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THE SITUATION ROOM

U.S. Government Tracking Verizon Calls; Interview With Mitt Romney and Ann Romney; Michelle Obama Opting Out

Aired June 6, 2013 - 18:00   ET

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


WOLF BLITZER, CNN ANCHOR: Plus, secret personal lounging inside a government warehouse, another outrageous expense on the taxpayers' dime now revealed.

And Michelle Obama is opting out of a sensitive trip with her husband. Is she concerned about being upstaged by a rock star?

I'm Wolf Blitzer. We want to welcome our viewers in the United States and around the world. You're in THE SITUATION ROOM.

A key U.S. lawmaker says more than one terrorist attack was prevented because of a top-secret program to seize Americans' phone records. An explosive new report is reigniting the concerns that your privacy is being violated to protect America's security.

It reveals a court order giving the National Security Agency, the NSA, blanket access to millions of Verizon customers' records on a daily basis.

Here is our crime and justice correspondent, Joe Johns. He's got the latest -- Joe.

JOE JOHNS, CNN CRIME AND JUSTICE CORRESPONDENT: Wolf, this was an order that basically says two things to Verizon. Give us your business and phone records and don't tell anybody about it.

But the "Guardian" newspaper got ahold of it and now the U.S. government seemingly consumed by leaks of sensitive information is coming to grips with a big one.

(BEGIN VIDEOTAPE)

JOHNS (voice-over): The court order, a top-secret document from the most secretive court in the land, gives a black-and-white view for the first time of the massive efforts by the government to collect call records of American communications. Authorized by Congress under the Patriot Act, the judge's order demands Verizon hand over details of its customer calls within the United States and overseas, including -- quote -- "the originating and terminating telephone number and duration of the call," but not the content of the call.

The White House defended the program as a critical tool that is subject to strict controls, a good way to catch terrorists.

SEN. DIANNE FEINSTEIN (D), CALIFORNIA: It's called protecting America.

JOHNS: In fact, it's already proven effective, argued the chair of the House Intelligence Committee.

REP. MIKE ROGERS (R), MICHIGAN: And I can tell you why this program is important, that within the last few years, this program was used to stop a program -- excuse me -- stop a terrorist attack in the United States. We know that.

JOHNS: So how does it work? It's a secret process. The National Security Agency wants the information from Verizon Business Network Services. The FBI makes the request to the secret intelligence court with federal judges. If a judge says OK, the telephone company forks over the information.

But if the government wants to look through that data, say, because of a terror concern, it takes more court permission. How long has it been going on? Since the Bush administration.

FEINSTEIN: As far as I know, this is the exact three-month renewal of what has been the case for the past seven years.

JOHNS: Earlier this year, the director of national intelligence said there was no widespread surveillance effort.

SEN. RON WYDEN (D), OREGON: Does the NSA collect any type of data at all on millions or hundreds of millions of Americans?

LT. GEN. JAMES CLAPPER (RET.), NATIONAL INTELLIGENCE DIRECTOR: No, sir.

WYDEN: It does not?

CLAPPER: Not wittingly.

JOHNS: Former intelligence officials and privacy advocates say it's reasonable to presume other telephone companies have gotten similar orders.

STEVE AFTERGOOD, FEDERATION OF AMERICAN SCIENTISTS: If this is an open-ended and indiscriminate collection process, as it seems to be, then logically one would expect it to be much bigger than Verizon Business.

JOHNS: The law gives companies that get such secret orders at least some power to challenge them. But no way to tell if Verizon did, because by law they can't talk about it. Verizon's general counsel in a statement to the employees, without confirming the existence of the order, suggested the company would -- quote -- "be required to comply."

If you wonder where all of this is headed, the government is expanding its efforts. The National Security Agency is building this massive new data center in Utah, meant to store billions of gigabytes of collected data.

(END VIDEOTAPE)

JOHNS: Senator Dianne Feinstein said today the telephone data collection program actually stopped more than one plot, but did not elaborate. What's stunning here, perhaps, is that the document at the center of the story marked top-secret actually made its way public.

The Justice Department's been very aggressive in trying to track down leakers, and it's just hard to see how the investigators will be able to ignore this one -- Wolf.

BLITZER: I assume there will be a full-scale leak investigation on this one as well. Joe, thanks very much.

Surprisingly, the phone snooping controversy isn't hurting Verizon's bottom line at all. Verizon Communications stock was up nearly 3.5 percent at the closing bell.

Joining us now to discuss what's going on, a former NSA employee and whistle-blower, Bill Binney. He exposed changes in a program he invented to track U.S. enemies overseas. He says it was twisted after 9/11 to allow domestic spying, and he says it violated Americans' rights. He says he became a political target after that. Armed federal agents raided his home, held him and his wife at gunpoint between the eyes. He's here.

Also joining us, Binney's lawyer, Jesselyn Radack. She's with the Government Accountability Project. That's a private organization. And CNN national security analyst Fran Townsend, the former Bush homeland security adviser, she serves on the CIA and Homeland Security external advisory boards.

Thanks to all of you, by the way, for coming in.

Mr. Binney, thanks especially to you.

All right, so you worked in the NSA for a long time. You left back in 2001.

BILL BINNEY, NSA WHISTLE-BLOWER: Yes.

BLITZER: You were upset about what you said the NSA was using with some data collection techniques you had actually created.

BINNEY: Well, it was more like the data that they were taking in. It was coming from the telecoms. The specific one that I knew of was AT&T. And AT&T was giving NSA on the order of 320 million records of U.S. citizens' communications with other U.S. citizens every day.

BLITZER: So, what do you make of this current disclosure about what's going on?

BINNEY: Well, this is the FBI trying to get evidence to take into a court. It doesn't talk about the intelligence community and the collection that's been ongoing since 9/11.

BLITZER: Because this has -- according to Dianne Feinstein, the chair of the Senate Intelligence Committee, what we learned now has been going on for seven years, but every 90 days or so they have to reauthorize it and get the court to approve it.

BINNEY: Yes. It used to be every 45 days. And now I guess it's every 90 days.

BLITZER: There's nothing illegal, based on everything you have seen? This is all legal, the way the Obama administration has engaged in this?

JESSELYN RADACK, GOVERNMENT ACCOUNTABILITY PROJECT: Well, just because the FISA court approved it...

(CROSSTALK)

BLITZER: But they're not breaking the law or anything?

RADACK: They are. They're violating FISA...

(CROSSTALK)

BLITZER: Well, how are they doing that?

(CROSSTALK)

RADACK: ... of the Patriot Act, because that authorizes only foreign surveillance or clandestine agencies or people. And that had been the first commandment at NSA was you were always able to spy on foreigners, but not domestic.

(CROSSTALK)

BLITZER: Are they violating -- is the Obama administration with the congressional backing, because Congress has known about this for seven years -- although we didn't know about it, Congress has known about it. Are they violating the law?

FRANCES TOWNSEND, CNN NATIONAL SECURITY CONTRIBUTOR: No.

And you heard Senator Dianne Feinstein say, specifically, the program is legal. The statute was passed. And there's a whole protocol, Wolf, about what they can collect, who can look at it, and the process by which they have to get court approval to actually use that data.

BLITZER: You worked for 30 years in the NSA. And your goal was to protect America's national security.

BINNEY: Absolutely.

BLITZER: So, when you hear Mike Rogers, the chairman of the House Intelligence Committee, say today, this program, this new one that we have just learned about, that's been around for a while, prevented terror attacks in the United States, what do you stay?

BINNEY: They never had to do that. They never had to collect data on all U.S. citizens to get bad guys. We were able to do that without any problems.

BLITZER: He says, without this, there would have been a successful terror attack, maybe more.

BINNEY: Only through incompetence, yes.

(CROSSTALK)

BLITZER: What does that mean?

BINNEY: That means the people looking at the data weren't competent to see a threat coming.

BLITZER: So, in other words, you think that that terror attack could have been prevented in other ways without violating the privacy and these kind issues.

(CROSSTALK)

BINNEY: Right, right, absolutely.

BLITZER: And you heard what Dianne Feinstein -- she's a liberal progressive Democrat. She says this is -- America needs this to save lives.

And you say to Dianne Feinstein?

RADACK: I say to her that her colleagues on Senate Intel, including Senators Wyden and Udall, disagree and say that most Americans would be mortified if they knew the breadth and scope and depth of this.

It far exceeds the plain language. It may be -- it may comport with the secret interpretation, but we're supposed to be a free and open democratic society.

BLITZER: What do you make of that?

TOWNSEND: It goes to an independent court. Right? It goes to the Foreign Intelligence Surveillance Court.

(CROSSTALK)

BLITZER: That's their job, this independent court.

TOWNSEND: That's their job, to review the probable cause, the basis upon which they're going to permit this collection. And so this is not just Congress, or just the executive branch. You have got all three branches of government. There's a statute that's been passed and the documents are consistent and reviewed by those standards.

BLITZER: Because Dianne Feinstein says that if under this broad sweeping surveillance that NSA is engaged in, they come across something that they flag, a phone conversation, let's say, between someone suspected of being a terrorist -- I'm just making this up -- in Yemen and someone calling to the United States, they then have to go back to another court and get further authorization to engage in additional surveillance.

RADACK: Actually, that kind of thing, they could surveil, if it was with a foreign entity.

And I respect what Fran said. But this did not involve probable cause. This did not involve even reasonable suspicion. We're talking about tens of millions of Americans who weren't suspected of doing anything to anybody who were surveilled in this kind of way.

I have no problem if people want to go to federal court. And, by the way, the Foreign Intelligence Surveillance Court isn't -- it's an independent court, but it's like a grand jury. It only hears one side of the story from the government and it doesn't hear any opposing argument.

(CROSSTALK)

RADACK: ... everything...

(CROSSTALK)

BLITZER: And, Fran, I just want to let you respond.

But this is the actual court document. It says top-secret. No foreign, meaning nobody -- no foreigners can see this, United States Foreign Intelligence Surveillance Court, Washington, D.C., but go ahead.

TOWNSEND: Right.

But the Foreign Intelligence Surveillance -- let's just be clear -- the Foreign Intelligence Surveillance Court is staffed by what's called Article 3 judges. They have lifetime appointments. They are completely independent of the executive branch, and provide a completely independent review.

BLITZER: So when Roger Vinson, he's the judge, the United States Foreign Intelligence Surveillance Court, who signed this court order says this is OK, you say?

RADACK: I say that I have no idea what the probable cause is. This whole thing is secret. Whatever the FISA court does, it only hears the government's side of the story about why it needs an order like that. And I don't know what the government could have possibly told the judge to necessitate or to get this kind of order.

BLITZER: Go ahead.

TOWNSEND: OK. So I ran the unit -- I ran the unit that presents the cases to the federal judge.

BLITZER: When you were at the Justice Department.

TOWNSEND: When I was at the Justice Department.

And, so, one, there is a sworn federal agent who has to give a factual recitation that he swears under oath that supports the request to the court. The court then has the ability to ask questions of the agents and the lawyers and frequently will make them go back and get additional information before they will approve an application.

BLITZER: Mr. Binney, you know, a lot of Americans say they're willing to sacrifice a little bit of their privacy if it will prevent another 9/11 from happening. What do you say to those folks who say, you know what, it's not that bad?

BINNEY: Well, my point all along is that even with when I was working at NSA is you don't have to sacrifice anybody's privacy to stop people like terrorists coming in and trying to commit some terrorist act inside this country. You do not have to violate their privacy. They're easy -- this is not technically that difficult to do.

BLITZER: You want to respond to that?

TOWNSEND: Well, in this case, what you're getting, again, is not the content of these conversations. You're not surveilling the content. You're getting the metadata, so it's who called who, the duration and the location. But you're not getting the content.

BLITZER: And if you want to get the content, you have to go back to another judge and get authorization to do that.

(CROSSTALK)

BLITZER: Hold your thoughts for a moment. I want to continue this conversation, because these are really important, sensitive issues, and the public out there has a right to know what's going on. Stand by.

Up next, stay with us. We're also getting some more breaking news coming into THE SITUATION ROOM. It's not just phones, apparently. "The Washington Post" has just revealed another secret surveillance program involving the Internet. We're going to have details of that we will discuss with our panel. And it looks like someone's basement rec room. But it's actually, get this, a federal government warehouse, and taxpayers are footing the bill.

Plus, an exclusive joint interview with Mitt and Ann Romney. They're opening up to CNN's Gloria Borger about their most difficult moments after losing the race for the White House.

(COMMERCIAL BREAK)

ANNOUNCER: This is CNN breaking news.

BLITZER: Another explosive article has just appeared, this time in "The Washington Post."

It's breaking news, and it reveals another broad and secret U.S. government surveillance program. "The Washington Post" and "The Guardian" in London reporting that the NSA and the FBI are tapping directly into the central servers of nine leading Internet companies, including Microsoft, Yahoo!, Google, Facebook, AOL, Skype, YouTube, and Apple. "The Post" says they're extracting audio, video, photographs, e-mails, documents and connection logs that enable analysts to track a person's movements and contacts over time.

Let's discuss this latest revelation. They're coming out fast, very, very quickly. Bill Binney is still with us, the former official of the NSA who quit back in 2001. You were angry over what was going on. You have been known as a whistle-blower right now. And Jesselyn Radack is joining us from the Government Accountability Project, an attorney representing Bill Binney, among others. It's a private organization. CNN national security analyst Fran Townsend is here as well.

Well, Bill, what do you think about this "Washington Post" story?

BINNEY: Well, I assume it's just a continuation of what they have been doing all along.

Mark Klein exposed the NSA room in the AT&T facility in San Francisco where they had Naris devices connected up to the fiberoptic lines inside the United States. What that technically meant to me...

BLITZER: Drink some water.

BINNEY: ... was that those devices could sessionize everything on that line and pass it on to the NSA. That included all the e-mails coming across...

(CROSSTALK)

BLITZER: So you're not surprised by this?

BINNEY: No.

BLITZER: Are you surprised?

RADACK: Actually, although, I find it very disturbing, I'm not surprised, because not only Bill, but Tom Drake and two other NSA whistle-blowers, have been shouting this from the rooftops for the last three years, that NSA was collecting all digital data, not just telephone envelope-type information, which I know people like to argue, don't worry, it's only the name and numbers.

You can actually get a lot more information from that than from content. But, again, my clients have been talking about this for years.

BLITZER: If this story is true, Fran, "The Washington Post" story that has just moved, just been posted on their Web site, obviously, the Obama administration would need court authorization for some massive surveillance program like this.

TOWNSEND: Right.

Look, Wolf, I haven't even read the thing yet, but, yes, that's right. You would presume that this was done under a court authorization, with a showing of probable cause. And it would have been briefed to Congress.

BLITZER: Congress would be informed of it. The chairs of the Intelligence Committees, the ranking members, the speaker, presumably, the Senate majority leader, among others. So there's no suggestion this is illegal, right?

RADACK: Well, I think if you read the plain language of Section 215, which I know most people probably...

(CROSSTALK)

BLITZER: The Patriot Act was pretty broad. So there is a basis, a legal basis for the government to intrude like this.

RADACK: Not on domestic-to-domestic communications.

There's plenty of latitude to hurry up the FISA process, to quicken that, to have foreign-to-domestic. You don't have to go through a bunch of red tape. But it does not approve the letter...

(CROSSTALK)

BLITZER: So, right now, basically they can say, if there's a foreign partner in a conversation or in an e-mail, that's OK, but if it's just strictly within the U.S., then that's not OK; is that your understanding?

TOWNSEND: And, Wolf, we should be clear that there's a whole process by which -- what the NSA collects, legally collects, there's an audit done by the Justice Department, by lawyers of both the collection of the FBI and the NSA.

They have to file reports to the attorney general if they collect things that they are not authorized to either collect or to access, and that's done on a regular basis, and those reports are provided to Congress.

(CROSSTALK)

BLITZER: Very quickly, when the FBI raided your home, your wife was there. You were in the shower when they showed up?

BINNEY: Yes, I was.

BLITZER: Guns in their...

BINNEY: Yes.

BLITZER: Did they ever charge you?

BINNEY: No.

BLITZER: Did they ever charge you with a crime or anything like that?

BINNEY: No. It was meant to intimidate me. That's it. BLITZER: But you were never accused of any espionage or any wrongdoing or violating law by leaking classified information?

(CROSSTALK)

BINNEY: No.

BLITZER: Do you have any idea who's leaking this information? Because you have represented some whistle-blowers over the years.

(CROSSTALK)

RADACK: I have, yes. And your co-whistle-blower was in fact charged under the Espionage Act in the case that collapsed in spectacular fashion.

I don't know who leaked this. I have no doubt that the administration will launch an investigation, not into who approved these programs, but into who leaked the information.

BLITZER: Yes, I'm sure there will be these investigations.

To all of you, thank you very much. These are critically important issue and I want our viewers to get a better appreciation of what's going on. Thanks to all three of you for coming in.

(CROSSTALK)

BLITZER: Up next, it looks like someone's basement rec room, but it's a federal government warehouse, taxpayers footing the bill.

And more of our exclusive joint interview with Mitt and Ann Romney. They're opening up to CNN's Gloria Borger about their most difficult moments after losing the White House.

(COMMERCIAL BREAK)

BLITZER: Happening now: Mitt and Ann Romney in a candid and exclusive interview on the heartbreak of losing the White House and their lives out there out of the political spotlight.

Michelle Obama, is she snubbing a global power? She's skipping a trip with her husband and it's raising some eyebrows.

And secret personal lounges inside, get this, a government warehouse, another outrageous expense on the taxpayers' dime. It has now been revealed.

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

Tonight, for the first time, and only here on CNN, Mitt and Ann Romney, they are opening up about the 2012 presidential election, and the wrenching loss that took both of them by surprise.

The Romneys sat down with our chief political analyst, Gloria Borger, for this exclusive and extraordinarily candid interview, talking about when they started to realize election night wasn't going their way.

(BEGIN VIDEOTAPE)

ANN ROMNEY, WIFE OF MITT ROMNEY: My team tells me that I was still holding out hope at 8:00. I don't think I was. But I think at 6:00, I was really worried. By 8:00, I think we knew it wasn't going well.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: And who kept hope alive?

A. ROMNEY: Me.

BORGER: I gather Karl Rove was calling.

A. ROMNEY: Karl Rove was, yes, was saying, don't give up. This isn't right. Whatever's happening, our numbers in Ohio are better than what they're thinking. So, yes.

BORGER: And what about you?

MITT ROMNEY (R), FORMER PRESIDENTIAL CANDIDATE: Well, I think the reason that Karl Rove and others, including members of my campaign team, not all, but some, felt that we were going to win, even as the evening went on, was that we looked at the numbers, and it showed that we were winning among independent voters...

A. ROMNEY: By the margin we should have.

M. ROMNEY: Yes, by a good margin. And they said, well, you're not going to lose Ohio if we win independent voters in Ohio. But we did.

And I think they just hadn't counted on the kind of turnout that would come from various minority groups, where we had not done as good a job as I wish we would have.

BORGER: When did you know?

M. ROMNEY: Well, probably, you know, you don't really know until 7:00 or 8:00, something like that.

BORGER: Exit polls?

M. ROMNEY: But the exit polls showed we were struggling in Florida and North Carolina. And we thought we were going to win big in Florida and North Carolina. And so if we were struggling there, that was a pretty good indication.

BORGER: Did you call each other?

(CROSSTALK)

M. ROMNEY: I got back about 4:00 or 5:00 in the afternoon.

BORGER: OK. So you were together? M. ROMNEY: So we were together. And I said, boy, the exit polls are not good. And Ann said, don't worry. And I said, well, we will watch.

And the numbers came in. And you don't know immediately because the numbers were close. And you don't know until the last counties are counted.

BORGER: Now, you're a numbers guy. And the analytics of the Obama campaign were so stunning, and their door-knocking and their ability to predict the electorate was -- really outgunned your campaign. Did you sort of sit there and go, why didn't I know this? Why didn't I know that?

M. ROMNEY: Oh, no.

BORGER: Why didn't I expect this?

M. ROMNEY: No, no, because we had, I don't know, maybe four or five months in a general election campaign. I was, before that, in a primary campaign. I wasn't the nominee. We didn't begin our general election effort until I became the nominee and began putting people together and doing our get-out-the-vote effort.

But the president had four years. One of the advantages of incumbency and one of the reasons it's difficult to replace an incumbent is, as an incumbent, you don't have a primary. You can raise money during the entire season, use it on the general election. You can hit your opponent when they come out of their primary. And you can build the kind of team -- I think he had as many as 10 times the number of ground workers, paid staff that we had, because he could afford them and we couldn't.

BORGER: Had you written a concession speech?

M. ROMNEY: No. I had written a very good winning speech.

(LAUGHTER)

A. ROMNEY: It was great.

M. ROMNEY: And I didn't think we were going to lose. I certainly didn't want to write a concession speech.

But at I think around -- I would have to go back and ask other people, but I think around 7:30 or 8:00 when it was pretty clear we were not sure we were going to win, that it was time to begin to put together some thoughts for a concession speech, which I did.

BORGER: Did you stay up half the night?

M. ROMNEY: Well, we had the -- the kids were there.

BORGER: Sure.

M. ROMNEY: So we had pizza with the kids and talked about what we were going to be doing next, and what each of them was doing. We put the grandkids to bed.

The next morning, we drove home to Belmont in Massachusetts. We have a condo there we live in. And we -- the refrigerator was bare, so go to the market and get some food.

(CROSSTALK)

M. ROMNEY: And we spoke with the Secret Service. They said, look, we'd like to transition over a week or so, maybe a little longer, because you're still very much in the public eye. And we said, no, we would like to transition faster than that. We don't want the taxpayers to be picking up your costs any longer.

We're no longer...

BORGER: So, then it's just the two of you.

A. ROMNEY: Yes.

M. ROMNEY: Then it's the two of us.

BORGER: Who took it the hardest?

A. ROMNEY: I don't think it was -- I think, initially, maybe I did. I think, initially, I was more upset.

M. ROMNEY: You know, we -- the next day, we went to the campaign office, and the workers were there, all the campaign workers, and gathered. And I got on the stand and spoke to them. And they had worked really hard for a long, long, long time.

A. ROMNEY: There were a lot of tears. A lot of tears.

M. ROMNEY: It's very hard. It's a real heart-wrenching experience, to say, you know, we just didn't get the job done.

But I also said to them, look, life's currency is the friendships you make. And we have made friendships in this campaign we will never forget. We were -- we were in the foxhole together. And this is something we won't lose. And we are all richer from the experience by virtue of those friendships that we've made.

BORGER: Because we all saw the pictures of you at Thanksgiving, in California. The governor and the boys at Disneyland. And sort of that was the public face of the Romneys...

A. ROMNEY: Right.

BORGER: ... after the election. And so the question is, what's going on behind that -- behind that public view?

A. ROMNEY: Obviously, there's a lot of healing that has to happen when anything is as traumatic as that -- that you go through.

But I also can be very quickly reminded of how traumatic life experiences are for everyone in this country. People, you know -- we lost an election. Let's put that in perspective. People lost a husband, lost a wife, lost a child. Lost someone in battle. There were so many things that people have to deal with in this life.

And, you know, yes, that was hard. But I think we can put it in perspective very quickly and say, "Aren't we blessed? Aren't we blessed to live in this country?" I think it would have been a better one if Mitt had won, but aren't we blessed? This is an amazing country, amazing people.

M. ROMNEY: We loved the experience. It was hard work. It's -- I said it was like a roller coaster. Yes, there are ups, and there are downs. But you still pay to get on the roller coaster. It's a real thrill and an experience that we will never forget. And frankly, I'd do it again.

BORGER: You would?

M. ROMNEY: Look...

BORGER: Again?

M. ROMNEY: I would do it again, but -- but it's not my time.

A. ROMNEY: I would go with that.

M. ROMNEY: Ann might not, but I would love to do it again. Are you kidding? I'd love to do it and win. But it's not my -- it's not my time. I had my chance. I expressed my views. I didn't win. It's time for someone else now to get in there, and give it their best shot.

And I'm -- I'm optimistic that a Republican is going to win in 2016. But I'm not going to be that guy. There will be somebody else that takes that mantle. And more power to them. I hope I can help them in some way. But that's something which time will tell.

BORGER: How do you get back to living a life without that single-minded intensity and focus that you have to have during a campaign every single minute of every single day?

M. ROMNEY: I'd say it's almost the opposite. It's easy to live life with family, with household chores you have, with the privacy you enjoy. What's difficult is going into a campaign and becoming extraordinarily focused, day after day, speaking to large groups of people, getting to know individuals one on one, learning their experiences, dealing with the media, that's what's difficult.

BORGER: Dealing with your mistakes.

M. ROMNEY: Dealing with your mistakes. That's what's difficult. That's what's challenging. When that's over, it's like, oh, back to real life. Isn't this great?

So it's not hard going back. It's hard going into the campaign. It's a new experience and a thrill. But at the same time, it's a real challenge. BORGER: Don't you spend a lot of your time kicking yourself? Like after the 47 percent remark, which was a real problem, didn't you kick yourself?

M. ROMNEY: Oh, yes, I was very upset. There are a number of times that I said things that didn't come out right. And one of the interesting things about campaigns today, unlike probably 25 or 30 years ago, is that everything you say is being recorded. And, you know, now and then things don't come out exactly the way you want them to come out. They don't sound the way you thought they sounded.

And now, with a good opposition campaign, they grabbed it, they blow it up, maybe they take it a bit out of context, maybe they don't, but it obviously is paraded in a way that you hadn't intended. But that's just the nature of politics today and you have to get over it and live with it.

BORGER: Do you miss it?

A. ROMNEY: I'll tell you what I do miss. I miss the associations that we had. The staff that I loved. The Secret Service agents, loved them. Having those -- it was the -- the personal feelings that I had with that. It was exciting. It was a lot of fun; a lot of days were a lot of fun. So yes, I do miss the personal associations that we had.

BORGER: Do you miss it? The limelight?

M. ROMNEY: Not the limelight, no, not the limelight and the constant scrutiny, and the microscope. Seeing if you can -- is your hair slightly out of alignment? What kind of shirt do you have on today? You don't enjoy that.

But you do miss the friendships. The friendships we've made during this campaign, and the one before, are life-long friendships. And I wish I could spend more time with those people.

(END VIDEOTAPE)

BLITZER: Fascinating stuff. We'll have more from Mitt Romney just ahead. Stand by for his advice to future presidential candidates. Also, we'll hear his take on Hillary Clinton. More of the interview with Gloria coming up.

We're also going to show you the secret personal lounges built inside a federal government warehouse on your dime.

(COMMERCIAL BREAK)

BLITZER: When CNN's chief political analyst Gloria Borger spoke with Mitt Romney, they spoke about the lessons he learned in 2012. He also looked ahead to 2016.

(END VIDEOTAPE)

BORGER: Let me ask you, Governor. You're here with Republican presidential candidates, fund-raisers. Democrats are coming here to -- you've run twice. What advice will you be giving to these candidates? Chris Christie, Paul Ryan if he runs, Rand Paul, if he runs, Republican candidates who are thinking about running for the presidency?

M. ROMNEY: Well, you've got to make sure your family's entirely united, and they understand what they're getting into, and they're willing to give themselves to the effort. Because it's going to be a lot of work.

And No. 2, you've got to make sure you build the best staff in the world. An extraordinary group of people that are loyal to you and to one another, and that are experienced.

I'd say No. 3, you've got to begin raising money.

BORGER: What should they not do?

M. ROMNEY: Don't make any mistakes. Be perfect. The funny thing is, everyone says, you know, be spontaneous, you know, don't act like you're being crafted. Well, today everything you say is being captured by video, or, you know, hand-held camera and so forth. And so jokes, for instance, will get you in trouble. Anytime you're trying to be funny...

BORGER: It happened to you. Yes.

M. ROMNEY: Yes. I mean, you've just -- you've just got to be very, very careful. And every question asked, you've got to stop and say, OK, what's the intent of the question? What do I really want to say here? Don't get pulled off your message by something that...

BORGER: Doesn't that keep people from knowing who you are, though?

M. ROMNEY: You know, there's got to be a better way to have people get to know the person running for office. Because right now, most people only see you in a 30-second ad which doesn't tell them much, or debates.

(END VIDEOTAPE)

BLITZER: Gloria is here with us.

Gloria, you also asked about Hillary Clinton maybe running for the Democratic presidential nomination in 2016.

BORGER: I did. And it's interesting, Wolf. He clearly believes that Benghazi has damaged Hillary Clinton's currency to a great degree. And also, he believes that Barack Obama's foreign policy has. Take a listen.

(BEGIN VIDEO CLIP)

M. ROMNEY: I think Secretary Clinton's challenge will -- not just be Benghazi, but more the record of American foreign policy over the last four years, while she was secretary of state. We'll look at everything from North Korea, to Iran, to Pakistan, to Afghanistan, to Syria, to Egypt.

And you look across the world and our prospects, the prospects for stability, for liberal democracy, for freedom have retreated over the period of her administration, in the Department of State. And I think that's something that will be a challenge for her.

(END VIDEO CLIP)

BORGER: Well, Wolf, you see, he's clearly already getting back into the fray of 2016.

I should also add that he had nice things to say about Chris Christie, whom lots of Republicans were angry about during the campaign. Paul Ryan, as well as Rand Paul, all of whom are going to be in his event in Park City.

BLITZER: Sounds like a good event.

BORGER: Yes.

BLITZER: Look forward to that. Excellent work, Gloria. Thanks very much.

BORGER: Thank you.

BLITZER: Just got back late last night...

BORGER: Yes.

BLITZER: ... from Park City, Utah. But here you are again.

BORGER: Beautiful, though, wasn't it?

BLITZER: Yes. It was lovely. Thank you.

BORGER: Sure.

BLITZER: Coming up, an investigation exposing secret lounges -- some calling them "man caves" -- set up by workers getting paid by you, the taxpayer.

(COMMERCIAL BREAK)

BLITZER: Here's another outrageous look at what some workers are doing at taxpayer expense. Take a look at this.

Contractors setting up secret personal lounges inside a huge Environmental Protection Agency warehouse. But now, an EPA investigator has blown the whistle on them.

Our Brian Todd has this report.

(BEGIN VIDEOTAPE) BRIAN TODD, CNN CORRESPONDENT (voice-over): How's this for a man cave? A private space with a couch, chairs, TV, a weight set. This isn't your cousin's basement. It's a U.S. government facility, a warehouse in Landover, Maryland, overseen by the Environmental Protection Agency, leased and operated by a private contractor for 1.6 million of your tax dollars a year.

ROBERT ADACHI, EPA INSPECTOR GENERAL'S OFFICE: When the auditors first saw it, it was overwhelming.

TODD: Robert Adachi was the lead auditor for the EPA's inspector general, who just issued a report on the facility. The document looks like a brochure, with pictures of other man caves in the same warehouse. Here's a space with an even larger TV, a chair, artwork on the wall.

Some had personal photos and pinups, and...

ADACHI: They had put in a refrigerator, microwave ovens.

TODD: That black object bottom center? That's a hair trimmer. I spoke about all this with taxpayer advocate Ryan Alexander.

RYAN ALEXANDER, TAXPAYERS FOR COMMON SENSE: We hired these people. We paid taxpayer money for these people to manage our inventory, take care of the warehouse. And as far as we can tell from what the inspector general found, they didn't do any of that.

TODD: And, the report says, these personal spaces were hidden from security cameras by partitions, curtains and piled up boxes.

(on camera): The EPA said we couldn't get access inside this warehouse, but EPA officials say as soon as they learned what the inspector general found, they had the private contractors who operated this building escorted out. They prohibited them from coming back, and they began taking an inventory of everything inside.

(voice-over): It's not just the little get-away spaces that raised concern. Those little specks on the box, lower right?

ADACHI: We did take pictures of places where they had taken rat traps, and where there were rat feces all throughout the building.

TODD: One place the contractors did keep immaculate, the 30- by 45-foot gym, with updated equipment including...

ADACHI: A picture show (ph), also a computer that was attached to some speakers, and it appeared to be used for music.

TODD: There was a security breach: expired passports of EPA employees with all their identity information lying there in open boxes. And did we mention the inexplicable inventory?

(on camera): Pardon my language, but what the hell do we need with pianos at an EPA warehouse? ALEXANDER: Good question. Why the EPA has pianos and why they had all this other inventory in the warehouse. Why they had all this stuff that we weren't using.

(END VIDEOTAPE)

TODD: An EPA spokeswoman says those pianos had been at EPA headquarters for award ceremonies, receptions and other functions there, and then they were moved to the warehouse.

The agency said in a statement that it moved quickly to address all of these problems, and indeed, the inspector general does give the EPA high marks for its fast response.

We called and e-mailed several times the private contractor that operated that warehouse, Apex Logistics of College Park, Maryland. We never heard back -- Wolf.

BLITZER: If you do, let us know.

TODD: Sure.

BLITZER: Brian Todd, excellent report. Thanks very much.

We'll have more of the breaking news coming up right here in THE SITUATION ROOM. "The Washington Post" now reporting the U.S. government is tapping directly into the servers of the biggest Internet companies in the United States. "The Post" has now published top-secret slides detailing what's going on.

(COMMERCIAL BREAK)

BLITZER: Let's get back to the breaking news now. "The Washington Post" and "The Guardian" reporting the U.S. government is now also tapping directly into the central servers of nine leading Internet companies, including Microsoft, Yahoo, Google, Facebook, AOL, Skype, YouTube and Apple. The newspapers just released new information to back up their reporting.

Tom Foreman is here taking a closer look. What's the latest?

TOM FOREMAN, CNN CORRESPONDENT: This information is really stunning, Wolf, when you consider it. Look at this one quote from the end of this article from "The Washington Post," "The Guardian." These are actually the slides here. But look at this quote.

The reason they say that they have the slides from a Power Point presentation that was done for the intelligence community. What was said in here is that firsthand experience with the systems and horror at their capabilities is what drove a career intelligence officer to provide Power Point slides about Prism and supporting materials to "The Washington Post" in order to expose what he believes to be a gross intrusion on privacy.

Quote, "They quite literally can watch your ideas form as you type," the officer said. Now let's look at the slides here, Wolf, that were from the presentation, because they really are quite surprising. This is the overview slide. You'll notice at the bottom the date there, April 2013. Very recent.

Now look at what this thing is all about. If you look at the next slide here, you can see they're talking in here about how communications flow from place to place on systems like Google and Yahoo that they're apparently, according to this program, monitoring.

And now look at the next part here, what is being monitored. This is the part that will most get people's attention. Look at that. There are the companies on the left. But what they're allegedly able to look at is e-mail, chats, videos, photos, stored data, video conferencing, all sorts of things that people would have thought were private, that were just on their desktop.

This is what is certainly going to put people up in arms to some degree, Wolf, because you look at that plus look at the data agreements that they made with the different companies. There are the dates there if you look side to side. They're a little hard to see. You see at the bottom, 2007 to 2013. That's the time line of how they entered into these program with all these companies that virtually all of us rely on all the time.

Again, reporting from "The Guardian" and "The Washington Post" suggesting that all the coverage today by cell phones looks like the tip of the iceberg.

Here's this ultra-secret program called Prism they're reporting on, which has been allowing the government to look in on the desktops of computer users, if this report is correct, and simply see what we're doing: who we're communicating with, the things we're writing, the video message we're exchanging and all sorts of things that, again, many, many computer users thought were private.

BLITZER: Apparently, though, authorized by Congress and the Patriot Act, authorized by a judge with these foreign intelligence courts, authorized obviously, by the president of the United States. We're going to have much more on this coming up. We'll see what's going on. But pretty shocking information.

Coming up also here in THE SITUATION ROOM, why the first lady isn't going with her husband for an important meeting with China's new president and his wife.

(COMMERCIAL BREAK)

BLITZER: All right. There's a lot of speculation out there about the first lady, Michelle Obama, why she won't be joining her husband when he meets with the new Chinese president. Erin McPike is looking into this for us.

(BEGIN VIDEOTAPE)

ERIN MCPIKE, CNN CORRESPONDENT (voice-over): A Chinese state visit is usually filled with pomp and circumstance. But when President Obama travels all the way to California this weekend to meet with new Chinese President Xi Jinping, the setting will be casual. It's being billed as a sign of progress for American and Chinese diplomacy: these two major world leaders rolling up their sleeves and building a personal relationship.

The Chinese president will be bringing along his wife, Peng Liyuan.

(MUSIC)

MCPIKE: Like Michelle Obama, Peng Liyuan is considered a rock star in China, except Peng actually is a rock star.

But she won't be serenading Michelle Obama. President Obama is going it alone, meaning there will be no face time for the first ladies. It's a curious turn. First ladies entertaining other first ladies is customary for many major state visits.

There are mixed reaction on Chinese social media about Mrs. Obama's decision to stay home. One said, "Because our first lady is so pretty that she was scared to show up?" Another, "Why disappointed? It is for sure understandable that she put family and her kids in the first place. Also, she's a mom in the first place, then the first lady."

Still, critics say that's a mistake for the White House as it tries to thaw tensions with the Chinese.

CHENG LI, BROOKINGS INSTITUTION: This is a kind of political gesture from the U.S. or this is part of a disrespect and people in China will think, you know, this may not be just a family matter.

MCPIKE: Cheng LI studies U.S.-Chinese relations for the Brookings Institution.

LI: It is unfortunate that the first lady will not be there. Otherwise, it will be a perfect story, with a double date.

MCPIKE (on camera): Now I should point out it's Sasha Obama's 12th birthday on Monday, and the White House says they haven't heard any complaints from their Chinese counterparts about the mom in chief's decision to stay home.

Erin McPike, CNN, Washington.

(END VIDEOTAPE)

BLITZER: That's it for me. Thanks very much for watching. See you back here in THE SITUATION ROOM tomorrow.

"ERIN BURNETT OUTFRONT" starts right now.