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JOHN KING, USA

Libya's Civil War; Senator Richard Lugar Interview; John Hofmeister Interview; Why Gasoline Costs Too Much; Gitmo Trials to Resume; 2011, Here They Come; 2012 GOP Field Taking Shape; Romney Slams President on Health Care

Aired March 7, 2011 - 19:00   ET

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


JOHN KING, HOST: Thanks Wolf and good evening everyone. Libya's civil war is more bloody by the day and as Colonel Moammar Gadhafi uses his military air power to attack opposition forces, pressure is mounting on the Obama White House and its allies to do more.

The NATO Alliance tonight says it has completed an assessment of what it would take to impose a no-fly zone and prevent Gadhafi from using his Air Force. But NATO ministers won't meet on the issue until Thursday and so with no military moves imminent, Mr. Obama used a meeting with Australia's prime minister today to warn Gadhafi loyalists, think twice.

(BEGIN VIDEO CLIP)

BARACK OBAMA (D-IL), PRESIDENT OF THE UNITED STATES: It is their choice to make how they operate moving forward. And they will be held accountable for whatever violence continues to take place there.

(END VIDEO CLIP)

KING: Let's take a closer look now at how the civil war is playing out in some of the day's more dramatic images. Libya, large in its land mass but remember, as we've been telling you, the battle is really up here -- these strategic coastal oil and gas producing cities. This is the main event up here, Benghazi in the east controlled by opposition forces to Gadhafi.

Some of the fiercest fighting on this day here in Ras Lanuf -- you see this playing out and you'll hear it as well. These are opposition forces who have taken some Libyan Army tanks, now in their position, air strikes from above. You see the opposition using relatively crude, but sometimes effective anti-aircraft guns here, trying to hold Ras Lanuf, an assault, an assault from the Gadhafi government.

As of now, though, as you see that play out, the opposition still holding Ras Lanuf. Their goal is to move west if they can. Tripoli, the capital still under Gadhafi's control -- look at these grainy images -- this came in yesterday, amateur video. You see opposition force here in Mesrata on top of an armored vehicle here. If you listen carefully, and I'll be quiet for a second --

(BEGIN VIDEO CLIP)

(SOUNDS)

(GUNSHOTS)

(END VIDEO CLIP)

KING: You hear the gunfire and the skirmishes in the back again, as we start to move toward the capital, opposition forces in charge here. It's more dicey when you move this way, show you a little bit from Zawiya yesterday. Again, listen --

(BEGIN VIDEO CLIP)

(GUNFSHOTS)

(SOUNDS)

(END VIDEO CLIP)

KING: Gunfire here. That was yesterday as the government, the regime tried to take that area back in one of the biggest skirmishes today, here right again in Zawiya, west of Tripoli, the port city there. CNN international correspondent Nic Robertson right there when things turned dicey.

(BEGIN VIDEO CLIP)

NIC ROBERTSON, CNN SR. INTERNATIONAL CORRESPONDENT: We've been able to do that.

(GUNSHOTS)

ROBERTSON: That's the sound of heavy machine gun fire. That sounds (INAUDIBLE) the shots --

(END VIDEO CLIP)

KING: Nic, let's start right there. You're out getting a firsthand look, some of us might argue too close of a first-hand look at the fighting in Zawiya there. What is the sense of the balance of power tonight? We have a civil war. Who is winning?

ROBERTSON: If you look across the whole country, the government potentially has the upper hand. At least it intends -- its aim is to take control of those oil towns in the east. And then try and force negotiations on Benghazi. Whether or not they can really do that, it's not clear.

But they potentially should have through the use of air power, but also through the use of the Army, the tribes potentially they can call in here, militias. They've got more money. They've got more weapons, and they should have more tacticians on their side. So they should have the upper hand, at least partially.

But what we saw in Zawiya today is an example of just how weak that big Army is, because they've been telling us the battle has been going on there for four days. And they told us three days ago that they took control of it, the government did. They haven't. This is as the Army says about 100 or so rebels holed up there.

We know they've got some big weapons. But if this Army, a national Army can't go in and defeat 100 rebels, it does raise questions about how they can use this much bigger force that they have across the rest of the country, which really speaks to the Army should have the upper hand, but this looks like it's going to be something that is quite protracted -- John.

KING: And Nic, that's exactly the point. The Obama White House and its allies as they watch this situation, they're trying to see what the state of play is; the state of the battle is on the ground. And the president today and his spokesman as well saying, number one, they're considering a no-fly zone with NATO and the spokesman saying that troops have not been ruled out.

Ground troops have not been ruled out, although he was very clear in saying that's not high on the list. Does any of these conversations, the talk about the prospect of potential military action having any impact on the regime?

ROBERTSON: They are. The foreign minister came to brief journalists here is this evening. And that was a clear reaction to this pressure that is mounting up from the west. And when he was asked specifically about this issue of ground troops and no-fly zones, he said it's very clear now that the United States, Great Britain, France are now intent on a conspiracy to divide and partition Libya.

This is the way he put it. He said we know that diplomats have been in touch with the rebels in the east. Indeed, on state television they've been playing audiotape recordings, reportedly the British ambassador here talking to the rebels in the east of the country. So this is something the government is now reacting very, very strongly to.

And, indeed, you could measure the pressure in a way on the foreign minister because he actually got up and walked out of the press conference before it was over. He just had enough of the questions he was getting and left. And if that isn't the sign of a government under pressure, I'm not sure what is -- John.

KING: Government under pressure in Tripoli and governments under pressure around the world to decide what to do about it -- Nic Robertson in Tripoli -- Nic, thanks and again Nic Robertson to the west in Tripoli the capital.

Let's zoom in and take a closer look -- one of our brave correspondents and crews on the ground in Libya taking great risk to bring us this story. Nic is over here. Again the regime holding tight in Tripoli right now, trying to take back some of these other areas along the coast while the opposition is headquartered here in Benghazi. And they are trying to get international help and one way they hope to do that, CNN's Arwa Damon tells us, is by getting more organized.

Arwa, one of the big questions you hear here in Washington from the Obama administration is they're pressured to have a no-fly zone. As they say, how can you do this until you know who you're dealing with on the ground? Who is the opposition? You're in Benghazi, where they are trying to put together at least the outlines of a transitional government. Tell us about that.

ARWA DAMON, CNN INTERNATIONAL CORRESPONDENT: Yes, John, and that's been a pretty critical step moving forward. What we saw happening over the weekend was the establishment of the international council. It is being headed by the former minister of justice acceptable we are being told to the people because he was actually viewed as being a voice of moderation under Gadhafi's rule.

And he did try to resign a number of times, and was among the first of Gadhafi's senior officials to actually step down and cross over to the opposition. They have eight members that they are naming, a number that they are not for security purposes. Their main aim is to try to put together some sort of a plan to really bring into a cohesive format all of these various moving parts that exist here. But they're saying that the most critical thing that they need right now is recognition by the international community -- John.

KING: And Arwa, what is the sense of the state of play in terms of the balance of power? The anti-Gadhafi forces you know had bold ambitions coming into the week and are continuing to move west toward Tripoli. But Colonel Gadhafi has been fighting back and more vigorously, so is it a sense that they will regroup and continue their march or try to consolidate their gains and essentially have a stalemate?

DAMON: Well, John, the impression that we're getting is that they're really going to try to push forward. Their aim of course is to reach Tripoli and bring down Colonel Gadhafi, no matter what the cost actually ends up being. But a few days ago we were hearing opposition leaders saying that they believe they would be in Tripoli basically by now.

It is proving to be a much tougher battle than they had anticipated. They are outgunned and experience-wise, they are outmanned. This is not a military that is on the front lines for the opposition. This is by and large civilians, many of them young men, teenagers even who have been given a weapon.

KING: And is there a sense of frustration, or is there a specific wish list when they watch the international community debate? And we've heard for more than a week now, military assistance of some sort might be on the table. A no-fly zone is one of the options being considered. But nothing seems to be imminent. Is there frustration among the anti-Gadhafi forces, and what specifically do they want first for help?

DAMON: There is a level of frustration John that they feel it is taking too long for the international community to debate what sort of help it might be offering. They do want a no-fly zone. And they want it now, because there are very real fears amongst just about everybody who we're talking to that Gadhafi is going to conduct an even more intense aerial bombing campaign, that he might even resort to using chemical weapons, and that when a no-fly zone, if it is put into place, it is simply going to be too late.

KING: Arwa Damon for us tonight in Benghazi -- Arwa, thanks.

Well any U.S. and NATO military involvement is at least days away, at least. We are told this tonight. NATO now says it has assets in place to track all air traffic in Libya, meaning it can build a case against the Gadhafi regime if it continues to use air power against the anti-regime forces. But what comes next -- what comes next remains a hotly debated question.

Let's get some perspective from our senior analyst David Gergen who has advised four American presidents. And let me start there, David. When you're in the Oval Office talking to a president who is about to consider a commitment of U.S. military forces, this president, he has been the commander-in-chief for nearly two years. He inherited Iraq and Afghanistan. Yes, he made a big decision to redo the strategy in Afghanistan, but he has never begun what could become a war.

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: Right. He has never initiated a war. And that's always a hard call to pull that trigger. And CNN is reporting that one of the things weighing on the president it's easy to get in. How do you get out? Where does it end?

They don't know quite who the opposition is. They're trying to check that out. They have rising voices coming from the Senate, from Senator McCain, Senator Kerry on two -- two different parties. But now you've got an interview with Dick Lugar coming up saying wait a minute, hold on. Let's be cautious. The president I'm sure is facing some conflicting advice, but these are hard decisions but -- and I'm sure he's doing a lot of things behind the scenes.

But he is now in danger having called for Gadhafi's ouster, and the momentum shifting over to Gadhafi, he is in danger of looking like he is dithering, and NATO is dithering. He's got to -- so he's got to bring this to some resolution fairly soon.

KING: And how significant is it? Last week we were listening to Senator McCain, a Republican known as a hawk, say have a no-fly zone. Senator Lieberman, an Independent, former Democrat, known as a hawk saying arm the opposition, but Senator Kerry, the chairman of the Foreign Relations Committee, a Democrat, who has been much more careful about these things, who is very important to the administration in dealing with Egypt, he now says at a minimum, crater the runways.

GERGEN: Right -- right.

KING: Essentially bomb the runways so Gadhafi can't fly his planes. But that is still an offensive military action against a sovereign nation. It's an act of war.

GERGEN: Well, when Senator Kerry, who was the nominee of the Democratic Party for the presidency, after all, and is their heavyweight right now in the Senate, when he calls for something like this, and he is very thoughtful about these issues, it does raise the stakes for the president politically. He's got someone in his own party. And now in addition to that, John, now the Arab nations are starting to weigh in.

The Gulf -- the six Arab nations in the Gulf Council weighed in today in favor of a no-fly zone. It's the first time they have done that. France is saying the Arab League, which up until this point had been hesitant about it. The Arab League is pushing them to get a no-fly zone. So --

KING: But China and Russia -- but China and Russia are very hesitant, David Gergen.

GERGEN: Absolutely.

KING: Will this president, if he decides military force is necessary, even a no-fly zone, he hopes he can keep it to just that. If the United Nations won't give him a resolution because China and Russia on the Security Council say no, and say they will exercise their veto, would he do this just through the auspices of NATO? Would he ask for an Arab League resolution? Would he risk that?

GERGEN: It's a darn good question. If it was a Republican president, I think the answer would be clear. They would move ahead without the U.N. This president, you know, is a big believer in the United Nations. He's a big believer in international organizations. His friends say good for him. His -- you know his Republican opponents say you know come on.

If you're really going to be muscular, you've got to get some things done. It's a tough world out there. So I don't think we know the answer to that question. He clearly doesn't want to do this. He clearly does not want to commit military forces there.

KING: We may be about to find out the answer to that question --

GERGEN: Exactly.

KING: -- in the days ahead. David Gergen, appreciate your insights and more on this story ahead including 351 and climbing. That's your average price per gallon at the pump. Would tapping the strategic petroleum reserves help or it is just political pandering?

And next, could using military force to help the Libyan opposition lead to a lengthy U.S. commitment on top of Iraq and Afghanistan?

(COMMERCIAL BREAK)

KING: As the bloodshed in Libya continues, there are more calls in Congress for the Obama White House to help the anti-Gadhafi forces. There is little appetite for any commitment of American ground forces, mind you, but some in Congress suggest helping to arm and advise the opposition. And the leading suggestion is to impose a no-fly zone so that the Gadhafi regime cannot use its air force to attack the opposition.

My next guest, however, warns that even a very limited U.S. military commitment at the outset could grow into something more troublesome and more costly both in lives and resources. Richard Lugar is the ranking Republican on the Senate Foreign Relations Committee and he joins us from Capitol Hill.

And Senator, I want to start right there. Our producer on Capitol Hill, Ted Barrett (ph), talked to you several days ago, and you said you did not think it was time to consider either a no-fly zone or any sort of military action or arming the rebels. Have you changed your position at all?

SEN. RICHARD LUGAR (R-IN), FOREIGN RELATIONS COMMITTEE: No, I haven't. But I'm listening carefully, obviously, to the president, to members of Congress. I just have not yet heard, however, a very crucial discussion as to what is our objective, specifically, who it is that we want to help. And in ways that we might want to help them, do we harm them in terms of ruining their influence in a post-Gadhafi Libya.

Specifically, we know that rebels, so-called, are people that are against Gadhafi, are trying to drive him out. But it's not really clear how unified they are, what kind of governance system even roughly they might have. And furthermore, it's not really clear who is fighting for Gadhafi. A lot of the armed forces have deserted him, and he always kept the armed forces very weak and kept really people that he was certain weren't (ph) loyal to him including many mercenaries.

It's in that context that I appreciate the frustration the president faces and members of Congress because the public says what are you going to do. There are people being shot at and killed. There is a ruthless dictator there. Why are you simply sitting there? So as a result, lists of possibilities, including no-fly zone perhaps increased sanctions, meetings with the NATO allies in terms of some broader alliance there, all of these things keep floating along to try to allay people who are saying that those in charge on our side have inactivity.

KING: But as they float along, as the proposals float along and the NATO defense ministers will meet on Thursday, and they say they have an assessment in place of what a no-fly zone would take, then they will debate whether to seek to go forward on that. Many people would say as the deliberations go on, as you noted, people are dying. At what point do the scales tip, sir?

LUGAR: Well, people unfortunately are dying throughout the Middle East. There are disruptions. There are people rebelling against authority. There are authorities killing people who are rebelling against authority. The basic question for the United States and/or for the United States as part of an alliance is are we prepared to come in, take hold of the situation and say now we're going to straighten this thing out, folks.

We're behind this group and democracy is our goal now and so forth. We have been down that road before. We are still working our way through that road in Iraq, even in late stages, haven't quite got there certainly in Afghanistan. And the American people really have to understand at this point that if we are prepared for more war, for more conflict, for more American boots on the ground that is a huge commitment. And that requires I believe a declaration of war by the Congress of the United States, not an informal thought that somehow a no-fly zone with or without danger might be imposed.

KING: And so your point, and I -- do you think the president needs to do a better job explaining this to the American people if it gets to this point, that even if we started with a no-fly zone, hoping that that was as far as the United States and the NATO allies would have to go, that there is no guarantee, and that once you make that investment you better be committed to going all the way, even if that ultimately leads to some sort of escalation?

LUGAR: Precisely. The fact is a no-fly zone doesn't guarantee anything at all, except that a few aircraft that might be up there in the air might be shot down by our aircraft or our allies. We hope without casualties to Americans in the process. But having said that, really, the ground action is where the people are being killed very swiftly. A

After you're certain the aircraft of Libya are gone, at least Moammar Gadhafi's aircraft, then the hew (ph) and cry would be but there are still people being killed, slaughtered on the ground. What are you going to do about that?

KING: Is there any place in your mind at any juncture where U.S. boots on the ground, NATO boots on the ground would be necessary or is this a civil war? Unfortunately bloody, but a civil war, and the United States should stay out?

LUGAR: I believe it's a civil war and the United States should not intervene in a civil war. Now after the war has concluded, the United States and other nations will have to make determinations as to how we treat whoever the winners may be. And at that point, the winners will want to have the independence of action, not be seen as shills (ph) of the United States or somebody else. Because if they're seen that way, then they're going to be repudiated by others, who'll be back into civil strife either between sectarian groups or between tribes that we haven't heard a great deal about in Libya.

KING: And so when your chairman, Senator Kerry, says maybe we could at least crater the runways so that Gadhafi can't fly his planes or Senator Lieberman says maybe we should think about arming those opposition forces, Senator Lugar says what?

LUGAR: Well that gives I'm certain my colleagues a satisfaction that as humane individuals, they are attempting to stop the killing of other people on this earth by a person that we repudiate. But I would say even though that is their wish and perhaps we could effect some saving of life, we are very likely I think to create conditions in which even more lives would be lost by continuation of civil strife.

KING: Senator Richard Lugar of Indiana, I appreciate your insights tonight, sir.

LUGAR: Thank you very much.

KING: Thank you. Still ahead here, 336 days and counting -- yes, a handful of Republicans who would like to be the next president, they're in Iowa tonight. And next, Libya, your price at the pump and what some politicians see as a quick fix.

(COMMERCIAL BREAK)

KING: It is as certain as death and taxes, turmoil in the Middle East means higher prices at the pump. We've been tracking this throughout the Libya crisis. Let's take a look. Watch this play out. This is crude. The dark green is crude oil, up above $105 a barrel -- right around $105 a barrel right now. This is what you're paying at the pump -- on average, $3.51 a gallon. That's for regular unleaded gas. If you pump premium you know it's higher than that.

And where you live can also change that. One impact of higher oil prices is declining consumer confidence. There's is a 30-point drop in consumer confidence just over the last couple of weeks. That matters when you have a fragile economy trying to get -- have a recovery take steam. Consumer confidence down, then consumer spending goes down, that could spell longer trouble for the economy. What you pay depends on where you live.

If you look across the country here where you see red, especially out there in California, the darker the color, the higher gas price you're paying. These green states, that's a -- I'll say -- lower price. I'm not saying it's a low price -- trust me -- still over $3 a gallon in all those areas. That's the effect of state gas tax on this debate. So as the prices go up, more places are turning red. The big debate now is should we tap the strategic petroleum reserves? What's that?

Well, the United States government has strategic reserves, about 727 million barrels. It is kept in four places right here along the Gulf coast. You see them right there. The average price the government paid for that way below what it's selling for now in the market, about 29, $30 a barrel. Enters (ph) the market in 13 days, you tap it, that oil can be on the market in 13 days.

Cost the government about $22 billion to build up those reserves. It has been done before, largely to make up for disruptions in the market like after Hurricane Katrina, Desert Shield/Desert Storm. Essentially, the government puts some oil on the market until the companies can replace it. So is it a good idea to tap in? That was a question I put just a bit earlier to John Hofmeister. He is the founder and CEO of Citizens for Affordable Energy and the former president of Shell Oil.

(BEGIN VIDEOTAPE)

KING: So John Hofmeister, you hear some of the politicians saying the price of gas is up. The president should tap the strategic reserves. Good idea?

JOHN HOFMEISTER, FOUNDER, CITIZENS FOR AFFORDABLE ENERGY: No it's not a good idea at all. That's not the purpose of the strategic petroleum reserve. The reserve exists for the event of national emergencies, which would include shortages or outages. And frankly, there is no shortage of oil in the United States today. We have record inventories in Cushing (ph), Oklahoma. There are no refineries that I'm aware of anywhere in the country that don't have an ample supply of crude oil. And the idea of opening the strategic petroleum reserve to impact price is just a non-starter.

KING: And so why it is then that every time you see a spike in prices, this spike cause by the uncertainty in Libya and the Middle East more broadly. But why is it that every time we see a spike, some politicians say open the reserves?

HOFMEISTER: Well, some people like to give lollipops to angry children to calm them down. And they think that might be a way of getting voters to back off. Because no question, when elected officials go home today and they face voters who are paying through the nose for gasoline at the pump, they don't want to say look, it's our fault.

We're the politicians that refuse to drill American oil. We're the politicians that have refused in the last two Congresses to change our energy policy. We'll open up the strategic petroleum reserve for you and make you happy for a few days. It's a nonsense situation, John.

KING: Well, if it's a nonsense situation, help people understand this. Because you're making an emphatic case that there is no supply problem here that no refinery in America is waiting for oil that there is plenty of oil on the market. The Saudis have promised that if there was a shortage, they would increase production a little bit. So why then is the market, why is it $3.51 on average and in some places more than $4 a gallon then, and why has it gone up so sharply in the last two weeks if there is no supply problem?

HOFMEISTER: There are a couple of reasons for it. Number one, the overall supply-demand situation is clearly tightening. Since last August to the present, global economic growth, including U.S. growth has led to not shortages, but tightening of the supply-demand relationship. Secondly, the particular growth in Asia and the way in which China is contracting for its future oil instead of wanting to use the global trading pool means there is a potential future less oil on the trading marketplace.

And thirdly, the U.S. not wanting to produce its own oil is a serious, serious problem. It's all complicated now because of the turmoil in the Middle East. And frankly, oil hates turmoil. And the fact that this turmoil could spread, contagion could set in. And everybody is really worried about what might happen in the Persian Gulf with respect to Bahrain, Saudi Arabia, Iran and so on that there's this uncertainty that is just feeding spiking actually the price. It's irrational, John, but it's happening.

JOHN KING, HOST: Does greed play a role here? Does greed like turmoil? Are there people out here who are making extra money because of all of these, maybe charging too much because of all these because they have the turmoil as an excuse?

HOFMEISTER: I think we have to worry about two kinds of potential greed plays. One, yes, there is always some level of speculation of people who are going to cut a deal because they can cut a deal. And that deal is not really necessary. So they're going to tempt a buyer of oil to buy it now, which spikes the price even further when that buyer really doesn't need to buy it, but he is pushed by that person.

Secondly, there are some retail stations that are run by some real knuckleheads that want to raise the price just as fast and as high as they can to get it while they can, taking advantage of the uncertainty. Over time, that shakes out. Over time, there is no ability to be too greedy in this market. It's too competitive, but in the short-term volatility, it can happen.

KING: And is there a long-term lesson in what we're watching right now in Libya, or is this just one of the policy bumps, one of the global turmoil causes trouble in the markets, in this case the oil markets. There something the president should be doing, saying never mind the strategic reserves, but we should be doing this?

HOFMEISTER: I think the long-term implication for the United States is this nation is the number one cause for high global crude oil prices because of the serious imbalance in our daily consumption compared to our daily production. No other country has such an imbalance as the United States.

We use 20 million barrels a day. We produce seven. We could produce 10, 11, 12 million barrels a day, but we don't. So for us to fail to produce our own crude oil makes us really we don't have the right to complain about global prices when we're the main cause of those high global prices.

KING: But it's harder to make and excuse me for putting these words in your mouth, the drill, baby, drill argument post BP, isn't it?

HOFMEISTER: Well, that's an issue and BP really messed up the Gulf of Mexico in addition to the tragic loss of life. But responsible companies operating responsibly have demonstrated over 100 years a pretty good track record over 50 years in the Gulf of Mexico, 40,000 plus wells, the one bad anomaly, the BP deepwater horizon really taints it for everybody.

But perhaps that's not just justified. And we're not going to stop using oil any time soon. We can't. We are dependent upon an infrastructure that is an oil-based infrastructure. I've been working on alternatives for ten years. In one way or another, and it's going to take another 10, another 20 for them to have a material impact. Meanwhile, we really need more oil.

KING: John Hofmeister, I appreciate your insights.

HOFMEISTER: Thank you.

KING: Still to come, a new presidential order on how to deal with terror detainees makes this crystal clear. The president's promise to close Guantanamo Bay won't be kept any time soon.

Plus, is Mitt Romney changing his tune on health care?

(COMMERCIAL BREAK) KING: Welcome back. If you are just joining us, here is the latest news you need to know right now.

A major announcement from the White House today on U.S. policy for terrorism detainees. The United States will resume the use of military commissions to prosecute alleged terrorists at the Guantanamo Bay detention facility.

President Obama made that announcement in writing today, stressing his administration remains committed to closing Gitmo, but that closing now nowhere in sight. Liberals tonight not happy with the White House announcement.

Commerce Secretary Gary Locke is getting a new job. A senior administration official confirms to CNN he'll be nominated as the next U.S. Ambassador to China, replacing Jon Huntsman, the former Republican governor of Utah who is resigning and may run for president.

Five other Republicans with presidential ambitions, you see them right there. Well, they're in the spotlight tonight. They're addressing the Iowa Faith and Freedom Coalition spring kickoff. That brings together presidential candidates for the first time.

And who followed them out to Iowa? Our national political correspondent Jessica Yellin. You're not seeking the presidential nomination, are you?

JESSICA YELLIN, CNN NATIONAL POLITICAL CORRESPONDENT: Not at this time. Not at this time, John. No, I'm here to -- the audience here -- I'm here to get a sense of the vibe here in Iowa. And I'll tell you, John, if this is a measure of how energized the conservative base will be come next February, this will be a very active base.

This is full to capacity room, more than 800 people it seems are here. More than 11 months before the vote begins, we have Newt Gingrich, Tim Pawlenty, Rick Santorum, Herb Cain and of course, Buddy Roemer who just got in last week.

One of the big debates you have heard people talking about as they come into this room, is what do we want to hear from them? Do social issues matter more as it has in the past or do economic issues matter more to this crowd this time around?

And overwhelmingly I found that the folks coming in here, John are, saying economic issues are their number one concern, even in this kind of forum at a Faith and Freedom forum, they want to hear about economic issues first, John -

KING: That's important. I'm glad you're also getting early campaign experience in talking over a good happy raucous political crowd. Jesse, what about who is not there?

Governor Huckabee is not there? Governor Palin is not there. Governor Romney, a big question whether he'll play in Iowa at all. Not there. Do the people in the crowd, are they saying those who don't come to an event like this will be punished?

YELLIN: They say it's still early and so they're allowed to slowly filter in. But you know, Iowans expect everybody who plans to run to make a good early showing and there will be another forum like this in a few week's time.

Haley Barbour has already said yes. A few more potential candidates have said yes, but you're right. If they don't start showing up soon, some of those other potentials, there will be some hurt feelings in this crowd, and the folks remember that come caucus day, John.

KING: I know the night is young and our reporting on this nation campaign is young, but are those Iowa activists, many whom we have met over the years and years, are they happy with this field or are they look around saying we're missing something?

YELLIN: So far they're still -- they have an open mind. They are so angry in this audience with President Obama that there is a lot more -- no matter what you ask, that's where the conversation goes. They just want a change. They say we just want a change.

And not a lot of criticism of the candidates, the potential candidates they're seeing at this time. But they say we have to see what they say, and then we'll make up our mind and you know Iowans will, and they speak their mind when they made it up, John.

KING: That's why we love them. Iowa, New Hampshire, South Carolina, the voters aren't shy. Iowa is under way. Jessica Yellin, have a great night at the event. We'll check in tomorrow to see how it went.

Let's talk this over. Yes, yes, yes, the campaign finally getting underway. With us tonight to talk about it, CNN contributors Roland Martin and Erick Erickson. They're here with me in Washington and in New York, John Avlon.

So Erick Erickson, I want to put to you the question I just put to Ms. Yellen there. Are conservatives, Republicans, not always the same thing, are they happy with the field so far, or is there something missing?

ERICK ERICKSON, CNN CONTRIBUTOR: I think it's too soon to tell my sense is a lot of them sense there is something missing. The candidates who are out there right now aren't necessarily seemingly the strongest candidates. They're retreads, a lot of them from 2008. People want some fresh voices, fresh ideas that they're not seeing right now.

ROLAND MARTIN, CNN POLITICAL CONTRIBUTOR: Let's keep in mind this is March. You're talking about the primaries kicking in place in January, but depending on the Florida moves, it could be November or October. And so really, the folks who are out there now they have different reasons why they are out there.

Your Tim Pawlenty, you're really trying to establish yourself on a national scale. Mitt Romney, trying to solidify yourself in terms of getting away, the issue of the moment, locking and loading on economic issues.

And of course if you're Herman Cain, you trying let anybody know you actually exist. If you're the candidates, you already have name id, you don't need these type of events in March. You can step in, frankly, July, August to wrap up when it comes to fundraising as well.

KING: Most of the American people I'm sure are grateful this campaign is actually starting late by recent standards. Most people I'm sure are grateful. The people in Iowa and New Hampshire are getting antsy because a, it's important to them, their pride, their stature, important to their economies as well.

What is your sense now? You the Republicans out tonight as Jess noted. Another one of the cattle calls as we call them in the business. We're off and running now, right?

JOHN AVLON, CNN SENIOR POLITICAL COLUMNIST, DAILYBEAST.COM: Yes. The bell has rung. The gates opened, and folks are running. One thing you can say about this field, a, there is no clear leader there is no candidate who is stacking up at the moment very competitively against President Obama, although I think you need to consider Mitt Romney the front-runner at this point although Huckabee is pulling very well, having put together a campaign.

I think what is missing is anyone representing the center right. You've got Mitch Daniels and John Huntsman potentially representing that wing of the party to the extent it still exists. But this is a very socially conservative campaign field right now and that may have trouble converting in the general election to appeal to independent voters.

KING: We all write every day. One of the things I like about George Will, whether you love, like, disagree with his politics, George has a very good way with words. He uses them smartly to bring clarity. Here's George Wills' column from Sunday. This is a conservative who wants to defeat President Obama in 2012.

Frankly, he is a little nervous about the field so far. So let's hear what he says. Let us not mince words there are at most five possible republican presidents on the horizon, Indiana Governor Mitch Daniels, Mississippi Governor Haley Barbour, the former Utah Governor and departing Ambassador to China Jon Huntsman, former Massachusetts Governor Romney and former Minnesota Governor Tim Pawlenty.

So a Republican winnowing process is far advanced, George Will says, but he goes on to say the nominee may emerge much diminished by involvement in a process cluttered with careless, delusional, ego maniacal spotlight-chasing candidates to whom the sensible American majority would never entrust a lemonade stand, much less nuclear weapons.

UNIDENTIFIED MALE: He's right.

KING: Who does he mean, Mr. Erickson?

ERICKSON: Well, he started off the article mentioning Newt Gingrich and Mike Huckabee in their forays in foreign policy, vis-a-vis Barack Obama's upbringing in Kenya and Indonesia. Yes, sensible Americans I don't think want to delve into birtherism and conversations like that.

The key word on to the horizon we don't see yet. I notice his bias for governors, which I think is the prevailing wisdom now that you're going to have a governor beat Barack Obama. Who is it going to be? Will Chris Christie get in? We'll see.

MARTIN: He's making the right point because the last thing you want if you're a Republican nominee is to have to stand there and answer any question dealing with birthers, dealing with the whole issue in terms of madrasta. You don't want to do any of that kind of stuff. You want to focus on the economy. You want to focus on health care.

And you don't want the get thrown off and you do not -- unlike Rick Santorum, and I like him, you don't want to have to confront the issue of abortion and gay marriage when the economy is front and center.

KING: John Avlon, you went through this with Rudy last time around, Rudy Giuliani. How much does that affect when you have candidates that clearly aren't going to win, but you have these eight or nine candidate forums and somebody says I think we should boom. When it's the last thing in the world you want to talk about?

AVLON: Honestly, I think 2008 was a very different field and political situation than this time around. I think the far right is much more inflamed and empowered with President Obama in office. Got to remember, the nominations of both John McCain and Barack Obama were both repudiations of the world according to Karl Rove.

It was an overturning of the strategy that year. This year in the Republican field is all about play to the base. The greatest marker of that is normally when people run for president in the past, they try the make their rhetoric more responsible in order to be seen that they're fit for office.

This year, we see some candidates making a strategic consideration that the more irresponsible they are, the better it may play with the base. That's a dangerous thing for a Republican at the end of the day.

KING: Quick time-out. Everybody is going to stay. When we come back, one of those Republican candidates, Mitt Romney, he did run last time. Some think of him as the front-runner this time. Health care is the biggest albatross some would say. Is he trying to shift his position? We'll be right back.

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KING: We're back, talking early 2012 politics with John Avlon, Erick Erickson, Roland Martin. One of the things we like to get people out there moving around and hold them accountable. Is what they're saying now match up to what they said then?

As we all know, Mitt Romney has an issue with many conservatives. They don't like the Massachusetts health care plan that he signed as governor because it has a mandate. It requires people to get insurance.

But listen to Governor Romney describing his plan over the weekend at a Carroll County Republican event in this very, very important state of New Hampshire.

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MITT ROMNEY, (R) FORMER MASSACHUSETTS GOVERNOR: Now our approach next door was a state plan to address state problems in ways that were unique to Massachusetts. Now, our experiment wasn't perfect. Some things worked, some things didn't. Some things I'd change but one thing I would never do is usurp the constitutional power of states with a one-size-fits all federal takeover.

(END VIDEO CLIP)

KING: Got it? State plan unique to Massachusetts. He would never usurp. Here's what he told our Jim Acosta in 2009.

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ROMNEY: I thik there are a number of features in the Massachusetts plan that could inform Washington on ways to improve health care for all Americans. The fact that we have portable insurance and that we were about to get people insured without a government option is a model I think they could learn from.

(END VIDEO CLIP)

KING: Now, Erick, not directly inconsistent, but he sure thought it was a much better national model then than he seems to now.

ERICKSON: The only criticism that I hear about Mitt Romney from conservatives across the board up to this weekend is he's not been an effective job walking back from what everyone calls Romney care on the right.

The big criticism is the plan objectively in Massachusetts hasn't worked. It has major problems in Massachusetts. He has credit for it up until this point. Maybe the walk back has begun. I think it's going to be too late.

KING: Can you walk away from a -- what many view as the signature achievement as Massachusetts governor? John Avlon, yes. Erick's right. There's a cost issue, but a lot of people knew when they passed it first thing was to get access, 95 percent of the people have coverage. Now they're dealing with a lot of the cost issues.

AVLON: Sure, no. Look. First of all, that Mitt Romney in 2009 was wearing a tie so that was a slightly different standard. But, you know, look if you go back to the totality of this, in 2005, Governor Romney was making this a center piece of a prospective presidential campaign saying mandates and I quote, from a 2005 article in "USA Today" a conservative idea insisting upon individual responsibility for your health care. That's a far cry from socialism. So yes, this is a real problem at a time when the health care debate is one of the things that's uniting the folks on the right.

MARTIN: I'm glad I got my cowboy boots on because the manure is piling high at any time when Mitt Romney talks. Look, here's the deal. This is the same guy who was ripped in '08 for being a flip flopper.

The last thing he wants in '12 is to say you're a flip flopping on the major issue. Here's what you do. I know health care is major, but you frankly minimize that conversation. If you're Mitt Romney, all you focus on is being a businessman and dealing with the economy.

If he walks down this path trying to do a dance with health care, he loses again. How do you not learn from '08?

KING: I want you guys to listen to this. We're talking presidential politics right now, but one of my big question going into 2012 is does the Tea Party have the same energy in Republican primaries as it had this past year.

At top of the program we were talking to Senator Richard Lugar of Indiana about foreign policy. He is a thoughtful Republican voice on foreign policy. He has a Tea Party challenge. Listen to my question to him about 2012.

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KING: In recent weeks, we have seen Senators Begaman and Senator Okaka on the Democratic side saying, you know, I'm going to call it quits now and not run for election.

Senator Enson on the Republican side today. You're up in 2012 and you know too well, Tea Party, another conservative forces saying we'll primary Richard Luger back home in Indiana. Any second thoughts? Are you in until the end in 2012?

SENATOR RICHARD LUGAR, (R) INDIANA: I'm in until the end and I'm enthusiastic about a great campaign supporters are waging much more prematurely than we anticipated, but with fund-raisers every week and with boots on the ground literally in Indiana people who are working the precincts.

(END VIDEO CLIP)

KING: Let me get a quick thought from everyone. John Avlon, he's been around the track a few times, but he seems very excited about the campaign.

AVLON: Well, Dick Lugar is a statesman. He's exactly the kind of guy we want in the Senate where the bill reached across the aisle constructively. Folks on the far right hate that so be it, but he should stay and fight. He represents his constituents effectively.

KING: Are you one of those people on the far right?

ERICKSON: I look forward to calling him former senator. You may say he represents his constituents effectively, but a lot of them want him out of there.

MARTIN: If you're a Tea Party person different next year than this year. Obama is on the ballot, but also those GOP candidates, they're ready for them this time.

KING: Excellent point. Roland Martin, Erick Erickson, John Avlon, thanks for coming in gentlemen.

When we come back, there's a lot of talk about military intervention in Libya. What does Moammar Gadhafi have at his disposal if the United States and NATO move into the neighborhood?

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KING: So what would the United States and his NATO allies have to worry about if it did decide to impose a no-fly zone or take some other military step in the Libya crisis?

Here's what Moammar Gadhafi has for weapons? Ninety percent of them come from Russia or the Soviet Union. Some of them go back that far about 10 percent come from the United Kingdom, France and South Korea.

Let's take a closer look. One thing we see playing out right now, what army assets does he have? Now on paper, the Libyans say they have 75 to 100,000 troops and they have 2,200 battle tanks. You see some of the other weapons here.

In reality, what most people believe it's about 10,000 to 12,000 loyal troops. One brigade is considered to be the most reliable and they do have some tanks and armored vehicles and we've seen them used these against the opposition in recent days.

Another concern or one of the reason you would have a no-fly zone is because of the Libyan Air Force. Again, what they list on paper is not really what they have in practice. Not as ready as Iraq was for example back in 2003. A lot of these jets are not of air quality. They have lost at least three already. Maybe we'll show you a picture of those before we go.

Here's what they do have though, French Mirage, Russian and Soviet fighters there. Migs, as well, you remember that and we've seen some of these in recent days. You see them right here in a no-fly zone. The goal would be to keep these out of the sky and perhaps to bomb the runways and take some of them out.

Now one concern has been weapons of mass destruction. Gadhafi gave up quite a bit in agreement with the international community. He still has at least 10 tons of mustard gas at this facility. People are worried about that.

Another big question, of course, what do the rebels have? We do know the opposition forces have taken some Libyan army assets including anti-tank missiles, some shoulder-fired surface-to-air missiles, some tanks and guns and ammunition.

This is what they have so far. They're trying to seize more as they go. We'll keep this mind and we'll keep visiting this over the next few days as NATO discusses what to do next, that's it for us tonight. We'll see you tomorrow. "IN THE ARENA" starts right now.