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THE SITUATION ROOM

"We Intend to Investigate Thoroughly"; "The Beast" Breaks Down; Who is the Hacker Named "Guccifer"?; Gun Ban Can't Pass; Interview With Rep. Paul Ryan; Peace Process on the Back Burner

Aired March 20, 2013 - 17:00   ET

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


WOLF BLITZER, CNN HOST: Jake, thanks very much.

Happening now, President Obama in the Middle East, waiting for proof that Syria has used chemical weapons. If he gets it, will he use military force?

"The Beast" breaks down -- President Obama's armored limo can withstand a chemical attack, but apparently not the wrong kind of fuel.

And critics are calling for him to come back to earth, but the House budget chairman, Paul Ryan, pushes ahead with his plan to balance the nation's books with major spending cuts. He'll join us live this hour.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

It may be President Obama's first official visit to Israel, but all eyes right now are on Syria. The president says he's trying to find out if the Damascus regime has crossed a U.S. red line by using chemical weapons against Syrians.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We intend to investigate thoroughly exactly what happened. Obviously, in Syria right now, you've got a war zone. You have information that's filtered out. But we have to make sure that we know exactly what happened. We know that there are those in the Syrian government who have expressed a willingness to use chemical weapons, if necessary, to protect themselves. I am deeply skeptical of any claim that, in fact, it was the opposition that used chemical weapons.

Once we establish the facts, I have made clear that the use of chemical weapons is a game-changer.

(END VIDEO CLIP)

BLITZER: Strong words from the president.

Let's go straight to CNN's John King.

He's on the scene traveling with the president in Jerusalem. They're investigating, but there's no firm evidence yet that the Syrians have used chemical weapons.

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: And that was the fascinating exchange when the issue came up, Wolf, because you know well all the intelligence assets that are here.

Israel, its the neighbor to the northeast of Syria, they have been helping the United States. So there are satellite images. There are drones flying over Syria from Israel and other places in the region. And there are different ways they can test if chemical weapons were used, sensors they put in the air to test.

So there's no question there's an intelligence investigation underway.

So the president made clear again that would be a game-changer. But he said he's waiting for the facts. He didn't say what he would do if there is conclusive evidence. He wasn't clear. It would be a game-changer, but what next?

And White House officials say that is one reasons they're going to be very, very careful, gather the facts, so they can talk about how -- they can talk about what the president would do if this works out.

Is that a military thing?

What else happens there?

Though, the president did not answer those questions, but you can be sure that his national security team, Wolf, will be debating the contingencies as they wait for that evidence.

BLITZER: If there is hard evidence, conclusive evidence, that the Syrians have either used these chemical weapons or transferred these chemical weapons, let's say, to Hezbollah or some other groups, that would presumably result in U.S. military action.

I assume that's the threat out there -- John.

KING: Well, that is the threat. But then think about what that means. The president has been very clear, his national security team has been very clear, they don't see any scenarios under which you would put U.S. boots on the ground.

Now, would there be some special operations to try to take out additional chemical weapons?

Certainly, the president would say that he would want the regime held to justice after the fact. But what do you do in the short-term?

That is the big question.

Do you do more to help the opposition or is there a direct U.S. military role?

Because if you take out -- it's very dangerous, Wolf, to take out a chemical weapons site.

Sometimes, if you just bomb a chemical weapons site, you can disperse those chemicals and do more harm than good. So the military options from the very beginning, one of the reasons the U.S. has not talked at all about any military options is that they range from bad to worse.

So it would be a tough dilemma for this president, if he thought he had to take some form of military action in response. That's one of the reasons his words were so cautious today. But he did lay down that line, if there is proof he said it would be a game-changer.

BLITZER: Yes. He had some strong words as far as Iran is concerned, as well.

John, we'll get back to you soon.

John King is on the scene in Jerusalem.

It's called "The Beast." It's heavily armored, bullet-proof and can even withstand a chemical attack.

But President Obama's massive limousine couldn't withstand the wrong kind of fuel.

Take a look at this. It broke down before he got to Israel and had to be towed to a repair shop.

Brianna Keilar is here in THE SITUATION ROOM.

She's got details.

This is awkward.

BRIANNA KEILAR, CNN CORRESPONDENT: It is a bit awkward, Wolf. "The Beast" is a steel, aluminum titanium and ceramic feature -- feat, I should say, of engineering. It reportedly has a fuel tank that won't explode, tires that roll even if punctured and its own air supply in the case of a biochemical attack. Just don't fill her up with regular unleaded.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: (INAUDIBLE).

KEILAR: (voice-over): Maybe so, but dysfunction still reared its head on President Obama's trip to the Middle East. It wasn't Congress causing problems, it was Obama's ride. The heavily armored presidential limousine, known as "The Beast," was towed away in Jerusalem before Obama even landed in Israel. An official said it malfunctioned Wednesday morning when its driver filled up using regular gas instead of diesel. RALPH BASHAM, FORMER DIRECTOR, U.S. SECRET SERVICE: They're very, very meticulous about that sort of thing. And I'm quite surprised. And I can tell you, they did not knowingly put in the wrong type of fuel.

KEILAR: Ralph Basham is a former director of the Secret Service.

It's not the first time this car has met its match. In Dublin two years ago, a steep driveway at the U.S. Embassy proved too much for the low riding "Beast." President Obama wasn't in that car at the time, but he reportedly watched from the identical one behind it, as agents worked for 15 minutes to un-wedge the first limo.

"The Beast" and its replicas weigh eight tons. And while the Secret Service is tight-lipped about the specifics of the car, it reportedly has several inches of armor, bullet-proof glass, doors and windows that seal shut in the event of a gas attack and special shocks to absorb blasts. It's said to be built on a medium grade truck chassis, the Chevrolet Kodiak, which runs on diesel fuel.

(on camera): You've had people come in here at your garage where they've mixed it up.

WOODY WOODALL, EXXON STATION SERVICE MANAGER: Oh, sure. Yes, we've had them towed in like that. You've got to drain the tanks, you know. And you refill it and it's usually fine.

KEILAR: (voice-over): Dave Woody Woodall runs an Exxon station blocks from the Capitol. He says this mix-up is pretty common.

(on camera): I imagine they're pretty embarrassed.

WOODALL: They are. And nine times out of 10, somebody else did it. That's always the story, you know, I didn't do this, but my friend, you know, borrowed my car. And we hear that a lot.

(END VIDEO TAPE)

KEILAR: Yes, but that's probably not going to fly in this case.

When you're talking about the presidential limo, this kind of mistake is serious business. And former Secret Service Director Basham says there will no doubt, Wolf, be a full investigation.

The Secret Service isn't saying a whole lot about this, though, just that one of their protective vehicles experienced mechanical problems. And they say that's why they bring multiple vehicles on these kinds of trips, as well as a mechanic.

BLITZER: So he's driving in another car right now, is that right?

KEILAR: He will be in another SUV. There's normally two SUVs in the motorcade, as you know, sometimes more -- or, sorry, SUVs -- two limousines in the motorcade. So this one, since it's out of commission, is being replaced, as we understand it, by an SUV limousine.

BLITZER: So they've got -- they've got vehicles (INAUDIBLE)...

KEILAR: They've got many cars.

BLITZER: Yes.

KEILAR: Brianna will be back.

Thanks very much.

All right, there's important news just coming into THE SITUATION ROOM from Capitol Hill. Only moments ago, the Senate passed a bill to avoid a government shutdown next week. If the House goes along, the new spending bill will keep the government running through the end of September.

In a little bit, by the way, I'll be speaking live with the House Budget Committee chairman, Paul Ryan. He joins us here in THE SITUATION ROOM.

The Secret Service is now looking into the reported hacking of e- mail sent to the former secretary of State, Hillary Clinton. Other reported targets include Colin Powell's Facebook page and e-mails of the Bush family.

A shadowy figure is said to be behind the hacking. We're trying to figure out just what's going on, just who this "Guccifer," as it's pronounced, is.

Brian Todd is walking into THE SITUATION ROOM right now.

You've been looking into the story.

What are you finding out?

BRIAN TODD, CNN CORRESPONDENT: Wolf, this is a very mysterious figure and he now has the U.S. government's best investigators after him.

We have confirmed as Wolf mentioned, confirmed this afternoon, the Secret Service is investigating the hacks of e-mails sent to Hillary Clinton by a former aide. And experts worry the perpetrator may start to target e-mails Mrs. Clinton herself, and others, will send.

(BEGIN VIDEOTAPE)

TODD: (voice-over): A hacker who is reported to have broken into correspondence involving former presidents apparently has found a new target. Confidential memos to Hillary Clinton from a former aide have been hacked, according to the Web site, Smoking Gun.

The Secret Service says it's investigating. Smoking Gun says it has been in touch with the hacker, known as "Guccifer." The memos, which Smoking Gun says were in the e-mail of former Clinton aide, Sidney Blumenthal, have information on the September attack on the U.S. consulate in Benghazi, Libya.

Our efforts to contact Guccifer were not successful.

Smoking Gun, owned by Turner Broadcasting, the parent firm of CNN, could not provide someone to go on camera with us.

Sidney (ph) Blumenthal, who has not worked for the government for several years, would not comment.

Cyber security expert Michael Sutton says this hacker has a diabolical method.

MICHAEL SUTTON, ZSCALER CYBER SECURITY: He's not going after the individual that he ultimately wants to get to, but rather, the family and friends, the ones that are in communication with them. And, of course, if they're on the receiving end of the e-mail, you have the e- mail.

TODD: Another expert said "Guccifer" may be doing this to zero in on the politicians themselves. According to Smoking Gun, there are also hacks of e-mails and pictures circulated among friends, relatives and aides of former Presidents George W. Bush and his father. Some of the e-mails reported reflect sensitive issues regarding the health of George H.W. Bush.

The Secret Service tells us it's investigating the Bush hacks.

But "Guccifer" could make that a challenge.

(on camera): It looks like the hacker took pains to cover his tracks. Instead of forwarding the hacked e-mails and attachments directly to journalists and others that would have looked like this, he recreated them, copying and pasting the text into new e-mails. This one, posted by Smoking Gun, shows that he put the text into a pink background with a casual font style that looks like a written note. Experts say he did this to make it harder for investigators to find metadata that could be traced back to him.

(voice-over): We could not get comment on the hacking from Hillary Clinton, from any representative of the Bush family, or from former secretary of State, Colin Powell, though he did confirm that his Facebook and e-mail accounts were hacked.

Who is Guccifer?

SUTTON: Often the demographics of an individual like this are male, young, highly intelligent. And the fact that they are getting recognition for their success continues to fuel them.

(END VIDEO TAPE)

TODD: Based on its correspondence with him, Smoking Gun says "Guccifer" subscribes to conspiracy theories and claims the government has investigated him for several years -- Wolf, we hope to learn more about him in the days ahead.

BLITZER: And we'll get more information as it becomes available.

Brian, thanks very much.

Pretty scary stuff there, as well.

Congress is giving up the fight, at least for now, to ban guns like the one used in last December's school massacre in Connecticut. We're going live to Newtown, Connecticut in just a moment. We're going to find out the emotional, the angry reaction that's coming in.

And on Capitol Hill today, Democrats were calling on the Budget Committee chairman, Paul Ryan to, quote, "come back to Earth." The former Republican vice presidential nominee, he's standing by live to join us here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: You're in THE SITUATION ROOM. U.S. senator Dianne Feinstein, made news on Tuesday when she promised to keep fighting for a ban on semi-automatic weapons like the one used to massacre these children and teachers in Newtown, Connecticut, even though Democratic leaders say they can't get enough votes to pass it.

(BEGIN VIDEO CLIP)

SEN. DIANNE FEINSTEIN, (D) CALIFORNIA: This is very important to me. And I'm not going to lay down and play dead. I think the American people have said in every single public poll that they support this kind of legislation. It's aimed to protect children, to protect schools, and malls. It's aimed to dry up the supply of these over time.

And it came out on a 10-8 vote of the judiciary committee. Not to give me a vote on this would be a major betrayal of trust in my -- as I would see it.

(END VIDEO CLIP)

BLITZER: Front page of today's "New York Daily News" calls it a shame. The assault weapons ban is effectively dead at least for now. CNN's Mary Snow is in Newtown, Connecticut right now. She's asking people there what they think about all of this. What do they think, Mary?

MARY SNOW, CNN CORRESPONDENT: Emotional reaction, Wolf. There are people here who've taken on an active role in trying to get an assault weapons ban passed. And after 20 children and six adults were killed, some are in disbelief that there's not enough support in the Senate to pass it, and they take it personally.

(BEGIN VIDEOTAPE)

SNOW (voice-over): With the pain raw just three months after the Sandy Hook Elementary School massacre, there are still messages of support coming from around the world. But it's the message from Washington that right now pains Alexandra Thompson. She supports a ban on assault weapons and even had a sign for a petition to ban them in her store's window. She takes it personally that the Senate has shelved a plan for a ban.

ALEXANDRA THOMPSON, NEWTOWN RESIDENT: You don't need that kind of gun to protect yourself.

SNOW: And when you put that sign in your window, do a lot of people come in and express their support?

THOMPSON: Every day they came in, wanted to know where they could sign for this petition. So -- and I don't know. Shame on Congress. That's all I have to say.

SNOW: Parents of victims have gone to Washington to personally appeal to lawmakers.

NEIL HESLIN, FATHER OF NEWTOWN SHOOTING VICTIM: I'm Jessie Lewis' (ph) dad. Jessie was brutally murdered at sandy hook school on December 14th 20 minutes after I dropped him off.

SNOW: Neil Heslin testified before a Senate committee in February, calling for a ban on assault weapons.

HESLIN: Those weapons were used on the battlefield of Vietnam. They were used in the Persian Gulf. They were used in Afghanistan and Iraq. Assault purpose is to put a lot of led on the battle field quickly. That's what they could do.

SNOW: Also there that day Rev. Matt Crebbin of Newtown's congregational church. He and other clergy members have been trying to turn up the pressure on lawmakers to ban assault weapons.

REV. MATT CREBBIN, NEWTOWN CONGREGATIONAL CURCH: I guess, I would say I'm disappointed. I'm not surprised.

SNOW: Why?

CREBBIN: Well, I think I was down in Washington, D.C. I'm not surprised by the reluctance of politicians still. Even given what's happened here in Newtown.

SNOW: But Rev. Crebbin says he will not give up the fight.

CREBBIN: The event that took place here on December 14th, I do think, altered America and altered the conversation. And I think what happens, though, in the short term is that people tend to think that, oh, this effect, this Connecticut effect, the Newtown effect, it's going to go away. Well, it's clear to us that it's not going to go away.

(END VIDEOTAPE)

SNOW (on-camera): Rev. Crebbin says that even if an assault weapons ban is just part of an amendment to a broader gun bill, he'll be thankful. He says he wants a vote and he says he plans to hold lawmakers accountable for what he sees as a moral issue -- Wolf. BLITZER: Deep disappointment in Newtown. Thanks very much, Mary, for that.

A brand new poll shows strong public support for banning the sale of assault-style weapons. So, why isn't that message getting through to Capitol Hill? Our chief Congressional correspondent, Dana Bash, has been asking that question to lawmakers. What are they saying?

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Well, you know, Wolf, the votes aren't there. I mean, that's the bottom line. That's what Harry Reid said. And we know that it's true because, you know, we've been reporting on this show really since the gun debate reignited after Newtown that it's not just because Republicans oppose it. It's also because of Democrats, particularly, in the Senate.

In fact, if you look at, we have a set of compiled -- some faces and names of Democratic senators. If you look, there's about a dozen. And these are senators who have either outright said, no way to assault weapons ban or those who run from us in the hallway when we try to ask or somewhere in between. And the reason is because most of them come from states where they're the whole concept of gun rights runs very wide and very deep.

And it would be cultural heresy many of them think to ban any kind of gun and to vote for that. And the senators here may support other gun control like background checks or limiting high capacity ammunition clips, even trafficking, and so, the thinking and it really has been all along, is that if they put the assault weapons ban in this broad gun control package, then the whole thing will go down.

Whereas, if they take it out and put it as an amendment which is the plan right now, we do expect a vote, then it is likely that other gun control measures could potentially pass.

BLITZER: They'd rather get what they can get as opposed to losing everything.

BASH: Bingo.

BLITZER: That's the theory. Don't go too far away. We've got another story that you've been working on, an amazing story. By the way, we're going to get a different perspective on the gun debate in our next hour. The speaker, John Boehner, his exclusive interview with our own Jake Tapper, that's coming up a little bit later.

But Dana will be back in a moment. She was running, literally running with Michele Bachmann, the congresswoman, bobbing and weaving pulling fast moves to duck some tough questions from Dana. Dana's pursuit of the congressman -- congresswoman when we come back.

(COMMERCIAL BREAK)

BLITZER: Congresswoman Michele Bachmann pulled some fast moves to duck some tough questions from CNN. Our chief Congressional correspondent, Dana Bash, tried to ask Bachmann about her allegations of lavish spending by the Obama family. Those allegations came in a speech that began with some sharp criticism of the president's handling of the Benghazi consulate attack.

(BEGIN VIDEO CLIP)

REP. MICHELE BACHMANN, (R) MINNESOTA: The president, you see, was informed of the attack within the very first hour of the attack. And after that call, the president then conversed with his advisers for approximately 30 minutes, we learned, in testimony in the Senate hearing. And then, inexplicably, the president apparently disappeared.

Now, we find out that there are five chefs on Air Force One. There are two projectionists who operate the White House movie theater. They regularly sleep at the White House in order to be readily available in case the first family wants a really, really late show. We are also the ones who are paying for someone to walk the president's dog?

(END VIDEO CLIP)

BLITZER: When Dana tried to follow up with some questions, Bachmann wanted to talk -- to walk, I should say, rather than talk. Watch this.

(BEGIN VIDEOTAPE)

BASH: Congresswoman, I just want to ask you about your speech at CPAC. You made some accusations against the president that are either questionable or untrue. Can you talk to me about that? I just want to ask you some specifics. No?

BACHMANN: What -- the comments that I made about the president are the fact that during the Benghazi debacle, the president went missing.

BASH: What I want to ask you about is the fact that you said that he had -- you talked about the excesses that he's engaged in the fact that he has a dog walker, which is not true.

BACHMANN: The big point of my speech was about Benghazi. This was an absolute disaster.

BASH: You also made specific accusations about the president spending money that other presidents also --

BACHMANN: The real issue is there are four Americans that are dead. The secretary of state was not in conversation with the secretary of defense or with the chair of the joint chiefs of staff.

(CROSSTALK)

BASH: I think that's an important point but this is another.

BACHMANN: The president of the United States didn't care about those four Americans and they were killed. That's the point.

(CROSSTALK) BACHMANN: That's what's important. You want to talk about dog handlers and there are four Americans killed?

BASH: But congresswoman, but you're the one who brought it up. You're the one who brought it up.

(END VIDEOTAPE)

BLITZER: Walking and walking and walking. Dana is here in the SITUATION ROOM. Dana, you were both in heels, too. That's not that easy to be walking that quickly. What was it like when you were trying to ask simple, straight forward questions, she really didn't want to answer those questions.

BASH: No, she didn't. And I think what really surprised me was that she wouldn't let me sort of get the question in because, look, Michele Bachmann has certainly not answered my questions and others in the past, but she generally is, you know, stops and she is polite and she smiles, a different kind of an experience there to say the least.

And I also didn't get why she was sort of trying to turn her back on me when she was the one who made these comments about the president's dog walker that were questionable at best. But I think it's important for our viewers to know the context of this, which is that Anderson Cooper and his team, they have a regular segment.

Everybody knows keeping them honest where we hold lawmakers and elected officials accountable, Republicans and Democrats. Michele Bachmann is maybe a special case for them because a couple years ago, she said things that are, you know, questionable before, but particularly on their show, she said that the president spends $200 million a day for example to go to India which turned out not to be true.

She said that to Anderson. And we came to this, Anderson's people saw it. They asked me to request an interview. I did, I was told no, so I just went to the regular House Republican meeting where we asked all kinds of lawmakers all kinds of questions and I found her and I tried to ask her.

BLITZER: Any follow-up today, any reaction from her or her staff?

BASH: No. And I tried to get, you know, context so I could be accurate, to get a little bit more information from her people and they just said that the congresswoman's statements speak for themselves.

BLITZER: Yes.

BASH: Thanks.

BLITZER: She always does good work.

Just ahead --

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Earth to Chairman Ryan. Come in, Chairman Ryan. Come back to Earth.

(END VIDEO CLIP)

BLITZER: The House Budget Committee chairman, Paul Ryan, he's going to talk about his plans to balance the nation's budget with some major spending cuts, reacting to Xavier Becerra. He's standing by live.

(COMMERCIAL BREAK)

BLITZER: Up on Capitol Hill this afternoon, the Senate passed a bill to avoid a government shutdown next week. A bigger fight, though, is underway. The House just rejected a series of alternatives to Congressman Paul Ryan's controversial blueprint to balance the budget. Ryan's plan, which is due for a vote tomorrow, is heavy on spending cuts and repeals Obamacare, ideas that have Democrats calling for the House Budget Committee chairman to, quote, "come back to earth."

Congressman Ryan is joining us now live from Capitol Hill. Thanks very much for coming in.

REP. PAUL RYAN (R-WI), HOUSE BUDGET COMMITTEE CHAIRMAN: You bet. Believe it or not, Capitol Hill is on earth, actually. I know some people don't believe that.

BLITZER: Some people don't believe it, but I know you do.

Listen to the Democratic congressman Xavier Becerra. I'll play the clip.

(BEGIN VIDEO CLIPS)

REP. XAVIER BECERRA (D), CALIFORNIA: To many of us, this new Ryan Republican budget looks a lot like the old Romney-Ryan Republican budget that Americans less than six months ago rejected at the polls.

Earth to chairman Ryan. Come in, chairman Ryan. Come back to earth, because people want to get to work. People want to make sure that the earned benefits that they pay for are there for them when they finally need them. And I think what we have is a budget on the Democratic side that reflects the reality of people on earth.

(END VIDEO CLIPS)

BLITZER: All right, Congressman, you want to respond to the Democrat?

RYAN: Well, we want to compete for the earthling vote as well. I don't really know what to say about Xavier there. I like Xavier quite a bit. We disagree on some of these things.

We're the ones that have the bipartisan idea to save and strengthen Medicare, not only for the current generation but for the next generation. We're the ones with the courage to say our entitlements need repairing if we're going to avoid a debt crisis and if we're going to make sure they don't go bankrupt. We are the ones that proposing fundamental tax reform, which a lot of centrist Democrats agree with us on this, Wolf. Plug the loopholes. Lower the tax rates for businesses and families for economic growth.

Our budget was reviewed by two prominent Stanford economists. It projected it would increase jobs by 500,000 next year and 1.7 million jobs a year by the end of the budget window. Faster economic growth. The reason we're balancing the budget, Wolf, is not just to make our spreadsheet look good. You know, expenditures equal revenues. It's to get our payment on our debt down. It's to have a healthy economy. It's to create faster economic growth, to get jobs. You have to reform government to do that.

BLITZER: All right. Well, on the Medicare issue which is maybe the most sensitive issue out there, are you saying there are Democrats who support your plan, which Democrats describe as creating a voucher for Medicare recipients?

RYAN: It's not a voucher program. It's a politesse (ph) word they used to describe it. It's called premium support, and it is an idea that originated from the Brooking Institution from Democrats to begin with. It is an idea I used to work on with Alice Rivlin. It's just like what we call the Rivlin-DeMenici (ph) plan, which is a bipartisan group that put out there. It's exactly just like the idea I worked with Ron Wyden, the senator from Oregon last year on.

The point is, good people from both political parties can look at this problem, a bankrupt Medicare system in the future, and come to a solution. And that is what we're proposing.

Our solution by the way, Wolf, doesn't affect benefits of anybody in or near retirement. But it puts reforms in the program so we can make it solvent for the next generation like my generation and our kids. We think it is the best idea for saving and strengthening Medicare. We think the Medicare board that will be put in place because of Obamacare is going to lead to cuts to Medicare that will deny access to Medicare beneficiaries.

So, yes, we have a problem with Obamacare because we think it is very dangerous for Medicare. And we think we have a better idea.

BLITZER: Let's look ahead. I assume your budget will pass the House tomorrow. But you know it isn't going to pass the Senate. What happens next?

RYAN: Well, the Senate budget was brought on the floor today here as well, and didn't pass the House. So, therein lies -

BLITZER: So, what is going to happen?

RYAN: Therein lies the issue.

Where I'm cautiously optimistic on this, Wolf, is at least the Senate is doing a budget. In the past four years, the Senate hadn't done a budget. That means the process stopped. What we call regular order, where the House and the Senate pass a budget, then you try to reconcile the differences --

BLITZER: Can you reconcile it?

RYAN: -- then find agreement.

We'll find out. But at least they're doing a budget. So, I actually am cautiously optimistic because the process is continuing.

Now, we have a big difference. We balance the budget; they never balance the budget. We don't want to keep raising taxes. We just have a $1.6 trillion tax increase that is already beginning this year. We don't want to do more of that because we think it is going to hurt the economy. Spending is the problem. Under our budget, spending grows 3.4 percent on average every single year, and just restraining the growth of spending like that gets us to a balanced budget.

So, hopefully somewhere between our budget, the spending cuts we have, the reforms we have, we can find some common ground. We need to keep talking to each other, and hopefully at the end of the day, now that we have a budget process that is moving, we can find some common ground and get some kind of agreement to get a down payment on the problem.

BLITZER: Because in early April, the president eventually is going to release his own budget. So, there will be a House budget, Senate budget, the president's budget. Do you believe based on the luncheon that you had with the president that he is ready to make compromises, that you're ready to make compromises --by the end of July, early August there will be what we call a grand bargain?

RYAN: I think it would be helpful to the process if he made them publicly. If he actually said on paper here is what I'm willing to do. Because that's what we've been doing for years.

BLITZER: Isn't he going to do that in early April?

RYAN: I don't think so. He's going to produce a budget. It's two months late. What he has been leading us to believe is he is not going to do anything new in the budget. He's not going to --

BLITZER: Do you think he is sincere? Do you think he is sincere?

RYAN: I don't know the answer to that question.

BLITZER: You had lunch with him. What was your impression?

RYAN: I enjoyed our lunch. I thought we had a very frank and candid conversation. I got the impression he wants to get something done, that he believes the window of getting things done is finite.

The question on sincerity is really one that time will tell, which is will he reengage the campaign in just a few short months? Will he focus on the campaign against Republicans for 2014, or will he work to bridge the partisan divide? The question is, will he go back to impugning our motives, making it impossible for compromise to occur? Or will he produce an environment where people of different parties can talk to each other so that we talk more and end up finding common ground and getting an agreement at the end of the day.

Time will tell. I'm hopeful but -- you know, it's trust but verify, as far as I'm concerned.

BLITZER: If there is no deal by the end of July, early August, will you vote to raise the nation's debt ceiling? Because that's when it has to be raised.

RYAN: Well, I think this will come down to all of that. I'm not going to get into what we will or will not do. I do believe that we can make sure that default is not going to happen. I'm not really worried about us defaulting. I think we can give the authority to the president to prevent default from happening.

But I have to tell you, Wolf, we can't keep running up deficits like this. It will damage our economy deeply, and people are saying that we don't have a crisis on the horizon. Of course we do. We've got a debt that is on a tear right now. And if the debt takes off like it's projected to do, it's not only hurting our economy today, it's destroying it for the next generation. And we just can't sit around and be complicit with that. That means the problem, we have to do something about that.

BLITZER: Let me get your thoughts on a couple other sensitive issues coming before Congress. Immigration reform. Do you support a pathway to citizenship for the 11 or 12 million illegal immigrants in the United States?

RYAN: Well, I think we can get the comprehensive immigration reform. I support reform. I supported the Bush reforms in 2005 and 2006. I think we can find a way of making sure that people here with an undocumented status have an ability to adjust that status. We're not going to be able to deport 12 million people.

And there is a way to do this without rewarding them for breaking the line or breaking the law. Without rewarding them for cutting in front of the line so they don't have a special and unique pathway, so that those who came here legally, who paid the fines, who waited patiently, are not penalized by letting people cut in front of them.

I think there is a way to do this, and I would call it earned legalization status. And I think there is a way to do that. I think the Rubio reforms --

BLITZER: Excuse me for interrupting. Is it just legalization status, or eventually under certain conditions, citizenship?

RYAN: Well, sure. I'm just saying no special pathway for rewarding lawbreakers. I think there is a way of regularizing this process so that people can get in the back of the line and become a citizen just like anybody else does in society. We just don't want to reward them by giving them an advancement in the line in front of all the people who have been waiting patiently and playing by the rules.

BLITZER: One final question: do you support any new restrictions on guns?

RYAN: Well, I think the loophole issue is one that is going to be debated here in the House, which is are we getting at the fact that people who are not legally allowed to buy firearms, are they buying firearms? Are there loopholes that we need to address? I am more than willing to look at that. I think we have to take a look at this instant check system. I think you need more personnel to make the instant check system work. But I'm not interested in infringing our Second Amendment rights on some of the other proposals I've heard around.

BLITZER: I lied. One final question. Senator Rand Paul yesterday was here in THE SITUATION ROOM, 24 hours ago. He said flatly he is going to Iowa in the next few weeks. He is seriously thinking of running for the Republican presidential nomination in 2016. He thinks that is a good idea for him. What about you?

RYAN: I'm going to make my mind up later. The reason why -- I think I need to do this job. I'm the chairman of the Budget Committee. When we have a budget crisis on our horizon, we've got to get these agreements done. And I don't think it's good for me, it's good for the Wisconsin first district, it's good for my colleagues to cloud my judgment at this time with other things.

I need to do what I think is right in this moment working on the budget. I have a leadership position. I take it seriously. And I don't want to cloud it with ideas of what I may or may not do in the future. I want to do the right thing now. Then I'll consider those things. And I will give it serious consideration, but I'm going to do that later on.

BLITZER: You enjoyed campaigning with Mitt Romney, right?

RYAN: I did. I did.

BLITZER: So, maybe you'll do it again.

RYAN: We'll see.

BLITZER: All right. Hey, Congressman, thanks very much.

RYAN: Thanks, Wolf.

BLITZER: Just ahead, while President Obama is in Israel talking about the peace process, our own John King goes to the West Bank. He is trying to seek out what's really going on.

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WOLF BLITZER, CNN ANCHOR: So far President Obama's visit to America's key ally Israel is focused on the threats posed by serious chemical weapons, Iran's nuclear ambitions. The Israeli-Palestinian peace process, at least for now, on the back burner. And a key sticking point could keep it there.

Let's go back to Jerusalem. CNN's John King is taking a closer look at the peace process and where it stands.

What are you seeing over there, John?

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: Wolf, after that news conference today President Obama and Prime Minister Netanyahu both saying they would like to bring back the peace process. The prime minister saying he's still committed to a two-state solution and he was very clear, he said he wished the Palestinians would come back to the bargaining table without any preconditions.

Well, one of those preconditions is the continued construction of Israeli settlements in the West Bank. That's also been a huge source of contention and friction between President Obama and Prime Minister Netanyahu. Mr. Obama never used the word settlement today but, Wolf, it is still a big obstacle.

(BEGIN VIDEOTAPE)

KING (voice-over): New construction in the Israeli settlement of Ma'ale Adumim, clearing ground for new homes and complicating any hopes for peace. Just across the way a bigger test. A push to build hundreds more on the West Bank parcel Israel calls E-1. The land is prepared. The water lines in place. The police station, too.

MAYOR BENNY KASHRIEL, MA'ALE ADUMIM, WEST BANK: There are these built already.

KING: The final step, a government green light, would make Ma'ale Adumim Mayor Benny Kashriel ecstatic and infuriate the Obama White House.

KASHRIEL: I expect for my prime minister to take care of our young couples that have been born in Ma'ale Adumim. Now there are young couples, they want to live by their families.

KING: The mayor invited the president to visit but was ignored.

KASHRIEL: Because he hears all the time the disinformation, stories -- lie stories from the Palestinians. This place doesn't disconnect the Palestinian state. It's not a buffer at all.

KING: Ala Salman says the Israelis are not to be believed or trusted.

This prayer protest is to draw attention to construction of an Israeli highway that connects Jewish settlements to Jerusalem but splits the Palestinian neighborhood of Beit Safafa. And splits Salman and some family members from relatives across the way as well as the neighborhood schools, clinic, and mosque.

ALA SALMAN, BEIT SAFAFA RESIDENT: This would change our life. They will cut the village. They will cut and destroy families, also. They take our land. They take our land.

KING: Land is the currency of the Israeli-Palestinian conflict that Prime Minister Benjamin Netanyahu is redrawing the map. Settlement expansion in 2012 was almost five times the rate of 2010. Netanyahu's first full year in office. Critics call it proof the prime minister wants to make it impossible to map out a contiguous Palestinian state. President Obama won't go that far but says any construction is an obstacle to peace talks.

Eve Harow says it's the president who's blocking progress.

EVE HAROW, WEST BANK SETTLER: He's made the Palestinian authority more intransigent. They can't say we'll talk to the Israelis while they're building settlements if the American president has said it were a problem.

KING: Harow left Los Angeles to join the settlement movement 25 years ago. Like many here Israelis and Palestinians she worries tensions are rising.

HAROW: We feel it here on the roads here, definitely, that there is an upswing in the violence. But I don't think that the settlements are the reason for the -- for the tension.

KING: The Palestinians and the visiting American president disagree but this new school in (INAUDIBLE) is proof the Israeli government, at least for now, isn't listening.

(END VIDEOTAPE) KING: No mention again from the president of the settlement issue in public, Wolf. We are sure it came up privately in the conversations between Mr. Obama and Mr. Netanyahu. The question is how will the Palestinians react. We'll find out when the president heads to Ramallah tomorrow.

BLITZER: We'll of course have live coverage of that here on CNN throughout the day. John is in Jerusalem for us.

Up next, is Congress really working together on immigration reform? Is there a deal that is now in the works?

Also coming up a driver thought he'd killed a deer and put the carcass in his trunk. When the police took a look, they all got a huge surprise.

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BLITZER: Congress may actually be moving toward bipartisan agreement on comprehensive immigration reform. It's a problem in need of a broad American solution.

Our chief political analyst Gloria Borger is here. She's been talking to a lot of folks about this.

So is there a deal? Is it a lot?

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Well, there's clearly a lot of momentum on the Republican side for this, Wolf. But as you know with Congress, nothing is ever done until it's done.

I want to do a little reality check here, take you down memory lane a little bit to those Republican primaries. Listen to how Republicans were sounding about immigration reform not so long ago.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), FORMER PRESIDENTIAL CANDIDATE: People who have come here illegally won't be able to find work and over time those people would tend to leave the country or self-deport.

RICK SANTORUM (R), FORMER PRESIDENTIAL CANDIDATE: There are people who have come to this country illegally, have broken the law repeatedly. And as a result of that, I think that people should no -- should not be able to stay here.

GOV. RICK PERRY (R), TEXAS: If you've been in the state of Texas for three years, if you're working towards your college degree, and if you are working and pursuing citizenship in the state of Texas, you pay in-state tuition there. And the bottom line is, it doesn't make any difference what the sound of your last name is. That is the American way. No matter how you got into that state from the standpoint of your parents brought you there or what have you, and that's what we've done in the state of Texas.

(END VIDEO CLIP)

BORGER: So, Wolf, you heard those boos. He got booed for showing some sympathy towards the kids of illegal immigrants who want to go to college in the state of Texas. So the question is, where is the base of the Republican Party on this? If you look at the polls, a majority of Republicans still remain opposed to immigration reform. So you may have the elite politicians in one place and the base of the party in another.

BLITZER: But Paul Ryan, just now, he supports immigration reform. Rand Paul yesterday.

BORGER: Rand Paul does.

BLITZER: So how do you get the base onboard?

BORGER: I think there are a couple of things. And I think we heard this a lot in your -- in your interview just now with Paul Ryan. First of all, you have to emphasize border security. I talked to lots of Republicans on the hill. They all say to me, remember what happened in 1986, Ronald Reagan had immigration reform, they call it amnesty and we had people pouring across the porous border. That cannot happen again. Then Republicans have to try to figure out a way to thread that needle. Are they offering citizenship, even though it's a long path? Or are they just going to offer some kind of legal status in this country?

Rand Paul spoke the other day. He did not use the worth citizenship, although he clearly supports immigration reform. So that's going to be a challenge for Republicans to figure out where they're going to be on the question of citizenship.

BLITZER: Just don't call it amnesty because the base hates that word.

BORGER: Oh, they do. They do. And they now say Reagan provided that.

BLITZER: He did?

BORGER: Yes.

BLITZER: In the '80s.

BORGER: Yes. Yes.

BLITZER: Thanks very much, Gloria.

When we come back, it's taken more than 35 years, but a pioneering spacecraft has now gone beyond the solar system.

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