BLITZER: The commander in chief lays down the line, President Obama saying he will not tolerate what he calls intelligence failures that failed to stop the attempt to blow up a plane on Christmas. Is this what Republican critics want to hear from the president?

Joining us now is the chairman of the Republican Party, Michael Steele.

He is the author of a new book entitled "Right Now." We will get to the book shortly.

Mr. Chairman, thanks very much for coming in. MICHAEL STEELE, CHAIRMAN, REPUBLICAN NATIONAL COMMITTEE: Great to be back with you, Wolf. And happy new year.

BLITZER: Happy new year to you as well.

Were you happy, what you heard from the president today?

STEELE: I was very pleased to hear the president finally address the issue and acknowledge something that many people knew on the 26th of December, that there was a breakdown in connecting the dots, as the administration said.

To have Janet Napolitano go all shortly after all of this became known and say that we have got control, and this is -- all the protocols were met was obviously premature. And, so, it was important for the president to set it very clear where he wants to go.

But this speaks to also a broader concern across the country for both Democrats and Republicans on this issue. And that is, where is the consistency and where is the urgency with respect to matters of national security, particularly the war on terror or dealing with terrorists in the country.

(CROSSTALK)

BLITZER: He seemed pretty frustrated and angry and urgent today, didn't he?

STEELE: Well, yes, but that is fine. But, then, when you look at the policy direction, Wolf, it kind of belies all the anger and frustration. It takes away from it, because, when you talk about -- on the first day in office, we are going to shut down Gitmo, with no strategy or plan to do so, and here we are a year later having the president say the exact same thing a year later, when you look at how all the pieces fit together, or, rather, didn't fit together, on this terrorist plot, and then, of course, when you won't call the very thing that we are fighting what it is, terrorism, war on terror or terrorists, and you instead treat them like a common criminal, wanting to wrap the Constitution around them, it creates a lot of concern on both sides.

(CROSSTALK)

BLITZER: Didn't the Bush administration do the same thing in treating Richard Reid, the shoe bomber, as a common criminal or Jose Padilla as a common criminal?

STEELE: Yes. And so past is not necessarily prologue here. I am not saying that it was right then and making it wrong now.

What I am saying is that when you want to avail the Constitution of this country to those who are hell-bent on destroying this nation, there has got to be a lot of thought put behind that, whether you are in a Republican administration or a Democrat administration. These are very dangerous times. And because we have been kept safe for the last eight years or so, that is a good thing, but you cannot let your guard down, and you certainly, when it comes to matters of national concern and interests, national security concern and interests, you have to be consistent. And I think there is that inconsistency right now that bothers a lot of people across the country and around the world.

BLITZER: Let's talk politics for a few moments and also talk about your new book. You said in an interview last night you didn't think the Republicans could retake the House of Representatives this year. Explain why.

STEELE: Well,, and you know, if you go on and listen to the rest of what I said -- and, look, I'm not a pundit here. I don't try to make those types of forecasts.

And, certainly, I know some of my friends in Washington on the Hill were a little bit put out by what I said. What I am saying is -- the question was, will you take back the House? I don't know, Wolf. As I said to Sean, we are still putting those building blocks in places.

We have races now that are just beginning to take shape. We -- announced today, you saw Senator Dorgan decide to step down, to retire. All of a sudden now that race takes on a new dynamic for us, with respect to the Senate. There will be other retirements. We had at Christmastime a Democrat congressman switch parties and become Republican.

BLITZER: Well..

STEELE: So from -- as the national chairman, I look at this and I'm not going to speak definitively of what we will do or won't do. What I can tell you is what we are going to be about the business of doing..

BLITZER: Well..

STEELE: ...and that is putting in place good candidates to run and -- and winning as if we will take the House in the fall.

BLITZER: Because the National Republican Congressional Committee, which is in charge of getting Republicans elected to Congress, they came out with a statement today, Ken Spain, the spokesman..

STEELE: Yes.

BLITZER: "The NRCC's goal has always been to recapture the majority in 2010. Independent political analysts and even liberal columnists have stated that Republicans have a very real shot at taking back the majority in 2010."

STEELE: That's not..

BLITZER: "And make no mistake about it, we are playing to win." That's been interpreted as a slap at you.

STEELE: It's not. It's not. I agree with the statement and it wasn't a slap at me. And, you know, there we go. We're trying to create this division and distraction. They're trying to create, oh, there's tension on the Republican side.

I'm saying, as the national chairman, I'm not going to sit in January and predict, we will take the House. What I agree with the NRC -- the NRCC and others around the country who are looking at these races, that we're going to be in play and we're going to fight very hard to win these seats and we're going to be competitive all the way to the end. No one is, right now, declaratively stating that we will win the House back in -- in -- this November. And if they are saying that, I would like to see the crystal ball they're looking through, because there's still a lot of politics to unfold here, a lot of races to be settled on both sides of the political tracks.

And what I want to be is deliberate..

BLITZER: All right..

STEELE: ...and determined to put the money out there to make every effort to win, in agreement with the NRCC statement today.

BLITZER: Here's a line that jumped out from your new book right now on page 14: "As chairman of the Republican National Committee, let me say it as clearly and succinctly as I can -- we screwed up."

All right, explain to our viewers here in the United States and around the world, how you, the Republicans, screwed up.

STEELE: Well, you know, when you look at the -- the history, you -- of -- you know, the Democrats had control of both houses of Congress for 40 years. We get it in '94 and lose it in 12.

And the question you have to ask yourself is what happened?

What occurred that people in '94 wouldn't trust us, through the Contract on America, with leadership and then take that leadership away from us 12 years later and then, of course, be in the -- you know, the mess that we've seen ourselves in -- in other races across the country?

And the reality of it is, when you step away from principles, when you step away from those values that you outlined very clearly in 1994 and begin to spend money, increase the -- the role and influence of government -- you know, the TARP bill was a real problem for a lot of conservatives on both sides, not just among Republicans, but those who identify as Independents and even some Democrats in -- in the last year.

Those types of principle -- moves away from principle are problematic. And so now we have a chance, I think, with -- with the kind of road map that, as the national chairman, we tried to lay out and -- and saw affected in New Jersey and Virginia this past fall in special elections that we've won throughout the -- the past year, to put a new footprint in place and move the party and the country in a direction away from, you know, this -- this sense of government entitlement and government -- onerous government intrusion into decisions that families and businesses are making every day.

BLITZER: You've got a huge challenge ahead of you.

Michael Steele is the chairman of the Republican Party.

His book is entitled "Right Now: A 12-Step Program for Defeating the Obama Agenda."

Michael Steele, thanks very much for coming in.

STEELE: Thank you, Wolf.

All right, buddy.

BLITZER: Good luck with the book.

STEELE: Thank you.