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American Morning

Terror Concerns; Airport Insecurity; '90-Second Tips': Tax Refund Tips

Aired April 23, 2004 - 07:30   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.


SOLEDAD O'BRIEN, CNN ANCHOR: Good morning. Welcome, everybody. It's just about half past the hour on this AMERICAN MORNING.
Inspectors the Homeland Security Department don't like what they are seeing from airport screeners who aren't seeing everything they should. A lot of dangerous items are still getting past checkpoints. This morning, we talk with an official with the TSA about whether the public should be alarmed at this point.

BILL HEMMER, CNN ANCHOR: Also in the next 30 minutes, among the images of war causing controversies are characters in comic strips. Two strips in particular are dealing with war in a very stark manner. We'll look at that this morning as well here.

O'BRIEN: We get to our top stories first this morning.

The U.N. reportedly preparing to choose an interim government in Iraq. "USA Today" cites Undersecretary of State Mark Grossman, who says U.S. Special Envoy Lakhdar Brahimi will begin the selection process within weeks. Grossman also told a Senate committee yesterday that the U.S. wants to limit the sovereignty of that interim government, including its control of the country's security.

Wanted Iraqi Muslim cleric, Moqtada al-Sadr, is reportedly making new threats. According to wire reports, the Shiite cleric threatened to launch suicide attacks if coalition forces attack him and his followers in holy city of Najaf. U.S. forces are deployed outside the city of Najaf, but their mission is on hold in an attempt to have negotiators resolve that standoff.

Three Japanese who were held hostage in Iraq have returned home to far less than a hero's welcome. They've apparently been forced into hiding as critics blame them for their own capture, charging they shouldn't have gone to Iraq in the first place. Well, now the government says it will bill the hostages for their airfare home.

Senate Republicans are taking aim at a Democratic member of the 9/11 Commission. Several GOP senators are demanding Jamie Gorelick be forced to testify before the commission about her apparent role in the strengthening of the so-called wall between the FBI and the CIA. Critics charge that policy hampered efforts to fight terrorism.

Former Ohio state football star Maurice Clarett will not take part in this weekend's NFL draft. The Supreme Court rejected an appeal yesterday to bypass the league's eligibility -- easy for me to say -- rules. The NFL bars players from turning pro within three years of leaving high school. Clarett is one-year short. He could still, though, win a lawsuit in a lower federal court, which would allow him to compete in a separate draft later on.

HEMMER: The draft starts this weekend, Madison Square Garden.

(WEATHER BREAK)

HEMMER: The Bush administration is again putting Americans on alert for the possibility of a terror attack here on U.S. soil. The attorney general, John Ashcroft, yesterday adding to a steady stream of recent warnings.

Kelli Arena has more on that in D.C.

(BEGIN VIDEOTAPE)

KELLI ARENA, CNN JUSTICE CORRESPONDENT (voice-over): As al Qaeda or its associates are being blamed for the latest bombing in Riyadh, U.S. officials are becoming increasingly convinced another attack on U.S. soil could take place in the next few months.

JOHN ASHCROFT, ATTORNEY GENERAL: There is, without a doubt, in my mind, a very serious level of activity of terrorism, which concerns me greatly. We know that the terrorists have often sought symbolic targeting.

ARENA: Ashcroft's comments follow warnings from a myriad of officials from the president on down.

ROBERT MUELLER, FBI DIRECTOR: I think we have to be concerned about the possibility of terrorism attacks between now and the fall. The attacks in Madrid just before the elections there, we should -- we certainly have noted and we believe al Qaeda has noted.

ARENA: What's more, terrorism analysts believe Islamic extremists are becoming more angry as the U.S. continues to fight for democracy in Iraq. Officials say there is no credible or specific information regarding an attack, no time, place or tactic, although there is speculative chatter to that effect.

REP. PORTER GOSS (R-FL), INTELLIGENCE COMMITTEE: We are going to be on our guard. It's going to make it harder for the terrorists, but wherever they stick their heads up, they know we're going to be ready to come and get them.

ARENA (on camera): On a more positive note, counterterrorism officials say the public remains very much on guard. They say calls continue to come in from helpful citizens, who are reporting what they believe to be suspicious behavior.

Kelli Arena, CNN, Washington.

(END VIDEOTAPE)

HEMMER: Kelli, from that story now to the skies. A new government report says dangerous objects are still getting past airport security checkpoints. According to the TSA, both federal and private screeners have performed poorly. How poorly?

Mark Hatfield, communications director with the TSA, here to talk about the efforts to close those security gaps.

Good morning, Mark.

MARK HATFIELD, TSA COMMUNICATIONS DIRECTOR: Good morning.

HEMMER: What do you make of these reports here?

HATFIELD: Well, the criticism is tough, but the fact is, it points to an area we need to improve. But it fails to, at least on first blush, identify the great strides that we've taken in the last two years.

HEMMER: I want to get to the strides in a moment here. "The Washington Post" is reporting today the failure rates are comparable to 1987, 15, 16 years ago.

HATFIELD: That was stated by a member.

HEMMER: In addition the "L.A. Times," even the best screeners can miss 20 percent of well-concealed threat objects. Talking about guns and knives and weapons like that. Your response to that, Mark.

HATFIELD: Well, first of all, to compare the testing today, the covert testing, which is very sophisticated and it's designed to break the system, it's designed to beat the screeners, because when you test and you beat them, it becomes a teaching moment. And that's how we use it to improve the system. But to compare it to 15 years ago is just erroneous. Fifteen years ago, they were using 44 Magnums in bowling bags and, you know, dynamite stick replicas that were very obvious. And those were getting through at an alarming rate for the time.

HEMMER: But the inference...

HATFIELD: But we're using kinds of things that the bad guys are doing now, which is much more sophisticated.

HEMMER: The inference here is that the same rate of catching these items exists today as it did 15, 16 years ago.

HATFIELD: I still think that that comparison is flawed. What we are doing today is we've raised the bar. We have increased the severity and the difficulty level, and in doing this, I mean, we coordinate with our allies in Israel. We use much of the same techniques that they do. You use testing as teaching. And every time you're able to penetrate the security layer, which is at the checkpoint, you have a chance to teach those screeners how to do better.

So, we are making great strides, and we've done a lot of things from training them better to getting them better equipment. But remember, as we point out every time, that checkpoint isn't a barrier, a foolproof barrier. It's a filter. And we've increased the efficiency of that filter, so that the aircraft environment is cleaner. And we've taken that aircraft itself and we've added armed pilots. We've added more federal air marshals. We've done a lot of things beyond the checkpoint. We've done things before the checkpoint. So, it's all about protecting the environment of the aircraft.

HEMMER: Two points. Would you acknowledge the system is not perfect?

HATFIELD: Absolutely.

HEMMER: Would you also acknowledge that much of the system of what's in place now has to deal with fear management for the flying public?

HATFIELD: I think it's more than that. I think what it has to do -- and one of our jobs, besides the, you know, the hard hands-on, making real changes in the security system, we have to convey that and make it both visible and real to the flying public. And I think we have. If you look at the way people are coming back to air travel, we're returning to pre-9/11 record -- or pre-9/11 levels of travel. And that's a vote of confidence that the public is rightly making.

HEMMER: What would make it even better tomorrow than it is today? More manpower? More screening?

HATFIELD: You know, you look at every one of these components and you just keep fine-tuning it. We've got to push these people. We've got to push our screeners.

By the way, the men and women who man the front lines of these checkpoints are doing an extraordinary job. They are patriotic. They're committed. And I do want to make that point that they should be recognized for what they've done in the last two years, because they're the heart and souls of these improvements in security.

HEMMER: Good to talk to you here. Director of communications with the TSA, Mark Hatfield.

HATFIELD: Thanks very much.

HEMMER: Nice to see you. All right -- Soledad.

O'BRIEN: Well, with 10 weeks to go before the handover of power in Iraq, it is still not clear who is going to be taking control. At congressional hearings this week, Bush administration officials offered a plan of an interim government with limited authority over its own armed forces and no power to make any laws.

Meanwhile, U.S. military officials in Iraq are warning insurgents that time is running out for negotiating a peaceful end to the Fallujah standoff. Fallujah is one of several cities, where there is armed combat going on.

Senator John McCain says there aren't enough troops in Iraq to control that country. (BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: I have said since my visit to Iraq last August that our military presence is insufficient to bring stability to the country. We should increase the number of forces, including Marines and Special Forces, to conduct offensive operations.

(END VIDEO CLIP)

O'BRIEN: Senator McCain called on President Bush to be frank with the American people, admit that mistakes have been made, and come up with a long-term plan for U.S. military presence in Iraq. That was Senator McCain calling for that.

And they're often called the funny pages. With the country at war, the storylines in two comic strips have taken a serious and controversial turn.

CNN's Adaora Udoji reports.

(BEGIN VIDEOTAPE)

ADAORA UDOJI, CNN CORRESPONDENT (voice-over): On the comic pages, two popular characters face the harsh realities of the Iraq war this week. Not all newspapers were pleased.

In "Get Fuzzy," main character Rob Wilco (ph) learned his cousin lost a leg in the embattled country. Even more personal in "Doonesbury," Gary Trudeau's B.D., a beloved football coach Reservist fighting in Iraq, was hit. B.D. didn't die. He did lose a leg.

UNIDENTIFIED MALE: It's typical of "Doonesbury." It's commentary. It's commentary on society.

UDOJI: But "Doonesbury's" distributors say it triggered calls of concern from a handful of newspaper editors. Academics say the comics are following a 100-year tradition by taking on polarizing issues that often have triggered debate among editors.

MATT MCCALLISTER, VIRGINIA TECH: I think they have to balance out what is best for the news literacy of a community versus what might significantly offend.

UDOJI: Trudeau has never shied away from current events in his 35-year career. He says, given the burst of American casualties the past two weeks in Iraq, he felt compelled to address it. Writing to CNN -- quote: "It seemed more important than ever to focus on and honor the sacrifice that many of our soldiers are making."

(on camera): Readers who like "Doonesbury," and those who don't, both say Trudeau's strip, among others, plays a critical role.

UNIDENTIFIED FEMALE: I think it helps people think about where they stand.

UNIDENTIFIED MALE: I'm more against what he writes normally, but I do find it entertaining. And in this case I would agree with him.

UDOJI (voice-over): Distributors for "Get Fuzzy" and "Doonesbury" say the Iraq storylines worried some newspaper editors, but they don't know of any newspapers that removed them.

Adaora Udoji, CNN, New York.

(END VIDEOTAPE)

O'BRIEN: Universal Press has got about -- calls from about 10 newspapers with concerns about the "Doonesbury" strip, primarily because of the language the character uses after learning his leg is gone. "Doonesbury" appears in 1,400 papers across the country. "Get Fuzzy" is carried in about 400 papers.

HEMMER: Still to come here, victories for both the prosecution and the defense in the case of Zacarias Moussaoui. The latest on that story next hour here.

O'BRIEN: And what should you do with your tax refund? In a moment, we're joined by our personal money coach. He's got some great ideas coming up on AMERICAN MORNING.

(COMMERCIAL BREAK)

O'BRIEN: Well, you should have filed your taxes last week. So, the big question for those who are getting money back from the feds: What did you do with your refund?

Our personal finance contributor, David Bach, is the author of the No. 1 national best-seller, "The Automatic Millionaire." Is that right, No. 1?

DAVID BACH, CNN PERSONAL FINANCE CONTRIBUTOR: It's No. 1 for four months.

O'BRIEN: Congratulations! That's great.

BACH: Thank you very much.

O'BRIEN: And he joins us this morning with some "90-Second Tips" about the wisest ways to use that refund. Nice to see you.

BACH: Good to see you.

O'BRIEN: Congratulations. I didn't know that.

BACH: Yes, thank you very much.

O'BRIEN: That's fantastic.

BACH: Appreciate it.

O'BRIEN: What's the average refund that people get back?

BACH: It's going to be about $2,300 according to the IRS, which is approximately $100 more than last year.

O'BRIEN: That's nice.

BACH: So that, you know, that big increase in our tax refund, not so big if it's $100. It's a lot day-to-day for a month.

O'BRIEN: Well, better to go that way than the other way, we all know.

BACH: That's right, no question.

O'BRIEN: Do you think that's enough money to actually invest?

BACH: No question. That's the real key here; $2,300, this refund check, there's a lot of things you can do with it. What does the government want you to do? Well, they'd actually like you to go out and spend it, because that will help our economy. And a lot of people will spend it, and advertisers will be trying really hard to get your money here in the next 30, 60, 90 days.

With that being said, $2,300 can really help you whittle down the debt, start saving, and also build an emergency account. And so, I really think we need to look at, how can we use this money intelligently to improve our lives?

O'BRIEN: OK, let's break down your advice. And you say, don't listen to typical advice. I've got to tell you, I've never heard typical advice. So, what's the typical advice?

BACH: Well...

O'BRIEN: And why shouldn't you listen to it?

BACH: Let's face it. Most people who do these shows will come on and say, what you should do with your tax refund if you have credit card debt is pay off your credit card debt.

O'BRIEN: It sounds good to me.

BACH: And, you know, it's like, well, gee, OK, I should do that. But really, you shouldn't do that. Don't take the entire amount and pay off your credit card debt.

O'BRIEN: Why not?

BACH: Because you lose out on what we call the miracle of compound interest. So, here is what I believe a better approach. You take half of your refund. If it's $2,300, you split that in half. You take the first half and you pay off your credit cards. Now, how do you pay off your credit cards? That's the real key. In my book, I have a philosophy I call dolp -- D...

O'BRIEN: Which sounds...

BACH: It sounds like, what does dolp mean?

O'BRIEN: Right, D-O-L-P.

BACH: D-O-L-P, dolp stands for "dead on last payment." So, you pick the credit card that has the highest interest rate, and you focus all of that -- half of that refund on that credit card first. And you focus as much as you can beyond the minimum on that credit card until that credit card gets paid off. Then go to the next credit card.

O'BRIEN: And then you cut it up.

BACH: Then you cut it up, exactly. So that one is done. Then you go to the next credit card with the next highest interest rate.

O'BRIEN: OK. So, you've dolped half of it.

BACH: You've dolped it.

O'BRIEN: What do you do with the other half?

BACH: All right, and the second thing is you take 25 percent of that refund and you put it away for the future. So, a retirement account.

Now, let me give you, what I would call, a no-brainer idea right now. A lot of people who are watching have spouses who are not working, but they can open a spousal IRA account, which is completely tax deductible. So, if you are working, your spouse is not working, take at least 25 percent of your refund. Put it in a deductible spousal IRA

Now, let me give you an example of how this adds up. Let's just say that you took the whole amount, as an example, $2,300, and you put it in a spousal IRA In 25 years at 10 percent interest, you have over 25 grand.

O'BRIEN: From that one $2,300 deposit.

BACH: One tax refund. Now, what if you did this for 20 years? By the time you reach retirement...

O'BRIEN: It's doing all right.

BACH: ... you'd have over $360,000 in the spousal IRA account. So, again, that small amount can add up to a lot of money later, but people sort of just flitter (ph) it away.

O'BRIEN: OK. The other 25 percent that we've got left over.

BACH: Emergency account. You want to open up an emergency account. We all know this. Three to six months of expenses set aside. But where? Separate from your checking account. Either put it in a money market account, a CD. What I particularly like are what are called I-bonds. So, let's look at these...

O'BRIEN: I've never even heard of that.

BACH: I-bonds are a new bond. It's a savings bond by the government. It stands for "inflation bond." These are fantastic. You can go buy these online through the government at TreasuryDirect.gov. These bonds can be bought in increments of $50 or more, up to $30,000 a year. The rate right now, the yield is about 2.5 percent, but it adjusts every six months for inflation.

So, right now, we're anticipating inflation next year potentially. That means the rates could go up. So, it's a very safe form of savings. It's away from you. The money gets out of your hand. And it adjusts. As we have inflation, you'll get a higher rate of return.

O'BRIEN: David Bach, as always, congratulations on the best- seller list.

BACH: Soledad, thank you.

O'BRIEN: That's very nice.

BACH: It's been fun.

O'BRIEN: And thanks for coming in to talk to us. As always, we appreciate it.

BACH: My pleasure.

O'BRIEN: David Bach, of course, is the host of a nationally- syndicated radio show. It airs Saturday afternoons on Cirius Satellite Radio, and every Wednesday right here, you can catch David on AMERICAN MORNING for tips on how to improve your financial life -- Bill.

HEMMER: All right, Soledad, nine minutes now before the hour. In a moment here, images from the war. How much does the Pentagon want you to see? In a moment on AMERICAN MORNING.

(COMMERCIAL BREAK)

HEMMER: Welcome back. Question of the day, to Jack.

JACK CAFFERTY, CNN ANCHOR: Thanks, Bill.

An issue that's been simmering since the war in Iraq began, now it's coming to a full boil. Photos of caskets of American soldiers coming home from the war in Iraq, 361 pictures from Dover Air Force Base were released under the Freedom of Information Act. The Defense Department has forbidden coverage of returning remains of soldiers.

In a related story, two employees of a defense contractor were fired this week after a photograph they took of a flag-draped coffin from Kuwait ran on the front page of Sunday's "Seattle Times." They lost their job.

The question is: Should the Pentagon be able to ban pictures of coffins of American military personnel? We are getting an awful lot of mail. Eric in Medina, Ohio: "They should be shown. These men and women deserve the public respect of all Americans. Hiding their return home after they have made the ultimate sacrifice is shameful. Is the administration playing politics with the lives and deaths of American service personnel?"

Karen in Palm Coast, Florida, has a different view: "Yes. Much as the DOD maintains the right to ban pictures of dead bodies being dragged through the streets. I think people forget that family members have the TV on daily, and they should not have their family member on display, no matter the motives of those doing the displaying."

David in Oviedo, Florida: "Of course, the pictures of a coffin should be shown. The Pentagon is not trying to spare the families any grief, for we don't know whose remains are in those coffins. The Pentagon is trying to spare themselves and the administration grief, because coffins are too similar to the body bags of Vietnam."

And finally, Sandy -- I thought this was interesting -- in Seattle writes this: "One of the most poignant and often documented pieces of historical film is the procession of the flag-draped casket of President Kennedy, the commander-in-chief, in 1963. Everyone has seen the tape of John, Jr., saluting the casket as it went by. If Jacqueline Kennedy, one of the most sensitive, tasteful and elegant women in American history, had no problem with her husband's flag- draped casket being viewed by the whole world as America honored his memory, please tell me how the Pentagon can make the asserting that honoring these brave Americans in this way would be insensitive to their families?"

AM@CNN.com. It is a very emotional issue.

HEMMER: That's right.

CAFFERTY: People have very strong feelings about it. And we're enjoying reading the mail. We're getting a lot of it.

HEMMER: Images of war.

CAFFERTY: Yes.

O'BRIEN: Oh, especially about that. All right, thanks, Jack.

CAFFERTY: Sure.

O'BRIEN: Still to come this morning, Democratic Senator Joseph Lieberman will join us to talk about what he has heard about Iraq this week on Capitol Hill. That's ahead. Stay with us. You're watching AMERICAN MORNING.

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


Aired April 23, 2004 - 07:30   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
SOLEDAD O'BRIEN, CNN ANCHOR: Good morning. Welcome, everybody. It's just about half past the hour on this AMERICAN MORNING.
Inspectors the Homeland Security Department don't like what they are seeing from airport screeners who aren't seeing everything they should. A lot of dangerous items are still getting past checkpoints. This morning, we talk with an official with the TSA about whether the public should be alarmed at this point.

BILL HEMMER, CNN ANCHOR: Also in the next 30 minutes, among the images of war causing controversies are characters in comic strips. Two strips in particular are dealing with war in a very stark manner. We'll look at that this morning as well here.

O'BRIEN: We get to our top stories first this morning.

The U.N. reportedly preparing to choose an interim government in Iraq. "USA Today" cites Undersecretary of State Mark Grossman, who says U.S. Special Envoy Lakhdar Brahimi will begin the selection process within weeks. Grossman also told a Senate committee yesterday that the U.S. wants to limit the sovereignty of that interim government, including its control of the country's security.

Wanted Iraqi Muslim cleric, Moqtada al-Sadr, is reportedly making new threats. According to wire reports, the Shiite cleric threatened to launch suicide attacks if coalition forces attack him and his followers in holy city of Najaf. U.S. forces are deployed outside the city of Najaf, but their mission is on hold in an attempt to have negotiators resolve that standoff.

Three Japanese who were held hostage in Iraq have returned home to far less than a hero's welcome. They've apparently been forced into hiding as critics blame them for their own capture, charging they shouldn't have gone to Iraq in the first place. Well, now the government says it will bill the hostages for their airfare home.

Senate Republicans are taking aim at a Democratic member of the 9/11 Commission. Several GOP senators are demanding Jamie Gorelick be forced to testify before the commission about her apparent role in the strengthening of the so-called wall between the FBI and the CIA. Critics charge that policy hampered efforts to fight terrorism.

Former Ohio state football star Maurice Clarett will not take part in this weekend's NFL draft. The Supreme Court rejected an appeal yesterday to bypass the league's eligibility -- easy for me to say -- rules. The NFL bars players from turning pro within three years of leaving high school. Clarett is one-year short. He could still, though, win a lawsuit in a lower federal court, which would allow him to compete in a separate draft later on.

HEMMER: The draft starts this weekend, Madison Square Garden.

(WEATHER BREAK)

HEMMER: The Bush administration is again putting Americans on alert for the possibility of a terror attack here on U.S. soil. The attorney general, John Ashcroft, yesterday adding to a steady stream of recent warnings.

Kelli Arena has more on that in D.C.

(BEGIN VIDEOTAPE)

KELLI ARENA, CNN JUSTICE CORRESPONDENT (voice-over): As al Qaeda or its associates are being blamed for the latest bombing in Riyadh, U.S. officials are becoming increasingly convinced another attack on U.S. soil could take place in the next few months.

JOHN ASHCROFT, ATTORNEY GENERAL: There is, without a doubt, in my mind, a very serious level of activity of terrorism, which concerns me greatly. We know that the terrorists have often sought symbolic targeting.

ARENA: Ashcroft's comments follow warnings from a myriad of officials from the president on down.

ROBERT MUELLER, FBI DIRECTOR: I think we have to be concerned about the possibility of terrorism attacks between now and the fall. The attacks in Madrid just before the elections there, we should -- we certainly have noted and we believe al Qaeda has noted.

ARENA: What's more, terrorism analysts believe Islamic extremists are becoming more angry as the U.S. continues to fight for democracy in Iraq. Officials say there is no credible or specific information regarding an attack, no time, place or tactic, although there is speculative chatter to that effect.

REP. PORTER GOSS (R-FL), INTELLIGENCE COMMITTEE: We are going to be on our guard. It's going to make it harder for the terrorists, but wherever they stick their heads up, they know we're going to be ready to come and get them.

ARENA (on camera): On a more positive note, counterterrorism officials say the public remains very much on guard. They say calls continue to come in from helpful citizens, who are reporting what they believe to be suspicious behavior.

Kelli Arena, CNN, Washington.

(END VIDEOTAPE)

HEMMER: Kelli, from that story now to the skies. A new government report says dangerous objects are still getting past airport security checkpoints. According to the TSA, both federal and private screeners have performed poorly. How poorly?

Mark Hatfield, communications director with the TSA, here to talk about the efforts to close those security gaps.

Good morning, Mark.

MARK HATFIELD, TSA COMMUNICATIONS DIRECTOR: Good morning.

HEMMER: What do you make of these reports here?

HATFIELD: Well, the criticism is tough, but the fact is, it points to an area we need to improve. But it fails to, at least on first blush, identify the great strides that we've taken in the last two years.

HEMMER: I want to get to the strides in a moment here. "The Washington Post" is reporting today the failure rates are comparable to 1987, 15, 16 years ago.

HATFIELD: That was stated by a member.

HEMMER: In addition the "L.A. Times," even the best screeners can miss 20 percent of well-concealed threat objects. Talking about guns and knives and weapons like that. Your response to that, Mark.

HATFIELD: Well, first of all, to compare the testing today, the covert testing, which is very sophisticated and it's designed to break the system, it's designed to beat the screeners, because when you test and you beat them, it becomes a teaching moment. And that's how we use it to improve the system. But to compare it to 15 years ago is just erroneous. Fifteen years ago, they were using 44 Magnums in bowling bags and, you know, dynamite stick replicas that were very obvious. And those were getting through at an alarming rate for the time.

HEMMER: But the inference...

HATFIELD: But we're using kinds of things that the bad guys are doing now, which is much more sophisticated.

HEMMER: The inference here is that the same rate of catching these items exists today as it did 15, 16 years ago.

HATFIELD: I still think that that comparison is flawed. What we are doing today is we've raised the bar. We have increased the severity and the difficulty level, and in doing this, I mean, we coordinate with our allies in Israel. We use much of the same techniques that they do. You use testing as teaching. And every time you're able to penetrate the security layer, which is at the checkpoint, you have a chance to teach those screeners how to do better.

So, we are making great strides, and we've done a lot of things from training them better to getting them better equipment. But remember, as we point out every time, that checkpoint isn't a barrier, a foolproof barrier. It's a filter. And we've increased the efficiency of that filter, so that the aircraft environment is cleaner. And we've taken that aircraft itself and we've added armed pilots. We've added more federal air marshals. We've done a lot of things beyond the checkpoint. We've done things before the checkpoint. So, it's all about protecting the environment of the aircraft.

HEMMER: Two points. Would you acknowledge the system is not perfect?

HATFIELD: Absolutely.

HEMMER: Would you also acknowledge that much of the system of what's in place now has to deal with fear management for the flying public?

HATFIELD: I think it's more than that. I think what it has to do -- and one of our jobs, besides the, you know, the hard hands-on, making real changes in the security system, we have to convey that and make it both visible and real to the flying public. And I think we have. If you look at the way people are coming back to air travel, we're returning to pre-9/11 record -- or pre-9/11 levels of travel. And that's a vote of confidence that the public is rightly making.

HEMMER: What would make it even better tomorrow than it is today? More manpower? More screening?

HATFIELD: You know, you look at every one of these components and you just keep fine-tuning it. We've got to push these people. We've got to push our screeners.

By the way, the men and women who man the front lines of these checkpoints are doing an extraordinary job. They are patriotic. They're committed. And I do want to make that point that they should be recognized for what they've done in the last two years, because they're the heart and souls of these improvements in security.

HEMMER: Good to talk to you here. Director of communications with the TSA, Mark Hatfield.

HATFIELD: Thanks very much.

HEMMER: Nice to see you. All right -- Soledad.

O'BRIEN: Well, with 10 weeks to go before the handover of power in Iraq, it is still not clear who is going to be taking control. At congressional hearings this week, Bush administration officials offered a plan of an interim government with limited authority over its own armed forces and no power to make any laws.

Meanwhile, U.S. military officials in Iraq are warning insurgents that time is running out for negotiating a peaceful end to the Fallujah standoff. Fallujah is one of several cities, where there is armed combat going on.

Senator John McCain says there aren't enough troops in Iraq to control that country. (BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: I have said since my visit to Iraq last August that our military presence is insufficient to bring stability to the country. We should increase the number of forces, including Marines and Special Forces, to conduct offensive operations.

(END VIDEO CLIP)

O'BRIEN: Senator McCain called on President Bush to be frank with the American people, admit that mistakes have been made, and come up with a long-term plan for U.S. military presence in Iraq. That was Senator McCain calling for that.

And they're often called the funny pages. With the country at war, the storylines in two comic strips have taken a serious and controversial turn.

CNN's Adaora Udoji reports.

(BEGIN VIDEOTAPE)

ADAORA UDOJI, CNN CORRESPONDENT (voice-over): On the comic pages, two popular characters face the harsh realities of the Iraq war this week. Not all newspapers were pleased.

In "Get Fuzzy," main character Rob Wilco (ph) learned his cousin lost a leg in the embattled country. Even more personal in "Doonesbury," Gary Trudeau's B.D., a beloved football coach Reservist fighting in Iraq, was hit. B.D. didn't die. He did lose a leg.

UNIDENTIFIED MALE: It's typical of "Doonesbury." It's commentary. It's commentary on society.

UDOJI: But "Doonesbury's" distributors say it triggered calls of concern from a handful of newspaper editors. Academics say the comics are following a 100-year tradition by taking on polarizing issues that often have triggered debate among editors.

MATT MCCALLISTER, VIRGINIA TECH: I think they have to balance out what is best for the news literacy of a community versus what might significantly offend.

UDOJI: Trudeau has never shied away from current events in his 35-year career. He says, given the burst of American casualties the past two weeks in Iraq, he felt compelled to address it. Writing to CNN -- quote: "It seemed more important than ever to focus on and honor the sacrifice that many of our soldiers are making."

(on camera): Readers who like "Doonesbury," and those who don't, both say Trudeau's strip, among others, plays a critical role.

UNIDENTIFIED FEMALE: I think it helps people think about where they stand.

UNIDENTIFIED MALE: I'm more against what he writes normally, but I do find it entertaining. And in this case I would agree with him.

UDOJI (voice-over): Distributors for "Get Fuzzy" and "Doonesbury" say the Iraq storylines worried some newspaper editors, but they don't know of any newspapers that removed them.

Adaora Udoji, CNN, New York.

(END VIDEOTAPE)

O'BRIEN: Universal Press has got about -- calls from about 10 newspapers with concerns about the "Doonesbury" strip, primarily because of the language the character uses after learning his leg is gone. "Doonesbury" appears in 1,400 papers across the country. "Get Fuzzy" is carried in about 400 papers.

HEMMER: Still to come here, victories for both the prosecution and the defense in the case of Zacarias Moussaoui. The latest on that story next hour here.

O'BRIEN: And what should you do with your tax refund? In a moment, we're joined by our personal money coach. He's got some great ideas coming up on AMERICAN MORNING.

(COMMERCIAL BREAK)

O'BRIEN: Well, you should have filed your taxes last week. So, the big question for those who are getting money back from the feds: What did you do with your refund?

Our personal finance contributor, David Bach, is the author of the No. 1 national best-seller, "The Automatic Millionaire." Is that right, No. 1?

DAVID BACH, CNN PERSONAL FINANCE CONTRIBUTOR: It's No. 1 for four months.

O'BRIEN: Congratulations! That's great.

BACH: Thank you very much.

O'BRIEN: And he joins us this morning with some "90-Second Tips" about the wisest ways to use that refund. Nice to see you.

BACH: Good to see you.

O'BRIEN: Congratulations. I didn't know that.

BACH: Yes, thank you very much.

O'BRIEN: That's fantastic.

BACH: Appreciate it.

O'BRIEN: What's the average refund that people get back?

BACH: It's going to be about $2,300 according to the IRS, which is approximately $100 more than last year.

O'BRIEN: That's nice.

BACH: So that, you know, that big increase in our tax refund, not so big if it's $100. It's a lot day-to-day for a month.

O'BRIEN: Well, better to go that way than the other way, we all know.

BACH: That's right, no question.

O'BRIEN: Do you think that's enough money to actually invest?

BACH: No question. That's the real key here; $2,300, this refund check, there's a lot of things you can do with it. What does the government want you to do? Well, they'd actually like you to go out and spend it, because that will help our economy. And a lot of people will spend it, and advertisers will be trying really hard to get your money here in the next 30, 60, 90 days.

With that being said, $2,300 can really help you whittle down the debt, start saving, and also build an emergency account. And so, I really think we need to look at, how can we use this money intelligently to improve our lives?

O'BRIEN: OK, let's break down your advice. And you say, don't listen to typical advice. I've got to tell you, I've never heard typical advice. So, what's the typical advice?

BACH: Well...

O'BRIEN: And why shouldn't you listen to it?

BACH: Let's face it. Most people who do these shows will come on and say, what you should do with your tax refund if you have credit card debt is pay off your credit card debt.

O'BRIEN: It sounds good to me.

BACH: And, you know, it's like, well, gee, OK, I should do that. But really, you shouldn't do that. Don't take the entire amount and pay off your credit card debt.

O'BRIEN: Why not?

BACH: Because you lose out on what we call the miracle of compound interest. So, here is what I believe a better approach. You take half of your refund. If it's $2,300, you split that in half. You take the first half and you pay off your credit cards. Now, how do you pay off your credit cards? That's the real key. In my book, I have a philosophy I call dolp -- D...

O'BRIEN: Which sounds...

BACH: It sounds like, what does dolp mean?

O'BRIEN: Right, D-O-L-P.

BACH: D-O-L-P, dolp stands for "dead on last payment." So, you pick the credit card that has the highest interest rate, and you focus all of that -- half of that refund on that credit card first. And you focus as much as you can beyond the minimum on that credit card until that credit card gets paid off. Then go to the next credit card.

O'BRIEN: And then you cut it up.

BACH: Then you cut it up, exactly. So that one is done. Then you go to the next credit card with the next highest interest rate.

O'BRIEN: OK. So, you've dolped half of it.

BACH: You've dolped it.

O'BRIEN: What do you do with the other half?

BACH: All right, and the second thing is you take 25 percent of that refund and you put it away for the future. So, a retirement account.

Now, let me give you, what I would call, a no-brainer idea right now. A lot of people who are watching have spouses who are not working, but they can open a spousal IRA account, which is completely tax deductible. So, if you are working, your spouse is not working, take at least 25 percent of your refund. Put it in a deductible spousal IRA

Now, let me give you an example of how this adds up. Let's just say that you took the whole amount, as an example, $2,300, and you put it in a spousal IRA In 25 years at 10 percent interest, you have over 25 grand.

O'BRIEN: From that one $2,300 deposit.

BACH: One tax refund. Now, what if you did this for 20 years? By the time you reach retirement...

O'BRIEN: It's doing all right.

BACH: ... you'd have over $360,000 in the spousal IRA account. So, again, that small amount can add up to a lot of money later, but people sort of just flitter (ph) it away.

O'BRIEN: OK. The other 25 percent that we've got left over.

BACH: Emergency account. You want to open up an emergency account. We all know this. Three to six months of expenses set aside. But where? Separate from your checking account. Either put it in a money market account, a CD. What I particularly like are what are called I-bonds. So, let's look at these...

O'BRIEN: I've never even heard of that.

BACH: I-bonds are a new bond. It's a savings bond by the government. It stands for "inflation bond." These are fantastic. You can go buy these online through the government at TreasuryDirect.gov. These bonds can be bought in increments of $50 or more, up to $30,000 a year. The rate right now, the yield is about 2.5 percent, but it adjusts every six months for inflation.

So, right now, we're anticipating inflation next year potentially. That means the rates could go up. So, it's a very safe form of savings. It's away from you. The money gets out of your hand. And it adjusts. As we have inflation, you'll get a higher rate of return.

O'BRIEN: David Bach, as always, congratulations on the best- seller list.

BACH: Soledad, thank you.

O'BRIEN: That's very nice.

BACH: It's been fun.

O'BRIEN: And thanks for coming in to talk to us. As always, we appreciate it.

BACH: My pleasure.

O'BRIEN: David Bach, of course, is the host of a nationally- syndicated radio show. It airs Saturday afternoons on Cirius Satellite Radio, and every Wednesday right here, you can catch David on AMERICAN MORNING for tips on how to improve your financial life -- Bill.

HEMMER: All right, Soledad, nine minutes now before the hour. In a moment here, images from the war. How much does the Pentagon want you to see? In a moment on AMERICAN MORNING.

(COMMERCIAL BREAK)

HEMMER: Welcome back. Question of the day, to Jack.

JACK CAFFERTY, CNN ANCHOR: Thanks, Bill.

An issue that's been simmering since the war in Iraq began, now it's coming to a full boil. Photos of caskets of American soldiers coming home from the war in Iraq, 361 pictures from Dover Air Force Base were released under the Freedom of Information Act. The Defense Department has forbidden coverage of returning remains of soldiers.

In a related story, two employees of a defense contractor were fired this week after a photograph they took of a flag-draped coffin from Kuwait ran on the front page of Sunday's "Seattle Times." They lost their job.

The question is: Should the Pentagon be able to ban pictures of coffins of American military personnel? We are getting an awful lot of mail. Eric in Medina, Ohio: "They should be shown. These men and women deserve the public respect of all Americans. Hiding their return home after they have made the ultimate sacrifice is shameful. Is the administration playing politics with the lives and deaths of American service personnel?"

Karen in Palm Coast, Florida, has a different view: "Yes. Much as the DOD maintains the right to ban pictures of dead bodies being dragged through the streets. I think people forget that family members have the TV on daily, and they should not have their family member on display, no matter the motives of those doing the displaying."

David in Oviedo, Florida: "Of course, the pictures of a coffin should be shown. The Pentagon is not trying to spare the families any grief, for we don't know whose remains are in those coffins. The Pentagon is trying to spare themselves and the administration grief, because coffins are too similar to the body bags of Vietnam."

And finally, Sandy -- I thought this was interesting -- in Seattle writes this: "One of the most poignant and often documented pieces of historical film is the procession of the flag-draped casket of President Kennedy, the commander-in-chief, in 1963. Everyone has seen the tape of John, Jr., saluting the casket as it went by. If Jacqueline Kennedy, one of the most sensitive, tasteful and elegant women in American history, had no problem with her husband's flag- draped casket being viewed by the whole world as America honored his memory, please tell me how the Pentagon can make the asserting that honoring these brave Americans in this way would be insensitive to their families?"

AM@CNN.com. It is a very emotional issue.

HEMMER: That's right.

CAFFERTY: People have very strong feelings about it. And we're enjoying reading the mail. We're getting a lot of it.

HEMMER: Images of war.

CAFFERTY: Yes.

O'BRIEN: Oh, especially about that. All right, thanks, Jack.

CAFFERTY: Sure.

O'BRIEN: Still to come this morning, Democratic Senator Joseph Lieberman will join us to talk about what he has heard about Iraq this week on Capitol Hill. That's ahead. Stay with us. You're watching AMERICAN MORNING.

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