

Why was that not possible?

CHOWDHURY: I did not get a chance to talk to her. This is the first day I'm talking to her, the first time.

UNIDENTIFIED MALE: This is the first day?


UNIDENTIFIED MALE: Do you think you'll be able to come to (INAUDIBLE)...

CHOWDHURY: I hope so.

UNIDENTIFIED MALE: Do you have an...


UNIDENTIFIED MALE: -- objection to letting her stay in her house?

She said she's not (INAUDIBLE).

CHOWDHURY: I will talk to her again, OK? Thank you.

CANDIOTTI: Ward, the proud granddaughter of a slave, returned home from the meeting to cheers. She's safe from eviction for a few more weeks. But after that, her fate depends on whether her lawyers can strike a deal with the owner.

WARD: Yes, it will be hard. But justice is going to be done and soon. Dignity for all. They're trying to take away our dignity, but they'll never take away my dignity.


CANDIOTTI: And this is the walkup where that grandmother lives. She's currently living in a building behind all this fencing and chicken wire. And she has a lot of supporters.

Politicians say that most often, African-American women are the targets of predatory lending. We reached out to the company that had gone out of business that was involved, allegedly, in this deal. However, CNNMoney could not reach them. They are said to be back in business -- Wolf.

BLITZER: Susan Candiotti.

All right, good luck.

We'll see what happens.

You'll keep us up to speed.

So much is the richest member of Congress worth?

We're going to show you a new list of the wealthiest lawmakers here in Washington.

And we'll break it down by party. And after 18 years in prison, the men dubbed the Memphis Three, they are now free. We're going to tell you about the dramatic events that led to their release.


BLITZER: I'm Wolf Blitzer.

Here are some stories we're working on for our next hour.

After months of near stalemate in the civil war in Libya, rebel troops right now making dramatic advances on the capital, Tripoli.

Also, thousands of Americans are being declared dead by the Social Security Administration due to clerical errors.

And the latest fallout from Christine O'Donnell's walking out on her interview with CNN's Piers Morgan.

You're in THE SITUATION ROOM. Look at these members of Congress. They're among the wealthiest lawmakers in Washington right now. That may or may not help them politically at a time when so many Americans are hurting. But financially, they're in great shape. And one of them is suddenly a lot wealthier than he was before.

Our Congressional correspondent, Kate Bolduan, has been looking at a new ranking of the richest members of Congress -- Kate, what are you finding out?


It's a pretty interesting list. "Roll Call" has put out its annual survey of the 50 richest members of Congress and here you can see the top five. So let's run through them for you.

At number five, you have Senator Mark Warner, the Democratic senator from Virginia. His minimum net worth, $76 million. Warner's wealth comes largely from the cell phone business. He was an early investor in the industry and co-founded the company that eventually became Nextel.

Now moving on to number four, Senator Jay Rockefeller. His minimum net worth, almost $82 million. And for him, it's all in the name for this member on the list, as you can probably guess, coming from the famed family, Rockefeller is a descendant of oil tycoon, John Rockefeller.

Number three, Senator John Kerry, the Democratic senator from Massachusetts. His minimum net worth, $193 million. Pretty impressive. This Democrat -- this Massachusetts Democrat, he is, of course, the chair of the Foreign Relations Committee and most recently named a member of the Special Committee on Deficit Reduction. Kerry can attribute much of his wealth to his wife, married in 1995 to Theresa Heinz Kerry of the -- you can guess it -- the ketchup fortune, of course.

Then for number two, we move over to California. Congressman -- let's get this for you. We'll find it. Congressman Daryl Issa, the Republican congressman from California, his minimum net worth, $220 million. He's the powerful Republican chair of the House Oversight and Government Reform Committee. Issa built his fortune on the car alarm company that he founded in the '90s. The company's products include the well-known Viper alarm system.

And then topping out the list at number one, the wealthiest member of Congress, Congressman Michael McCall. His minimum network is $294 million. Pretty impressive. It appears -- it appears a majority of his wealth actually also comes from his better half. McCall is married to the doctor of the fonder of Clear Channel Communications, the media and entertainment company. McCall was actually number five on last year's list. And "Roll Call" attributes his big jump to some transfer of wealth from his wife's family.

So here you have it. These are the top five wealthiest members of Congress at this very moment. But we also broke down this list of the top 50 and found that Republicans outnumbered Democrats on the list -- 31 of the top 50 members. Men out -- still continue to outnumber women on the list, 39 to 11. And House members slightly outnumber senators on the list, 29 to 21. But, of course, considering there are more than four times the number of House members than senators, the senators are doing pretty well, I would say -- Wolf.

BLITZER: Kate Bolduan, thanks very, very much.

As my dad used to say, rich or poor, it's good to have money. And these guys have a lot of money.

All right, we're going to follow what's going on and some other stories when we come back, including three men convicted of murder in a famous case. They go free almost two decades later. We're going to tell you why.

And the Social Security Administration is killing off Americans -- on paper, at least. It's a records nightmare happening to thousands of people.

We're going to tell you what's going on and what you can do about it.


BLITZER: Three men known as the West Memphis Three are free after 18 years in prison.

Mary Snow is monitoring that and the other top stories in THE SITUATION ROOM right now.

What do you have -- Mary?

SNOW: Wolf, the three men walked out of the prison a short time ago, to the cheers of a supportive crowd. Two had been serving life sentences while the third was sentenced to death after being convicted of killing three boys in West Memphis, Arkansas in 1993. The case drew national attention with many people believing they were innocent. Legal observers say they were on course to win the right to new trials this year. Instead, prosecutors agreed to a plea deal that resulted in today's release. We'll have much more on this story at the top of the hour.

The families of the victims of last month's mass shootings in Norway are visiting the scene of the attack. 69 people died on an island where young people were gathered for a summer camp. Family members are being show the location where each victim was found after the attack.

Federal authorities have arrested two Pennsylvania men charged with making threats to former Alaska governor, Sarah Palin, her family, and a lawyer. The men are identified as 47-year-old Shawn Christy and his son, 22-year-old Craig Christy. They're accused of calling Palin's attorney more than 400 times this month and leaving profanity-laced messages with threats of sexual assault, kidnapping, and death.

And members of the Georgetown University basketball team and members of a Chinese team are attempting to mend fences after that ugly brawl ended a Goodwill game in Beijing this week. According to a statement from Georgetown, Coach John Thompson III and two players met with members of the Chinese team. Reuters is quoting a top Chinese Foreign Ministry official as saying, "The skies have cleared". Not sure about the bruises, though, Wolf. We'll see in the rematch this weekend.

BLITZER: Let's hope the skies really have cleared. All right, Mary. Thank you.

In the Republican presidential race, Jon Huntsman is trying to draw sharper lines between himself and some of his more conservative rivals, like the Texas Governor, Rick Perry. But, the former U.S. Ambassador to China also has some tough comments for Congress and even for his former boss, President Obama. CNN's Piers Morgan asked Huntsman about the showdown over raising the debt limit and the Tea Party's refusal to compromise.


JON HUNTSMAN, FORMER UTAH GOVERNOR: I thought it was a height of irresponsibility -- the height of irresponsibility -- where 25 percent of the world's GDP, the United States of America, that has never defaulted before -- just let it go over a cliff. You can imagine what the marketplace would have done in response. The marketplace is trashing everybody right now. Assets are under water. 401(k)s, retirement -- you can only imagine what this country would look like today if we had defaulted. It was complete lunacy.

PIERS MORGAN, CNN HOST: Do you have sympathy for Barack Obama who's been a friend of yours, personally? Do you have sympathy for him, in the position he found himself in, where you have such an intransigent part of the Republican Party really just refusing to compromise?

HUNTSMAN: He appointed me, and I stood up and took the appointment to serve my country. I love this country. You serve her. But, in terms of any personal relationship, there's not a personal relationship. You work for your president when you are asked to serve. He had 2 1/2 years to get this country right. He had 2 1/2 years to do the most important thing demanded by the American people. Fix the economy, create an environment that is conducive to job growth and he's failed us. He's a good man, he's earnest, but he has failed us on the most important issue of our day.


BLITZER: I there'll be more of the Huntsman interview on "Piers Morgan Tonight". That will air Monday night, nine pm, Eastern. Monday night, the interview with Jon Huntsman.

This programming note, I'll be speaking with Piers here in "The Situation Room". That's coming up. We'll talk about his now-famous interview with the former U.S. Senate candidate, Christine O'Donnell. She's making some harsh accusations about him, explaining why she walked out of her interview with Piers. Piers will be here to respond. Stand by for that.

Polls now show many Americans are simply fed up with their elected officials and many lawmakers are experiencing that firsthand right now. Our Lisa Sylvester gives us a taste of the anger that's out there. Lisa?

LISA SYLVESTER, CNN CORRESPONDENT: Wolf, this has been a brutal month for the economy. Unemployment is above nine percent. People have watched their retirement accounts plummet in value. There are likely program cuts on the horizon. And constituents want their lawmakers to know they are mad.


SYLVESTER: They are frustrated.

UNIDENTIFIED FEMALE: I want to see you working together. That means Democrats, Republicans, that means two parties, opposites, you may call them.

SYLVESTER: They are fuming.

UNIDENTIFIED MALE: how can you stand here in front of all of us and take a pledge not to raise taxes?

SYLVESTER: And they are angry.


SYLVESTER: Across the country, people are mad. Mad at politicians for ignoring them and mad at politicians for ignoring each other. Members of Congress, back in their home districts, are catching hell over jobs, concerns about Social Security cuts, and the economy. Representative Fred Upton of Michigan had his town meeting repeatedly interrupted.

In Representative Lou Barletta's district in Pennsylvania, angry constituents parked themselves outside of his office after, according to them, they couldn't get a meeting with him.

UNIDENTIFIED MALE: Lou, where's the jobs? Lou, where's the jobs?

SYLVESTER: Among the protesters, Steve Simco (ph).

STEVE SIMCO (ph): I have a degree in electronic engineering. It's an associate's degree, but it's still a college degree. I cannot find a job. I'm at a loss that our government and our officials are not standing up for them like we had asked.

BARAK OBAMA, UNITED STATES PRESIDENT: This is a town hall meeting. SYLVESTER: It's not just congressional lawmakers getting hit with criticism. President Obama is not winning any popularity contests on talk radio host Neal Boortz's show.

NEAL BOORTZ, NEAL BOORTZ RADIO SHOW HOST: He clearly is grasping at straws. I mean, he says he's going to have a new plan after he gets back from Martha's Vineyard.

UNIDENTIFIED MALE: Yes, but only after he spends a couple of days - a week or so - in Martha's Vineyard. Then, he'll have his plan for jobs.

SYLVESTER: There's a lot of anger and a lot of fear.

UNIDENTIFIED FEMALE: I think people are really fearful about the economy. And that fear is driving a lot of anger at Washington. They're worried about the future of middle class jobs and they're worried about their retirement. And they don't see anyone in Washington taking the future of the middle class and what keeps them up at night seriously.

SYLVESTER: If you ask Americans what they really think of their elected leaders? A recent CNN ORC poll shows three out of four think they act like spoiled children.


SYLVESTER: That same poll shows President Obama's approval rating is 45 percent. Congress's overall approval rating is just 14 percent. That is the lowest in history. Wolf?

BLITZER: Lisa, thank you.

A dramatic turn in Libya's civil war. We're getting a live report coming in from the frontlines with rebel troops advancing on a key oil-refining city. Stand by.

We're also taking you to the scene of a shocking suicide attack on a crowded Mosque in Pakistan.


BLITZER: An explosion ripped through Friday prayers in Pakistan today. The suicide bomber striking in the courtyard of a Mosque. It happened in the Northwestern tribal region. In the words of one witness, dead bodies were everywhere. CNN's Reza Sayah is in Islamabad.

REZA SAYAH, CNN INTERNATIONAL CORRESPONDENT: Wolf, police say a teenage suicide bomber carried out this attack. They say he was no more than 16, 17 years old. That he walked into the courtyard of this Mosque and blew himself up. This is one of those attacks that drives home the fact that, for some militant groups here, no target is off limits, not even a Mosque where you have hundreds of innocent worshippers. More than 40 people killed in this blast. More than 100 injured. The video of the aftermath showed an awful scene -- debris, shoes, slippers strewn everywhere. Bloodied victims staggering away from the scene, looking for help. At a nearby hospital, there were more victims, sometimes sharing one hospital bed because there simply wasn't enough room to treat everyone.

No group has claimed responsibility for this attack. But, two important things to look at, here. The timing and the location of this attack. The attack happened right in the middle of Friday prayers, right in the middle of the Muslim holy month of Ramadan, a time when Mosques are often packed. And then, you look at the location, the district of Khyber, just west of Peshawar, right along the Afghan border. A region that has been hit hard by militancy, not just because of fighting going on across the border in Afghanistan, but because of the presence of the Pakistani Taliban in the area. Wolf?

UNIDENTIFIED MALE: This is CNN breaking news.

BLITZER: All right, it's happening in Libya right now. Let's bring in our Pentagon correspondent, Barbara Starr. Barbara, we're getting new information on what's happening potentially towards the Libyan leader Muammar Gadhafi.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: That's right, Wolf. U.S. officials are now telling CNN they believe it is very possible that Muammar Gadhafi is making preparations for what they call a last stand in Libya. Of course, everyone is watching around the clock to see if he finally packs up and goes. But U.S. Officials are telling us they believe he might be preparing for a lasts stand from his last stronghold which, of course, is Tripoli. The last major area loyal to him where he has significant numbers of fighters.

What would a last stand look like? That's the problem, U.S. officials say. They don't know what he's up to. Could he fire more SCUD missiles? Of course, on Sunday, he fired one. Would he launch an all-out military assault on civilians in Tripoli? Does he still even have enough fighters loyal to him -- including the African mercenaries that he's trying to pay -- to do his bidding? But, right now they are watching two things. Any notion that he might be preparing to go soon. They don't have evidence of that, they tell us. They're worry now is this possibility that he's making preparations for what they're calling a last stand. Wolf?

BLITZER: A huge development, potentially, in Libya, Barbara. Thanks very much. We're going to have a lot more on this story coming up right at the top of the hour. Stand by for that. We're watching Libya. We'll go there live.

Meanwhile, some Republicans are wondering openly if Republican presidential candidate Rick Perry is too risky to run against President Obama. We're going to talk about that in today's strategy session. We'll also discuss new criticism of President Obama's healthcare law. One Republican candidate says he would be dead if it had been in effect when he was diagnosed with cancer. (COMMERCIAL BREAK)

BLITZER: Now, let's get right to our strategy session. Joining us right now are CNN Political Contributor, Roland Martin, and Republican Strategist and Publisher of, Rich Galen. Guys, thanks very much for coming in. Let's talk first about Rick Perry for a moment. Bruce Bartlett who worked in the first Bush administration, at the Treasury Department. Earlier, worked for the Reagan administration. He reacted to the Governor Perry's comments about the chairman of the Federal Reserve, Ben Bernanke, potentially being treasonous if he's going to print more money. This is what Bruce Bartlett said on CNN's "American Morning".


BRUCE BARTLETT, FORMER TREASURY OFFICIAL: Rick Perry is an idiot and I don't think anybody would disagree with that.


BLITZER: Anybody disagree with that?

RICH GALEN, PUBLISHER OF MULLINGS.COM: I do disagree with that. I mean, we all know there's no love lost between the Bushies and Perry's folks.

BLITZER: Why is that?

GALEN: Well, it goes - there's a lot of reasons, but it goes -- you know, all the way back when Reagan was president and H.W. was vice president. I worked for Lee Atwater, we used to say the lowest ranking person on the Reagan staff thought they outranked the vice president of the United States and they did. And that's just the nature of the beast. Perry was lieutenant governor when Bush was governor. The Bush people kind of drove the deal. Just a bunch of type-a Texans.

BLITZER: Do you get a sense that Democrats would love for the President to run against Rick Perry in a general election?

ROLAND MARTIN, CNN POLITICAL ANALYST: Oh, absolutely. I think if they had their choice, Congresswoman Michelle Bachmann is number one, and Governor Rick Perry is number two. Because the belief is that both of them absolutely cannot appeal to those independent voters. When Governor Perry makes these kinds of comments, the problem is, he does not come across as a strong economic person. Because, at the end of the day, the Federal Reserve plays a critical role. And so, when you make that kind of comment, it makes no sense whatsoever. And so, he should be mindful of independent voters, because that's who will determine the next presidency.

BLITZER: Because he makes a good point. If you read that Politico story today, even some moderate Republicans, Peter King of Long Island, some congressmen from suburban Philadelphia, Republicans from suburban Chicago -- they're saying maybe this guy is too radical, if you will, to appeal to independent moderate Republican voters. GALEN: He's been in the race for 12 minutes. And he's got his economics training, by the way, at Texas A&M.

MARTIN: Actually, he got it in Austin, at the University of Texas. Nice try, Rich.

GALEN: But he's been in the race for less than a week. And for somehow suddenly everybody to be thinking he's downstairs rehearsing his acceptance speech is just silly. Either he'll figure out what it takes to run for president or, like a lot of people who have been very popular in statewide races, they'll find that the national stage is a little too broad.

BLITZER: Herman Cain, who is another presidential candidate --

GALEN: Should we do candidate - I'm sorry, go ahead.

BLITZER: He speaks very highly of you.

He said this about President Obama and the Democrats' healthcare reform law. It's now the law of the land. Listen to what Herman Cain said.


HERMAN CAIN, REPUBLICAN PRESIDENTIAL CANDIDATE: If Obamacare had been fully implemented when I caught cancer, I would be dead, and here's why. I'd be dead and here's why. I was able to go to the doctors that I wanted to go to. As fast as they could do the tests. I didn't have to wait six months like you do in other countries in order to get a CT scan. And sometimes people die before they get the CT scan.


BLITZER: All right. What do you think?

MARTIN: You know what? There's a lot of money in President Obama's healthcare plan, when it comes to mental issues. He might want to take advantage of that. That comment makes no sense whatsoever.

BLITZER: Are you suggesting that maybe -- in some other countries where they have socialized medicine - you do have to wait to get a CT scan or MRI.

MARTIN: Right, in other countries. This is what happens when you actually don't read. And so, he has shown, on the campaign trail, his failure to read many things, whether it's Afghanistan policy, but also, the health plan.

GALEN: Well, look, if every presidential candidate, including the current president, had to defend over hyperbolic statement he made on the campaign trail, we'd never have a president.

MARTIN: Well, he makes a lot, though. GALEN: Well, so did your guy.

MARTIN: Who is my guy? Actually makes sense. He won.

GALEN: Winning doesn't mean you made sense, it means -

MARTIN: Mine actually makes sense, though.

GALEN: It's harder to be president than it was being a candidate. But, to Herman Cain - and actually, to Roland's point -- we have such a vast healthcare system that it's unfair to compare, you know, U.K. or even Canada with the -- what's available here. And frankly, there are a lot of healthcare plans that make you go to the doctor they want you to go to also.

MARTIN: Right now?


MARTIN: Right now? The current system that he's proud of, absolutely.

BLITZER: Because I'm sure he had a good healthcare plan. He was an executive at Godfather's pizza, so I'm sure he had an excellent healthcare plan.

MARTIN: I'm sure his healthcare plan was a lot better than the employees, absolutely.

GALEN: Oh, I don't know that.

MARTIN: I'll guarantee no CEO -

BLITZER: President Obama and Democrats always said if you like your current healthcare plan, you're going to be able to keep your current healthcare plan, you're not going to have to change it once the new law goes into effect.

GALEN: Speaking of people that may want to look into the mental health business, you think that's true?

BLITZER: I'm asking you the questions.

GALEN: No, I don't - no.

BLITZER: Why do you think it's not true?

GALEN: Because once you sit -- I am not an economist, but I do know this -- once you sit down the road towards single-payer --

BLITZER: But it's not single-payer.

GALEN: It will be once we set down that road. That's where it's going to end.

MARTIN: Wow, I'm sure unions right now and progressives are happy to hear Rich call it single-payer when it's actually not single payer.

GALEN: It will be.

MARTIN: Oh, OK, got you. Let me know when that happens.

GALEN: I will.

BLITZER: It will be if the Democrats have a lop sided majority in the House and Senate and there's a Democratic president and enough to beat a filibuster, you think it's going to happen?

GALEN: I think - well, over time, that's what it's going to end up being.

BLITZER: Will the Democrats have that kind of majority?

GALEN: Even if they don't, it's just going to end up that way.

MARTIN: Not going to be -

GALEN: They'll do it by fiat.

MARTIN: Rick, seriously, it's not going to be single payer. So, the reality is, that's not what was passed, that's not the case. And so, wishful thinking, wake up, but it's not going to happen.

GALEN: All right, we'll see.

BLITZER: We should all live to be happy and healthy.

MARTIN: So, we're going to do a Christine O'Donnell and just walk off. All right, Wolf, later.


BLITZER: All right, guys. Thanks very much.

U.S. officials say the Libyan leader, Muammar Gadhafi - get this - he may be preparing to make his "last stand". Right now. We're going live to the front lines for more on the breaking news.

And, they were just teenagers when they went to prison for murder. Now, almost two decades later, they are free. We're going to take you to the scene of their emotional release.


BLITZER: Here's a look at this hour's hot shots. Take a look at these.

In Bulgaria, members of an international religious movement gather on a mountain to perform ritual dances. In Switzerland, people drive aquatic vehicles across a lake during an annual meeting of amphibious cars. In India, a girl shakes the water out of her hair during a heavy downpour. And in England, baby flamingos are fed at the zoo. Hot shots. Pictures coming in from around the world.

Some of the Pentagon's priciest fighter jets are on very shaky ground right now. Let's go back to our Pentagon correspondent, Barbara Starr. She's looking into the problems for us and the enormous cost involved. What are you finding out, Barbara?

STARR: Well, Wolf, Defense Secretary Leon Panetta knows job number one for him is to cut defense spending here at the Pentagon and these aircraft may be first up.


STARR: It's the most expensive weapons program ever, says the Pentagon. $384 billion earmarked for some 3,000 F-35 stealth fighter jets. Testing is resuming after a two week halt.


Then, there's the F-22 Air Force stealth fighter. At more than $140 million per plane. The nearly 200 plane fleet has been grounded since May after oxygen to the pilots kept cutting off. One pilot died. With a half -trillion dollar price tag for both aircraft?

UNIDENTIFIED MALE: The question is, are you really getting the kind of combat capability that justifies that cost?

UNIDENTIFIED MALE: We cannot afford aircraft that double and triple the original estimated cost.

UNIDENTIFIED MALE: I think we have to watch it very carefully.

STARR: The F-22 has never been in combat. The F-35 may go the same way. Both planes have serious limitations.

UNIDENTIFIED MALE: These aircraft are relatively short range, which means they have to be based fairly close to the area of conflict. Well, what we've seen in recent years are countries like China, countries like Iran building ballistic missile forces that can easily target the forward air bases.

STARR: Winslow Wheeler, a Pentagon spending critic, says the planes too expensive and not stealthy enough.

WINSLOW WHEELER, DIRECTOR, STRAUS MILITARY REFORM PROJECT AT THE CENTER FOR DEFENSE INFORMATION: Against some radars, it's detectable as soon as it comes over the radar horizon and some of the radars that are best at doing that are quite antiquated technology from the Soviets.


STARR: And these aircraft may be just some of the what's on the budget cutting list. All the major defense contractors in town lining up now to try and preserve their programs. They know, after Labor Day, Congress comes back, the administration comes back from vacation, and it's all about cutting the budget. Wolf?

BLITZER: It's all about the money. Barbara, thanks very much.

Now, here in "The Situation Room", happening now -- the breaking news. We are following a chilling warning about the embattled Libyan leader, Muammar Gadhafi. With rebels closing in, there's growing concern he may be planning a final massive military assault. Possibly targeting his own people. Stand by.