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American Morning

Three Days of Mourning Under Way in Spain

Aired March 12, 2004 - 07:00   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.


BILL HEMMER, CNN ANCHOR: The scare in Spain -- just minutes ago the train station ripped apart 24 hours ago gets another threat.
Meanwhile, that nation mourns.

NASA reaches a milestone with its Rover Spirit poised on the edge of a Martian crater.

And, political upheaval in Asia. The impeachment of a president.

Ahead this hour on AMERICAN MORNING.

ANNOUNCER: From the CNN Broadcast Center in New York, this is AMERICAN MORNING with Bill Hemmer and Soledad O'Brien.

SOLEDAD O'BRIEN, CNN ANCHOR: And good morning. Welcome everybody. It is Friday. That is good.

Other stories we're following this morning where there's a terror attack in Spain, many people assume the ETA, the Basque separatists, are responsible, but some experts actually see the imprint of al Qaeda in yesterday's bombings.

We're going to hear about that.

Also get a live update from Spain in just a few minutes.

HEMMER: It was a significant part of our morning coverage today.

Also this hour, Martha Stewart a week ago wore a smile, a polite smile, leaving the court after she was convicted, but what was she saying and feeling inside last Friday as she watched the world crumble around her?

We'll talk with one of the few people who spoke with Martha Stewart every day of her trial. We'll talk with her in moment here.

O'BRIEN: Interesting insight there. Let's get to our top stories, though, first.

The U.S. Senate has approved a $2.36 trillion budget plan; the measure was approved early this morning 51 to 45.

The plan calls for lower spending, smaller tax cuts, and would reduce the deficit faster than President Bush had proposed.

Federal prosecutors have charged a former journalist and congressional aide with being a paid Iraqi intelligence agent.

Susan Lindauer was taken into custody yesterday in Maryland. She has been ordered to undergo psychiatric evaluation, and she's due back in court later today.

Lindauer, a self-proclaimed anti-war activist, says she is innocent. We've got much more on this story coming up.

Colorado's high court has refused a prosecutor's request to intervene in the Kobe Bryant case. The state Supreme Court yesterday denied a petition to overrule the trial judge, which means that Bryant's accuser will have to testify about her sexual history.

More legal perspective on this story coming up just ahead.

The government is cracking down on a steroid-like supplement known as Andro. The Food and Drug Administration is telling manufacturers to stop production of the supplement until its makers can prove its safe.

While it's not a steroid, the FDA says Andro may pose the same health risks. We're on this ahead as well.

In Georgia, a sky diver shaken but alive after crashing into a tree and then hanging for hours about sixty feet above the ground.

Rescue workers needed special equipment to lower the 20-year-old woman to the ground. She was treated at a nearby hospital for minor injuries and she was later released.

HEMMER: I might be standing on the ground for a while.

O'BRIEN: I'd think so, yes.

(WEATHER REPORT)

HEMMER: Want to get to Spain straight away. Significant part of our day today.

Three days of mourning now underway in that country. The worst terror attack in Europe since the 1988 bombing of Pan Am Flight 103.

Officials now say at least 198 are dead; some 1400 wounded.

For the latest, straight to Madrid, the Spanish capitol, and Christiane Amanpour for more today -- Christiane, hello there.

CHRISTIANE AMANPOUR, CNN: Bill, good morning to you.

Well, it was more than 24 hours ago at the station, just behind me, and then others coming into to Madrid, that these bombings, these simultaneous attacks, took place.

Most of the victims I'll tell you were caused -- most of the casualties -- at the station just behind me.

There has been already today 15 minutes of silence called by the government at mid-day.

We saw people coming out of all the buildings in the city. Cars stopped in the middle of the street and silence to remember those who have died, and those who are still struggling for their lives in hospitals around.

There are full-page notices in the newspapers. The government calling on millions of Spaniards to come out in a show of defiance this evening in all the capitol cities of Spain.

Last night already in the Basque region in northern Spain thousands of people turned out for a long period of silence in a show of solidarity and sympathy.

In the meantime, the Prime Minister again addressed reporters and addressed the nation today vowing to stand firm, vowing to put all the security resources and police and investigative resources to find out who caused these criminal acts, and to bring them to prosecution.

He was asked several times why did he continue to think that ETA, the terrorist group, the Basque separatist group, that has been waging a 35-year armed struggle here -- why that group was still their prime suspect. And he responded quite vigorously.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE (THROUGH TRANSLATOR): Why does the government think that it could be the same terrorist group that we know so well here?

JOSE MARIA AZNAR, SPANISH PRIME MINISTER (THROUGH TRANSLATOR): Anybody thinks that the government -- intelligent government -- after 30 years of terrorists with an attempt like the one yesterday -- isn't it reasonable to think that it could have been that group?

(END VIDEO CLIP)

AMANPOUR: He went on to say, specifically citing circumstantial evidence, saying that why did -- why do you think these people were driving an explosives-laden truck into Madrid and were caught just two weeks ago? Two suspects were caught with a truck full of explosives.

Why do you think that these people were trying to bomb a train just on Christmas Eve? He also pointed to forensics evidence in terms of the type of explosives that were found yesterday that matched previous ETA attacks.

But, officials are also saying that they are investigating other avenues; they are looking for other leads, specifically because of this van they said they found last night.

They showed a picture of a van that contained bomb detonators and also Arabic verses, Koranic verses -- Bill.

HEMMER: Christiane Amanpour from Madrid -- Christiane thanks for that. Back in this country, Peter Brookes, senior fellow of the Heritage Foundation, live with us now from Washington to talk more about this.

Peter, welcome back, nice to see you.

PETER BROOKES, HERITAGE FOUNDATION: Good morning, Bill.

HEMMER: I know last night you thought this was al Qaeda or a group linked with al Qaeda -- do you still think that this morning?

BROOKES: I do. I mean, I'm not going to question President Aznar's beliefs about this, but a lot of people go to the default position on terrorism in Spain in saying it's ETA.

And it could be a combination of ETA and al Qaeda; we've not known that they've had previous links or previously strong links, but we know al Qaeda is in Spain and there is certainly a possibility that ETA is copy-catting al Qaeda's tactics.

HEMMER: So you think that's a possibility? ETA may be using that?

BROOKES: Certainly; absolutely. I mean this certainly is a possibility.

If you look at the scenario it looks -- simultaneous bombings, extra bombings, no notice, it doesn't sound like -- it doesn't sound like ETA, it sounds more like al Qaeda.

HEMMER: In a way is that even more ominous if it is ETA, if they're taking notes from al Qaeda?

BROOKES: Yes, we have to be very concerned about it, as you know, Bill, al Qaeda had become much more decentralized. Osama bin Laden, Zawa Heri (ph) have their heads down. It's become more of a movement than a group.

We've really crippled the group in a lot of ways, but then there are all these other affiliates, there's all these other associates. And some of them are looking at -- at taking upon their successful tactics.

And these bombings -- these sort of things -- have been very successful for al Qaeda, but like I said, once again, we haven't seen ETA embrace that and if it is, it's very frightening.

HEMMER: Just to be clear that there are no known attacks carried out by al Qaeda in the country of Spain to this point?

BROOKES: That's right but we have -- we know several things. Mohammed Ata, one of the leaders of 9/11 met in Spain.

There are a number of al Qaeda people have been arrested -- some senior financiers, some senior operatives, over the years. In fact, there is -- I believe there is an al Qaeda operative on trial in Spain today.

Al Qaeda has also put Spain in the crosshairs. They have Osama bin Laden himself has mentioned Spain in the past as a target, and at one point southern Spain was Muslim, and al Qaeda has talked about this worldwide pan-Islamic caliphate that stretches all the way from Spain to Indonesia and southeast Asia, so it doesn't surprise me that they could be -- they could be a target for al Qaeda.

HEMMER: Just to confuse the picture a little more, though, go back a month ago and you had these explosives that were found tied to ETA back in December, you had the backpacks were found that were tired to ETA.

There are signs of ETA that could argue directly against your theory.

BROOKES: Absolutely. And like I said, once again, it could be ETA, it could be al Qaeda; it could be a combination of the two.

But you know there's another thing that goes against it. These explosions took place in working class neighborhoods.

ETA has sort of a Marxist, working class sort of mentality and it would go against those people from which they look for support.

HEMMER: Why then is there no claim of responsibility?

BROOKES: Al Qaeda doesn't claim responsibility. Of course, ETA has said it has not claimed responsibility and this other group is -- which is not a terrorist group, but some maybe associated with al Qaeda that sent out these letters.

But if you notice in the past, Bill, al Qaeda has rarely claimed responsibility.

They don't give warning, they don't claim responsibility. ETA in the past has given warning and claimed responsibility.

So there's still a lot to be worked out here. The important thing to know is that this was a terrible terrorist act.

HEMMER: And you've given us a lot to think about.

Peter thanks.

Peter Brookes, Heritage Foundation. We sure do appreciate it -- Soledad.

BROOKES: Thank you, Bill.

O'BRIEN: The Madrid bombings have prompted increased security measures on U.S. railways.

Amtrak has increased its patrols by police and K9 units. Electronic surveillance of bridges and tunnels has also been intensified. And Amtrak is once again stressing to its employees that they should report anything suspicious.

Amtrak says there is no credible threat against it or other railroads.

HEMMER: Question of the day, related matter now.

Back to Jack Cafferty, good morning.

JACK CAFFERTY, CNN ANCHOR: Good morning.

Repercussions from this day in Madrid -- felt here in the United States almost immediately; the stock market reacted to it yesterday.

I come through the Lincoln Tunnel to come to work every morning; this morning police all over the place in the Lincoln Tunnel, they were at every tollbooth, the traffic was being funneled in just to a single lane, they were looking at all the trucks, checking papers.

So, and all of these things of course impact the economy here.

Want to get at whether or not you think al Qaeda might be behind this this morning. Just to recap a couple of the things that have been brought up this morning.

ETA has never done anything this large. There were 13 bombs; ten of them went off all at once.

They usually warn authorities before an attack. They often claim responsibility when they do something. They've done neither.

The most people ever killed in an ETA-related act of terrorism was 21. That was in 1987.

Spain, of course, is an ally of the United States in the war in Iraq. The attack happened on March the 11th, two and a half years to the day after September the 11th.

And, of course, that van with the seven detonators and the Arabic tape of Koranic messages that was found in the Madrid suburb.

Do you think the bombings in Madrid a-- are you afraid the bombings in Madrid might be the work of al Qaeda is the question? Give us your thoughts and you know what this thing kind of did to your psyche as you became aware of what happened over there yesterday.

HEMMER: We will.

O'BRIEN: Interesting question.

HEMMER: Thank you, Jack.

In a moment here on AMERICAN MORNING a former Congressional aide says she did it for the good of U.S. security; now she says she is accused of aiding the former Iraqi regime. Her story in a moment. O'BRIEN: And how is Martha Stewart coping with the prospect of prison time? We're going to ask one of her close friends.

All that when AMERICAN MORNING continues.

(COMMERCIAL BREAK)

HEMMER: About 15 minutes past the hour on a Friday morning.

A former journalist and press secretary for four members of Congress, now arrested on charges she served as a paid agent for the Iraqi intelligence service both before and after the U.S. invasion.

Susan Lindauer was released yesterday on half a million dollars bond. Kelli Arena now picks up the story from D.C. for us.

KELLI ARENA, CNN: Susan Lindauer is due back in court today. The former journalist and Congressional aide insists that she is not an Iraqi spy.

LINDAUER, ACCUSED OF WORKING AS IRAQI AGENT: I'm an anti-war activist and I'm innocent.

ARENA: An indictment says Lindauer had repeated contacts with Iraqi intelligence officers in New York and Baghdad between 1999 and 2002, and conspired with two sons of Iraq's former liaison with U.N. weapons inspectors.

Lindauer says she was trying to get inspectors back into Iraq.

LINDAUER: I'm very proud and I will very proudly stand by my achievements.

ARENA: In January 2003, two months before the U.S. invaded Iraq, prosecutors say she took a letter to the home of a U.S. official saying she had access to Saddam Hussein's regime.

Sources tell CNN that official is White House Chief of Staff Andrew Card, Lindauer's second cousin.

The White House says Card never met with Lindauer and called the incident very sad.

LINDAUER: I'm an anti-war activist.

ARENA: Sources say Card alerted authorities, then the FBI set up a sting operation.

In June, prosecutors say Lindauer met with an undercover FBI agent posing as an agent for Libyan intelligence, looking to support resistance groups in post-war Iraq.

And near her home in Tacoma Park, they say she followed instructions to leave unspecified documents at dead drop locations.

Neighbors were surprised. UNIDENTIFIED MALE: She was a Tacoma Park type person, pretty unique around here. We're a nuclear free zone, as you know. So -- very laid back, liberal sort of person.

ARENA: Prosecutors say Iraq paid Lindauer $10,000 for expenses and services. She faces up to 25 years in prison if she's convicted on all charges.

LINDAUER: This is what democracy is all about.

Kelli Arena, CNN, Washington.

HEMMER: Now Lindauer once worked at "Fortune" magazine.

AMERICAN MORNING'S business contributor Andy Serwer worked with Lindauer at the magazine several years ago, 1986.

Good morning to you.

ANDY SERWER, "FORTUNE" MAGAZINE: Good morning Bill.

HEMMER: How well did you know her?

SERWER: I knew her pretty well; we worked together for about five months back when we were both in our 20s, both starting out as journalists and she was an intelligent, soft-spoken, well-spoken person.

But she always seemed to be trying to find herself, Bill. After she left the magazine she was in touch a little bit about what should I do? I'm interested in politics; I'm interested in journalism. That sort of thing.

HEMMER: Did she strike you as an activist then? 1986?

SERWER: Not at all; and we were shocked yesterday when the news came up onto the floor at "Fortune" that someone who worked here was accused of being a spy for the Iraqis. She had no political leanings at all; not an Islamic or anything like that.

And didn't display any political tendencies at all.

HEMMER: It seems like you can look at this two different ways here and one is that it's a sinister plot to help the Iraqi regime or the Baath Party or this is a woman who is anti-war and was just trying to communicate with a distant cousin, Andy Card at the White House.

How do you come down on those issues?

SERWER: Well, to me this woman that I knew -- I mean, it would strike me as being very far-fetched that she was a criminal mastermind.

I mean, a lot can happen in intervening years, Bill, but at that point you know this is a woman and what I've learned subsequent that was a peace activist and maybe got mislead -- you know -- accused of being mislead.

HEMMER: All right, Andy, while we have you here let's talk about the markets. I mean, triple digit loss yesterday. Two days in a row for the Dow 30.

SERWER: Yes, 168 points down yesterday, Bill and a couple of things are going on.

First of all, you had that weak jobs report on Friday then the trade deficit you can see here an ugly day for all the indices were in the red.

Across the board for the year now. So we did have the weak job report; the trade deficit this week and of course the terrorism incident in Spain yesterday. All of that really providing a negative sentiment for the market.

However, futures are up this morning a little bit. Maybe a bit of a bounce back.

HEMMER: Maybe a silver lining. Thank you, Andy, talk to you later.

SERWER: Yes.

HEMMER: Here's Soledad.

O'BRIEN: Still to come this morning, President Bush launches his first round of attacks over the airwaves aimed at Senator John Kerry. We're going to talk with Bush campaign adviser Mary Matalin about the latest salvos.

Stay with us; you're watching AMERICAN MORNING.

(COMMERCIAL BREAK)

O'BRIEN: The Bush campaign rolls today with -- will roll out today it's first round of what could be characterized as attack ads.

Meanwhile, Senator John Kerry is not backing down from saying that some GOP opponents are, quote, "The most crooked, lying group of people he's ever seen."

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: I have no intention whatsoever of apologizing for my remarks. I think that these -- I think the Republicans need to start talking about the real issues before the country.

George Bush doesn't have a record to run on; he has a record to run away from.

(END VIDEO CLIP)

O'BRIEN: Are we in for nearly eight months more of nothing but negative campaigning? Joining us from Washington, D.C. this morning is an advisor to the Bush campaign, Mary Matalin.

Nice to see you, Mary. Thanks for being with us.

MARY MATALIN, ADVISER TO BUSH CAMPAIGN: Good morning, Soledad.

Can I just say these aren't negative ads, they are -- they're ready to engage on the issues ads. We talk about the senator's policies, his programs, his record.

If he thinks that's negative then he needs to look at his own record. We're not out there calling him names; we're not saying anything that we need to apologize for.

So it's time to stop the distortion, stop the histrionics, and let's start engaging on the issues. We're very proud of our record and we're very proud of the president's vision for peace and prosperity.

O'BRIEN: You may have seen the report in the "L.A. Times" today. There are some Democratic strategists -- Republican -- forgive me -- Republican strategists, even, who are quoted saying that while attacks from the Democrats are one part of the problem, there are other problems that have nothing to do with the Democrats.

For example, jobs not being created. For example, weapons of mass destruction not found. How do you fix those issues going forward? Isn't that a bigger problem?

MATALIN: Well, goodness, I mean, we've had six consecutive months of job creation after a recession, after corporate scandals that began in the previous watch, after an attack on our country.

This president has precipitated the greatest growth in 20 years, the lowest inflation, lowest interest rates. I mean, we have a great economy to talk about.

We want to increase job growth but the unemployment rate is lower than the averages of the previous three decades.

The -- there's no one on either side is saying that Saddam Hussein wasn't a threat, that we're not safer because he's gone. United States had a policy to eradicate the threat of Saddam Hussein.

We're safer for it and if you have a -- if you are against that policy, which Senator Kerry was for at the time and now he's against I think he needs to explain that.

O'BRIEN: At the same time, there are many people who say look at the exit polls out of the most recent primaries -- Ohio, for example.

Jobs, jobs, jobs is going to be the issue and while you're spouting some numbers about jobs, at the same time they were predicting 130,000 jobs had been created only something like 21,000 -- I think they called it anemic growth there.

That's got to be a big problem for the president. How nervous are you when you read some of the comments from other GOP strategists? They start to sound pretty nervous.

MATALIN: Well, you know after 14 months and $40 million of exclusively Bush bashing which is what the Democratic primary was all about, we're engaging -- we're engaging on the issues and these numbers are meaningless at this point but it is time to talk about the issues; it is time to quit calling the president names.

It is time to quit distorting his record, it is time to talk about why this economy is not producing jobs as fast as the president would like it to and that has to do with the aftermath of 9/11, for instance. We lost nine -- we lost one million jobs after 9/11. We should talk about the causes and what we're doing about it.

Senator Kerry has not one job-creating proposal. Not one. So we're ready to engage on the issues; we're not sure which Senator Kerry we're to debate with his policies and positions have changed so much and none of his proposals are really out there but it's time to talk about the issues and get past the Bush bashing.

O'BRIEN: Bush campaign adviser Mary Matalin with us this morning. Nice to see you. Thanks for being with us.

MATALIN: Thanks, Soledad.

O'BRIEN: John Kerry's senior campaign adviser Ted Devine is going to join us at 8 a.m. Eastern Time -- Bill.

HEMMER: from overseas here's a political note for you. Dramatic scene in South Korea's parliament building. The national assembly voting to impeach the president, Roh Mo-hyun.

Members of Parliament cursed and shoved one another, lawmakers loyal to the president trying to keep the assembly speaker from reaching the podium. That's the only place where the speaker can call for a vote. Lawmakers did vote after that but emotions continued to run high.

The constitution of course still must give final approval to unseat the president, President Roh. That's the image from Seoul in South Korea.

O'BRIEN: You can't pick up the furniture in the middle of a vote.

HEMMER: None of that stuff's tied down, though.

O'BRIEN: Apparently not.

HEMMER: They showed in the past that they are able. Capable.

O'BRIEN: Exactly. And they should have learned to bolt that stuff down after all this time.

HEMMER: Maybe they will now.

O'BRIEN: They certainly know that now, all right, thanks. Still to come this morning, Spirit and Opportunity send snapshots of their vacation on Mars. The mission's lead scientist is going to join us to tell us why these pictures are so special.

Stay with us. You're watching AMERICAN MORNING.

(COMMERCIAL BREAK)

HEMMER: In a moment here the government now wants to ban a diet supplement that made the slugger Mark McGuier famous.

Back in a moment, the update on Andro this morning on AMERICAN MORNING

(COMMERCIAL BREAK)

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Aired March 12, 2004 - 07:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
BILL HEMMER, CNN ANCHOR: The scare in Spain -- just minutes ago the train station ripped apart 24 hours ago gets another threat.
Meanwhile, that nation mourns.

NASA reaches a milestone with its Rover Spirit poised on the edge of a Martian crater.

And, political upheaval in Asia. The impeachment of a president.

Ahead this hour on AMERICAN MORNING.

ANNOUNCER: From the CNN Broadcast Center in New York, this is AMERICAN MORNING with Bill Hemmer and Soledad O'Brien.

SOLEDAD O'BRIEN, CNN ANCHOR: And good morning. Welcome everybody. It is Friday. That is good.

Other stories we're following this morning where there's a terror attack in Spain, many people assume the ETA, the Basque separatists, are responsible, but some experts actually see the imprint of al Qaeda in yesterday's bombings.

We're going to hear about that.

Also get a live update from Spain in just a few minutes.

HEMMER: It was a significant part of our morning coverage today.

Also this hour, Martha Stewart a week ago wore a smile, a polite smile, leaving the court after she was convicted, but what was she saying and feeling inside last Friday as she watched the world crumble around her?

We'll talk with one of the few people who spoke with Martha Stewart every day of her trial. We'll talk with her in moment here.

O'BRIEN: Interesting insight there. Let's get to our top stories, though, first.

The U.S. Senate has approved a $2.36 trillion budget plan; the measure was approved early this morning 51 to 45.

The plan calls for lower spending, smaller tax cuts, and would reduce the deficit faster than President Bush had proposed.

Federal prosecutors have charged a former journalist and congressional aide with being a paid Iraqi intelligence agent.

Susan Lindauer was taken into custody yesterday in Maryland. She has been ordered to undergo psychiatric evaluation, and she's due back in court later today.

Lindauer, a self-proclaimed anti-war activist, says she is innocent. We've got much more on this story coming up.

Colorado's high court has refused a prosecutor's request to intervene in the Kobe Bryant case. The state Supreme Court yesterday denied a petition to overrule the trial judge, which means that Bryant's accuser will have to testify about her sexual history.

More legal perspective on this story coming up just ahead.

The government is cracking down on a steroid-like supplement known as Andro. The Food and Drug Administration is telling manufacturers to stop production of the supplement until its makers can prove its safe.

While it's not a steroid, the FDA says Andro may pose the same health risks. We're on this ahead as well.

In Georgia, a sky diver shaken but alive after crashing into a tree and then hanging for hours about sixty feet above the ground.

Rescue workers needed special equipment to lower the 20-year-old woman to the ground. She was treated at a nearby hospital for minor injuries and she was later released.

HEMMER: I might be standing on the ground for a while.

O'BRIEN: I'd think so, yes.

(WEATHER REPORT)

HEMMER: Want to get to Spain straight away. Significant part of our day today.

Three days of mourning now underway in that country. The worst terror attack in Europe since the 1988 bombing of Pan Am Flight 103.

Officials now say at least 198 are dead; some 1400 wounded.

For the latest, straight to Madrid, the Spanish capitol, and Christiane Amanpour for more today -- Christiane, hello there.

CHRISTIANE AMANPOUR, CNN: Bill, good morning to you.

Well, it was more than 24 hours ago at the station, just behind me, and then others coming into to Madrid, that these bombings, these simultaneous attacks, took place.

Most of the victims I'll tell you were caused -- most of the casualties -- at the station just behind me.

There has been already today 15 minutes of silence called by the government at mid-day.

We saw people coming out of all the buildings in the city. Cars stopped in the middle of the street and silence to remember those who have died, and those who are still struggling for their lives in hospitals around.

There are full-page notices in the newspapers. The government calling on millions of Spaniards to come out in a show of defiance this evening in all the capitol cities of Spain.

Last night already in the Basque region in northern Spain thousands of people turned out for a long period of silence in a show of solidarity and sympathy.

In the meantime, the Prime Minister again addressed reporters and addressed the nation today vowing to stand firm, vowing to put all the security resources and police and investigative resources to find out who caused these criminal acts, and to bring them to prosecution.

He was asked several times why did he continue to think that ETA, the terrorist group, the Basque separatist group, that has been waging a 35-year armed struggle here -- why that group was still their prime suspect. And he responded quite vigorously.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE (THROUGH TRANSLATOR): Why does the government think that it could be the same terrorist group that we know so well here?

JOSE MARIA AZNAR, SPANISH PRIME MINISTER (THROUGH TRANSLATOR): Anybody thinks that the government -- intelligent government -- after 30 years of terrorists with an attempt like the one yesterday -- isn't it reasonable to think that it could have been that group?

(END VIDEO CLIP)

AMANPOUR: He went on to say, specifically citing circumstantial evidence, saying that why did -- why do you think these people were driving an explosives-laden truck into Madrid and were caught just two weeks ago? Two suspects were caught with a truck full of explosives.

Why do you think that these people were trying to bomb a train just on Christmas Eve? He also pointed to forensics evidence in terms of the type of explosives that were found yesterday that matched previous ETA attacks.

But, officials are also saying that they are investigating other avenues; they are looking for other leads, specifically because of this van they said they found last night.

They showed a picture of a van that contained bomb detonators and also Arabic verses, Koranic verses -- Bill.

HEMMER: Christiane Amanpour from Madrid -- Christiane thanks for that. Back in this country, Peter Brookes, senior fellow of the Heritage Foundation, live with us now from Washington to talk more about this.

Peter, welcome back, nice to see you.

PETER BROOKES, HERITAGE FOUNDATION: Good morning, Bill.

HEMMER: I know last night you thought this was al Qaeda or a group linked with al Qaeda -- do you still think that this morning?

BROOKES: I do. I mean, I'm not going to question President Aznar's beliefs about this, but a lot of people go to the default position on terrorism in Spain in saying it's ETA.

And it could be a combination of ETA and al Qaeda; we've not known that they've had previous links or previously strong links, but we know al Qaeda is in Spain and there is certainly a possibility that ETA is copy-catting al Qaeda's tactics.

HEMMER: So you think that's a possibility? ETA may be using that?

BROOKES: Certainly; absolutely. I mean this certainly is a possibility.

If you look at the scenario it looks -- simultaneous bombings, extra bombings, no notice, it doesn't sound like -- it doesn't sound like ETA, it sounds more like al Qaeda.

HEMMER: In a way is that even more ominous if it is ETA, if they're taking notes from al Qaeda?

BROOKES: Yes, we have to be very concerned about it, as you know, Bill, al Qaeda had become much more decentralized. Osama bin Laden, Zawa Heri (ph) have their heads down. It's become more of a movement than a group.

We've really crippled the group in a lot of ways, but then there are all these other affiliates, there's all these other associates. And some of them are looking at -- at taking upon their successful tactics.

And these bombings -- these sort of things -- have been very successful for al Qaeda, but like I said, once again, we haven't seen ETA embrace that and if it is, it's very frightening.

HEMMER: Just to be clear that there are no known attacks carried out by al Qaeda in the country of Spain to this point?

BROOKES: That's right but we have -- we know several things. Mohammed Ata, one of the leaders of 9/11 met in Spain.

There are a number of al Qaeda people have been arrested -- some senior financiers, some senior operatives, over the years. In fact, there is -- I believe there is an al Qaeda operative on trial in Spain today.

Al Qaeda has also put Spain in the crosshairs. They have Osama bin Laden himself has mentioned Spain in the past as a target, and at one point southern Spain was Muslim, and al Qaeda has talked about this worldwide pan-Islamic caliphate that stretches all the way from Spain to Indonesia and southeast Asia, so it doesn't surprise me that they could be -- they could be a target for al Qaeda.

HEMMER: Just to confuse the picture a little more, though, go back a month ago and you had these explosives that were found tied to ETA back in December, you had the backpacks were found that were tired to ETA.

There are signs of ETA that could argue directly against your theory.

BROOKES: Absolutely. And like I said, once again, it could be ETA, it could be al Qaeda; it could be a combination of the two.

But you know there's another thing that goes against it. These explosions took place in working class neighborhoods.

ETA has sort of a Marxist, working class sort of mentality and it would go against those people from which they look for support.

HEMMER: Why then is there no claim of responsibility?

BROOKES: Al Qaeda doesn't claim responsibility. Of course, ETA has said it has not claimed responsibility and this other group is -- which is not a terrorist group, but some maybe associated with al Qaeda that sent out these letters.

But if you notice in the past, Bill, al Qaeda has rarely claimed responsibility.

They don't give warning, they don't claim responsibility. ETA in the past has given warning and claimed responsibility.

So there's still a lot to be worked out here. The important thing to know is that this was a terrible terrorist act.

HEMMER: And you've given us a lot to think about.

Peter thanks.

Peter Brookes, Heritage Foundation. We sure do appreciate it -- Soledad.

BROOKES: Thank you, Bill.

O'BRIEN: The Madrid bombings have prompted increased security measures on U.S. railways.

Amtrak has increased its patrols by police and K9 units. Electronic surveillance of bridges and tunnels has also been intensified. And Amtrak is once again stressing to its employees that they should report anything suspicious.

Amtrak says there is no credible threat against it or other railroads.

HEMMER: Question of the day, related matter now.

Back to Jack Cafferty, good morning.

JACK CAFFERTY, CNN ANCHOR: Good morning.

Repercussions from this day in Madrid -- felt here in the United States almost immediately; the stock market reacted to it yesterday.

I come through the Lincoln Tunnel to come to work every morning; this morning police all over the place in the Lincoln Tunnel, they were at every tollbooth, the traffic was being funneled in just to a single lane, they were looking at all the trucks, checking papers.

So, and all of these things of course impact the economy here.

Want to get at whether or not you think al Qaeda might be behind this this morning. Just to recap a couple of the things that have been brought up this morning.

ETA has never done anything this large. There were 13 bombs; ten of them went off all at once.

They usually warn authorities before an attack. They often claim responsibility when they do something. They've done neither.

The most people ever killed in an ETA-related act of terrorism was 21. That was in 1987.

Spain, of course, is an ally of the United States in the war in Iraq. The attack happened on March the 11th, two and a half years to the day after September the 11th.

And, of course, that van with the seven detonators and the Arabic tape of Koranic messages that was found in the Madrid suburb.

Do you think the bombings in Madrid a-- are you afraid the bombings in Madrid might be the work of al Qaeda is the question? Give us your thoughts and you know what this thing kind of did to your psyche as you became aware of what happened over there yesterday.

HEMMER: We will.

O'BRIEN: Interesting question.

HEMMER: Thank you, Jack.

In a moment here on AMERICAN MORNING a former Congressional aide says she did it for the good of U.S. security; now she says she is accused of aiding the former Iraqi regime. Her story in a moment. O'BRIEN: And how is Martha Stewart coping with the prospect of prison time? We're going to ask one of her close friends.

All that when AMERICAN MORNING continues.

(COMMERCIAL BREAK)

HEMMER: About 15 minutes past the hour on a Friday morning.

A former journalist and press secretary for four members of Congress, now arrested on charges she served as a paid agent for the Iraqi intelligence service both before and after the U.S. invasion.

Susan Lindauer was released yesterday on half a million dollars bond. Kelli Arena now picks up the story from D.C. for us.

KELLI ARENA, CNN: Susan Lindauer is due back in court today. The former journalist and Congressional aide insists that she is not an Iraqi spy.

LINDAUER, ACCUSED OF WORKING AS IRAQI AGENT: I'm an anti-war activist and I'm innocent.

ARENA: An indictment says Lindauer had repeated contacts with Iraqi intelligence officers in New York and Baghdad between 1999 and 2002, and conspired with two sons of Iraq's former liaison with U.N. weapons inspectors.

Lindauer says she was trying to get inspectors back into Iraq.

LINDAUER: I'm very proud and I will very proudly stand by my achievements.

ARENA: In January 2003, two months before the U.S. invaded Iraq, prosecutors say she took a letter to the home of a U.S. official saying she had access to Saddam Hussein's regime.

Sources tell CNN that official is White House Chief of Staff Andrew Card, Lindauer's second cousin.

The White House says Card never met with Lindauer and called the incident very sad.

LINDAUER: I'm an anti-war activist.

ARENA: Sources say Card alerted authorities, then the FBI set up a sting operation.

In June, prosecutors say Lindauer met with an undercover FBI agent posing as an agent for Libyan intelligence, looking to support resistance groups in post-war Iraq.

And near her home in Tacoma Park, they say she followed instructions to leave unspecified documents at dead drop locations.

Neighbors were surprised. UNIDENTIFIED MALE: She was a Tacoma Park type person, pretty unique around here. We're a nuclear free zone, as you know. So -- very laid back, liberal sort of person.

ARENA: Prosecutors say Iraq paid Lindauer $10,000 for expenses and services. She faces up to 25 years in prison if she's convicted on all charges.

LINDAUER: This is what democracy is all about.

Kelli Arena, CNN, Washington.

HEMMER: Now Lindauer once worked at "Fortune" magazine.

AMERICAN MORNING'S business contributor Andy Serwer worked with Lindauer at the magazine several years ago, 1986.

Good morning to you.

ANDY SERWER, "FORTUNE" MAGAZINE: Good morning Bill.

HEMMER: How well did you know her?

SERWER: I knew her pretty well; we worked together for about five months back when we were both in our 20s, both starting out as journalists and she was an intelligent, soft-spoken, well-spoken person.

But she always seemed to be trying to find herself, Bill. After she left the magazine she was in touch a little bit about what should I do? I'm interested in politics; I'm interested in journalism. That sort of thing.

HEMMER: Did she strike you as an activist then? 1986?

SERWER: Not at all; and we were shocked yesterday when the news came up onto the floor at "Fortune" that someone who worked here was accused of being a spy for the Iraqis. She had no political leanings at all; not an Islamic or anything like that.

And didn't display any political tendencies at all.

HEMMER: It seems like you can look at this two different ways here and one is that it's a sinister plot to help the Iraqi regime or the Baath Party or this is a woman who is anti-war and was just trying to communicate with a distant cousin, Andy Card at the White House.

How do you come down on those issues?

SERWER: Well, to me this woman that I knew -- I mean, it would strike me as being very far-fetched that she was a criminal mastermind.

I mean, a lot can happen in intervening years, Bill, but at that point you know this is a woman and what I've learned subsequent that was a peace activist and maybe got mislead -- you know -- accused of being mislead.

HEMMER: All right, Andy, while we have you here let's talk about the markets. I mean, triple digit loss yesterday. Two days in a row for the Dow 30.

SERWER: Yes, 168 points down yesterday, Bill and a couple of things are going on.

First of all, you had that weak jobs report on Friday then the trade deficit you can see here an ugly day for all the indices were in the red.

Across the board for the year now. So we did have the weak job report; the trade deficit this week and of course the terrorism incident in Spain yesterday. All of that really providing a negative sentiment for the market.

However, futures are up this morning a little bit. Maybe a bit of a bounce back.

HEMMER: Maybe a silver lining. Thank you, Andy, talk to you later.

SERWER: Yes.

HEMMER: Here's Soledad.

O'BRIEN: Still to come this morning, President Bush launches his first round of attacks over the airwaves aimed at Senator John Kerry. We're going to talk with Bush campaign adviser Mary Matalin about the latest salvos.

Stay with us; you're watching AMERICAN MORNING.

(COMMERCIAL BREAK)

O'BRIEN: The Bush campaign rolls today with -- will roll out today it's first round of what could be characterized as attack ads.

Meanwhile, Senator John Kerry is not backing down from saying that some GOP opponents are, quote, "The most crooked, lying group of people he's ever seen."

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: I have no intention whatsoever of apologizing for my remarks. I think that these -- I think the Republicans need to start talking about the real issues before the country.

George Bush doesn't have a record to run on; he has a record to run away from.

(END VIDEO CLIP)

O'BRIEN: Are we in for nearly eight months more of nothing but negative campaigning? Joining us from Washington, D.C. this morning is an advisor to the Bush campaign, Mary Matalin.

Nice to see you, Mary. Thanks for being with us.

MARY MATALIN, ADVISER TO BUSH CAMPAIGN: Good morning, Soledad.

Can I just say these aren't negative ads, they are -- they're ready to engage on the issues ads. We talk about the senator's policies, his programs, his record.

If he thinks that's negative then he needs to look at his own record. We're not out there calling him names; we're not saying anything that we need to apologize for.

So it's time to stop the distortion, stop the histrionics, and let's start engaging on the issues. We're very proud of our record and we're very proud of the president's vision for peace and prosperity.

O'BRIEN: You may have seen the report in the "L.A. Times" today. There are some Democratic strategists -- Republican -- forgive me -- Republican strategists, even, who are quoted saying that while attacks from the Democrats are one part of the problem, there are other problems that have nothing to do with the Democrats.

For example, jobs not being created. For example, weapons of mass destruction not found. How do you fix those issues going forward? Isn't that a bigger problem?

MATALIN: Well, goodness, I mean, we've had six consecutive months of job creation after a recession, after corporate scandals that began in the previous watch, after an attack on our country.

This president has precipitated the greatest growth in 20 years, the lowest inflation, lowest interest rates. I mean, we have a great economy to talk about.

We want to increase job growth but the unemployment rate is lower than the averages of the previous three decades.

The -- there's no one on either side is saying that Saddam Hussein wasn't a threat, that we're not safer because he's gone. United States had a policy to eradicate the threat of Saddam Hussein.

We're safer for it and if you have a -- if you are against that policy, which Senator Kerry was for at the time and now he's against I think he needs to explain that.

O'BRIEN: At the same time, there are many people who say look at the exit polls out of the most recent primaries -- Ohio, for example.

Jobs, jobs, jobs is going to be the issue and while you're spouting some numbers about jobs, at the same time they were predicting 130,000 jobs had been created only something like 21,000 -- I think they called it anemic growth there.

That's got to be a big problem for the president. How nervous are you when you read some of the comments from other GOP strategists? They start to sound pretty nervous.

MATALIN: Well, you know after 14 months and $40 million of exclusively Bush bashing which is what the Democratic primary was all about, we're engaging -- we're engaging on the issues and these numbers are meaningless at this point but it is time to talk about the issues; it is time to quit calling the president names.

It is time to quit distorting his record, it is time to talk about why this economy is not producing jobs as fast as the president would like it to and that has to do with the aftermath of 9/11, for instance. We lost nine -- we lost one million jobs after 9/11. We should talk about the causes and what we're doing about it.

Senator Kerry has not one job-creating proposal. Not one. So we're ready to engage on the issues; we're not sure which Senator Kerry we're to debate with his policies and positions have changed so much and none of his proposals are really out there but it's time to talk about the issues and get past the Bush bashing.

O'BRIEN: Bush campaign adviser Mary Matalin with us this morning. Nice to see you. Thanks for being with us.

MATALIN: Thanks, Soledad.

O'BRIEN: John Kerry's senior campaign adviser Ted Devine is going to join us at 8 a.m. Eastern Time -- Bill.

HEMMER: from overseas here's a political note for you. Dramatic scene in South Korea's parliament building. The national assembly voting to impeach the president, Roh Mo-hyun.

Members of Parliament cursed and shoved one another, lawmakers loyal to the president trying to keep the assembly speaker from reaching the podium. That's the only place where the speaker can call for a vote. Lawmakers did vote after that but emotions continued to run high.

The constitution of course still must give final approval to unseat the president, President Roh. That's the image from Seoul in South Korea.

O'BRIEN: You can't pick up the furniture in the middle of a vote.

HEMMER: None of that stuff's tied down, though.

O'BRIEN: Apparently not.

HEMMER: They showed in the past that they are able. Capable.

O'BRIEN: Exactly. And they should have learned to bolt that stuff down after all this time.

HEMMER: Maybe they will now.

O'BRIEN: They certainly know that now, all right, thanks. Still to come this morning, Spirit and Opportunity send snapshots of their vacation on Mars. The mission's lead scientist is going to join us to tell us why these pictures are so special.

Stay with us. You're watching AMERICAN MORNING.

(COMMERCIAL BREAK)

HEMMER: In a moment here the government now wants to ban a diet supplement that made the slugger Mark McGuier famous.

Back in a moment, the update on Andro this morning on AMERICAN MORNING

(COMMERCIAL BREAK)

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