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Video Shows Military Raid to Capture 'El Chapo'; North Korea: U.S. Citizen Held on Spying Charges; U.S. Sends Nuclear-Capable Bomber Over South Korea; U.S. Bombs ISIS Cash Center, Destroys 'Millions'; 'El Chapo' Back in Prison Six Months After Escape; Trump Slams Cruz as Polls Show Iowa Tightening; Trump Continues to Raise Cruz's Citizenship; Clinton and Sanders Race Tightens; Michael Bloomberg as Third Party Candidate?. Aired 5-6p ET

Aired January 11, 2016 - 17:00   ET

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

JAKE TAPPER, CNN HOST: What a loss. That's it for "THE LEAD." I'm Jake Tapper. turning you over now to Wolf Blitzer. He's in THE SITUATION ROOM. Thanks for watching.

[17:00:16] WOLF BLITZER, CNN ANCHOR: Happening now, dramatic raid. Stunning new video of the deadly assault in the takedown of a fugitive drug lord. Did a secret interview with the actor, Sean Penn, help put "El Chapo" back in prison? And Will he now face justice in the United States?

American spy caught. North Korea says it's holding an American accused of spying for a U.S. ally and gives CNN exclusive access to the prisoner. Why is the U.S. government keeping quiet?

ISIS bank obliterated. The U.S. strikes an ISIS cash hoard and payroll center, destroying millions. Why was the Pentagon willing to risk major civilian casualties by bombing right in the heart of a captured city?

And Trump bump. As the GOP frontrunner surges in Iowa, is his constant questioning of Ted Cruz's citizenship starting to pay off?

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

Gunshots and explosions as dramatic new video shows the bloody raid on the hideout of the notorious drug kingpin known as "El Chapo." It left five of his bodyguards dead and ultimately put "El Chapo" back in the same prison he had escaped six months earlier.

While on the run, he did a secret interview with the actor, Sean Penn, for "Rolling Stone" magazine which may have provided clues leading to his re-capture. But there's growing backlash over that meeting, as the United States pushes Mexico to extradite the drug lord to face charges here in this country.

And a CNN exclusive from inside North Korea, where the Kim Jong-un regime says it's holding a U.S. citizen accused of espionage. CNN's Will Ripley was given access to the man who says he was caught red- handed while spying for what he called "elements" in South Korea. He's appealing to the U.S. government to rescue him. I'll speak with Congressman Will Hurd of the Homeland Security Committee. He's a former CIA operative.

And our correspondents, analysts and guests, they'll have full coverage of all the day's top stories.

Let's begin with "El Chapo," as new video emerges of the bloody raid which helped put the fugitive drug lord back in prison. CNN's Brian Todd has been looking into all of this for us.

What are you learning, Brian?

BRIAN TODD, CNN CORRESPONDENT: Wolf, tonight we've got new details about the raid which led to "El Chapo" capture about how the drug lord is being guarded tonight and about how an interview he gave to "Rolling Stone" magazine played a significant role in his apprehension. The Mexican attorney general just telling CNN it was essential.

Now, the newly-released video of the raid shows how chaotic and violent that gun battle was and how determined "El Chapo's" bodyguards were to protect him.

(BEGIN VIDEOTAPE)

TODD (voice-over): A concussive blast. Then a Marine fires through a door. Riveting footage from the Mexican navy of the raid on a safe house which led to the capture of the world's most wanted drug lord, Joaquin "El Chapo" Guzman.

From the helmet cam of a Mexican officer, Marines are seen firing up a staircase. Our analyst, Art Roderick, believes that might have been the most dangerous moment in the raid.

ART RODERICK, CNN LAW ENFORCEMENT ANALYST: You're in a fatal funnel, basically, is what you're in. So anybody can pop around that corner. You've got three, four people stacked up. You can easily take out three or four people with one person.

TODD: Marines throw grenades into the house, engage in suppressive fire. A commander yells to move faster. It's utter confusion: smoke, gunfire everywhere.

(on camera): How chaotic is this? How hard is it to tell friend from foe?

RODERICK: Well, they're doing the right thing here, because they're kind of moving together on line. So obviously, anybody that's in front of them is a bad guy.

TODD: A Marine is seen on the floor, seemingly wounded.

During this raid on Friday in Los Mochis, Mexico, authorities say "El Chapo" escaped through a sewer drain and to a car. But he was later tracked down and finally captured.

A key question tonight: Was actor Sean Penn's interview with "El Chapo" for "Rolling Stone" a key in locating the drug lord. A senior Mexican law-enforcement official tells CNN authorities there want to question Penn and Mexican actress Kate del Castillo, who according to "Rolling Stone," helped arrange Penn's interview.

In the interview, "El Chapo" brags about his empire. Quote, "I supply more heroin, methamphetamine, cocaine and marijuana than anybody else in the world. I have a fleet of submarines, airplanes, trucks and boats."

Why would "El Chapo" take the risk of a high-profile interview with a celebrity?

UNIDENTIFIED MALE: Chapo Guzman is a narcissistic individual, and he wants to leave a legacy behind. You know, he wants to have something, a movie done of him and -- and his escapades as a major drug lord.

TODD: These pictures, printed by Mexican newspaper "El Universal," are claimed to be photos of Sean Penn and Kate del Castillo going to their meeting with "El Chapo" in early October.

(END VIDEOTAPE)

TODD: And multiple Mexican officials now telling CNN authorities there knew of the interview before it was printed on "Rolling Stone -- in "Rolling Stone" magazine on Saturday, and that it was one of the leads they had in locating "El Chapo." The Mexican attorney general saying it was an essential lead.

Now, as for possibly being questioned by Mexican authorities, Sean Penn told the Associated Press, he's got nothing to hide -- Wolf.

BLITZER: Brian, what do we know about the extradition? Will "El Chapo" be extradited to the United States any time soon?

TODD: A source in the Mexican attorney general's office, Wolf, tells CNN the extradition process could take months, maybe even more than a year. And "El Chapo" is being held at the same prison where he escaped from in July.

Now one analyst says that's going to give "El Chapo" plenty of time to bribe and intimidate his way out of that prison. But a Mexican official just told me that's not going to happen. This official says Chapo is being guarded by the Mexican army and navy. That's the first time in their history that that's happened and that among the units guarding him is the one which captured him on Friday.

BLITZER: Brian Todd reporting, thank you.

As tensions rise following North Korea's claim of a H-bomb test, Kim Jong-un's regime now claims that it has arrested a U.S. citizen for spying and has given CNN's Will Ripley exclusive access to the man who's asking the U.S. government now for help. Will is joining us now live from the North Korean capital of Pyongyang.

So what's this all about, Will?

WILL RIPLEY, CNN CORRESPONDENT: Wolf, we first got wind of this American prisoner shortly after we arrived in Pyongyang last week. Keep in mind, this was just after this nuclear test. It was a chaotic time, but we were told that we would learn more details. And we did shortly before the interview when a man walked through the doors of a hotel conference room with a very complex and uncorroborated story of espionage.

(BEGIN VIDEOTAPE)

RIPLEY (voice-over): Days after North Korea's nuclear test shocked the world, a new diplomatic bombshell. Kim Dong Chul says he's an American citizen who used to live in Fairfax, Virginia. North Korea calls him a spy, accused of stealing nuclear and military secrets.

Pyongyang authorities ordered Kim to speak to us in Korean. He seems aware our conversation is likely being listened to.

"I committed an act of espionage against North Korea," he says. "I gathered information about its nuclear program and military facilities." Kim says North Korean agents arrested him three months ago seizing a USB drive, camera and documents with details of North Korea's nuclear program. CNN cannot determine whether Kim is making his statements under duress. He says he was not spying for the United States but for South Korean conservative elements, with the goal of undermining North Korean leader Kim Jong-un's regime. The South Korean government calls the claims groundless.

(on camera): How did it work? How did you pass on the information you collected?

"I bribed a local resident, an ex-soldier with military access," he says. "He handed over information. I hid it in my car and secretly brought it to China." Kim says he drove back and forth from China every day as president of a company that operates in Rason, a special economics zone where foreign-owned businesses operate just inside North Korea.

The businesses help the cash-strapped regime make money to pay for things like its nuclear program.

"It's time for the U.S. government to withdraw its hostile policy against North Korea," Kim says, using the same language often found in Pyongyang propaganda.

We're allowed to photograph Kim's American passport. He says he was born in South Korea but became a U.S. citizen almost 30 years ago. So far the State Department has refused to comment or even confirm his U.S. citizenship, telling CNN, quote, "Speaking publicly about specific purported cases of detained Americans can complicate our tireless efforts to secure their freedom."

"I'm asking the U.S. or South Korean government to rescue me," Kim says. Neither country has diplomatic relations with North Korea.

For now this professed U.S. citizen is detained: no trial date, no idea if he'll ever see his family or country again. So why would North Korea put this man in front of our cameras now? The answer, judging by past experience, seems to be political

leverage. The nuclear test and now an American detainee accused of stealing nuclear secrets, it all seems to be an effort to get United States officials to sit down and talk to the North Korean regime, because their goal is the lifting of sanctions and normalizing of relations.

But so far the State Department seems to be keeping their distance, although the spokesman, John Kirby, did say that they are looking into this matter, Wolf.

[07:10:04] BLITZER: Thanks very much. Will Ripley reporting for us exclusively from Pyongyang, North Korea.

North Korea's claim that it's holding a U.S. citizen comes amid all of the escalating tensions following its nuclear test the other day. The United States this weekend sent a nuclear capable bomber on a flight near the Korean Demilitarized Zone, the DMZ.

Let's go to our chief national security correspondent, Jim Sciutto. So, Jim, is the U.S. raising the stakes now?

JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT: They are raising the stakes. We were told by the State Department today that they're still working with the U.N. on what was called a robust set of measures to respond to, to penalize North Korea, in effect, for this test.

What you're seeing here, though, as you referenced, Wolf, is a visible demonstration. And that was this nuclear-capable B-52 accompanied by a U.S. F-16 and Republic of South Korean F-15 flying very low over the Osan Air Base. This is just south of the North/South Korean border.

That message, of course, not intended for South Korea, very much North Korea, a reminder of U.S. capabilities in the region after North Korea conducted its fourth nuclear test.

To be clear, the State Department says that the information from the U.S. is that this was not a hydrogen bomb test, not a successful hydrogen bomb test. Still in the atomic bomb category, that would be a step behind. But they're still analyzing.

I'll tell you one thing, though. This invisible message, no question, it's part of re-demonstrating to the world that South Korea falls under America's nuclear umbrella, in effect, its defense umbrella. And I'll tell you, many people in South Korea, they want something different. They want antimissile defense. It's a system called the FAD. That's a terminal high altitude area of defense. To this point, it's deployed in Hawaii and Guam, not in South Korea.

There are many in South Korea who want this today, particularly as North Korea makes advances with its own ballistic missile technology. That's a decision the U.S. has yet to make, though.

BLITZER: Yes, the million North Korean troops north of the DMZ, almost a million South Korean troops south of the DMZ, nearly 30,000 American troops right along the DMZ. This is arguably the most dangerous spot on earth right now. So clearly what the U.S. was doing in sending this B-52 bomber was trying to send a message to Pyongyang, right?

SCIUTTO: No question. And keep in mind this, that even without its nuclear capability, North Korea has tremendous ability to cause casualties in Seoul, the South Korean capital very close to the North Korean border where, as you mention, there are tens of thousands of U.S. troops based.

Short of that nuclear capability, they've got a lot of missiles, rockets, chemical weapons, you name it, pointed there. By all accounts, either side would pay a heavy cost for war.

BLITZER: Yes. Millions of people in Seoul, only about 30 miles south of the DMZ with a lot of artillery just north of the DMZ that could hit Seoul. So this is a very volatile area joining us very much.

Jim Sciutto, thank you very much.

Joining us now is a key member of the House Homeland Security Committee, Republican Congressman Will Hurd of Texas. He's a former clandestine CIA officer, spent nine years in the CIA.

Let's talk about this American citizen, now arrested in prison in North Korea, accused of spying, not necessarily for the United States but on behalf of elements in South Korea. What can the U.S. do to get this American citizen out of there?

REP. WILL HURD (R-TX), HOMELAND SECURITY COMMITTEE: Well, we've got to confirm this story, No. 1. Making sure this guy is who he says he is.

I haven't heard of anything about his family trying to help free him. If he's an American citizen, we should do everything we can to get him back. But it's a little suspicious the timing of all this, of allowing, you know, someone to be interviewed and say come and rescue me.

That sounds really strange, especially at a time with this heightened tensions with us, as you just showed, the bombers being flown over there, naval assets being redeployed to the region. This is a delicate situation, and the timing is suspicious.

BLITZER: It's not the first time North Koreans have allowed our Will Ripley come into North Korea and interview Americans who are being held by the North Koreans. They obviously think they have an agenda that they can accomplish by allowing an American reporter to basically go in there and talk.

But this follows, as you point out, this test, this nuclear test the other day. They say it was a hydrogen bomb. The U.S. says no evidence it was a hydrogen -- whatever it was, this is a really dangerous development.

HURD: Absolutely. You know, the difference between atomic bomb and a hydrogen bomb is basically yield. They're both disastrous. They both could kill a lot of people, and it's a sign that Kim Jong-un, the dictator of the DPRK, is willing to do something crazy like use these.

And we need to be doing everything we can: in Congress today, tonight likely, is going to pick up legislation that continues to expand some of the sanctions that are ongoing. Make sure the president is reviewing any kind of cooperation between Iran and North Korea. And also making sure the State Department has a plan on beaming information into North Korea.

The folks in North Korea don't have access to the Internet. They're basically blind from the rest of the world. And if we're able to help show them what's really going on, we can maybe see some change.

BLITZER: We know that the Iranians provided nuclear technology to Syria. The Israelis blew up a nuclear reactor in Syria that the North Koreans helped build. The North Koreans helped the Syrians with that. North Koreans helped Pakistan build their nuclear arsenal.

But what evidence is there that North Korea's helping Iran with any kind of nuclear ambition?

HURD: Well, that's one of the things that we're asking, is making sure the president and the executive agencies are reviewing all the information they have to see if there's any connections, if there's any violations of U.N. treaties by the Iranians. They've already done it with their long-range missile program recently. This is something they'd probably do.

And the North Koreans are looking to Iran as an example of how they could possibly position themselves. If they have nuclear capability, they think the United States will treat them a little bit differently, almost the way we're changing our tune when it comes to Iran.

BLITZER: You'll vote in favor of this legislation to tighten sanctions against North Korea?

HURD: Absolutely.

Blitzer: All right. Congressman, stand by. We have more to discuss, including the latest U.S. airstrikes against an ISIS target inside Iraq, an ISIS target where there are millions and millions of dollars that have been, quote, "vaporized."

We'll be right back.

(COMMERCIAL BREAK)

[17:20:23] BLITZER: We're talking with Congressman Will Hurd of Texas, but first I want to bring to you another story that we're following right now.

Risking civilian casualties, the U.S. military has attacked a major building right in the heart of Mosul, the Iraqi city held by ISIS terrorists. The target was a hoard of cash used by ISIS to fund its operations. Let's go to our Pentagon correspondent, Barbara Starr. She broke this

story. Barbara, what are you hearing about this specific airstrike?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Wolf, this was two 2,000- pound bombs dropped by U.S. aircraft on this building in Mosul. It could have been very risky. This is a building in which there are civilians nearby.

So when the U.S. got the intelligence that this was a major cash facility where ISIS was collecting and storing cash and then disbursing it to fund their operations. They began watching from overhead, airplanes and drones, to see when the civilians were most likely in the neighborhood.

What they learned, we are told, is that ISIS was there at night, civilians in the neighborhood in the daytime, so they made the decision to go ahead and strike it at dawn on Sunday. They were willing, we are told, to risk up to 50 civilian casualties.

Why would the U.S. take the risk? Because this was a site that was storing, we are told, millions in ISIS-controlled cash. This is the cash that ISIS uses to pay its troops, to fund its operations.

This is now a shift that we should expect to see, that they will go after targets like financial targets like this. And that they will potentially risk more civilian casualties in order to really strike at the heart of ISIS.

In this case the initial assessment is that there were a small handful of casualties. Not clear ISIS or civilians, but it was not as bad as they thought, they believe. But this time they were definitely willing to take the risk to get to the heart of what they believe is part of ISIS's cash flow, Wolf.

BLITZER: Sounds like a more aggressive, assertive U.S. airstrike strategy. Barbara, thanks very much.

We're back with Republican Congressman Will Hurd of Texas. He's a member of the House Homeland Security Committee. He's a former clandestine CIA officer. This kind of operation going after the money, the cash that ISIS has. We know that they're the richest terrorist group in the world. Is it going to make a difference?

HURD: It's going to have an impact not only in, you know, their ability to purchase weapons, vehicles, things that they need to prosecute terror in the region, but it also has a demoralizing effect on the troops. Everybody in ISIS knows, you know, what had happened. They know they may not get paid. They know that they may not be able to take care of their families. And that this may signal a change in how what the U.S. military is targeting them. So this is a good thing for the war.

BLITZER: Even if there are innocent civilians, collateral damage, as it's called, that are killed in the process, are you OK with that?

HURD: Look, this is one of the difficulties of being at war. And this is one of the issues that it's ISIS putting these individuals in harm's way. It's because of their activity that these innocent folks could possibly be injured. And these are the risks that our military planners have to weigh. It's a difficult risk, but in this case it seems it paid off.

BLITZER: You know, King Abdullah of Jordan, one of America's best friends in the Middle East, Jordan has been a source of great support for the United States taking in recently maybe a million Syrian refugees.

King Abdullah is here in Washington this week. He's meeting with the secretary of state, the defense secretary, the vice president. But the president of the United States is not meeting with him this week. The White House is saying that, due to scheduling conflicts because of the president's State of the Union address, he's not going to have time to meet with the king of Jordan. Are you surprised by that?

HURD: I'm very surprised by that. There is -- as you said, there's no more important partner in the region in our fight against terrorism. You know, this is something that President Obama should change his schedule in order to meet with.

You know, this is an ally that has been with us since 9/11, before 9/11, does everything he can to help us. He has a tenuous grasp in that region. This is another sign that, you know, our Sunni -- our moderate Sunni Arab partners are looking at is this even more example of the president pivoting towards Iran?

You know, you have this with the tensions between Saudi Arabia and Iran right now. This fuels that. I think this is a terrible move by the president. And it's a slap in the face to one of our most important allies.

BLITZER: Yes, I'm surprised. The king of Jordan, a great friend of the United States, comes to Washington for a few days. The president doesn't have time to meet with him. That's a surprise to me, given this relationship, an extraordinary relationship. They did meet early last year, February 2015, a year ago. But given what's going on in the region right now, presumably they would have a lot to discuss.

HURD: There's so much to discuss. And this is -- this is a mistake by this president. We have a couple more days while he's here. I hope he changes his mind and takes in and listens to one of our most important allies in that region.

BLITZER: Will Hurd, the congressman from Texas. Thanks very much for coming in.

HURD: Thank you, Wolf.

BLITZER: Coming up, he's back in prison, but the Mexican drug lord, "El Chapo," almost got away again. Will he ever face justice here in the United States?

And Donald Trump may be surging in Iowa. Does that mean his constant questioning of Senator Ted Cruz's citizenship is starting to pay off? (BEGIN VIDEO CLIP)

DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: Ted Cruz has a problem, because the question is, is he a natural-born citizen. And the question was asked on "Meet the Press." It was asked to me by Chris Wallace this weekend. And I said, "I don't know." I mean, nobody knows.

(COMMERCIAL BREAK)

BLITZER: Our top story, dramatic new video shows the bloody raid on the hideout of the Mexican drug lord known as "El Chapo," a raid which eventually led to his recapture and return to prison.

[17:30:30] Joining us now, CNN law enforcement analyst Tom Fuentes, he's a former FBI assistant director and CNN law enforcement analyst Art Roderick, a former U.S. Marshals Office assistant director.

All right. Soldiers chased "El Chapo" through the sewer tunnels, but he made it to the surface, where he stole a car, almost got away.

Do you have confidence that the Mexican authorities now can retain this guy, maybe for a year until he's extradited?

ART RODERICK, CNN LAW ENFORCEMENT ANALYST: Well, I mean, I've heard up to a year, possibly. I've heard some DOJ officials come out and say actually it could be by this summer.

Either way, I think in this particular case, although they've put him back in the same jail, he's being guarded 24 hours a day by the Mexican marines who actually arrested him. And also the Mexican army. So I think there's going to be no chance at all of the individual getting out at this particular point. Of course, there's always that possibility.

BLITZER: Because he's got maybe a billion dollars or whatever under his control. And they threaten people like crazy. If they find out individuals. As you know, Art, they threatened to kill family members. That's a real big problem.

RODERICK: It is a huge problem. But I think, because of the embarrassment that occurred the last time to the government of Mexico, they're not taking any chances.

And I think, although you've heard his -- Guzman's current attorney say he's going to file every injunction possible, because he doesn't believe he should be extradited, I think the government of Mexico might step in, with the help of the U.S. government, and maybe move this extradition along a lot quicker.

BLITZER: Tom, Sean Penn told the Associated Press he has nothing to hide. He met with "El Chapo" last year, late last year while he was in hiding. Do you believe his meeting did, in fact, lead authorities to the recapture of "El Chapo"?

TOM FUENTES, CNN LAW ENFORCEMENT ANALYST: You know, I'm not sure about that, Wolf. I mean, we'll hear more about that in the future. But I certainly also don't believe that he's facing any exposure to a crime on his own for having had that meeting.

But how much he helped or whether he was already secretly notifying the authorities that he was going to have that meeting, we don't know. In fact, we may never know if it was -- you know, if they want to keep that a secret from us.

BLITZER: Should he face, Art, any consequences for conducting this interview?

RODERICK: I don't think so. Generally, if you're a regular journalist; and you go overseas and you meet a fugitive, and you do an interview, there's really no repercussions.

There is a circumstance with this particular individual that he's a specially designated national. And legally, that's going to have to be looked at, but I think overall, he's probably not.

The interesting thing here is the coincidence from the arrest to the time the article was released, which was only a couple days. I mean, doesn't take a genius to put one and one together to equal two to say, wow, did this have anything to do with his arrest?

BLITZER: Apparently did. At least that's what Mexican authorities...

FUENTES: Wolf, if I -- could I add something?

BLITZER: Go ahead, Tom.

FUENTES: What I'd like to add is that, given the fact that he had done this interview and wants to have a movie made, it could be that one of his underlings gave him up, that they didn't want the publicity.

They want to inherit this cartel intact, making billions of dollars from it, and they may have done that. I mean, this goes back to the 1930s and '40s when Lucky Luciano, the head of the American Cosa Nostra decided, after being deported to Italy, he wanted to make a movie. The Italian mafia killed him within days of that announcement.

BLITZER: The extradition, if it does take place, he would come here to the United States, presumably faces charges in several states. Art, he would go to a maximum security prison. What would the role of the U.S. Marshals Office be in, A, bringing him out of Mexico to the United States?

RODERICK: Well, the marshals handle all extraditions that occur, regardless of which country they're from. So they would be -- probably be at least four or five, maybe six marshals. Obviously, this is a very high-profile individual. They'll fly him on a private plane back to the U.S., not quite sure where he's going to land.

But immediately, once he lands he'll face a U.S. federal magistrate. And he'll be remanded to the custody of the attorney general, which means he'll come back to the U.S. Marshals and be housed in a maximum- security facility.

BLITZER: He certainly would be. All right, Art Roderick, Tom Fuentes, guys, thank you very much.

Coming up, just three weeks from the Iowa caucuses, some new polls are getting our attention as well as Donald Trump's attention.

(BEGIN VIDEO CLIP)

TRUMP: I watch some of the programs. They came out with new polls this morning. I love polls when I'm winning.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

[17:39:22] BLITZER: In political news, new polls show Donald Trump extending his lead in New Hampshire and catching up with Ted Cruz in Iowa. The caucuses are just three weeks from tonight. Trump is sharpening his attacks on Senator Cruz. Our political reporter, Sara Murray, is here in THE SITUATION ROOM.

Sara, tell us about the latest polls.

SARA MURRAY, CNN POLITICAL CORRESPONDENT: That's right, Wolf.

Right now Donald Trump has a wide lead in New Hampshire, but in Iowa, it is a much tighter race. And that's why you're seeing him hammering his closest rival, Ted Cruz.

(BEGIN VIDEOTAPE)

TRUMP: Iowa, you know, you haven't been good at picking the winners, folks. We've got to pick a winner this time.

MURRAY (voice-over): Tonight, Ted Cruz and Donald Trump locked in a dead heat in Iowa. A new Quinnipiac University poll shows Trump with 31 percent support, while Cruz polls 29 percent within the margin of error.

[07:40:10] But in New Hampshire, Trump dominates in a new Monmouth University poll with 32 percent. That's more than double Cruz and John Kasich, who are tied in second with 14 percent support.

TRUMP: I love polls when I'm winning.

MURRAY: Today, Trump reveling in the states where he's on top and urging his GOP opponents to clear the field.

TRUMP: If I was in second place even, let alone some of these guys that are in ninth place, I wouldn't even know -- I don't know if I'd even come. If you're in ninth place, don't you sort of say, "Let's cut down on the trips. It's not going to happen"?

MURRAY: But with Cruz sticking close in Iowa, Trump is trying to go in for the kill, questioning whether Cruz is a true evangelical, knocking his big donors, and today pumping up his latest line, claiming Cruz's Canadian birthplace could disqualify him for president.

TRUMP: But Ted Cruz has a problem, because the question is, is he a natural-born citizen? And the question was asked to me on "Meet the Press." It was asked to me by Chris Wallace this weekend. And I said, "I don't know." I mean, nobody knows.

MURRAY: Insisting a Cruz nomination would only lead to lawsuits and a mess for the Republican Party.

TRUMP: You can't have a nominee who's going to be subject to being thrown out as a nominee. You just can't do it. So you're going to make that decision, folks. I mean, it's one of those little decisions. I'm sure Ted is thrilled that I'm helping him out, but I am. I mean, I am. I mean, he's got to go. And he's got to fix it.

MURRAY: Cruz shrugged off Trump's jabs, telling CNN's Jake Tapper, the citizenship question is settled...

SEN. TED CRUZ (R-TX), PRESIDENTIAL CANDIDATE: But the substance of the issue is clear and straightforward. As a legal matter, the Constitution and federal law are clear that the child of a U.S. citizen born abroad is a natural-born citizen.

MURRAY: ... and hinting that the latest shots from his GOP rivals are a side effect of his strong poll numbers.

Three weeks ago almost every Republican candidate was attacking Donald Trump. Today almost every Republican candidate is attacking me.

(END VIDEOTAPE)

MURRAY: Now, it's clear that Donald Trump thinks the citizenship question is a winning issue, but CNN's Dana Bash was there in New Hampshire earlier today. And when she talked to voters, people even who were supporting Trump, not a single one of them said that they thought that this could be a big problem for Ted Cruz. So Trump might have to keep hammering that drum if he hopes to make voters change their minds.

BLITZER: Sara Murray, thanks very much.

Joining us now here in THE SITUATION ROOM, Nia-Malika Henderson, our senior political reporter. Also joining us, our political commentator, the "New Yorker" magazine Washington correspondent, Ryan Lizza. And our senior political analyst, Ron Brownstein, the director of "The National Journal."

Ryan, Donald Trump appears to be catching up with Cruz in Iowa, not because he's successfully exploiting the so-called birther issue?

Maybe. You know, I was in Iowa with Cruz this week, and I didn't find a lot of people, a lot of voters that really seized on this issue. I think you've got to look at -- you've got to look at a run of polls here. There's a very important poll coming out on Wednesday by "The Des Moines Register."

That's historically been a very accurate poll. Trump has performed very poorly in that poll the last few times it's out. And if you look at the polling average, the average of the last, you know, five or six polls, Cruz still has a significant lead there. They're doing Iowa in two totally different ways.

Ted Cruz is on there. Last week he did three, four events a day for an entire week. He's got a very traditional ground game. He's got traditional leadership supporting him, conservative evangelical leaders activating their networks.

Trump pops in. He does a big rally, and then he goes back to Trump Tower and goes to sleep for the night. So it is really a tale of two kinds of organizations. If Trump is going to do this, if he's going to win Iowa, a lot of new Iowa voters that have not shown up to the caucuses are going to have to flood things on February 1.

BLITZER: It's not just Trump, though, discussing the so-called birther issue about Senator Cruz. It's Rand Paul is talking about it. You heard John McCain talking about it.

Now Harvard Law School Professor Lawrence Tribe, one of the most distinguished legal scholars out there, he's saying, "Yes, this is a legitimate question that has never been reviewed by the U.S. Supreme Court. Here's the question: is -- is Cruz handling this well?

NIA-MALIKA HENDERSON, CNN SENIOR POLITICAL CORRESPONDENT: You know, I think he's tried a number of tactics, one of which is to sort of sound lawyerly like the lawyer he is in talking about the Constitution.

He's tried humor on Twitter essentially saying that Trump has jumped the shark on this. Today he was in Baton Rouge, Louisiana, and he was talking about his roots. He was talking about his mother and her background in Wilmington, Delaware, and how she grew up as an Irish Catholic and went to school in Louisiana.

So I think that's kind of an indirect way to fill in some of the blanks here and say, "Listen, I may have been born in Canada, but my mom was born in Wilmington, Delaware, working-class roots." So that's the way he's doing it.

But I think Trump has had some success here. Because he's been able to make Ted Cruz have to talk about something else...

[17:45:00] BLITZER: He made him, Cruz, release his mother's -- his mother's birth certificate from Delaware, as well.

Let's take a closer look at the Quinnipiac University poll, Ron. Among the like caucus-goers they were asked, who would you definitely not support, either likely Republican caucus-goers, 26 percent said Trump, only 7 percent said Ted Cruz. So if you have to show up at a caucus, spend an hour or two or three at a caucus, it's a major effort.

What does that say to you? RON BROWNSTEIN, CNN SENIOR POLITICAL ANALYST: Less of a problem on

the Republican side than the Democratic side because the Republicans caucus works basically as a straw poll. The Democratic caucus, if you don't reach a threshold, voters have to reassign and clearly in that case Trump might have problems.

I think the key issue is the one that Ryan mentioned in Iowa. If you look at the poll that came out yesterday, the Marist-NBC-"Wall Street Journal" poll, it was fascinating. Among people who have previously participated in the caucus Ted Cruz was over Donald Trump by about 10 points. Among people who had never participated Donald Trump was up over Ted Cruz by about 10 points.

Donald Trump is in the same situation in some way that Barack Obama was in 2008 where to win the caucus he has to change the electorate. And we will see whether this enormous engine of celebrity without the traditional organizing he can truly change it. I think that's the difference in the polls by the way.

The polls probably vary based on how big of a portion of new voters they anticipate and that will be the one thing that can't be answered until election night.

BLITZER: And a lot of people wait for hours to go -- to go to a Donald Trump rally. If they're willing to wait hours out in a line to go to a rally, why not go to a caucus and do a two or three hour little bit there.

RYAN LIZZA, CNN POLITICAL COMMENTATOR: Absolutely. I was in Biloxi, Mississippi, at a Trump rally last week and waited two and a half hours with the crowd to get in. And nobody left that line. So people might do it. And in Iowa you have same-night registration. So right now if you look at the numbers that the Iowa Republican Party has put out in terms of registration, you don't see a big jump in Republican registration. So we haven't detected in the registration numbers any big Trump boom, but you can do same-night registration. So you might see something like 2008 and Obama.

BROWNSTEIN: And I would say I was struck, I was in South Carolina at a Trump rally last week -- Friday night. And I was struck how many of the people had voted last time. I mean, these are not people who are just completely disconnected from the process.

BLITZER: All right. Guys, hold your thoughts for a moment. There's a lot more politics coming up including the Democratic side. What's going on between Hillary Clinton and Bernie Sanders? We'll be right back.

(COMMERCIAL BREAK)

[17:51:39] BLITZER: We're seeing some interesting poll numbers in the race for the Democratic presidential nomination as Hillary Clinton and Senator Bernie Sanders get more pointed and personal in their criticism of one another. Listen to the senator's response to a question today from our senior political correspondent Brianna Keilar.

(BEGIN VIDEO CLIP)

BRIANNA KEILAR, CNN SENIOR POLITICAL CORRESPONDENT: You told the "Des Moines Register" you think she's panicking.

SEN. BERNIE SANDERS (D), PRESIDENTIAL CANDIDATE: Well, I think clearly they began this race believe that their victory was virtually inevitable. I don't think they believe that today.

Secretary Clinton is running ads on television talking about electability. She is the candidate that can beat the Republicans. Well, if you look at all of these polls, the recent ones in New Hampshire and Iowa, face-to-face with Donald Trump and the other Republican candidates, I mean, we've been doing a lot better than Hillary Clinton does. So I think in terms of electability in the general election, I think Democrats might want to look at Bernie Sanders as a candidate.

(END VIDEO CLIP)

BLITZER: He makes the point in this recent poll that just came out in New Hampshire, only in New Hampshire, Hillary Clinton would get 45 percent to Donald Trump's 44 percent pretty close. But look at Bernie Sanders. He would smash Donald Trump 56 percent to 37 percent. That's a significant advantage for Bernie Sanders.

HENDERSON: It is. And it's what we've seen all along which is that Bernie Sanders does very well in states that look demographically like Vermont. Meaning there are more white, that's why he's doing well.

(CROSSTALK)

BROWNSTEIN: Like Bernie Sanders.

HENDERSON: Exactly. That's why he's doing well in Iowa. He's just as always been, can he grow that? Can he win in a state like South Carolina? Can he win those traditional Democratic coalitions, African-American voters and Latinos? And he's yet to really I think prove that, even though he's kind of closing the gap in Iowa.

BLITZER: Take a look at these other poll numbers in New Hampshire, a potential matchup between Hillary Clinton and Ted Cruz. Cruz 48, Hillary Clinton 44. If it were Sanders, 36 for Cruz, 55 for Sanders. Also in New Hampshire, potential matchup with Rubio. Rubio 52 to Hillary Clinton's 40 percent, but if Sanders were the nominee, 50 percent for Sanders, 41 for Rubio. So these numbers are favorable at least in New Hampshire.

BROWNSTEIN: Yes. Right.

BLITZER: To Bernie Sanders.

BROWNSTEIN: So I would say if you look at general election polling this far, it tells you some things but not others. There is a limit to how much it tells you because the contrast and the choice really hasn't been defined for people. I think after the Republican National -- Bernie Sanders is the nominee, after the Republican National Committee finishes with ads about the costs of his agenda, he would look different to swing voters in New Hampshire than he does today.

But I think what it does tell you is that Democrats are looking at a situation where Hillary Clinton has work to do if she is the nominee. There is a lot of questions about her. She faces a lot of resistance among different groups of voters. On the other hand, the Republicans are looking at a race where their top two candidates Ted Cruz and Donald Trump are in a position to exacerbate their problems with the growing segments of the electorate that cost them the last couple of elections.

BLITZER: Very quickly, Ryan. We've now learned that Michael Bloomberg, the former mayor of New York, has commissioned at least last month a poll to see how he would do if he ran as a third party candidate. That potentially could be significant.

LIZZA: I think there is space for someone like Michael Bloomberg if you have a Trump or a Cruz nominee on the Republican side and someone like Bernie Sanders on the Democratic side, and you really do have space in the center for someone like that.

Absent that scenario, I don't really see what the issues are for Michael Bloomberg. Third parties succeed when they have issues that the two main parties are not addressing and I don't see how he's that different than Hillary Clinton. So if she wins the nomination, I don't see bloom for Michael Bloomberg.

[17:55:02] BLITZER: Well, very intriguing, though, that he even commissioned a poll --

(CROSSTALK)

LIZZA: This guys -- yes, he wants to run.

HENDERSON: He wants it.

BLITZER: Like Donald Trump I suspect he has more billions than even Donald Trump.

LIZZA: That's right.

BROWNSTEIN: He's just got more willingness to spend them.

BLITZER: Yes. He would be willing to spend it. Guys, thanks very much.

Coming up, dramatic new video of the bloody assault which led to the takedown of a fugitive drug kingpin. Did a secret interview with the actor Sean Penn help put El Chapo back in prison?

And is the suspect of the ambush of the Philadelphia police officer tied to a radical group? What was he doing during trips in recent years to Saudi Arabia and Egypt.

(COMMERCIAL BREAK)

BLITZER: Happening now, dangerous liaisons. Dramatic video of the raid that resulted in the capture of the notorious Mexican drug lord known as El Chapo. And tonight new information about the --