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CNN Live At Daybreak

Latest Attacks at American Checkpoints Near Najaf; Colin Powell's Trip to Germany

Aired April 29, 2004 - 06:00   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.


CAROL COSTELLO, CNN ANCHOR: And good morning to you.
We are following breaking news going on right now out of Iraq. A possible solution to the violence in Fallujah.

From the CNN global headquarters in Atlanta, I'm Carol Costello.

Here are the latest headlines for you right now.

Possibly a huge break in the Iraq situation. We're just getting reports that four former Iraqi generals are now vowing to end the violence in Fallujah. The Iraqi generals are meeting right now with U.S. Marines.

Making history at the White House, but no stenographer will be there to record it. President Bush and Vice President Cheney will answer questions a few hours from now from the 9/11 Commission.

In Iraq, the A.P. is reporting a U.S. soldier from the 1st Infantry Division has been killed and another wounded in a roadside bombing today near Baqoubah.

On New York's Staten Island, police find an arsenal of weapons -- seven homemade bombs, 10,000 rounds of ammunition and 13 guns. A man and a woman now under arrest.

And starting today, seniors can go online to shop for the best prescription drug discount card. Enrollment in the new Medicare program starts on Monday.

To the forecast center and Chad -- good morning.

CHAD MYERS, CNN CORRESPONDENT: Good morning, Carol.

(WEATHER REPORT)

COSTELLO: Four of Saddam Hussein's former generals are stepping up to end the violence in Fallujah. This is a major development that's unfolding right now.

Our senior international editor, David Clinch, is here with me to talk more about this.

So these four Iraqi generals want to assemble an army and go into Fallujah and take over security there. DAVID CLINCH, CNN INTERNATIONAL EDITOR: Right. Well, let's take it right from the beginning. Tony Perry, "Los Angeles Times" reporter, is in Fallujah and attended these talks between U.S. Marines and U.S. civilian authorities in Fallujah with various groups. Included in those is we've heard about these sheikhs who have been coming in to try and talk to the insurgents directly. We've heard now about these former Iraqi generals. He says four Iraqi, Saddam's army generals now have offered themselves to lead the Iraqi Army in Fallujah.

Now, let's be clear, there is, as Tony pointed out, an Iraqi Army. The U.S. has paid for and rebuilt the Iraqi Army, both with people who used to be in it at the lower level and people who volunteered. But what they did not have was any former Saddam leadership for that army. What...

COSTELLO: Because they weren't allowed to take part in it, frankly.

CLINCH: Because they weren't. Neither Baath leaders or any senior military leader had been specifically excluded from that. We've been hearing again and again over the last few months that the U.S. has been, first of all, criticized for that, excluding the leadership; and then now, within the last few weeks, considering seriously allowing some of those former Baathists and former Saddam generals to come back in. Here we're seeing it.

A tentative agreement -- and Tony is stressing that. And here's how it works, he says. Over the next two weeks or so, these four generals will allow the Iraqi Army to come into Fallujah itself and maintain security in the city. During those two weeks, the Marines stay on the periphery of the city. At the end of those two weeks, the Marines, if the security situation is acceptable, would be able to pull back further from the city.

The key elements, of course, that remain to be seen is will they be able to get the Iraqi Army in? Will they turn up? You asked him some questions about that. We've seen the Iraqi Army within the last few months not turn up when they've been asked to turn up.

COSTELLO: Or run away.

CLINCH: Will they accept the leadership of these former generals? And then will they be able to deal with the insurgency?

We asked him questions, we asked Tony questions about what the expectations were -- just to keep the security level acceptable or to actually take on these insurgents and eliminate them?

Now, let's not forget the origin of this Fallujah situation -- four U.S. contractors killed, their bodies burnt and abused in the city. The U.S. vowed to find them and eliminate them, then came up against an insurgency which, in turn, they vowed to eliminate.

So obviously the question now remains these generals, will they be able to lead the army and what exactly will we see on the streets in Fallujah in the next week?

But as you've been saying, a very important breakthrough if, for no other reason than it was absolutely clear to the Marines and to everybody else that the cost in lives on the Marines' side and on the Iraqis' side, both militants and civilians, would be very high if they had to go into the streets.

COSTELLO: And, you know, talk about -- right. Talk about winning hearts and minds, you know, if you invade Fallujah, which the Marines have not wanted to do for obvious reasons -- now the Iraqi Army may be able to go in there and convince these insurgents to turn in their weapons and to quit fighting.

CLINCH: Right.

COSTELLO: Much better than an American force to go in.

CLINCH: Right. And, again, remember, we're talking about, in some ways, two tracks working at the same time -- a track working with these tribal leaders, the so-called sheikhs, who the U.S. will not negotiate directly with the insurgents. They tell us they're talking to these local tribal leaders, who, in turn, are talking to the insurgents. And they believe they have some influence.

Now, they're also on a separate track, saying that security in the city could be supplied by Iraqis themselves. Now, for the first time with leadership, real leadership, generals with experience -- we heard Tony saying that one of the Marine generals had actually fought against one of these Iraqi generals in the original invasion.

And when you think about it, what we're seeing here really is, in some ways, the original model of what would happen in Iraq, that if the leadership, Saddam Hussein's leadership went away, that Iraqis would be so happy that they themselves would take over security within the country itself.

What happened in the meantime is that the Baathist leadership and the generals were removed. So a new army had been created. Where is the leadership? Now we're seeing it.

COSTELLO: OK...

CLINCH: A big experiment, a big risk, but...

COSTELLO: But if that experiment works, it may spread throughout Iraq.

CLINCH: Correct.

COSTELLO: And we want to take people to Najaf right now, because American forces came under fire there.

Jane Arraf is live in Najaf.

She's on the phone this morning, correct -- Jane, what is happening there now? JANE ARRAF, CNN CORRESPONDENT: Yes, Carol, American forces actually came under simultaneous attack at two checkpoints that they set up just yesterday. Now, we were in the middle of one of those attacks at a checkpoint where traffic had been slowing normally. All of a sudden traffic stopped and soldiers said that was an indication that they may be about to attack. Indeed, there was rocket propelled grenades, there was mortar fire off in the distance and small arms fire.

One of the soldiers was lightly wounded by gunfire and at the main base in Najaf, which houses the coalition civilian authorities, where it came under mortar attack. Another person on the base was slightly wounded, as well, by shrapnel.

Now, this, again, only the second day that the U.S. has set up these checkpoints to emphasize its presence in Najaf. It is staying well clear of the holy sites, but it is trying to make its presence known on the outskirts. But these attacks, simultaneous attacks, it seems, indications that the militia loyal to the radical Shia cleric is still very much out there -- Carol.

COSTELLO: And, Jane, as far as we know, Muqtada al-Sadr is still holed up in a mosque inside of Najaf?

ARRAF: It's unclear his -- where his whereabouts are exactly. But what is clear is that his militia is in control in Najaf and in Kufa, the adjoining town, where people coming through in cars at the checkpoint were telling us it was even worse.

Now, there were reports of an explosion in Najaf overnight. And in Kufa, Carol, we actually saw people who were fleeing the city; one person who had almost his whole possessions, his entire possessions stacked into a truck, saying that Kufa had become just too dangerous and he was actually going to Najaf, which although controlled by the militia, is still relatively less violent, it seems, than the adjoining city of Kufa.

All in all, a very delicate, complicated, tense situation for U.S. forces here -- Carol.

COSTELLO: All right, Jane Arraf reporting live for us from Najaf, Iraq this morning.

Let's get back to David Clinch right now to talk more about this new tentative deal with this -- these four Iraqi generals who apparently are going to assemble an Iraqi Army and take over the security situation in Fallujah.

CLINCH: Yes. Correct.

COSTELLO: Now, if that experiment works, it could spread to cities like Najaf.

CLINCH: Right. Well, yes, it's a different situation in Najaf, but listening to Jane there, you get sort of an idea of the pattern that the U.S. may be trying to -- I'm not speculating, I'm just saying that there may be a pattern here. What Tony Perry in the "Los Angeles Times" has been reporting from Fallujah is a tentative deal with the former Iraqi generals to take over security in Fallujah with the Iraqi Army, but only after the U.S. Marines established massive power around the city.

Now, we've seen the U.S. establish that same massive power around Najaf. It'll be interesting to see whether they follow the pattern there.

COSTELLO: Well, let's take a few steps back.

We've got -- we have Tony Perry from the "Los Angeles Times" on the phone right now.

Tony, tell us how this deal came about. And also tell us about these generals and what you know about them.

TONY PERRY, "L.A. TIMES": It came about in the last few days. The generals stepped forward. They've been known. People have been talking to them, encouraging them to step forward, to return to the army and return their leadership capabilities to the army.

The Marines, since this began, have been disappointed in the Iraqi police, disappointed in the Iraqi Civil Defense Corps, sort of a national guard group; that they really were too rickety, they weren't ready, they didn't show up, they were basically missing in action; that they really didn't help much. They were very disappointed. They've been very disappointed that Iraqis haven't stepped forward.

Now some people with credibility, with professional credentials -- and these are known people. These are people who have been in the Iraqi Army for a number of years. They even fought, of course, last year. I was talking to a Marine colonel who fought against one of these men and said that he's a professional. He fights honorably. He doesn't hide behind women and children. He doesn't use biological weapons and other banned weaponry. These are professionals.

Now, the Marines are going to watch them very closely. The U.S. is going to watch them very closely to make sure they can follow through. Can they muster enough men and gear to get it done and can they also put pressure on the insurgents to stop their daily, even their hourly attacks on the Marines here?

A lot of imponderables, a lot of steps have to be taken. But what we seem to have is a way out of the specter of an urban war in downtown Fallujah that would have cost American lives and, I think, would have cost a significant number of civilian casualties.

COSTELLO: The other positive out of this, Tony, is these generals probably know where the bones are buried in Fallujah, so to speak.

PERRY: Certainly. As I talked to Major General James Mattis, the commander of the 1st Marine Division, he said these guys know a Syrian accent from an Iraqi accent. They know the territory. In other words, they know who the bad actors are. They have means to get them out, we're going to give them a chance. And as they came out of the meeting, General Mattis, who is one of the -- was with one of the three star Iraqi generals who was in a business suit -- he had a very close conversation with him. He said, "You and I are going to make this work together. You need me. I'm here. We Americans didn't come here to fight, we came here to help."

It's got to be a positive step.

COSTELLO: Also, the weaponry -- U.S., the United States isn't going to supply this Iraqi Army with weapons -- or is it?

PERRY: Well, I don't think weapons, vehicles, electronic gear and communications is going to be a problem. This city and this country is so bristling with weaponry you can go to any Wal-Mart, if you will, the Iraqi equivalent of Wal-Mart, and buy all the weaponry you want. I don't think that's going to be a problem.

COSTELLO: And the other thing, it seems as if any time an Iraqi is associated with the United States, other Iraqis are suspect of that person.

PERRY: Sure.

COSTELLO: How are the generals going to get the Iraqi populace to believe that they're on their side?

PERRY: And that's one of the challenges. And that shows the bravery of these men to step forward. Others have stepped forward and paid with their lives. As we know, a lot of Iraqi police have been killed. The Civil Defense Corps people have been killed. Civilians have been killed.

These people have stepped forward. They're willing to take the challenge. They're willing to take the risk. That in itself speaks highly of them. We'll see if they're able to, frankly, stay alive and get it done.

COSTELLO: Tony Perry from the "Los Angeles Times" joins us live this morning from Fallujah.

Many thanks for that interesting bit of information, this tentative deal made with U.S. Marines. These four Iraqi generals going to assemble an Iraqi Army and eventually take over the security concerns in the city of Fallujah.

Of course, we will keep you posted throughout the day here on CNN.

You know, Colin Powell spoke about the situation in Fallujah this morning.

Chris Burns is joining us live from the German capital, where the secretary of state is this morning -- good morning, Chris.

CHRIS BURNS, CNN CORRESPONDENT: Good morning, Carol. (AUDIO GAP) all this talk about what's happening in Fallujah (AUDIO GAP) book after WWII. But keep in mind that there were a lot of (AUDIO GAP) army who were rehabilitated, including (AUDIO GAP). Johanes Kepler was also in Hitler's army. But these people said that they were not Nazis, that they were just regular people and were (AUDIO GAP) after the war.

So this rehabilitation (AUDIO GAP) Nazis (AUDIO GAP) former Nazis or former soldiers in the Nazi army was part, after WWII (AUDIO GAP) the de-Baathification (AUDIO GAP)...

COSTELLO: Oh, unfortunately, unfortunately, Chris, your signal is not the best, so we're going to step away.

Maybe we'll get him back when we get the signal problems all worked out.

Still to come on DAYBREAK this morning, he is not the first president to pray. But when this leader calls on a higher power, does it affect his image in other parts of the world? Later, the producer behind a new documentary, "The Jesus Factor."

And life in a war zone -- are Iraqis satisfied with the results of the coalition operation? Results of a new CNN/Gallup poll that questioned the Iraqi people on the issues.

And saying good-bye to an automotive staple.

This is DAYBREAK for April 29.

(COMMERCIAL BREAK)

COSTELLO: Time for a little business buzz right now.

Today marks the end of an era for America's oldest car company, Oldsmobile. That's kind of sad.

Joya Dass live from the NASDAQ market site to tell us more -- good morning.

JOYA DASS, CNN CORRESPONDENT: Good morning, Carol.

Well, the last Oldsmobile is coming off the assembly line in Lansing, Michigan. We are talking about this brand, which has seen sales drop steadily over the years. So G.M. has decided to discontinue it with the 2004 model. So, the last Oldsmobile Alero, after 106 years of production for Oldsmobile, the last Alero is going to be put in a museum honoring the cofounder of the Olds Motor Vehicle Company. His name is Ramson Eli Olds. And the last 500 Aleros will be painted metallic cherry red and carry special final 500 markings.

Outside of this, of course, we are tracking earnings results from our parent company, Time Warner. They beat the most optimistic of Wall Street's forecasts thanks to big gains in its movies and TV businesses. It helped to offset smaller subscriber losses at the AOL online unit. First quarter earnings more than doubled. But, if we can take our cue from any of the sessions this past week, investors seem to be looking past some of these very optimistic earnings results and it hasn't really had too much of an effect on the market.

So, the futures market, once again, Carol, are looking flat.

COSTELLO: OK. You sound like a broken record.

DASS: I know. I sure do.

COSTELLO: Joya Dass live from the NASDAQ market site.

Your news, money, weather and sports.

It is 6:18 Eastern time.

Here's what's all new this morning.

Possibly a huge break in the Iraq situation. We're just getting word that four former Iraqi generals are now vowing to end the violence in Fallujah. The Iraqi generals are meeting right now with U.S. Marines.

The 9/11 Commission calls at the White House this morning. President Bush and Vice President Dick Cheney will meet with the panel investigating the terrorist attacks.

In money news, the U.S. House votes to lower taxes for some married couples. The measure will change part of the tax law requiring some couples to pay higher taxes than if they filed individual returns.

In sports, Jack Nicklaus says he spent every weekend for the last 40 years in press rooms at golf courses. Now, he is considering quitting competitive golf, possibly after the Memorial Tournament in June, which is in Columbus, Ohio, by the way.

In culture, a study by Promise Keepers finds most American Christian men do not put religion at the top of their list. Most ranked family, money and health as more important issues.

To the forecast center and Chad.

MYERS: Good morning, Carol.

(WEATHER REPORT)

COSTELLO: Those are the latest headlines for you.

Coming up on DAYBREAK this morning, tips to help you get through a major summer project -- dry wall.

And the up and down world of air fares -- who's the latest to jump into the competition? We'll tell you, next.

(COMMERCIAL BREAK)

COSTELLO: If you're about to head out to work, you will want to hear the first story in our Across America segment this Thursday.

Southern California tops the list of cities and counties most threatened by air pollution. The American Lung Association says San Bernardino tops the nation in ozone pollution. The report also finds that half the nation's population lives in areas with hazardous smog levels.

The NAACP is blaming Cincinnati police for the death of Nathaniel Jones last November. Police repeatedly struck Jones with batons and then made him lie on his stomach while handcuffed. He died of asphyxiation. The NAACP initiated a review of Jones' autopsy, after the county prosecutor closed the case, saying police committed no crime.

Who do they think they are, those NASCAR drivers, Chad? A federal judge rules today on a suit by seven jockeys who want to wear advertising on their clothing. The jockeys are suing the Kentucky Horse Racing Authority. And if the ruling goes their way, we could see some company logos in Saturday's Kentucky Derby.

MYERS: Hmmm, that's interesting. I mean golfers do it all the time. You can't watch a golf tournament without somebody wearing a hat or a logo on a bag and all that other kind of stuff.

COSTELLO: I know. They're sort of behind the times, aren't they? Get with it!

MYERS: Well, it's kind of still one of the more pure -- I remember hockey, when you didn't have all the advertising on the boards, you know? I kind of liked that better. You could see the puck a little bit better.

COSTELLO: Well, that's true.

MYERS: You didn't have all this other junk getting in the way.

COSTELLO: Deal with it. Those days are gone.

MYERS: Yes. It's all advertising now.

COSTELLO: Let's talk about "People" magazine's most -- 50 most beautiful people list.

MYERS: OK. I have that somewhere. Go ahead.

COSTELLO: Guess who made the list?

MYERS: Dale Earnhardt, Jr..

COSTELLO: That was a surprise. Although he is very attractive. But Jennifer Aniston and Brad Pitt made the list.

MYERS: Habit. COSTELLO: What a shock.

MYERS: Yes, right.

COSTELLO: That is so shocking.

MYERS: And that Jessica Simpson, didn't she make it, too?

COSTELLO: Oh, I'm sure she did, too. I don't know.

MYERS: And the Olsen twins.

COSTELLO: Oh, the Olsen twins!

MYERS: Well, we can't call them the Olsen twins anymore.

COSTELLO: Oh, no. They want to be called Mary-Kate and Ashley, so that they can be separate people.

MYERS: Right.

COSTELLO: But in every picture, they're hugging each other face to face. I just don't get that. OK.

MYERS: How about this...

COSTELLO: What were you going to say?

MYERS: The daughters of Keith Richards. Who'd have thunk it?

COSTELLO: Well, he married a beautiful woman.

MYERS: He had a really beautiful wife.

COSTELLO: He does have a really beautiful wife.

MYERS: Yes.

COSTELLO: And they look like her.

MYERS: And A-Rod. Alex Rodriguez is on the list.

COSTELLO: Well, he needs some uplifting in his life right now, so perhaps this will help him start to hit.

MYERS: There you go.

COSTELLO: Knowing that he's beautiful, that is.

Thank you, Chad.

MYERS: OK.

COSTELLO: Thanks for joining me here on the set. We appreciate it.

MYERS: We have one Stumpy question if you want to do it.

COSTELLO: Oh, we do? We don't have time for it, but we'll get to it later.

MYERS: Well, OK, then.

COSTELLO: I promise.

Here's what's all new in the next half hour of DAYBREAK.

In the hot seat, President Bush and Vice President Cheney answer to the 9/11 Commission this morning. What will that questioning involve?

And what do Iraqis think of the war in their own backyard? We've got some interesting responses to share with you -- Gallup poll, the Gallup poll went to Iraq.

Plus, the praying president -- how does his spirituality affect his politics? It is the topic of a brand new documentary. I'll talk with the producer. We'll do that next.

(COMMERCIAL BREAK)

COSTELLO: Private testimony -- no oaths will be taken, no recordings will be made when the president and vice president meet the 9/11 Commission.

This is DAYBREAK for Thursday, April 29.

And good morning to you.

From the CNN global headquarters in Atlanta, I'm Carol Costello.

Here are the latest headlines for you now.

At the White House this morning, President Bush and Vice President Cheney will answer questions from the Commission investigating the 9/11 terrorist attacks. No recording of that meeting will be made.

And we are getting word this morning that a tentative deal has been reached with former Iraqi generals. They are vowing to end the violence in Fallujah. Those generals meeting right now with U.S. Marines.

The families of three Italian security guards held hostage in Iraq are appealing for a huge turnout at a Rome demonstration today. The march is due to begin at 11:00 a.m. Eastern. Organizers hope Pope John Paul II will express his support for their release.

In Los Angeles, police are investigating what they call an uncorroborated threat against a shopping mall. The credibility of the source unknown.

And at 9:30 Eastern this morning, the WWII memorial on the National Mall in Washington opens to the public for the first time. And to the 16 million who served in uniform, thanks.

To the forecast center and Chad.

MYERS: Good morning, Carol.

(WEATHER REPORT)

COSTELLO: We want to talk more now about that possible breakthrough in Iraq. Four of Saddam Hussein's former generals are stepping up with a plan to end the violence in Fallujah. This could be huge, but it's happening right now.

Joining us now to talk more about it, senior international editor David Clinch.

And let's put this in perspective. Is this huge?

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 29, 2004 - 06:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL COSTELLO, CNN ANCHOR: And good morning to you.
We are following breaking news going on right now out of Iraq. A possible solution to the violence in Fallujah.

From the CNN global headquarters in Atlanta, I'm Carol Costello.

Here are the latest headlines for you right now.

Possibly a huge break in the Iraq situation. We're just getting reports that four former Iraqi generals are now vowing to end the violence in Fallujah. The Iraqi generals are meeting right now with U.S. Marines.

Making history at the White House, but no stenographer will be there to record it. President Bush and Vice President Cheney will answer questions a few hours from now from the 9/11 Commission.

In Iraq, the A.P. is reporting a U.S. soldier from the 1st Infantry Division has been killed and another wounded in a roadside bombing today near Baqoubah.

On New York's Staten Island, police find an arsenal of weapons -- seven homemade bombs, 10,000 rounds of ammunition and 13 guns. A man and a woman now under arrest.

And starting today, seniors can go online to shop for the best prescription drug discount card. Enrollment in the new Medicare program starts on Monday.

To the forecast center and Chad -- good morning.

CHAD MYERS, CNN CORRESPONDENT: Good morning, Carol.

(WEATHER REPORT)

COSTELLO: Four of Saddam Hussein's former generals are stepping up to end the violence in Fallujah. This is a major development that's unfolding right now.

Our senior international editor, David Clinch, is here with me to talk more about this.

So these four Iraqi generals want to assemble an army and go into Fallujah and take over security there. DAVID CLINCH, CNN INTERNATIONAL EDITOR: Right. Well, let's take it right from the beginning. Tony Perry, "Los Angeles Times" reporter, is in Fallujah and attended these talks between U.S. Marines and U.S. civilian authorities in Fallujah with various groups. Included in those is we've heard about these sheikhs who have been coming in to try and talk to the insurgents directly. We've heard now about these former Iraqi generals. He says four Iraqi, Saddam's army generals now have offered themselves to lead the Iraqi Army in Fallujah.

Now, let's be clear, there is, as Tony pointed out, an Iraqi Army. The U.S. has paid for and rebuilt the Iraqi Army, both with people who used to be in it at the lower level and people who volunteered. But what they did not have was any former Saddam leadership for that army. What...

COSTELLO: Because they weren't allowed to take part in it, frankly.

CLINCH: Because they weren't. Neither Baath leaders or any senior military leader had been specifically excluded from that. We've been hearing again and again over the last few months that the U.S. has been, first of all, criticized for that, excluding the leadership; and then now, within the last few weeks, considering seriously allowing some of those former Baathists and former Saddam generals to come back in. Here we're seeing it.

A tentative agreement -- and Tony is stressing that. And here's how it works, he says. Over the next two weeks or so, these four generals will allow the Iraqi Army to come into Fallujah itself and maintain security in the city. During those two weeks, the Marines stay on the periphery of the city. At the end of those two weeks, the Marines, if the security situation is acceptable, would be able to pull back further from the city.

The key elements, of course, that remain to be seen is will they be able to get the Iraqi Army in? Will they turn up? You asked him some questions about that. We've seen the Iraqi Army within the last few months not turn up when they've been asked to turn up.

COSTELLO: Or run away.

CLINCH: Will they accept the leadership of these former generals? And then will they be able to deal with the insurgency?

We asked him questions, we asked Tony questions about what the expectations were -- just to keep the security level acceptable or to actually take on these insurgents and eliminate them?

Now, let's not forget the origin of this Fallujah situation -- four U.S. contractors killed, their bodies burnt and abused in the city. The U.S. vowed to find them and eliminate them, then came up against an insurgency which, in turn, they vowed to eliminate.

So obviously the question now remains these generals, will they be able to lead the army and what exactly will we see on the streets in Fallujah in the next week?

But as you've been saying, a very important breakthrough if, for no other reason than it was absolutely clear to the Marines and to everybody else that the cost in lives on the Marines' side and on the Iraqis' side, both militants and civilians, would be very high if they had to go into the streets.

COSTELLO: And, you know, talk about -- right. Talk about winning hearts and minds, you know, if you invade Fallujah, which the Marines have not wanted to do for obvious reasons -- now the Iraqi Army may be able to go in there and convince these insurgents to turn in their weapons and to quit fighting.

CLINCH: Right.

COSTELLO: Much better than an American force to go in.

CLINCH: Right. And, again, remember, we're talking about, in some ways, two tracks working at the same time -- a track working with these tribal leaders, the so-called sheikhs, who the U.S. will not negotiate directly with the insurgents. They tell us they're talking to these local tribal leaders, who, in turn, are talking to the insurgents. And they believe they have some influence.

Now, they're also on a separate track, saying that security in the city could be supplied by Iraqis themselves. Now, for the first time with leadership, real leadership, generals with experience -- we heard Tony saying that one of the Marine generals had actually fought against one of these Iraqi generals in the original invasion.

And when you think about it, what we're seeing here really is, in some ways, the original model of what would happen in Iraq, that if the leadership, Saddam Hussein's leadership went away, that Iraqis would be so happy that they themselves would take over security within the country itself.

What happened in the meantime is that the Baathist leadership and the generals were removed. So a new army had been created. Where is the leadership? Now we're seeing it.

COSTELLO: OK...

CLINCH: A big experiment, a big risk, but...

COSTELLO: But if that experiment works, it may spread throughout Iraq.

CLINCH: Correct.

COSTELLO: And we want to take people to Najaf right now, because American forces came under fire there.

Jane Arraf is live in Najaf.

She's on the phone this morning, correct -- Jane, what is happening there now? JANE ARRAF, CNN CORRESPONDENT: Yes, Carol, American forces actually came under simultaneous attack at two checkpoints that they set up just yesterday. Now, we were in the middle of one of those attacks at a checkpoint where traffic had been slowing normally. All of a sudden traffic stopped and soldiers said that was an indication that they may be about to attack. Indeed, there was rocket propelled grenades, there was mortar fire off in the distance and small arms fire.

One of the soldiers was lightly wounded by gunfire and at the main base in Najaf, which houses the coalition civilian authorities, where it came under mortar attack. Another person on the base was slightly wounded, as well, by shrapnel.

Now, this, again, only the second day that the U.S. has set up these checkpoints to emphasize its presence in Najaf. It is staying well clear of the holy sites, but it is trying to make its presence known on the outskirts. But these attacks, simultaneous attacks, it seems, indications that the militia loyal to the radical Shia cleric is still very much out there -- Carol.

COSTELLO: And, Jane, as far as we know, Muqtada al-Sadr is still holed up in a mosque inside of Najaf?

ARRAF: It's unclear his -- where his whereabouts are exactly. But what is clear is that his militia is in control in Najaf and in Kufa, the adjoining town, where people coming through in cars at the checkpoint were telling us it was even worse.

Now, there were reports of an explosion in Najaf overnight. And in Kufa, Carol, we actually saw people who were fleeing the city; one person who had almost his whole possessions, his entire possessions stacked into a truck, saying that Kufa had become just too dangerous and he was actually going to Najaf, which although controlled by the militia, is still relatively less violent, it seems, than the adjoining city of Kufa.

All in all, a very delicate, complicated, tense situation for U.S. forces here -- Carol.

COSTELLO: All right, Jane Arraf reporting live for us from Najaf, Iraq this morning.

Let's get back to David Clinch right now to talk more about this new tentative deal with this -- these four Iraqi generals who apparently are going to assemble an Iraqi Army and take over the security situation in Fallujah.

CLINCH: Yes. Correct.

COSTELLO: Now, if that experiment works, it could spread to cities like Najaf.

CLINCH: Right. Well, yes, it's a different situation in Najaf, but listening to Jane there, you get sort of an idea of the pattern that the U.S. may be trying to -- I'm not speculating, I'm just saying that there may be a pattern here. What Tony Perry in the "Los Angeles Times" has been reporting from Fallujah is a tentative deal with the former Iraqi generals to take over security in Fallujah with the Iraqi Army, but only after the U.S. Marines established massive power around the city.

Now, we've seen the U.S. establish that same massive power around Najaf. It'll be interesting to see whether they follow the pattern there.

COSTELLO: Well, let's take a few steps back.

We've got -- we have Tony Perry from the "Los Angeles Times" on the phone right now.

Tony, tell us how this deal came about. And also tell us about these generals and what you know about them.

TONY PERRY, "L.A. TIMES": It came about in the last few days. The generals stepped forward. They've been known. People have been talking to them, encouraging them to step forward, to return to the army and return their leadership capabilities to the army.

The Marines, since this began, have been disappointed in the Iraqi police, disappointed in the Iraqi Civil Defense Corps, sort of a national guard group; that they really were too rickety, they weren't ready, they didn't show up, they were basically missing in action; that they really didn't help much. They were very disappointed. They've been very disappointed that Iraqis haven't stepped forward.

Now some people with credibility, with professional credentials -- and these are known people. These are people who have been in the Iraqi Army for a number of years. They even fought, of course, last year. I was talking to a Marine colonel who fought against one of these men and said that he's a professional. He fights honorably. He doesn't hide behind women and children. He doesn't use biological weapons and other banned weaponry. These are professionals.

Now, the Marines are going to watch them very closely. The U.S. is going to watch them very closely to make sure they can follow through. Can they muster enough men and gear to get it done and can they also put pressure on the insurgents to stop their daily, even their hourly attacks on the Marines here?

A lot of imponderables, a lot of steps have to be taken. But what we seem to have is a way out of the specter of an urban war in downtown Fallujah that would have cost American lives and, I think, would have cost a significant number of civilian casualties.

COSTELLO: The other positive out of this, Tony, is these generals probably know where the bones are buried in Fallujah, so to speak.

PERRY: Certainly. As I talked to Major General James Mattis, the commander of the 1st Marine Division, he said these guys know a Syrian accent from an Iraqi accent. They know the territory. In other words, they know who the bad actors are. They have means to get them out, we're going to give them a chance. And as they came out of the meeting, General Mattis, who is one of the -- was with one of the three star Iraqi generals who was in a business suit -- he had a very close conversation with him. He said, "You and I are going to make this work together. You need me. I'm here. We Americans didn't come here to fight, we came here to help."

It's got to be a positive step.

COSTELLO: Also, the weaponry -- U.S., the United States isn't going to supply this Iraqi Army with weapons -- or is it?

PERRY: Well, I don't think weapons, vehicles, electronic gear and communications is going to be a problem. This city and this country is so bristling with weaponry you can go to any Wal-Mart, if you will, the Iraqi equivalent of Wal-Mart, and buy all the weaponry you want. I don't think that's going to be a problem.

COSTELLO: And the other thing, it seems as if any time an Iraqi is associated with the United States, other Iraqis are suspect of that person.

PERRY: Sure.

COSTELLO: How are the generals going to get the Iraqi populace to believe that they're on their side?

PERRY: And that's one of the challenges. And that shows the bravery of these men to step forward. Others have stepped forward and paid with their lives. As we know, a lot of Iraqi police have been killed. The Civil Defense Corps people have been killed. Civilians have been killed.

These people have stepped forward. They're willing to take the challenge. They're willing to take the risk. That in itself speaks highly of them. We'll see if they're able to, frankly, stay alive and get it done.

COSTELLO: Tony Perry from the "Los Angeles Times" joins us live this morning from Fallujah.

Many thanks for that interesting bit of information, this tentative deal made with U.S. Marines. These four Iraqi generals going to assemble an Iraqi Army and eventually take over the security concerns in the city of Fallujah.

Of course, we will keep you posted throughout the day here on CNN.

You know, Colin Powell spoke about the situation in Fallujah this morning.

Chris Burns is joining us live from the German capital, where the secretary of state is this morning -- good morning, Chris.

CHRIS BURNS, CNN CORRESPONDENT: Good morning, Carol. (AUDIO GAP) all this talk about what's happening in Fallujah (AUDIO GAP) book after WWII. But keep in mind that there were a lot of (AUDIO GAP) army who were rehabilitated, including (AUDIO GAP). Johanes Kepler was also in Hitler's army. But these people said that they were not Nazis, that they were just regular people and were (AUDIO GAP) after the war.

So this rehabilitation (AUDIO GAP) Nazis (AUDIO GAP) former Nazis or former soldiers in the Nazi army was part, after WWII (AUDIO GAP) the de-Baathification (AUDIO GAP)...

COSTELLO: Oh, unfortunately, unfortunately, Chris, your signal is not the best, so we're going to step away.

Maybe we'll get him back when we get the signal problems all worked out.

Still to come on DAYBREAK this morning, he is not the first president to pray. But when this leader calls on a higher power, does it affect his image in other parts of the world? Later, the producer behind a new documentary, "The Jesus Factor."

And life in a war zone -- are Iraqis satisfied with the results of the coalition operation? Results of a new CNN/Gallup poll that questioned the Iraqi people on the issues.

And saying good-bye to an automotive staple.

This is DAYBREAK for April 29.

(COMMERCIAL BREAK)

COSTELLO: Time for a little business buzz right now.

Today marks the end of an era for America's oldest car company, Oldsmobile. That's kind of sad.

Joya Dass live from the NASDAQ market site to tell us more -- good morning.

JOYA DASS, CNN CORRESPONDENT: Good morning, Carol.

Well, the last Oldsmobile is coming off the assembly line in Lansing, Michigan. We are talking about this brand, which has seen sales drop steadily over the years. So G.M. has decided to discontinue it with the 2004 model. So, the last Oldsmobile Alero, after 106 years of production for Oldsmobile, the last Alero is going to be put in a museum honoring the cofounder of the Olds Motor Vehicle Company. His name is Ramson Eli Olds. And the last 500 Aleros will be painted metallic cherry red and carry special final 500 markings.

Outside of this, of course, we are tracking earnings results from our parent company, Time Warner. They beat the most optimistic of Wall Street's forecasts thanks to big gains in its movies and TV businesses. It helped to offset smaller subscriber losses at the AOL online unit. First quarter earnings more than doubled. But, if we can take our cue from any of the sessions this past week, investors seem to be looking past some of these very optimistic earnings results and it hasn't really had too much of an effect on the market.

So, the futures market, once again, Carol, are looking flat.

COSTELLO: OK. You sound like a broken record.

DASS: I know. I sure do.

COSTELLO: Joya Dass live from the NASDAQ market site.

Your news, money, weather and sports.

It is 6:18 Eastern time.

Here's what's all new this morning.

Possibly a huge break in the Iraq situation. We're just getting word that four former Iraqi generals are now vowing to end the violence in Fallujah. The Iraqi generals are meeting right now with U.S. Marines.

The 9/11 Commission calls at the White House this morning. President Bush and Vice President Dick Cheney will meet with the panel investigating the terrorist attacks.

In money news, the U.S. House votes to lower taxes for some married couples. The measure will change part of the tax law requiring some couples to pay higher taxes than if they filed individual returns.

In sports, Jack Nicklaus says he spent every weekend for the last 40 years in press rooms at golf courses. Now, he is considering quitting competitive golf, possibly after the Memorial Tournament in June, which is in Columbus, Ohio, by the way.

In culture, a study by Promise Keepers finds most American Christian men do not put religion at the top of their list. Most ranked family, money and health as more important issues.

To the forecast center and Chad.

MYERS: Good morning, Carol.

(WEATHER REPORT)

COSTELLO: Those are the latest headlines for you.

Coming up on DAYBREAK this morning, tips to help you get through a major summer project -- dry wall.

And the up and down world of air fares -- who's the latest to jump into the competition? We'll tell you, next.

(COMMERCIAL BREAK)

COSTELLO: If you're about to head out to work, you will want to hear the first story in our Across America segment this Thursday.

Southern California tops the list of cities and counties most threatened by air pollution. The American Lung Association says San Bernardino tops the nation in ozone pollution. The report also finds that half the nation's population lives in areas with hazardous smog levels.

The NAACP is blaming Cincinnati police for the death of Nathaniel Jones last November. Police repeatedly struck Jones with batons and then made him lie on his stomach while handcuffed. He died of asphyxiation. The NAACP initiated a review of Jones' autopsy, after the county prosecutor closed the case, saying police committed no crime.

Who do they think they are, those NASCAR drivers, Chad? A federal judge rules today on a suit by seven jockeys who want to wear advertising on their clothing. The jockeys are suing the Kentucky Horse Racing Authority. And if the ruling goes their way, we could see some company logos in Saturday's Kentucky Derby.

MYERS: Hmmm, that's interesting. I mean golfers do it all the time. You can't watch a golf tournament without somebody wearing a hat or a logo on a bag and all that other kind of stuff.

COSTELLO: I know. They're sort of behind the times, aren't they? Get with it!

MYERS: Well, it's kind of still one of the more pure -- I remember hockey, when you didn't have all the advertising on the boards, you know? I kind of liked that better. You could see the puck a little bit better.

COSTELLO: Well, that's true.

MYERS: You didn't have all this other junk getting in the way.

COSTELLO: Deal with it. Those days are gone.

MYERS: Yes. It's all advertising now.

COSTELLO: Let's talk about "People" magazine's most -- 50 most beautiful people list.

MYERS: OK. I have that somewhere. Go ahead.

COSTELLO: Guess who made the list?

MYERS: Dale Earnhardt, Jr..

COSTELLO: That was a surprise. Although he is very attractive. But Jennifer Aniston and Brad Pitt made the list.

MYERS: Habit. COSTELLO: What a shock.

MYERS: Yes, right.

COSTELLO: That is so shocking.

MYERS: And that Jessica Simpson, didn't she make it, too?

COSTELLO: Oh, I'm sure she did, too. I don't know.

MYERS: And the Olsen twins.

COSTELLO: Oh, the Olsen twins!

MYERS: Well, we can't call them the Olsen twins anymore.

COSTELLO: Oh, no. They want to be called Mary-Kate and Ashley, so that they can be separate people.

MYERS: Right.

COSTELLO: But in every picture, they're hugging each other face to face. I just don't get that. OK.

MYERS: How about this...

COSTELLO: What were you going to say?

MYERS: The daughters of Keith Richards. Who'd have thunk it?

COSTELLO: Well, he married a beautiful woman.

MYERS: He had a really beautiful wife.

COSTELLO: He does have a really beautiful wife.

MYERS: Yes.

COSTELLO: And they look like her.

MYERS: And A-Rod. Alex Rodriguez is on the list.

COSTELLO: Well, he needs some uplifting in his life right now, so perhaps this will help him start to hit.

MYERS: There you go.

COSTELLO: Knowing that he's beautiful, that is.

Thank you, Chad.

MYERS: OK.

COSTELLO: Thanks for joining me here on the set. We appreciate it.

MYERS: We have one Stumpy question if you want to do it.

COSTELLO: Oh, we do? We don't have time for it, but we'll get to it later.

MYERS: Well, OK, then.

COSTELLO: I promise.

Here's what's all new in the next half hour of DAYBREAK.

In the hot seat, President Bush and Vice President Cheney answer to the 9/11 Commission this morning. What will that questioning involve?

And what do Iraqis think of the war in their own backyard? We've got some interesting responses to share with you -- Gallup poll, the Gallup poll went to Iraq.

Plus, the praying president -- how does his spirituality affect his politics? It is the topic of a brand new documentary. I'll talk with the producer. We'll do that next.

(COMMERCIAL BREAK)

COSTELLO: Private testimony -- no oaths will be taken, no recordings will be made when the president and vice president meet the 9/11 Commission.

This is DAYBREAK for Thursday, April 29.

And good morning to you.

From the CNN global headquarters in Atlanta, I'm Carol Costello.

Here are the latest headlines for you now.

At the White House this morning, President Bush and Vice President Cheney will answer questions from the Commission investigating the 9/11 terrorist attacks. No recording of that meeting will be made.

And we are getting word this morning that a tentative deal has been reached with former Iraqi generals. They are vowing to end the violence in Fallujah. Those generals meeting right now with U.S. Marines.

The families of three Italian security guards held hostage in Iraq are appealing for a huge turnout at a Rome demonstration today. The march is due to begin at 11:00 a.m. Eastern. Organizers hope Pope John Paul II will express his support for their release.

In Los Angeles, police are investigating what they call an uncorroborated threat against a shopping mall. The credibility of the source unknown.

And at 9:30 Eastern this morning, the WWII memorial on the National Mall in Washington opens to the public for the first time. And to the 16 million who served in uniform, thanks.

To the forecast center and Chad.

MYERS: Good morning, Carol.

(WEATHER REPORT)

COSTELLO: We want to talk more now about that possible breakthrough in Iraq. Four of Saddam Hussein's former generals are stepping up with a plan to end the violence in Fallujah. This could be huge, but it's happening right now.

Joining us now to talk more about it, senior international editor David Clinch.

And let's put this in perspective. Is this huge?

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