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CNN NEWSNIGHT AARON BROWN

Al Qaeda May Be Planning Terrorist Strikes During Holiday Season; Investigation Into Death of U.S. Attorney Continues; Authorities Seize Limbaugh's Medical Records

Aired December 4, 2003 - 22:00   ET

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

AARON BROWN, CNN ANCHOR: Good evening again everyone.
Back two years ago in the shadow of 9/11, I remember a friend saying she wasn't going to the shopping mall. It was the holidays. She was a shopper so I asked why. "How hard would it be" she replied "for a suicide bomber to walk into the mall, any mall in the country and blow it up"? It was a conversation stopper then and a program starter two years later.

We begin "The Whip" tonight with a terror warning and we got to CNN's Kelli Arena in Washington, Kelli a headline.

KELLI ARENA, CNN JUSTICE CORRESPONDENT: Well, counterterrorism officials say that al Qaeda may be planning attacks between now and the New Year and while they say the information coming in is not specific the experts are becoming increasingly concerned -- Aaron.

BROWN: Kelli, thank you. We'll get to you at the top tonight.

Not far from Washington the murder of a federal prosecutor, the case he was involved with and the question of a connection between the two. CNN's Elaine Quijano is in Baltimore tonight where the case unfolded, Elaine a headline please.

ELAINE QUIJANO, CNN CORRESPONDENT: Aaron, an assistant U.S. attorney never made it to work here at the Federal Courthouse in Baltimore. Instead, his body was found miles away in Pennsylvania and authorities believe he was murdered. Now Justice Department officials are vowing to find the killer or killers -- Aaron.

BROWN: Elaine, thank you.

On to Miami now, and more legal problems for Rush Limbaugh CNN's Susan Candiotti working the story, Susan a headline.

SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT: Hello, Aaron. Investigators seize Rush Limbaugh's medical records and his attorneys accuse investigators of going on a fishing expedition. We'll try to hook some answers for you.

BROWN: Susan, thank you.

And finally to the White House, echoes of a new frontier and an old challenge made new again. Our Senior White House Correspondent John King has the duty tonight, John a headline.

JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: Aaron, NASA wants the new mission of the space agency to include a return to the Moon. The White House says some big decisions still need to be made but it appears the president is inclined to agree.

BROWN: John, thank you. We'll get back to you and the rest shortly.

Also ahead on the program tonight we talk with Mary Matalin, a former adviser to President Bush and the vice president too about presidential images and presidential image tricks.

Later the story of Sharon (unintelligible), her son Marcus and the school where Marcus got in trouble they say for telling another student that his mom was gay. We'll talk to the head of the school board in Lafayette, Louisiana.

Segment 7 tonight he has the best comedic timing on the campaign trail so why not host "Saturday Night Live"? That's what Al Sharpton will be doing this weekend. We'll peak in on the rehearsal.

And while he can't tell jokes he sure can crow, wow, the rooster stops by with morning papers, all that and more in the hour ahead.

We begin tonight in familiar territory with the people who sift through intelligence and reconnaissance and chatter raising serious new concerns about the possibility of new al Qaeda attacks inside the United States, familiar territory for more than two years into the new normal but no less challenging to the professionals and, at times like this, no easier for the rest of us either.

Here again, CNN's Kelli Arena.

(BEGIN VIDEOTAPE)

ARENA (voice-over): As Christmas approaches recent intelligence has counterterrorism officials increasingly concerned about a possible attack against soft targets such as shopping malls.

ROGER CRESSEY, FORMER NSC COUNTERTERRORISM OFFICIAL: As recently as two weeks ago the intelligence community was telling the Homeland Security Department that this felt a lot like the summer of 2001, seeing lots of data, lots of information coming together that paints a very disturbing picture.

ARENA: It's far from certain but if al Qaeda does hit the United States some officials continue to expect the attack will be much bigger than recent strikes like these overseas.

M.J. GOHEL, ASIA PACIFIC FOUNDATION: The terror movement will always reserve the biggest and the most spectacular attacks for the U.S. and for U.S. interests.

ARENA: At least one senior U.S. official stressed there is usually increased threat information, including Web site activity before and during several key holidays. The problem is separating the legitimate intelligence from the rest.

Now there were several warnings of possible attacks in the U.S. back in October. Those never panned out. What's more officials say the terror movement is more scattered and harder to track.

GOHEL: Each of these groups are autonomous with their own leadership, with their own funding, their own personnel and they have their own plots as it were but they're all bonded together by a common ideology.

(END VIDEOTAPE)

ARENA: Now lacking specifics, Homeland Security officials say that there is no plan to raise the national threat level. Now that is unless more concrete information comes in -- Aaron.

BROWN: Kelli, quickly on another item new al Qaeda tapes, apparently al Qaeda tapes surfaced today. We've had a quick look at them. What do they show?

ARENA: Well, there was a tape that was released last night over the Internet that officials believe was produced by al Qaeda and it shows, interestingly enough, a terror cell that claims to be training inside Saudi Arabia.

Now this important according to terrorism analysts because it could suggest that al Qaeda is really focused on continuing to strike in the Saudi kingdom and the fact that they are actually continuing to train there. The main focus of this tape though seems to be recruiting, fund-raising, a message that al Qaeda is alive and well -- Aaron.

BROWN: And then there was another part of the tape or a separate tape, I'm not exactly sure, that showed and we warn viewers here it does show the planes hitting the towers but it's an angle that at least I had not seen before.

ARENA: Well, Aaron, I made a flurry of phone calls and no one that I've talked to has ever seen this angle before either. The FBI would only say that it was aware of this video that it existed.

But very interesting question how does this video that obviously was not widely circulated how did this make its way allegedly into al Qaeda's hands and onto this tape, which was a pretty well produced portion of that tape, so lots of disturbing questions and officials say that obviously they'd like to review more of it as they have the others. This is the seventh such tape, Aaron that's been produced.

BROWN: Kelli, thank you, Kelli Arena in Washington. Good to have you on the program tonight.

Other news now, the murder of a federal prosecutor, Jonathan Luna was an up-and-comer it is said. He was a friend to many, a mentor to some, the father of two young children, a champion of the little guy all of which makes his murder a terrible tragedy. What makes it more than that is twofold, the connection if any between the case he was working on and his death and, if there is a connection, the notion that someone should consider an officer of the court a target.

Here's CNN's Elaine Quijano.

(BEGIN VIDEOTAPE)

QUIJANO (voice-over): A federal law enforcement source says Jonathan Luna's body was found in Lancaster County, Pennsylvania and says the Assistant U.S. Attorney was stabbed multiple times.

TOM DIBIAGIO, U.S. ATTORNEY, MARYLAND: At this time, the evidence indicates that he was murdered.

QUIJANO: Luna had been working on finalizing plea agreements until 6:30 Wednesday evening in a drug conspiracy case involving an aspiring rap artist and his associate.

A senior law enforcement source says Luna arrived home around 8:00 Wednesday night. The source says Luna received a call then left home around midnight. He was due in Federal Court in Baltimore Thursday morning for that case. He never appeared. Both defendants later pled guilty. A neighbor of Luna's was stunned by the news of his death.

UNIDENTIFIED MALE: Just shock, it's just shock. It's just shock.

QUIJANO: At the Justice Department in Washington, officials who gathered for the annual holiday party Thursday night were visibly shaken and Attorney General John Ashcroft released this statement saying:

"We share his family's grief and will provide any support and assistance to help them through this difficult time. All appropriate resources will be dedicated to investigating this matter," a feeling echoed by Luna's colleagues in Baltimore.

DIBIAGIO: We will find out who did this and we are dedicated to bring the persons responsible for this tragedy to justice.

(END VIDEOTAPE)

QUIJANO: Now we talked to the defense attorney for that aspiring rap artist and he says he has no reason to believe that his client was involved in Luna's death. This attorney went on to call Luna a "friend as well as a colleague" and he added that Luna was most of the most decent men he had ever known.

Jonathan Luna was 38 years old. He had worked as a federal prosecutor here in Baltimore for four years. He was married and had two young children -- Aaron.

BROWN: Just one thing this sort of thing does not happen very often. It happened a couple years ago in Seattle. To my knowledge it's still unsolved. Were there any signs in the Luna case, had there been any threats against him?

QUIJANO: No indication that there were any threats, although I have to tell you, Aaron, people here are not giving out a whole lot of information. A lot of the information we have gotten are from law enforcement sources. Here people were simply too upset to talk.

After the news conference that took place tonight they very abruptly left the area and refused to answer any questions, both the FBI representative that was there as well as the colleague, the U.S. Attorney here in Baltimore.

So at this point, Aaron, nothing to indicate that there were any threats made against Luna though this investigation is just getting underway -- Aaron.

BROWN: Elaine, thank you very much. Thank you.

To Boston next the troubles for the Catholic Church there go on. What was once a sex abuse problem, a public relations nightmare and a legal problem is now all of that plus a financial problem as well.

So as best it can in a very visible way the Archdiocese in Boston is trying to cut its losses; reporting the story for us CNN's Jason Carroll.

(BEGIN VIDEOTAPE)

JASON CARROLL, CNN CORRESPONDENT (voice-over): For years it was solely a symbol of strength, an architectural benchmark of how powerful the church is but recently in the wake of a sex abuse scandal the archbishop's mansion had for some come to symbolize opulence and arrogance.

GARY BERGERON, CLERGY ABUSE VICTIM: I think the mansion became a symbol of what the Catholic Church had become and that's not what the Catholic Church is supposed to be.

CARROLL: Now the church says the time has come to sell it.

FATHER CHRIS COYNE, SPOKESMAN, ARCHDIOCESE OF BOSTON: The archbishop himself said that there is in his own march yesterday said that this was the end, yes, the end of an era, the setting aside of a different understanding of ourselves as a church.

CARROLL: The Archdiocese of Boston needs to raise $85 million to pay a settlement it reached with 552 victims of clergy sex abuse. The church says selling the archbishop's mansion, 27 acres of surround land, plus the money received from liability insurance will cover the cost of the settlement. Victims say the sale is long overdue.

BERGERON: We've been asking them to do this as a symbolic step, you know, time and time again over two years. Everyone that I have spoken to, lay people that I have spoken to think this is a positive step.

CARROLL: It's a step many here saw coming. Boston's former Cardinal Bernard Law lived at the residence until the scandal finally forced him to resign. The city's new archbishop, Sean O'Malley, refused to live there instead taking a modest apartment across town.

Historian John O'Connor says the sale could have broader implications for other diocese facing multimillion dollar settlements.

DR. THOMAS O'CONNOR, BOSTON COLLEGE HISTORIAN: Before maybe other diocese, for example, who have been wondering whether or not to do it, what would happen if they did do it perhaps, particularly if this works out well it might be a model for them too.

BERGERON: I hope they're watching. They should be learning a lesson here. People are not going to be led blindly by their faith anymore.

CARROLL (on camera): Real estate experts estimate the sale could raise at least $20 million, one potential buyer the archdiocese next door neighbor Boston College. The church needs to pay the settlement by December 21st.

Jason Carroll, CNN, Boston.

(END VIDEOTAPE)

BROWN: Now to Miami where if there was ever any doubt it is gone now. Police and prosecutors clearly suspect Rush Limbaugh, the powerful radio talk show host, of illegally obtaining prescription drugs.

That Mr. Limbaugh used and became addicted to those drugs, painkillers, is not in dispute but whether he broke the laws to attain them is, at least by Mr. Limbaugh.

Here's CNN's Susan Candiotti.

(BEGIN VIDEOTAPE)

CANDIOTTI (voice-over): Criminal investigators say it appears the popular talk show host was, quoting here, "doctor shopping" for controlled substances and "his actions violate the letter and spirit of Florida law."

Doctor shopping means going from doctor to doctor without telling them for prescriptions you might not necessarily otherwise get. Investigators say they searched two doctors' offices in Palm Beach County, Florida and have a search warrant for a third in that area and a law enforcement source says they have a search warrant for a fourth in L.A.

In response, Limbaugh read a statement from his attorney on his talk show.

RUSH LIMBAUGH, TALK SHOW HOST: What these records show is that I did suffer pain and had legitimate reasons for taking pain medication.

CANDIOTTI: Among key disclosures in the search warrant Limbaugh allegedly received prescriptions for more than 1,000 pills including the prescription painkillers OxyContin, Lorcet, and Hydrocodone.

The court papers indicate the drugs were sometimes obtained in the same week, less than a month apart, over a five month period. The documents state Limbaugh used multiple doctors "to obtain excessive amounts of controlled substances to support his addiction."

LIMBAUGH: Rush Limbaugh is not part of a drug ring. Rush Limbaugh was never a target of a drug investigation but what should be a responsible investigation is looking more and more like a fishing expedition.

CANDIOTTI: The Palm Beach County state attorney in a statement says his office has scrupulously protected Limbaugh's rights and added this: "Whether Mr. Limbaugh is subject to prosecution for any crimes is still under investigation. Mr. Limbaugh is presumed innocent at this time."

No word either on whether charges will be filed against Limbaugh's former housekeeper who told investigators a year ago she sold him prescription painkillers and then sold her story to the "National Enquirer."

(END VIDEOTAPE)

CANDIOTTI: The state attorney finally had to acknowledge its investigation because by Florida law search warrants have to be filed in public court. However, before they were Limbaugh's attorney announced the seizure first, a masterful move according to legal experts who say that by doing that they were able to control their message that Limbaugh is a recovering addict not a criminal -- Aaron.

BROWN: Well, not to be picky here but you could actually be both and that may be what it comes down to for Mr. Limbaugh. Just help me with this. The case going, that went forward today, that is to say the search warrants that were served today these are, this is separate from anything the housekeeper, this is a question, allegedly told police is that correct?

CANDIOTTI: No, it's actually part of it and the search warrants it turns out were actually served within the last ten days, not today, and they still have more to do but they're still looking into more of her claims including, for example, that she was paid off she claims by one of Limbaugh's representatives to keep her mouth shut.

BROWN: Well, it's certainly messy if nothing else and we'll see how it plays out Susan thank you, Susan Candiotti in South Florida tonight.

Ahead on the program is it time to head back to the moon? Three decades after the last American stood on the moon, President Bush preparing to send some Americans back. And is it state craft or stage craft, the choreography of managing the presidential image? We'll talk with former White House adviser Mary Matalin and more as NEWSNIGHT continues from New York.

(COMMERCIAL BREAK)

BROWN: To anyone old enough to remember or young enough not to know better, the idea of Americans not walking on the moon today is both strange and sad but it's been more than three decades since the last human being set foot on the moon and back when we had him on the program Astronaut Gene Cernan said, more than a little sadly as we recall, that he didn't expect to see it again in his lifetime.

Well eat your Wheaties captain and hang in there. Here's our Senior White House Correspondent John King.

(BEGIN VIDEOTAPE)

KING (voice-over): The president is on the verge of calling for a return to the moon as part of a dramatic new mission for the space program and sources say other ideas on the table include a permanent presence on the moon and even a manned mission to Mars. Aides say Mr. Bush wants to set bold new goals in space but has not made key decisions.

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: There are no plans for any policy announcements in the immediate future.

KING: After the Columbia disaster ten months ago, the president quickly committed to resuming shuttle flights. NASA's latest target is early 2005.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Mankind has led into the darkness beyond our world by the inspiration of discovery and the longing to understand. Our journey into space will go on.

KING: The administration review includes setting a target for retiring the shuttle fleet, a plan to phase out the International Space Station, picking a new space vehicle for manned flights, debating the costs and benefits of a permanent moon base and developing a proposal for a mission to Mars. NASA is urgently debating and refining proposals and Vice President Cheney is consulting key members of Congress.

SAM BROWNBACK (R), KANSAS: Great countries need to have visions to pull them on forward.

KING: The last moon flight was 31 years ago, December, 1972. Sources tell CNN NASA's target for returning to the moon is about 15 years from now.

BROWNBACK: You've got the Chinese now going into space and saying that they're interested in going to the moon. We don't want them really to beat us to the moon.

KING: But NASA's target of a moon mission in 2018 or so is not yet embraced by a White House still debating key policy and multibillion dollar budget questions.

(END VIDEOTAPE)

KING: And so many big questions are yet to be answered here at the White House that we might have to wait a while for the president's final decision. Aides say it will not be ready two weeks from now when the president will mark the 100th anniversary of the Wright Brothers first flight and perhaps, Aaron, not even ready for the State of the Union address in late January.

BROWN: All right, I'm still trying to figure out how the Chinese can beat us to the moon when we've already been there. Having said that is there a clear scientific reason to go? There are still people, as you know, that believe that aside from the breathtaking accomplishment of it there wasn't necessarily a scientific reason to send men to the moon in the first place. Is there a better reason now?

KING: We are told that at least the vice president believes there is a better reason now that with advances in technology that a permanent station on the moon could do more scientific research, could look out into the universe in ways you cannot do from Earth, could also be used for some testing of key military technology and perhaps to test the feasibility of taking that much more dramatic step of a manned mission to Mars.

The vice president, we are told, is in favor of this. He's quite influential, of course. The president is still in the process of crunching the numbers about the budget so we're going to have to wait a little bit for a final decision.

BROWN: John, thank you very much, John King in a snowy Washington tonight.

KING: Beautiful.

BROWN: Coming up on the program managing the presidential message and image, just how far can you go to get the right picture of the president?

On CNN this is NEWSNIGHT.

(COMMERCIAL BREAK)

BROWN: This is about politics and perception and the fallout when someone decides reality isn't good enough. Apparently it wasn't when it came to the president's surprise Thanksgiving visit to Baghdad. Much was made of the secrecy surrounding the trip. Even the president's father, we're told, was left in the dark but now another secret has emerged.

Remember that perfectly roasted turkey the president held for the cameras? Well, it was sort of a stunt bird, a centerpiece meant for decoration not dinner. The troops didn't get a taste of it and so tonight we ask does this constitute, get ready, Turkey Gate?

Mike Allen filed for "The Washington Post" and joins us tonight, nice to see you.

MIKE ALLEN, "THE WASHINGTON POST": Hi, Aaron.

BROWN: I think the -- well first explain the turkey part quickly and then let's talk about the implications of it all.

Well, Aaron, I first got suspicious of this turkey when I saw it blown up in one of the news magazines and it was so perfect, honey on top, golden brown in the middle, singed on the sides and I was thinking this is a country club turkey not a chow hall turkey.

And then the next day my editor heard from someone that this was a prop that it had been put there for the president and that no one ate it and we were interested in the question of to what degree this image, which is now very famous, which people in the White House hope will replace the mission accomplished image was at all unauthentic.

Now we checked into it and it turns out, as you say, this was a decoration. This was put on the buffet line by the contractor as the sort of, as to sort of tempt the soldiers. Apparently this is a normal thing for them to do and the White House staff says we didn't know the turkey was going to be there. We didn't know the president was going to pick it up. It was completely spontaneous.

BROWN: All right now as every administration since television has tried to manage the picture in one way or another I think the question then is, is this administration more than most good at managing the picture or obsessed with managing the picture and the message and how the president looks?

ALLEN: Right. Every modern White House has had a Hollywood or a Broadway component to it. This White House takes pride in the degrees to which they've sort of pushed that envelope, refined those techniques.

When you got to a presidential event outdoors at high noon it's lit just like this studio is because even though it's daylight the president looks better. The other day we were at an event on the economy in Michigan and behind the president was something that was made to look like rivets and it was fake. It was made out like cloth but it looked like rivets.

And what the White House says is we're showing things, we're dramatizing things that are real that are true. This president does care about the economy. We want people, you know, flipping the dial to see that. This president does care about the soldiers. Here we'll put him in a situation with the soldiers.

BROWN: Just tell me what sort of reaction you've gotten from all this because I have a feeling I know.

ALLEN: Well, you're right, a lot of teasing about this. I've gotten more sarcastic e-mails about this than probably any story in a long, long time. I got one call today where they said you must not get out much. Haven't you ever been to a restaurant where they show you the steak or show you dessert? What we thought this story did was it pulled the curtain back just a little bit, showed people how carefully these photographs are controlled and it's not always quite what it looks like.

BROWN: You did a good job of it. Thank you, Mike, Mike Allen of "The Washington Post."

Now, some defenders of the stand-in turkey contend there is a deeper truth to be found in a false event if you will. We wondered what that might be. What did we learn from that bird that was deemed better than dinner and what price to be paid?

We talked with Bush political adviser Mary Matalin a short time ago.

(BEGIN VIDEOTAPE)

BROWN: Well, Mary, this White House hardly invented theatrics. It's part of every administration, every White House since television, since Kennedy I guess. Is there a risk in all of it?

MARY MATALIN, BUSH POLITICAL ADVISER: Well there's a risk in not communicating and a fundamental component of good communications is visuals, is showing the message as much as saying the message and the fact that the way in which we receive our information today is so accelerated, it happens so fast that people are less prone to listen to speeches all the way through and have to take cues from visual events. So, there's a danger in not getting the message out more than there is giving those images that help convey it.

BROWN: But if -- maybe the danger, maybe it doesn't matter in this sense that the people who support and believe in the president support and believe in the president and those who don't, don't, and then there's this group in the middle.

Do you worry that, when the White House, at one point, said, well, when the president flew to the aircraft carrier, he had to fly in a jet, and then later had to retract that, that it just raises questions about the veracity of the White House itself, not the president?

MATALIN: Well, if there was a veracity issue with the White House, that would be troublesome.

But, unlike our predecessor, there isn't a veracity issue. In that particular case -- and we can go through all of them, if you want to -- the White House advance team was originally told they were going to have to come in the way that they did come in. But let me tell you something, Aaron.

I just got back, literally flew in to come visit with you from Winston-Salem with Congressman Richard Burr, who is running for the Senate. And people out there who are voting -- and this was a bipartisan group -- they care about the issues. We're in a really big debate time here, a very big transformational age with economic issues, intelligence issues, terrorist issues. And some of this stuff to them is irrelevant, to put it bluntly.

BROWN: I think you're probably right, so let's talk about some of the other things for a bit.

The president got a pretty good bounce, it looks like, in the polls after the Thanksgiving visit. As somebody who has dealt in political strategy, clearly, there are risks and rewards to the policy from a political point of view. What are they? What are the dangers?

MATALIN: Well, from the policy in Iraq?

BROWN: Yes.

MATALIN: The policy in Iraq is -- Iraq, it's part of the long- term strategy to bring stability to a region that, without, it's going to cause our continued insecurity, as the president said in a really ground-breaking speech, reversing, or changing, or transforming 60 years of policy that you can't buy stability at the expense of liberty.

So he's thinking long. This administration is going long-term, bring, if not democracy, some sort of representative government that offers opportunity and hope. And the political danger in that is -- whatever it may be is irrelevant, relative to the policy danger of not confronting this threat that is new to us, this asymmetrical, 21st century threat.

And people have no choice. We could do it the way we did for the last 20 years, since Khobar Towers, which resulted in terrorists that got bolder, stronger, better financed, more organized; 60,000 went through the terrorist camps and the al Qaeda camps. So he has -- this president has a bias for action. So the danger is in not taking action, not in taking action.

BROWN: But, roughly, half the country -- it depends on the poll and it depends on the week -- half the country doesn't think the administration is dealing with Iraq especially well today.

MATALIN: Well, then, that's what campaigns are about. And what I've heard from the Democratic field -- and I don't doubt that, when there is an ultimate nominee, they'll be up to the challenge to have a debate on this, but they haven't offered an alternative to the Bush proposals.

It's one thing to bash Bush all the time, as one is wont to do or the process dictates in a primary. But when we get mano-a-mano, Americans have to make a choice. And the president has out a policy that is a forward strategy for peace, as he calls it. And, look, this is how politics works. There's nine of those guys. They're all over the field. And we're not even suited up yet.

So when it's on an even playing field and people are making a choice, comparing the Bush policy of action to the policy of question mark at this point, then they'll make the choice. And I feel confident as a citizen, as a mother, that I'd rather look forward to a place, a globe that is more secure than not, where my kids can feel more secure than I feel today.

BROWN: Good to see you. I hope you'll come back often in the next few months. It's going to be an interesting campaign and an interesting and important time.

MATALIN: It sure is. Thanks for a smart show, Aaron.

BROWN: Thank you very much. Nice of you to say, Mary Matalin.

A smart program.

A few quick business stories before we go to break tonight, starting with steel. President Bush today lifted tariffs on steel imports, saying they've done their job in helping the American industry, the American steel industry, get back on its feet. Some people dispute that and the impact of the tariffs. This heads off trade sanctions from Europe. It leaves the president open to political sanctions from steelworkers, steel states, come Election Day.

As anticipated, FAO Schwarz filed for bankruptcy again today, the second time this year. The toy store chain is asking for protection from creditors, so it can sell off its assets and try and rebuild. To that end, the company is holding clearance sales at all locations, including the Toy Museum, the big store here in New York.

The government comes out with unemployment numbers tomorrow, or employment numbers, if you prefer. Look for payrolls to grow about 150,000 jobs, but the unemployment rate to remain where it is, 6 percent. That's what Wall Street is expecting.

The markets were up across the board today. And, after the closing bell, chipmaker Intel, an important stock, said it expects better sales, higher margins this quarter, which could have a bearing on markets come tomorrow. But we'll tell you that, in after-hours trading, Intel was down. So much for good news.

Still to come on NEWSNIGHT: Marcus' mom is gay, but he got in trouble when he said that in school -- or at least he believes he did. We'll find out why from the head of the local school board after the break.

Around the world, this is NEWSNIGHT.

(COMMERCIAL BREAK)

BROWN: Most of the time, you can count on children to tell it like it is. Most haven't learned the art of spin. Adults can be less comfortable with the facts, however, which brings us to Louisiana and a conversation between two second-graders that has set off a fascinating storm.

In this case, the second-graders were discussing their families, nothing unusual there; 7-year-old Marcus McLaurin told a classmate he has two moms and then explained what it means to be gay. What happened next is in dispute. Both sides agree that Marcus was disciplined. But his mother and the ACLU are demanding an apology.

David Thibodaux, is the president of the school board in Lafayette Parish, Louisiana, and he joins us from there tonight.

It's nice to see you, sir.

Do you know -- do you believe you know why Marcus was disciplined?

DR. DAVID THIBODAUX, SCHOOL BOARD PRESIDENT, LAFAYETTE PARISH: I think so.

Let me explain first that what we're involved in is a process and not an event. And the process isn't over yet. The superintendent conducted his investigation into the matter and issued some statements. But the investigation is still going on.

I can tell you this. We now know for a fact that some of the allegations made by the ACLU are kind of like that turkey you all were talking about in your previous spot. It just isn't there. For instance, one of the things we've been hammered with on e-mails for the last three days from all over the world was that the child was made to write lines to the effect that, "I will not use the word gay."

That's simply not true. That did not happen, as confirmed by the student himself this morning on an interview on national television.

BROWN: Is it your belief that he was, in fact, though, disciplined, because, in this conversation with a classmate, he said that his mom was gay and explained, in a second-grader sort of way, what gay meant?

THIBODAUX: Actually, no.

And the superintendent has been very, very insistent on that point, that the student was disciplined for disrupting classroom activity. The -- my understanding, based on what we know now, is that this happened in class and there was a class activity going on and the students were working in small groups. That's when the incident occurred.

The -- it's also important -- and I appreciate you giving us this opportunity to speak to this -- it's important to know that the school board has taken no action or issued no statements up to this point.

BROWN: OK.

THIBODAUX: Up to this point, it's been handled by the staff -- the superintendent and his staff, which is appropriate, because when it comes to discipline matters, the school board only gets involved in an expulsion case, where it has been appealed to the school board.

But I felt, in this case, it was so important and we were getting so much attention, that it was appropriate for the board to get involved.

BROWN: Look, I've read the superintendent's comments. And I know you have...

THIBODAUX: Right.

BROWN: I believe. I don't know this. But I believe you also have seen the teacher's report here, not the one on the screen. This is Marcus' report. This one. And the teacher is -- her report is unambiguous.

She says: "Marcus decided to explain to another child in his group that his mom is gay. He told the other child that gay is when a girl likes a girl. This kind of discussion," the teacher wrote, "is not acceptable in my room. I feel that parents should explain things of this nature to their children in their own way."

She, in no place here, talks about being disruptive to the class or any of the things the superintendent said. Clearly, if this document is accurate, he was disciplined for a different reason.

THIBODAUX: I would tend to agree, looking simply at that document.

The action the school board has taken is, at our meeting last night, we voted to have a special meeting one week from today. And we have asked that all the documents be brought to us, so we can see everything, the entire file. Also, all of the staff that was involved, we want them to be there, so that, if we have questions, we can ask them.

We need to establish exactly what happened, the sequence of events. Until that meeting next Thursday, it's a little difficult to speak specifically. But there's another rub to all of this, which is, the student is protected by a privacy act. We have to protect our students' rights to privacy. The documents that you have were released to the media by the student's mother.

There are documents and more documents in the file that we cannot release and that we will not release. So that's something of a disadvantage as we try to put all the facts together. But we're going to do the best we can.

BROWN: Well, yes. It's clearly -- there is some conflict in the two versions of the story.

THIBODAUX: I agree.

BROWN: I hope you're able to sort it out.

THIBODAUX: I agree.

BROWN: Because, in the middle of all this, I think we both understand it is a second-grader, who is obviously a bit confused by it all.

Mr. Thibodaux, it's good to talk to you.

THIBODAUX: I absolutely agree. Thanks very much. Thanks for having me.

BROWN: We appreciate the seriousness with which you've approached this. Thank you, sir.

THIBODAUX: Thank you, sir.

BROWN: A couple quick items from around the country before we move on.

North Dakota, the search for a missing college student Dru Sjodin goes on. Alfonso Rodriguez, the man accused of kidnapping her, a man with a long history of sex offenses, agreed today to stay in jail, rather than try and post bond. It was set at $5 million, his first appearance in Grand Forks, North Dakota, court.

The manslaughter trial of South Dakota's most prominent Republican congressman -- its only congressman, after all -- William Janklow. The state's most prominent Democrat, Tom Daschle, took the stand today. He testified that he did not see Mr. Janklow eat anything on the day the former governor sped through a stop sign and killed a motorcyclist. The two men have been friends over 30 years. They were at a memorial for Korean war vets on the day of the crash.

Mr. Janklow now claims he did not eat all day and was disoriented when he ran the stop sign. He is diabetic, has a long history of speeding. And, we would add, he has given a number of different versions of the tragic events of that day.

And it is the season, is it not? Another tree lighting today. This is the big one, the National Tree lighting in Washington, D.C.

Isn't the nice?

Ahead on NEWSNIGHT: He's got the best one-liners on the campaign trail. It may not get you elected, but it does get you a job on "Saturday Night Live."

NEWSNIGHT continues in a moment.

(COMMERCIAL BREAK)

BROWN: Back to politics, we go. It's an election year.

It has begun -- become -- it has become as predictable as those other television campaign ads. What began more than three decades ago -- cue the tape here -- with Richard Nixon's famous "Sock it to me" moment has become a ritual. We're talking about the quest, if you're gunning for the White House, to prove you have a sense of humor. And who, honestly, was funnier than Richard Nixon?

The preferred place to do it these days is "Saturday Night Live," with "Laugh-In" long gone. This weekend, the Reverend Al Sharpton becomes the 10th politician to host the program.

CNN's Kelly Wallace was at today's rehearsal.

(BEGIN VIDEOTAPE)

AL SHARPTON (D), PRESIDENTIAL CANDIDATE: I always wanted to host "SNL."

JIMMY FALLON, ACTOR: Really?

SHARPTON: No. I'm just desperate for votes.

KELLY WALLACE, CNN WHITE HOUSE CORRESPONDENT (voice-over): The preacher-turned-politician now the performer.

TRACY MORGAN, ACTOR: He loves to go clubbing.

SHARPTON: And I do love the ladies.

WALLACE: Reverend Al Sharpton getting ready for what could be his breakout moment on national television.

(on camera): You're the only Democratic presidential candidate hosting "Saturday Night Live." What do you think about that?

SHARPTON: I'll tell you Sunday morning, after it's over.

(LAUGHTER)

WALLACE (voice-over): Among the nine Democratic presidential candidates, Sharpton is regularly at the back of the pack. But he caught the attention of the "SNL" team with these.

SHARPTON: Well, I think the first thing going through my head will be to make sure that Bush has all of his stuff out.

Probably the best person I've met in the campaign the party with, Mrs. Kerry. I'm sorry.

(LAUGHTER)

SHARPTON: We've had too many elephants running around in donkey jackets that are not real Democrats.

WALLACE: Crowd-pleasing one-liners at the presidential debates, which led to the invite to a place where only the bravest have gone before.

(BEGIN VIDEO CLIP, "SATURDAY NIGHT LIVE")

AL GORE, FORMER VICE PRESIDENT OF THE UNITED STATES: Tipper.

(END VIDEO CLIP)

WALLACE: Sharpton follows in the footsteps of politicians such as Al Gore, who made fun of himself with that infamous kiss.

(BEGIN VIDEO CLIP, "SATURDAY NIGHT LIVE")

SEN. JOHN MCCAIN (R), ARIZONA (singing): Memories. (LAUGHTER)

(END VIDEO CLIP)

WALLACE: Republican Senator John McCain, trying to carry a turn, and former New York City Mayor Rudolph Giuliani, showing off his older and more feminine side.

(BEGIN VIDEO CLIP, "SATURDAY NIGHT LIVE")

RUDOLPH GIULIANI (R), FORMER MAYOR OF NEW YORK: They just had me.

(END VIDEO CLIP)

WALLACE: What's the best advice? Who better to ask than a man who has been on this stage more than once?

ED KOCH, FORMER MAYOR OF NEW YORK CITY: On "Saturday Night Live," there is no sacred cow. The more fun you make of yourself, the greater your success on that program.

SHARPTON: This guy is goofier than Bush's health care plan.

WALLACE: Sharpton's biggest comedic test comes as he tries to become the most popular African-American leader in the country, but never quite shying away from controversy.

DARRELL HAMMOND, COMEDIAN: I turned the channel and I actually -- I heard Sharpton say: "I didn't call Giuliani a bozo. I said a bozo could have done just as good a job as Giuliani." When you can't predict where this guy is going to go...

WALLACE: And that's just the way Al Sharpton likes it.

Kelly Wallace, CNN, New York.

(END VIDEOTAPE)

BROWN: Morning papers after the break.

(COMMERCIAL BREAK)

(ROOSTER CROWING)

BROWN: All right, time to check morning papers from around the country and around the world. And it will be around the world, because I just saw this.

"The Times of London." Why middle classes do look 20 years younger. It's down over here, OK? But I haven't had a chance to figure out what the answer is. But I think it has to do with having some money. I'm not sure. It's "The Times of London." Check it's out on the Web. Everything is on the Web. You can find it.

"The Washington Times." "Bush Rescinds Steel Tariffs." This is on the front page of a lot of papers for a lot of different reasons. But here is the story I like. It's a very good story by "The Washington Times." "Researchers Fake AIDS Study Data." NIH spent $1 million on the report. It turns out that three researchers made up interviews they said they had conducted with teenagers evaluating safe sex. What are we coming to?

"The Charleston Gazette." That's Charleston, West Virginia. "Steel Tariffs Lifted. Bush Elicits Negative Response." Steel produced in that part of West Virginia. This is a quote here: "Today, the Bush administration shattered any credibility it ever had with the steel industry in West Virginia and across the country" -- Senator Robert Byrd, Democrat of West Virginia. People in other states will see that differently, but that's how it played in Charleston.

"The San Francisco Chronicle" also plays the steel tariffs on its front page. But its big story: "Bonds" -- that would be Barry Bonds -- it's Barry, right? Bobby's the dad. Barry Bonds -- "Before San Francisco Grand Jury. Giants Slugger Appears in Probe of Suspected Illegal Steroid Ring." That's their front page of "The San Francisco Chronicle." I like that paper.

"The Boston Herald." We've could have spent some time on this today. "It's a Rout." New Hampshire poll numbers, Dean 45 percent, Kerry 13 percent. John Kerry must be going nuts, OK? He's a good guy. And that's not a political endorsement. He's a good guy. And he must be going, what the heck is going on here?

"The Detroit Free Press," there must have been a reason I took this one. I'm not sure what. So we'll just move on.

"The Philadelphia Inquirer." OK, Pennsylvania, steel, too. "U.S. Lifts Tariffs on Steel." And, also, the prosecutor story. "Baltimore Federal Prosecutor Slain in a Pennsylvania Creek." That's that story.

"The Chicago Sun-Times," which is a pretty good sign we're at the end, isn't it, of morning papers? "Sticker Shock: City Hunts Down 1,007 Garage Parking Scofflaws in Ticketing Blitz." The weather tomorrow in Chicago is "messy." No ambiguity there.

We'll update our top story, preview tomorrow after the break.

We'll be right back.

(COMMERCIAL BREAK)

BROWN: Quickly, a bonus edition of morning papers.

First, back to "The Times of London," why middle classes look 20 years younger. It is money. It turns out that people who make less age more quickly, or appear to age more quickly. Didn't want you worried about that.

And Keith Richards at 60. "The Guardian" says "20-Year-old chicks" -- goodness -- "still throw panties at me." Now, can you see his picture? Come on. Who are you kidding? Tomorrow on the program, it isn't always a field of dreams, the family of Mickey Mantle selling off precious memories to make -- no -- yes, to make ends meet. That's what I meant.

We'll see you tomorrow. I'll have it all sorted out.

"LOU DOBBS" is next.

Good night for all of us.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com



Season; Investigation Into Death of U.S. Attorney Continues; Authorities Seize Limbaugh's Medical Records>


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