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The Situation Room

IRS Controversy; Biting Moment at World Cup; Crisis in Iraq

Aired June 24, 2014 - 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: Happening now: a growing threat, ISIS terrorists recruiting by the thousands in the battle for control of Iraq. Stand by for a disturbing new assessment of the danger, as more American boots hit the ground.

Another key U.S. ally at risk. We are taking a closer look into rising fears that ISIS is now taking its fight beyond Iraq's borders into Jordan.

And a biting moment in a World Cup. Did a player with a history of baring his teeth do it again?

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

Flames shooting from a critical oil refinery in Iraq. You're looking at new video of a fierce battle that is under way right now, government forces firing back at ISIS terrorists. They claim they are holding on to the facility. The government claims that as the fight for Iraq rages, though the United States is stepping up its presence in the country. Another 90 American military advisers have just landed there in Baghdad.

And Secretary of State John Kerry just wrapped up his second trip to Iraq in two days.

Our correspondents are covering all of the urgent new development in the crisis.

First, let's go to our chief national security correspondent, Jim Sciutto. He is traveling with the secretary. He interviewed Secretary Kerry in Iraq today. He is now joining us from Brussels -- Jim.

JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT: Wolf, spending these last few days with Secretary Kerry, I do not get a sense that he or this administration is champing at the bit for military action from Iraq, their focus now very much on a political agreement.

That said, they are far from certain that Iraqi leaders will deliver it. Secretary Kerry says the most powerful driving force, frankly, is the dire situation in Iraq.

(BEGIN VIDEOTAPE) SCIUTTO (voice-over): The Iraqi military battled ISIS in Fallujah today, as the country's air force targeted militants claiming control over a key oil refinery.

It was against this backdrop that Secretary of State John Kerry traveled in Northern Iraq today to press Iraq's divided leaders to join together or lose any chance of defeating ISIS and saving their country.

(on camera): In your time here, have you seen any hard evidence of any of the parties involved willing to make compromises?

JOHN KERRY, U.S. SECRETARY OF STATE: Words are cheap.

I fully -- I'm not taking anything I hear to the bank and saying, wow, it's going to be solved, but I'm hearing things that indicate to me that if they follow through on the things they are saying, there's a capacity to have a new government that could be a unity government.

SCIUTTO: Twelve days ago, June 12, the president that said, my team is working around the clock on options to respond. During that 12 days since, ISIS has captured an additional 11 cities and towns, a key refinery, crucial roadways and border crossings.

Hasn't the delay in the administration's response here on the ground, military action, strengthened ISIS during that time?

KERRY: I think the real question, Jim, is not sort of what happened in those days. The question is, what can happen going forward to have a strategy that's really going to work?

SCIUTTO: More than two years ago, you were advocating for more robust support for moderate rebel groups inside Syria.

When the president was considering military action in Syria, some say you gave the speech of your life advocating for that action, explaining for it. Of course, it didn't happen. Since then, the war. And, again, we have to speak of it across borders. Syria and Iraq has only deteriorated. And I just wonder if you're personally frustrated to have watched that?

KERRY: No. Let's be crystal-clear, Jim. The reason that the decision to strike Syria didn't happen was because we ultimately came up with a better solution after the president made his decision to strike.

SCIUTTO: On chemical weapons, but that doesn't -- hasn't helped the calculus on the ground.

(CROSSTALK)

KERRY: Well, but the purpose of the strike was to send a message to Assad, don't use chemical weapons, not a strike that was calculated to end the regime or to get involved in the war directly. It was to end the use of chemical weapons.

We found a better solution. We got all of the chemical weapons out.

SCIUTTO: But ISIS has only grown as a threat during that time period.

(CROSSTALK)

KERRY: You're absolutely correct. ISIS has grown as a threat because countless numbers of jihadists are flocking to Syria to oppose Assad.

(END VIDEOTAPE)

SCIUTTO: Secretary Kerry raised with the Kurdish leader, Massoud Barzani, his comments to Christiane Amanpour yesterday that Kurdistan is ready for self-determination. And Kerry responded by saying this.

He said that whatever Kurdistan's long-term aspirations, its short- term interests are in a stable, unified Iraq. And that, Wolf, is a consistent message that Secretary Kerry delivered to Sunnis, Shias and Kurds alike. The question is now, will they listen?

BLITZER: Jim Sciutto reporting from NATO headquarters outside Brussels, thanks very much.

We are getting new information about the size and the strength of ISIS fighting forces in Iraq right now and indeed beyond.

Our Pentagon correspondent, Barbara Starr is joining us.

You have been talking, Barbara, to Pentagon officials, other U.S. officials. What are you hearing?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Wolf, lots of diplomacy, but hard military facts on the ground at this hour, here is where we are.

The U.S. now estimates that ISIS has up to 10,000 fighters under its command in that region between Syria and Iraq going back and forth across the border, being in both countries, heavily armed, engaging in extortion to raise funds to continue its march. No estimate precisely how many are inside Iraq at the moment, because the border with Syria essentially is gone. People are moving back and forth.

So that is what Iraq is facing, up to 10,000 militants in its own country. Now U.S. military advisers on the ground, about 130 now on the ground in Iraq, another 50 coming in the next several days. This is the effort to try and assess both the ability of Iraq to fight for itself and the ability to counter ISIS.

So what happens if, if it comes to U.S. airstrikes? Let's put a map up and show you what the military facts are about what U.S. has at its disposal. Right now, there are seven U.S. Navy warships in the Gulf, dozens of helicopters, aircraft on board, about 1,000 Marines, Tomahawk missiles. They would be able to engage in any airstrike option the president were to order.

But here perhaps, Wolf, is one of the most interesting facts. Right now, military-wise, the U.S. is flying 30 sorties a day over Iraq to collect additional intelligence. Reconnaissance and surveillance missions over Iraq both unmanned droned and manned aircraft, pilots in the cockpit, it hasn't been like this since 2011, when U.S. troops left, Wolf.

BLITZER: The situation clearly heating up. Barbara Starr at the Pentagon, thank you.

The U.S. military certainly on alert right now for this dangerous, dangerous scenario. ISIS may be making good on its threat to spread the battle beyond Syria and Iraq into Jordan, Jordan a very ally of the United States.

Brian Todd is digging in this part of the story for us.

Brian, what are you learning?

BRIAN TODD, CNN CORRESPONDENT: Wolf, we have been speaking with U.S. and Jordanian officials today about all of this and they are getting increasingly concerned. We all know about these cities and towns in Northern and Western Iraq captured by ISIS. But the fear tonight is that ISIS, with its newly recruited fighters, its organization, its tactical momentum, could push as far west as Lebanon.

And we are told that Jordan is under more immediate threat.

(BEGIN VIDEOTAPE)

TODD (voice-over): New concerns about the chaotic fight in Iraq spilling over into neighboring Jordan. One counterterrorism official tells CNN, the aggressive push by the Islamist militant group ISIS to the border with Jordan is especially worrisome. And a recent propaganda video clearly states the group's intent to take the fight to this key American ally.

UNIDENTIFIED MALE: And we will even go to Jordan and Lebanon with no problems, wherever our sheik wants to send us.

Colonel Derek Harvey, a former U.S. military intelligence officer who advised General David Petraeus in Iraq, believes ISIS is laying the groundwork to challenge Jordan's King Abdullah.

COL. DEREK HARVEY (RET.), U.S. ARMY: I think they are establishing the capability to conduct violence, assassinations and bombings in order to open up another front for the ISIS campaign.

TODD: There are deep concerns about three refugee camps inside Jordan, all the near the border with Syria, housing more than 100,000 refugees. The fear is, they will become recruiting grounds for terrorists.

LT. COL. DOUGLAS OLLIVANT (RET.), FORMER NATIONAL SECURITY COUNCIL STAFF: Almost certainly, they will going into refugee camps to recruit, finding displaced Syrians who have grievances against the Assad government, and therefore these are easy to translate into grievances against the Iraqi government or just into the entire status quo of the region in general. TODD: A Jordanian official tells CNN the government is concerned, but

also confident that its military and intelligence units will keep ISIS out. The Jordanian foreign minister told CNN they have complete control of their borders.

NASSER JUDEH, JORDANIAN FOREIGN MINISTER: We're very, very vigilant and we're keeping a very close watch, but Jordan -- Jordan, as a -- in terms of stability and in terms of security, is quite fine.

TODD: U.S. and Jordanian officials tell us they see no evidence of organized groups of ISIS fighters crossing into Jordan toward refugee camps or anywhere else. Harvey says you may not see that, but the danger is there.

HARVEY: They are going to do this in a clandestine way. They are going to subvert. They are going to infiltrate. And they are going to recruit and set up an underground base.

(END VIDEOTAPE)

TODD: Now, analysts say ISIS will be patient, will move on pockets inside Jordan where it sees citizens upset with the economic situation and they are going to exploit that.

Their end goal, push all the way to the Mediterranean, into Lebanon, possibly beyond. Wolf, the Israelis have to be worried a little bit.

BLITZER: Brian, as far as the leadership of those countries are concerned, I'm sure ISIS' goal is to take them out.

TODD: That's right. They view Jordan's King Abdullah, the king of Saudi Arabia, the leadership in Lebanon and the leadership in Cairo, for that matter, all as illegitimate.

Analyst says, they're not going to overthrow all these regimes, but they say ISIS is willing to be patient, take 10 years or more to challenge as many of those regimes as they can, Wolf. ISIS for years is likely going to make these a lot of these regimes miserable.

BLITZER: Brian Todd with the latest very worrisome developments, thank you.

Still ahead, other news we're following, including the IRS. The scandal widening to the White House, is it? CNN is asking tough questions. Wait until you hear the exchange at today's briefing.

And it's a controversy you can sink your teeth into, even if you don't follow the World Cup. A player may have sealed his team's victory by biting an opponent.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: Doesn't that sound like the dog ate my homework when you have two years of missing e- mails? It just -- it just -- on the face of it, it doesn't sound credible, does it not?

JOSH EARNEST, WHITE HOUSE PRESS SECRETARY: I guess if you listen to solely to the arguments that are offered up by the Republicans, you might have reason to question their credibility.

(END VIDEO CLIP)

BLITZER: Tense exchange over at the White House briefing today, CNN's Jim Acosta pushing for answers about those missing e-mails linked to the IRS targeting controversy.

The agency says the e-mails were destroyed when a hard drive crashed. The e-mail flap is giving new ammunition to Republicans and it's putting top IRS officials in the hot seat.

Our Tom Foreman takes a closer look.

(BEGIN VIDEOTAPE)

REP. PAUL RYAN (R), WISCONSIN: I don't believe it.

UNIDENTIFIED MALE: Why should anyone believe you?

UNIDENTIFIED MALE: What I didn't hear in that was an apology.

JOHN KOSKINEN, IRS COMMISSIONER: I don't think an apology is owed.

TOM FOREMAN, CNN CORRESPONDENT (voice-over): Amid the outrage and congressional outrage and accusations, there he sat, serene as a saint.

IRS commissioner John Koskinen:

KOSKINEN: If you have any evidence of that, I would be happy to see it.

REP. DARRELL ISSA (R), CALIFORNIA: I asked a question.

KOSKINEN: And I answered it.

FOREMAN: Throwing jabs and making jokes.

KOSKINEN: I didn't say I would provide you e-mails that disappeared. If you have a magical way for me to do that, I would be happy to know about it.

FOREMAN: The White House could not have picked a better brawler. Koskinen was trained in physics at Duke and law at Yale. He worked for a New York mayor, a Connecticut senator and was deputy mayor of Washington, D.C., during a financial crisis.

What he likes most, however, are seemingly lost causes. He helped bring the World Cup to the U.S. in '94, when many Americans had never watched a match. President Clinton tasked him with saving the nation's computers from what was feared would be a Y2K meltdown.

BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES: I expect we will experience no major national breakdowns.

FOREMAN: He headed Freddie Mac when its troubles were spinning out of control.

ISSA: Quite frankly, we asked for all the e-mails.

KOSKINEN: You're going to get hundreds of thousands of pages, irrelevant documents.

ISSA: No, no.

FOREMAN: And now with the IRS under heavy fire, Koskinen is once again in the middle of the fray.

KOSKINEN: And to say that this is the most corrupt IRS in history ignores a lot of history and seems to me again is a classic overreaction to a serious problem which we are dealing with seriously.

FOREMAN: Koskinen delivers shattering news as calmly as if discussing the weather. Asked about the computer in which all those e-mails were lost?

REP. DAVE CAMP (R), MICHIGAN: Do you know where the actual hard drive is that crashed in 2011?

KOSKINEN: Yes. I'm advised the actual hard drive, after it was determined that was dysfunctional and that, with experts, no e-mails could be retrieved, was recycled and destroyed in the normal process.

CAMP: So, was it physically destroyed?

KOSKINEN: That's my understanding.

FOREMAN: To interrogators, he seems maddingly unflappable.

REP. TREY GOWDY (R), SOUTH CAROLINA: You have heard the phrase foliation of evidence, haven't you?

KOSKINEN: I can't recall ever hearing it.

GOWDY: It is true in administrative hearings, civilian hearings, criminal hearings.

KOSKINEN: I practiced law once 45 years ago, gave it up for Lent one year and never went back.

FOREMAN: When pressed enough, Koskinen hit back hard and fast, for example, when asked why his agency didn't better protect those lost records.

ISSA: Isn't that in fact a priority that should have allowed for full retention?

KOSKINEN: If we had the right resources, there would be a lot of priorities we would have.

FOREMAN: Or when asked why he lacks evidence of division chief Lois Lerner's actions from some years back.

KOSKINEN: I have no evidence whether she beat her dog, whether she beat children. I have no evidence of a whole series of things.

FOREMAN: And he is not above giving his opinion whenever he thinks someone needs it.

KOSKINEN: I have a long career. That's the first time anybody has said they do not believe me. I am...

RYAN: I don't believe you.

KOSKINEN: That's fine.

(END VIDEOTAPE)

FOREMAN: Maybe the reason that's fine is his personal wealth is estimated about $27 million, somewhere there, maybe a little bit less. But it's still a lot of money. The soccer stadium at Duke is named after him.

So, the truth is, Wolf, he doesn't need the job, nor does he needs the headaches. He just seems to like it. And that is giving Republicans fits right now.

BLITZER: Tom Foreman, thanks for the insight, because a lot of people are talking about this guy. Thanks very much.

Just ahead: World Cup officials are deciding whether to take action against a player who apparently bit -- yes, bit, his opponent. We're going to have details on the controversy that's getting a lot of fans all riled up.

(COMMERCIAL BREAK)

BLITZER: Millions and millions of people here in the United States and indeed around the world, they're following the World Cup competition and a new controversy that's unfolding right now.

A player with the history of biting, biting his opponents appears to have done it again.

CNN's Rachel Nichols is joining us now with more on what's going on.

What is going on over here, Rachel?

RACHEL NICHOLS, CNN CORRESPONDENT: Well, when this guy played in Holland, they nicknamed him the cannibal.

So, that gives you a pretty good idea of who we're dealing with here. His name is Luis Suarez. He is actually Uruguay's best player. But look what happened today. This is actually the third time that he's been accused of biting, biting an opponent.

This is to a defender against in -- Italy, and, you know, the Italians lost this game shortly afterwards. So, they are up in arms about this. A lot of controversy. And it'll be interesting to see whether he plays the rest of the World Cup. There is a lot of people who want him banned the rest of the way.

BLITZER: Who is going to make that decision? How long does it take?

NICHOLS: FIFA officials make that decision. They don't have a real process, which is part of the controversy. There are some people who feel like they are going to let this go under the rug. But any decision would come in the next couple days. Uruguay is moving on to the next round. And Italy is going home.

BLITZER: Let me do a tweet for you -- read a tweet for you from Evander Holyfield. A lot of us remember that little incident he had with Mike Tyson, when he -- Mike Tyson bit off a piece of his ear.

Holyfield tweeted this: "I guess any part of the body is up for eating."

I don't even know if that's funny or what it is, but I guess it's a little history there.

NICHOLS: Yes, I was actually at the fight when Tyson bit off Holyfield's ear. So, I can tell you, it was very jarring in that moment for me covering it, and it was just as jarring today.

And people all around Twitter have been having a little fun with this today. The McDonald's account in Uruguay, their Twitter account actually tweeted after the match, Suarez, if you're still hungry, come by for a bite of a Big Mac afterward. Some -- few funny tweets from other places, other accounts around the world, but I can assure you, the Italians don't see this as any laughing matter.

BLITZER: We are all anticipating Thursday's big game between team USA and Germany. And there are a lot of crossover connections between the Germans and the Americans. The American coach, for example, from Germany, used to coach the Germans. So, what do we anticipate? This is going to be an important game on Thursday.

NICHOLS: Yes, absolutely.

And the United States is in an advantageous win, lose or draw position. They win, they're in. They draw, they're in. They can even go into the next round by losing if certain other things fall their way in other matches. But because of those connections you mentioned, Wolf, there is a little bit of suspicion and controversy going into the match.

Jurgen Klinsmann, the U.S. coach, used to coach the German national team, used to play for the German national team. He was a big start there and he mentored the current coach of Germany. There's five German-Americans on the U.S. team, and because both Germany and the U.S. can move forward into the next round if they draw, if they tie, well, there has been some suggestion that maybe the coaches might call up each other and say, hey, old friend, maybe we should all just play kind of defensively and play to a 0-0 or 1-1 tie, and we will all just move through.

Now, that is not because anybody is saying that Jurgen Klinsmann is that kind of guy, but it's because it has happened before, with Germany. Back then, it was West Germany colluding with Austria to move forward a round in the World Cup, and so because there is this history, there's been these whispers. And the German team and the U.S. team have both denied there is any impropriety going on. But people will be watching. There's no question.

(CROSSTALK)

BLITZER: Let's just hope team USA wins. I would be happy about that.

All right, let's talk about basketball right now, LeBron James, as you know, exercising a termination clause in his contract. On July 1, he becomes a free agent. What's the -- you have spent a lot of time with LeBron over the years. You recently interviewed him for your show. Give us a sense of what this means.

NICHOLS: Well, it doesn't mean something astounding.

This doesn't mean that LeBron will never play for the Miami Heat again. It just means that he has put the team on notice to say, hey, I have the option to listen to other teams and sign with them, and I am going to do that listening.

So, it tells Miami, you better get a better roster going, because clearly they clearly didn't have the roster to beat the San Antonio Spurs in these last finals. And it tells other teams, hey, there's a chance. We expect the Clippers to make a run at LeBron. We expect the Houston Rockets to make a run at LeBron. And, yes, the Cleveland Cavaliers probably make a run at LeBron as well. Wouldn't that be interesting, Wolf?

No one sees that as the surest path. But, gee, it would be interesting to see how they try to pitch him, right?

BLITZER: He is going to get the maximum amount of money that you're allowed to get, right, no matter where he goes?

NICHOLS: Well, he will get more money if he resigns with the Miami Heat. The NBA incentivizes players to stay with their team. But he would get actually about $33 million more if he stays at Miami and signs a max deal.

That would be enough, honestly, to convince a lot of players. But LeBron has made it clear he is interested in championships and who are the other players around him. The L.A. Clippers, for example, they can offer up Chris Paul and a coach in Doc Rivers. The Houston Rockets, they can offer up Dwight Howard and James Harden. So, it's going to be interesting to see what the Miami Heat have to offer up to him in terms of teammates and what their chances are to win.

BLITZER: He can go wherever he wants because he is LeBron James.

Hey, Rachel, thanks very much. Maybe he will come to Washington and play for my Washington Wizards. You can always hope.

NICHOLS: You never know.

BLITZER: Never know.

Thanks very much.

Remember, you can always follow us on Twitter. Just tweet me, @WolfBlitzer. Tweet the show, @CNNSitRoom. Please be sure to join us again tomorrow right here in THE SITUATION ROOM. You can always watch us live or DVR the show so you won't miss a moment.

That's it for me. Thanks very much for watching. I'm Wolf Blitzer in "THE SITUATION ROOM." Now let's step into the CROSSFIRE with Stephanie Cutter.