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THE SITUATION ROOM

Interview With German Foreign Minister Guido Westerwelle; President Obama's Approval Rating Drops; U.S. Spying on Vatican?

Aired October 31, 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 HOST: Happening now: President Obama's scary October. On this Halloween, the White House is reeling from a series of political nightmares.

Plus, Americans potentially could be paying a huge price for Obamacare and its failures. We're talking billions of dollars.

Was the U.S. spying on the Vatican while cardinals were choosing the new pope? The NSA says no. A key U.S. ally tells me it's possible.

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

This image says a lot about the state of the Obama White House right now, the cover of "Bloomberg Businessweek" suggesting the administration has crashed, much like the Obamacare Web site. Today alone, the president's approval rating has fallen to an all-time low of 42 percent in a brand-new poll. Republicans blocked, meanwhile, the confirmation of two of his high-profile nominees and subpoenaed his health secretary for more information about the Web site fiasco.

We have a team of coverage coming up this hour of the president's enormous challenges right now, not only here in the United States, but around the world.

First to our chief congressional correspondent, Dana Bash.

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Wolf, the White House isn't just in damage control over a bad health care Web site. They're also trying to calm concerns from Americans all over the country who are being dropped from their current health plans. Republicans here on Capitol Hill are saying, we told you so.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: The gentleman from Ohio, Mr. Boehner.

BASH (voice-over): March 2010, then Minority leader John Boehner came to the House floor as Democrats were poised to pass Obamacare. He issued this warning.

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: Look at this bill. Ask yourself, do you really believe that if you like the health plan that you have, that you can keep it? No, you can't. BASH: It's just one example of a Republican effort before the health care bill became law of the land to push back on this presidential sales pitch.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: If you like your health care plan, you will be able to keep your health care plan, period. No one will take it away, no matter what.

BASH: That was the summer of 2009, during the heat of the health care legislative battle. So was this weekly GOP address.

REP. TOM PRICE (R), GEORGIA: On the stump, the president regularly tells Americans that, if you like your plan, you can keep your plan, but if you real your bill, that just isn't so.

For starters, within five years, every health care plan will have to meet a new federal definition for coverage, one that your current plan might not match, even if you like it.

BASH: Fast-forward three years, that's exactly what's happening. Insurance companies are dropping Americans all across the country from their health plans, many because policies don't have coverage now required under Obamacare. Democrats trying to calm concerned constituents call it a good thing.

REP. HENRY WAXMAN (D), CALIFORNIA: If we don't enforce this policy, insurance companies can continue offering flimsy coverage that disappears when people actually need it. No one should want that.

BASH: The HHS secretary struggled to explain. Some current plans are for longer available because they're bad for consumers and no longer legal.

KATHLEEN SEBELIUS, U.S. HEALTH AND HUMAN SERVICES SECRETARY: Many women are charged 50 percent more than men. That will be illegal.

BASH: The problem, that's not what people expected when they heard this over and over.

OBAMA: If you like your plan, you can keep your plan.

(END VIDEOTAPE)

BASH: While Republicans are eager say, I told you so, privately Democrats are increasingly frustrated and regretful they left Americans with expectations that didn't pan out. In fact, the number two House Democrat, Steny Hoyer, said this week that they should have been "more precise" in explaining that not everyone will be able to keep their current plans, especially if they don't meet new minimum mandatory standards -- Wolf.

BLITZER: Dana Bash on Capitol Hill, thank you.

Let's get to the cost of Obamacare right now, a cost that goes potentially well beyond the Web site and its problems. American taxpayers are paying billions of dollars for the states to set up their health care exchanges.

Tom Foreman has been tallying up the costs for us.

Tom, what are we see?

TOM FOREMAN, CNN CORRESPONDENT: Wolf, a great deal has been made over the cost of Obamacare Web site.

Secretary Sebelius puts the price tag at about $174 million so far, and others put it closer to $300 million, but now we're starting to see numbers on how much it cost to set up all the state exchanges, too, and the price is actually very hefty when you start looking at that.

To start with, every state out there, except for Florida and Alaska, received a state planning grant, even if they did not plan to participate in Obamacare, just to study how it would fit into and affect their state governments, their existing insurance programs and their populations.

The bottom line, for those students, more than 53 million federal dollars sent to and spent by the states. Next, many of those states that were seriously considering full participation in Obamacare needed even more money. They needed committees and research and so forth beyond that initial level. That was really costly, because now we're talking about the first step coming up to $1,767,000, a little bit more than that. Bottom line for level one establishments, more than $1.25 billion.

And some states have taken it all the way. They're fully invested in this idea. And getting to that point costs even more. The bottom line for the level two establishment grants, well over $2 billion. Look at the total. Beyond all of the federal part of Obamacare, which we have been talking about so much, this is how much of your tax money has gone to helping the states get ready for Obamacare. More than $4 billion, pushing up toward $4.5 billion -- Wolf.

BLITZER: A lot of money, Tom. The White House has pointed out that some of those state exchanges, the Web sites, they are working quite well, suggesting the money was well spent.

FOREMAN: They have said that, and in such instances where it's working like that, that may be a fair claim. This is no surprise. Everyone knew this money had to be spent to help the states get ready.

But other places are not helping the administration much with their arguments. For example, if you look at Colorado, Colorado has received almost $179 million to help deal with 716,000 uninsured residents here. But so far, just over 3,000 have enrolled. As we have said in everything we do, Wolf, this is early in the process. Much of this will change as it moves forward, but again, these numbers at least right now make it look very costly and are not helping the administration with their arguments.

BLITZER: Tom Foreman with those numbers, thank you. Still ahead, is the Vatican vulnerable to U.S. spying? We're taking a look into a bombshell report in Italy and the NSA's flat denials. A key American ally tells me, though, anything is possible.

Plus, an update on the breaking news, the story we're following, a school bus that went off a bridge in Kansas.

(COMMERCIAL BREAK)

BLITZER: In the midst of the Obamacare controversy, the U.S. government says it's making flexible spending accounts for health care more user-friendly.

For decades, participants had to use all the money in their FSA accounts by the end of the year or lose it. Now they will be able to carry over up to $500 of unused money into the next year.

More news right after this.

(COMMERCIAL BREAK)

BLITZER: An international watchdog group says Syria has now destroyed all its chemical weapons facilities, meeting its first deadline.

Let's bring in our chief national security correspondent, Jim Sciutto.

The Syrians apparently they met this first deadline, but there are still some significant problems out there.

JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT: Yes.

Well, when you think where we were a little more than a month ago, in Geneva, when this deal came out of nowhere, we have come a lot way. But even the White House admits there is still a long way to go. We have a new report tonight on FP.com that Syria has asked to keep some of this chemical weapons factories to turn into civilian chemical factories.

I spoke to a U.S. official about this who told me -- quote -- "There's a real concern that the Syrians might be trying to reserve some of their chemical weapons capabilities."

And, remember, separate from the factories, Syria still has one of the largest chemical weapons stockpiles in the world. As long as they have those stockpiles, in theory they could still use them. "Jane's Defense Weekly" made the following damning assessment -- quote -- "The destruction of the production equipment has little to no impact on their immediate capabilities."

There are other problems. Russia still shipping arms to Syria, even as it takes part in this chemical weapons deal. This is something that U.S. Ambassador to Syria Robert Ford spoke about during hearings on the Hill today. Listen to this exchange.

(BEGIN VIDEO CLIP) ROBERT FORD, U.S. AMBASSADOR TO SYRIA: But I can say this, that it's substantial, that it has increased from a year ago. There are more deliveries. And in some cases, they are militarily extremely significant.

(END VIDEO CLIP)

SCIUTTO: One thing the Russians have shipped in recently are refurbished warplanes, which are significant. They do help tip the balance of this war.

BLITZER: Amidst all of this, Secretary John Kerry, secretary of state, he is working aggressively to come up with some sort of real solution.

SCIUTTO: He is. He wants to push the so-called Geneva two talks, peace talks in Geneva over Syria scheduled for later next month.

The trouble is several of the key players don't want to take part, and you have at least 20 rebel groups boycotting the conference. And the main political opposition group in Syria says it won't decide until November 9 whether it will take part. It's also not clear whether Iran and Saudi Arabia who are backing the opposing sides will participate.

And at the same time you have strong criticism of the Obama administration's stumbling support for the opposition. Ambassador Ford also took real heat on this today. Listen to another exchange.

(BEGIN VIDEO CLIP)

FORD: there isn't a person on my team at the State Department who doesn't feel frustrated by the Syrian problem in general. But I have to say, we do provide support to help them against the regime. We provide a lot of support.

SEN. BOB CORKER (R), TENNESSEE: I think our help to the opposition has been an embarrassment. And I find it appalling that you would sit here and act as if we're doing the things we said we would do three months ago, six months ago, nine months ago.

(END VIDEO CLIP)

SCIUTTO: Some blistering criticism there. And as long as the opposition is weak, the Assad regime is emboldened. Assad even said in public recently, Wolf, he's thinking about running for reelection next year. Doesn't sound like the guy who thinking about stepping down. That's a real problem.

BLITZER: It certainly is. Jim Sciutto, thanks very, very much.

Just ahead, the Vatican's response to a report that it's been a target of U.S. surveillance. I will ask a key U.S. ally if he trusts prosecute after all the spying allegations.

(COMMERCIAL BREAK) BLITZER: We have an update on the breaking news coming into THE SITUATION ROOM, reports of a school bus that's gone off a bridge near Douglass, Kansas.

We're told the bus driver, some children are being pulled from the water. We have no word yet how many people were on board. There are no reports of fatalities. We will update you with more information as we get it.

(COMMERCIAL BREAK)

BLITZER: The Obama administration has been getting angry pushback over reports of U.S. spying on key allies. Now even the Vatican is getting dragged into this.

Brian Todd is taking a closer look into what's going on.

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT (voice-over): It's a place where secrecy is almost celebrated, where changes in leadership are signaled with smoke.

But could even the Vatican be vulnerable to NSA eavesdropping? A report in Italy's "Panorama" magazine says the NSA intercepted calls into and out of the residence where cardinals stayed before the recent conclave where Pope Francis was chosen. The NSA says in a statement it does not target the Vatican, but on the heels of accusations made by Edward Snowden that the U.S. listened into to German Chancellor Angela Merkel's cell phone calls and may have had access to data collected from dozens of other world leaders, some experts say it doesn't matter whether the story is true or not.

U.S. intelligence officials all but admit they do spy on America's allies.

LT. GEN. JAMES CLAPPER (RET.), NATIONAL INTELLIGENCE DIRECTOR: Some of this reminds me a lot of the classic movie "Casablanca." My god, there's gambling going on here. It's the same kind of thing.

TODD: Author Matthew Aid says one way the NSA can reestablish trust.

MATTHEW AID, AUTHOR: If it came forward and was more open, more transparent about what it does and why it does these things, including spying on our friends and allies, I think people may say, well, that makes sense.

TODD: The Vatican responded to the "Panorama" report, saying: "We're not concerned."

Others say if anyone is listening in on the Vatican, there could be good reason. Analysts say the papacy is plugged in, in places like Syria, where Western intelligence agencies sometimes don't have eyes and ears.

JOHN ALLEN, CNN SENIOR VATICAN ANALYST: They are priests, and nuns, and other Catholic players who have boots on the ground in those places who often are passing information back up the food chain about what is really happening. It would not surprise me at all if the American government were interested in gleaning some of that insight.

(END VIDEOTAPE)

TODD: The analysts we spoke to today say part of the NSA's problem now is just one of image, that it's been so secretive for so long, that no one knows quite what to believe, especially in light of new reports that the NSA was spying on the German chancellor's cell phone -- Wolf.

BLITZER: Brian Todd, thanks very much.

And joining us now from Berlin, Germany, the Foreign Minister Of Germany, Guido Westerwelle.

Mr. Minister, thanks very much for coming in.

GUIDO WESTERWELLE, GERMAN FOREIGN MINISTER: Thank you for inviting me.

BLITZER: Let's talk about U.S.-German relations right now, specifically about the allegations that the United States was eavesdropping on the phone conversations of the German chancellor, Angela Merkel. She said: "We need trust. Spying among friends is never acceptable. True change is necessary."

What would you like the United States, President Obama, to do about this current controversy right now?

WESTERWELLE: I think it would be the right gesture if Washington would send a delegation to Berlin and to the other capitals here in Europe, because we cannot ignore that this was a breach of trust.

And we have now to consider how we can restore this confidence and this trust between our countries and, of course, our governments.

BLITZER: Do you know how long the United States was monitoring her cell phone, Angela Merkel's cell phone, how long that surveillance was going on?

WESTERWELLE: I do not want to speculate about these facts.

I can only tell you that this is a very delicate and sensitive issue for my country. We went through a very difficult history, especially when we think about the GDR and what we called the Stasi.

So these surveillance activities in Germany is really a breach of trust, and is really something which is discussed in our public opinions in a very serious and intensive way, not only in the -- in the parliament and among the political leaders. So we are not naive. We know that we all have to fight against terrorism, but you cannot fight against terrorism by tapping the chancellor's cell phone.

BLITZER: And you have no doubt that the U.S. was tapping the chancellor's cell phone? On that subject, you're 100 percent sure that they were?

WESTERWELLE: And what we heard is enough. We think it is now to consider how we can restore the confidence, because we think this eavesdropping of other governments or of millions of people is not acceptable among friends.

We belong to the same community of values. We belong to the Western communities. And this Western community is founded on common values, and, therefore, it is decisive.

BLITZER: Foreign Minister, I have spoken to U.S. intelligence officials. And they make the point that if the U.S. were doing all of this, and they acknowledge the U.S. was doing it, it was being done to fight terrorism and to help your country, the people of Germany, as well as the people of the United States. Do you buy that?

WESTERWELLE: We are grateful for the collaboration between our governments, and especially between our intelligence agencies.

But these -- we don't think that it is fighting terrorism by spying on our government or by tapping the chancellor's cell phone. So we are not naive, but when I say we are not naive, it's in both directions. On the one hand, we are not naive because we know it's necessary to fight against terrorism, but we are not naive also that we know by tapping the chancellor's cell phone, you will not fight terrorist activities. I mean, that's for sure.

BLITZER: Your interior minister has raised the possibility that you might expel certain U.S. diplomats as a result of what has been going on. Is that in fact something you are considering right now?

WESTERWELLE: No, we are not discussing these kinds of measures. And we think that our friendship is deep, and we think it's not only a partnership. We think it's a real friendship.

BLITZER: Has Germany conducted espionage activities on the United States?

WESTERWELLE: I can only repeat what the head of our intelligence agency said in a very frank and clear way. He said that the United States of America, the government in the United States of America, are not a subject of any intelligence activities of my country.

BLITZER: Bottom line, Minister, do you trust President Obama?

WESTERWELLE: We had an excellent discussion about civil rights and about privacy and freedom on the occasion of his very successful visit here in Berlin.

So I think it's now time to restore and to rebuild this confidence between our countries. And this is now our goal, and it is also our duty, what we have, as political leaders on both sides of the Atlantic. This is necessary, and this is urgent, and I think we shouldn't underestimate how serious this discussion is in Europe.

BLITZER: It sounds to me like that answer suggests you do not, at least right now, fully trust President Obama.

WESTERWELLE: I trust President Obama.

But, please, I cannot tell you what Europe intelligence agencies are doing, and I do not know what kind of reports they are giving to the president and to his team.

BLITZER: One final question before I let you go, Minister. There's this report in Italy that the U.S. was also eavesdropping, they had surveillance on the Vatican. Do you believe that?

WESTERWELLE: I don't know it. I cannot exclude it, and, probably, everything is possible.

BLITZER: The German chancellor -- excuse me -- the German foreign minister speaking with me about a very, very sensitive subject. And he was pretty blunt, I must say that.

Thanks very much for watching.

Remember, you can always follow what's going on here in THE SITUATION ROOM on Twitter. Do me a favor. Tweet me @WolfBlitzer. You can always certainly tweet the show @CNNSitRoom.

Thanks for watching.