The Story So Far: CIA Leak Investigation Timeline; Schwarzenegger Under Fire for Magazine Deal
JOHNS: As the markets get set to close on Wall Street, I'm joined by Christine Romans in New York with "THE DOBBS REPORT." Christine?</s>CHRISTINE ROMANS: Thanks, Joe. A quiet day on Wall Street. It's often the case on a summer Friday, and it is today. Stocks little changed -- right now at the bell, the Dow Industrials up less than eight points -- 10,636. And the NASDAQ is a quarter percent higher. It's at its best level since January 3. On the economic front, producer prices were unchanged in June, another sign inflation remains in check. Enron is trying to clear up a five-year-old mess involving its role in the California energy crisis. The bankrupt company has agreed to pay more than $1.5 billion to settle price gauging charges. However, the final amount actually paid? Well, that will depend on what Enron has left after its creditors are repaid. California and other western states had accused Enron of using illegal tactics to drive up energy prices in 2000 and 2001. Big changes may be in the works at Hewlett Packard. There have been rumors circulating for awhile now that HP plans to cut thousands of jobs, and now reports say the official word? It could come early next week. The company is still not commenting. You may recall HP sacked its CEO, Carly Fiorina, earlier this year. Coming up on CNN at 6 p.m. Eastern on "LOU DOBBS TONIGHT," homeland insecurity. The Senate voted yesterday not to hire more border patrol agents and failed to increase detention space for those caught illegally crossing the border.</s>SEN. JOHN MCCAIN (R), ARIZONA: Anybody who comes into the United States of America across our southern border today and is from a country other than Mexico, 95 percent chance they will continue their journey to wherever they want to go. We don't have enough detention facilities. We don't have enough beds.</s>ROMANS: Also tonight, political analyst Lawrence O'Donnell was one of the first to suggest Karl Rove was the CIA leaker. He'll give us his insight into this controversy. And some members of America's labor unions are calling for radical changes at the AFL-CIO. We'll tell you why. Plus, Jerry Taylor of the Cato Institute will join us to explain why he thinks the U.S. should not worry about China's bid for the American oil company Unocal. That and more, 6 p.m. Eastern, "LOU DOBBS TONIGHT." Now back to Joe.</s>JOE JOHNS, HOST: Thanks, Christine. Now back to INSIDE POLITICS. Other than the Supreme Court, the CIA leak investigation has seemed like the only thing people here in Washington have been talking about this week, or trying not to talk about. But this story actually has been unfolding for more than two years. Here's what we know as of today about what's been said and left unsaid.</s>JOHNS (voice-over): January 2003, President Bush makes the case for invading Iraq by suggesting Saddam Hussein posed a nuclear threat.</s>GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The British government has learned that Saddam Hussein recently sought significant quantities of uranium from Africa.</s>JOHNS: In July, former Ambassador Joe Wilson calls the president's claim about Iraq's nuclear intentions highly doubtful. In a "New York Times" op-ed piece, Wilson says he investigated similar allegations for the CIA on a trip to Africa the previous year. Days later, columnist and CNN political analyst Bob Novak calls Karl Rove and tells him he has heard Wilson's wife suggested sending him to Africa. A lawyer familiar with the investigation says Novak identified Wilson's wife, Valerie Plame, as a CIA agent. Rove responded, "I heard that too." Rove then talks to "TIME" magazine reporter Matthew Cooper. According to an e-mail sent to Cooper's editor, Rove said Wilson's wife apparently works on weapons of mass destruction issues for the CIA and authorized Wilson's trip to Africa. July 14, 2003, Bob Novak writes in his column that Plame is a CIA operative and that she suggested sending her husband to Africa. He cites two senior administration officials as sources. In September of that year, the Justice Department acts on a CIA request and launches a criminal investigation in the leak of Plame's identity. It's against the law to knowingly reveal the name of an undercover CIA agent. The White House dismisses speculation that Karl Rove was Novak's source.</s>SCOTT MCCLELLAN, WHITE HOUSE SPOKESMAN: It's totally ridiculous.</s>BUSH: If there's a leak out of my administration, I want to know who it is. And if the person has violated law, the person will be taken care of.</s>JOHNS: Fast forward to 2004, the president, vice president, Rove and other administration officials are questioned about the leak. At the GOP convention in August, CNN asks Rove about the Valerie Plame leak.</s>KARL ROVE, WHITE HOUSE DEPUTY CHIEF OF STAFF: I didn't know her name and didn't leak her name.</s>JOHNS: The story heats up again in 2005 as two journalists caught up in the leak probe face possible jail time for refusing to reveal their sources. In June, the Supreme Court refuses to consider an appeal by "TIME" magazine's matt Cooper and Judith Miller of "The New York Times." "TIME" decides to surrender Cooper's notes to the grand jury, and Cooper agrees to testify, saying his source gave him permission to break their confidentiality agreement. Miller, still refusing to name her sources, is jailed for contempt. Cooper later confirms reports that Rove was a source who let him off the hook. The White House is pummeled with questions about its previous denials that Rove was linked to the leak.</s>BUSH: We're in the midst after on going investigation. And I will be more than happy to comment further once the investigation is completed.</s>UNIDENTIFIED MALE: Hey-hey, ho-ho, Karl Rove has got to go.</s>UNIDENTIFIED MALE: Hey-hey, ho-ho, Karl Rove has got to go.</s>UNIDENTIFIED MALE: Hey-hey, ho-ho, Karl Rove has got to go.</s>JOHNS: Democrats seize on the story, demanding the president fire Rove.</s>SEN. JOHN KERRY (D), MASSACHUSETTS: The White House's credibility is at issue here and I believe very clearly Karl Rove ought to be fired.</s>JOHNS: Though the time line is getting clearer, there's still a great deal we do not know. Was the leak of Plame's name a crime? Some argue it was not. But with the investigation still underway, the jury that still counts on that is out. Now to a controversy on the West Coast. Governor Arnold Schwarzenegger is under fire for having a multimillion dollar deal with fitness magazines that advertise nutritional supplements. Critics say that's a conflict of interest, but the California Republican is pretty much ignoring them. CNN's Peter Viles reports from Los Angeles.</s>PETER VILES, CNN CORRESPONDENT (voice-over): It turns out the boss of California politics has a boss of his own.</s>GOV. ARNOLD SCHWARZENEGGER (R), CALIFORNIA: Give him a big hand to David Becker and American Media.</s>VILES: Under this contract which wasn't made public until this week, Becker's American Media has been paying a consultant it calls "Mr. S" -- and yes, "Mr. S" is Arnold Schwarzenegger -- no less than $1 million a year.</s>DOUGLAS HELLER, FOUNDATION FOR TAXPAYER/CONSUMER RIGHTS: Governor Schwarzenegger has been secretly taking in millions without telling the public.</s>VILES: The governor gets a percentage of the ad revenue in the magazines "Muscle and Fitness" and "Flex," much of which comes from nutritional supplements, pills like T-Bomb, Blitz, Blaze and Hot Rox. And here's the controversy. While under the contract, he vetoed a Bill that would have put state regulations on those supplements.</s>BILL ALLISON, CENTER FOR PUBLIC INTEGRITY: Here's a case where a Bill coming before the governor, is he ruling on the merits or is he ruling on his own private financial interests? I mean, that's as clear a case as you can have of a conflict of interest.</s>VILES: In vetoing the Bill, Schwarzenegger wrote, quote, "Most dietary supplements are safe."</s>JACKIE SPEIER (D), CALIFORNIA STATE SENATE: The evidence would suggest that many dietary supplements are dangerous and have been linked to the deaths of more than 100 people.</s>VILES: The federal Food and Drug Administration does not regulate most supplements but has banned some considered unsafe. The governor's staff says his position is not new. He has always believed in supplements and complied with state law by disclosing last fall that he is paid by American Media, even if he never said how much money he's making.</s>ROB STUTZMAN, SCHWARZENEGGER SPOKESMAN: You guys are asking me questions that you should have been asking me last fall, which actually, I think you did ask that we didn't answer at the time. There is no technical conflict. I'm not sure anyone cares about it anyhow except all of you.</s>VILES (on camera): And for a big star like the governor, critics suggest there is another advantage to working for American Media. It's a kind of scandal insurance because you're now working for the same company that owns those aggressive tabloids, "The Star," "The Enquirer" and "The Examiner." Peter Viles for CNN, Los Angeles.</s>JOHNS: And we'll have much more on the controversy surrounding Schwarzenegger coming up in our strategy session. Some of Schwarzenegger's fellow governors are busy laying the groundwork for 2008. Coming up, a different kind of fair in Iowa, showcasing presidential wannabes. We'll talk to one possible contender, Iowa Governor Tom Vilsack. Also ahead, party crashers. Should a couple of high political figures have had second thoughts about their cameos in an "R"-rated movie? And when we go "Inside the Blogs," the buzz about a retirement that is happening and one that isn't.