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CNN INSIDE POLITICS

Israel Struck by Another Suicide Bombing; President on Defensive About Financial Past

Aired July 17, 2002 - 16:00   ET

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


THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(INTERRUPTED FOR BREAKING NEWS)

JUDY WOODRUFF, CNN ANCHOR: The story we're watching out of Tel Aviv, Israel, is yet another suicide bombing, this time five people dead after two suicide bombers blew themselves up in South Tel Aviv near the central bus station at a movie theater.

At this point, police are saying five are dead in addition to the two suicide bombers, 30-some others taken to the hospital. Five of them are considered to be in serious condition. No one at this point has claimed responsibility. This comes on the heels of another bombing in the West Bank that took place yesterday, several dead and a number injured in that attack, so two days in a row. And we continue to watch this story coming out of Tel Aviv.

Now to some of the other news of this day: We turn to the United States economy and to President Bush, who was on the defensive today about the vice president's corporate past, as well as his own financial history.

Here now: our White House correspondent Suzanne Malveaux -- hello again, Suzanne.

SUZANNE MALVEAUX, CNN CORRESPONDENT: Hello, Judy.

Well, this evening, the president is formally hosting the president of Poland. They going to be having a state dinner this evening. But this administration continues to be dogged by questions, both about the president as well as Vice President Cheney's own business dealings before they took office.

(BEGIN VIDEOTAPE)

(voice-over): President Bush formally welcomed the president of Poland. The two praised each other for the cooperation in the war on terror, vowing to strengthen their military and economic ties, but the first question out of the gate to President Bush linked to problems surrounding Vice President Dick Cheney, an investigation by the Securities and Exchange Commission into possible accounting abuses at the Halliburton company when Cheney was CEO.

Mr. Bush, for the first time, confronted with Cheney's corporate troubles, dismissed any suggestion that Cheney is guilty of wrongdoing.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I have great confidence in the vice president. He's doing a heck of a good job. When I picked him, I knew he was a fine business leader.

MALVEAUX: Cheney's office calls the allegations of shady accounting meritless, but Democrats and reporters calling for Cheney to answer questions, fully disclose his position in a public forum. The vice president has refused -- and Mr. Bush also dogged by questions about his own business dealings.

The SEC investigated Mr. Bush when he was director of Harken Energy Group more than a dozen years ago and found no evidence of insider trading. Democrats continue to press the president, asking the SEC to release all documents related to the investigation. But Mr. Bush continues to refuse opening the decade-old case.

BUSH: As to a look at Harken, the SEC, as a result of Freedom of Information requests, has released documents. And the key document said there was no case.

(END VIDEOTAPE)

MALVEAUX: The Democrats tonight are using the president's statements to make the case that the administration cannot objectively investigate Vice President Dick Cheney.

I'm quoting here from a spokesperson from the DNC, Jennifer Palmieri, who said today: "When the president of the United States stands at a podium and says basically there's nothing to this investigation, I think that this could have a sign, an impact on the SEC's investigation. It becomes increasingly doubtful that Harvey Pitt is able to run an objective and impartial investigation of Vice President Cheney" -- Judy.

WOODRUFF: All right, Suzanne Malveaux at the White House.

With me now: the former chairman of the Securities and Exchange Commission, Arthur Levitt.

Mr. Levitt, the president continues to be confronted with questions about the sale of Harken Energy stock back about 10, 12 years ago. Should the SEC today release everything it has, all the information it has about that sale?

ARTHUR LEVITT, FORMER SEC CHAIRMAN: I really don't know.

The one brief brush I had with that was when an inquiry was made about the issue. I asked the then-enforcement director to look into it. He came back to me and said that there was nothing inappropriate that was uncovered by the investigation. And that's all I know about the issue.

WOODRUFF: Well, let me ask you about the vice president, Vice President Cheney, and all the questions being raised now about what happened in terms of the financials at Halliburton when he was president of that company. It is -- the company is now under investigation by the SEC.

Can you shed any light on that? And do you think that more documents should be made available by the White House on that?

LEVITT: I really have no idea. I was not a party to that investigation. I really don't know how far it's gone or what they've uncovered. So, I'm afraid I can't shed any light on that.

WOODRUFF: All right, well, let me turn you to something that took place today, Mr. Levitt. Before Congress, for the second day in a row, Fed Chairman Alan Greenspan testified. And among other things, he said today that he thinks there are yet to be significant corporate restatements, in other words acknowledgments that there were misstatements of their financial books yet to come.

Now, does this surprise you? And do you agree with him that that's likely to be out there?

LEVITT: Absolutely. I think the notion that we're dealing with a few bad apples is simply false. We've seen an ethical deterioration of corporate ethics for almost two decades. And that's played out in terms of how the numbers are reported.

Now that executives are going to be held criminally liable for misstatements, I think that's going to trigger off a whole rash of restatements. And I think today's announcement of a restatement of a case that started while I was still there is but one of many that will probably occur over the course of coming weeks and months.

WOODRUFF: All right, well, Arthur Levitt, we are going to have to leave it there. Clearly, our show is a little bit shortened today by the breaking news out of the Middle East. We want to thank you so much, though, for taking the time to join us.

Good to see you.

LEVITT: You're quite welcome. Good to be here.

WOODRUFF: We appreciate it.

When we come back, we're going to take a look at a tragedy out of California. And that is that a 5-year-old girl abducted Monday evening from her home, her body found today, in what must be the worst news any parents can be told.

We'll be back with that story in just a moment.

(COMMERCIAL BREAK)

WOODRUFF: Recapping our top story out of the Middle East: Five Israelis are dead, more than 30 injured in the wake of a double suicide bombing that took place in Tel Aviv just outside a movie theater, Southern Tel Aviv, near that city's central bus station.

Here at home, as if Americans weren't already anxious enough about the economy and about terrorism, many are reminded today that their children may be in danger in their own front yards. Police in California confirmed that a body found late yesterday was indeed kidnapped 5-year-old Samantha Runnion. They warn that her assailant probably is a serial rapist and killer who could strike again soon.

We begin with coverage with CNN's Frank Buckley -- Frank.

FRANK BUCKLEY, CNN NATIONAL CORRESPONDENT: Yes, Judy, just an awful day here in Southern California with the confirmation that the body that was found yesterday at about 3:00 in the afternoon along an area, Ortega Highway in Riverside County, was in fact the body of 5- year-old Samantha Runnion.

The girl was sexually assaulted, according to authorities. They say there was trauma to the body, but they have no obvious cause of death. The autopsy was under way today to determine the exact cause of death. That continues. We expect an update on that later today.

As you said, investigators described the person who did this as a serial rapist, possibly a serial murderer, serial killer, based on an FBI profile and also the way the crime scene was discovered. Yesterday, investigators were asking for the public's help in finding Samantha. Today, they are asking the public's help in finding this killer.

(BEGIN VIDEO CLIP)

MIKE CARONA, ORANGE COUNTY SHERIFF: We need the public's continued involvement in this. We believe the individual or individuals who committed this crime are probably watching.

You have to understand: Don't sleep. Don't eat, because we're coming after you. We will take every resource that's available to us to bring you to justice.

(END VIDEO CLIP)

BUCKLEY: They described the suspect as a Hispanic male, 25 to 40 years old, with slicked-back hair. He had a mustache. He may be driving a Honda or an Acura, a green car, a Honda or an Acura. That's based on a witness description, the witness being a 5- or 6-year-old girl who was playing with Samantha at the time of the abduction.

They are asking members of the public to be aware of possible changes in behavior of this suspect. They believe someone in public, in the public knows this person and this suspect will be exhibiting perhaps some changes in behavior. They are hoping that someone will come forward with information -- Judy.

WOODRUFF: All right, Frank Buckley reporting -- thank you, Frank.

And this is just the latest in a series of child abductions which have grabbed the attention of the whole country and, in some cases, have led to new laws.

(BEGIN VIDEOTAPE) (voice-over): Samantha Runnion, 5, killed and dumped by a road; Elizabeth Smart, 14, still missing after nearly seven weeks. Danielle van Dam, 7, murdered, her alleged killer now on trial: horrifying crimes made worse by the age of the victims and the apparent ease with which they were taken.

According to the latest government information, between 3,200 and 4,600 children are abducted by nonfamily members each year. But only 200 to 300 of those children are abducted by complete strangers. The nonprofit Klaas Foundation, named after murdered Polly Klaas, says that fewer than 1 percent of child abductions are done by strangers, but that they are extremely dangerous. The Klaas Foundation says that 74 percent of all children abducted by strangers are killed within three days.

Politicians have responded with stiffer sentences for child sex offenders and registries to alert families of sex criminals in their neighborhoods. But public policy can only do so much because sex offenders are notoriously difficult to reach. According to the best recent research, most sex offenders are not in prison, are not known by the communities in which they live, and they have a high risk of repeating their acts.

(END VIDEOTAPE)

WOODRUFF: We are going to continue to follow these stories, as we have been telling you.

We're going to take a break. INSIDE POLITICS will be right back.

(COMMERCIAL BREAK)

WOODRUFF: In Florida, Governor Jeb Bush says his family is saddened that his daughter, Noelle, has failed to follow a court- ordered drug treatment plan. The 24-year-old was jailed in Orlando today.

(BEGIN VIDEO CLIP)

TIMOTHY RYAN, ORANGE COUNTY JAIL: At sometime early this morning, probably a little after 11:00, we received in custody Noelle Bush, who was sentenced for -- in court in Orlando this morning. The information we have received is a charge called indirect contempt of court. The court has directed that she receive a three-day sentence, which would mean, some time on Friday, she would be released from custody in the Orange County jail.

(END VIDEO CLIP)

WOODRUFF: Noelle is Governor Jeb Bush's only daughter. Her drug problem was revealed back in January when she was arrested for trying to buy the sedative Xanax with a fake prediction.

In a statement today, Governor Bush said: "We love Noelle. But she is an adult and I respect the role of the courts in carrying out our state's drug treatment policies" -- end quote. That's it for INSIDE POLITICS. "WOLF BLITZER REPORTS" is next. We thank you for joining us. I'm Judy Woodruff.

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