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CNN Live At Daybreak

Baghdad Bloodshed; Iraqi Deaths; Middle East Crisis; California Wildfires; 'Friends' & Money

Aired May 06, 2004 - 05:30   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.


CAROL COSTELLO, CNN ANCHOR: In the bull's eye in Baghdad, a suicide car bomber strikes at U.S. soldiers and Iraqi citizens.
It is Thursday, May 6. This is DAYBREAK.

And good morning to you, welcome to the second half-hour of DAYBREAK. From the CNN Global Headquarters in Atlanta, I'm Carol Costello.

Here are the latest headlines for you.

In Baghdad this morning, a suicide car bomber exploded near the green zone where the coalition has its headquarters. A U.S. soldier and six Iraqis were killed. We're going to take you live to Baghdad in 60 seconds.

The International Red Cross says it's repeatedly urged the U.S. to take corrective action at Iraq's Abu Ghraib Prison. A Red Cross spokeswoman says the group had visited the prison since last year and was aware of what was going on.

Donald Rumsfeld is preparing for his testimony before the Senate Armed Services Committee. The Defense Secretary goes to Capitol Hill tomorrow morning for a public session on the abuse of Iraqi prisoners.

And the American truck driver who escaped from captivity in Iraq is expected to head home to Mississippi tomorrow. Thomas Hamill is at a hospital in Germany where he was reunited with his wife.

Cool weather and low winds are helping firefighters battle those southern California wildfires. More than 26,000 acres have burned and more than a dozen homes have been destroyed -- Chad.

CHAD MYERS, CNN METEOROLOGIST: Good morning, Carol.

(WEATHER REPORT)

COSTELLO: New bloodshed in Baghdad this morning. A suicide car bomber kills six people, one American soldier and five Iraqis. It happened near the so-called green zone.

Let's head live to Baghdad now and Ben Wedeman to tell us more.

Hello -- Ben.

BEN WEDEMAN, CNN CORRESPONDENT: Good morning, Carol. Well, that bomb wet off at about 7:30 a.m. local time right next to a checkpoint on a road that leads to the so-called green zone where the U.S.-led Coalition Provisional Authority is located, headquartered. It killed seven people, including five Iraqis, one U.S. soldier and the suicide bomber himself, in addition to wounding 25 people, among them, Iraqi policemen and two U.S. soldiers.

The bomb apparently contained artillery rounds, fragments of which were found littering the area where the blast went off. Coalition officials say that the bomb bears all the hallmarks of al Qaeda associate Abu Masabu Zarqwai (ph). This is the first car bomb in Baghdad since March 17 when a blast went off outside a hotel killing seven people.

Now regarding local reaction to President Bush's interviews on Arabic satellite news networks, here is one Baghdad newspaper that was published today. It says an apology is not enough for the torturing of the prisoners. And certainly this seems to be what many people are asking for here in Baghdad, they want a frank and sincere apology from the United States president. They have heard it from senior coalition officials, they have heard it from Major General Geoffrey Miller who runs Abu Ghraib Prison, but they would like to hear it from the man at the top -- Carol.

COSTELLO: Ben Wedeman live in Baghdad this morning.

The families of 12 Iraqis want an independent inquiry and damages for their deaths. The Iraqis were killed by British troops, but the military denies responsibility.

Let's head live to London now and Diana Muriel.

Diana, tell us more about this.

DIANA MURIEL, CNN CORRESPONDENT: Well, Carol, I have just been speaking with Phil Shiner who is the lawyer who went to the high court here in central London yesterday and produced the 12 witness statements for these dead Iraqis. He told me that he expects a decision early next week from the high court as to whether or not these test cases will be heard, whether or not an independent inquiry will be set up to investigate the causes of death and whether or not it will be possible to hold the Ministry of Defense here accountable for the unlawful killing of these 12 Iraqis. He's got 12 cases at the moment, but he understands that he may have a further few cases, taking the number possibly to 17 as more people come forward in Iraq.

He's very concerned that the -- this inquiry should happen very quickly. He is accusing the British troops in Basra of tampering with evidence, taking bullets out of walls and doors, for example, in an effort to frustrate any future inquiry should there be one set up.

Now what they want, what the families want, is accountability from the British government. They want the acceptance that their relatives were killed unlawfully by British soldiers there. They want this full, independent of the military, inquiry into what happened and they want what Shiner describes as proper damages. That is compensation for the deaths of their relatives.

Already the Ministry of Defense has paid out, in some cases, ex- gracia payments, donations if you like, of between $850 and $1,700, but it does not accept liability for the deaths of these Iraqis. It argues that they are not covered by the European Convention on Human Rights because they are outside of Europe and indeed because the Ministry of Defense argues that the British government is not in control of southern Basra. The lawyers say that effectively they run that part of the country and therefore, they are responsible -- Carol.

COSTELLO: Diana Muriel live from London this morning.

Want to bring in our senior international editor David Clinch right now.

You know you got to believe that lawsuits will soon be filed in the United States, too.

DAVID CLINCH, CNN SENIOR INTERNATIONAL EDITOR: That's a very interesting question. Iraqis watching closely in Britain to see if the high court takes that case.

The bigger story for us again today, the photographs of abuse. More photographs today. We have been reporting "The Washington Post" now has their hands on some more photographs. But front page of "The Washington Post" will be landing on people's doorsteps this morning with that photograph and others. You can see this woman, we've seen her before, but holding an Iraqi apparently by a leash inside Abu Ghraib Prison.

This woman has apparently told her family on the phone from where she is being detained now that she was in the wrong place at the wrong time. And really, in my view, that's sort of a metaphor for this whole story. Certainly for the Bush administration this is the wrong story at the wrong time for them and they are still dealing with it.

As we have been reporting, reaction to President Bush appearing on Arab TV stations mixed. There are some people demanding an apology. Others telling us in the Arab world that apologies really don't mean much there, what they want is punishment. But in some ways it's a no-win situation because the type of punishment they are talking about in an area of the world where eye for an eye means a lot, long, drawn out cases of investigations and mid-level people being held responsible may not add up to the kind of punishment they are looking at.

COSTELLO: And you have to wonder, too, how many more pictures will surface and where they are all coming from.

CLINCH: Right. "The Washington Post" has, I don't know, I think 3, 4, 5 in the paper today, but they say they have got their hands on many hundreds of photographs. And there is still a big question mark of exactly who was taking these photographs, so.

COSTELLO: Exactly, who was taking these pictures?

CLINCH: Well, it's not clear.

COSTELLO: And why were they -- I mean some of -- on some of these pictures the Americans portrayed seem to know a camera was present.

CLINCH: Yes.

COSTELLO: They seem to be mugging for the camera.

CLINCH: Very true. It's not clear, of course, whether the people handing over the photographs were the ones who took them. From the very beginning, certainly from "60 Minutes" showing the pictures, those handing them over were indicating that they thought they were doing good, that they thought they were exposing something that needed to be exposed.

There's also, of course, the question for those people who have handed over photographs, the story that we've been talking about for the last few days, these photographs creating a greater risk for American troops and Americans, perhaps, throughout the world. The people handing out over the photographs of course have to live with the fact that they are handing over the photographs and there are -- there are consequences to that, as we journalists reporting the story do too. So very interesting aspects there.

And we're also, of course, bomb in Baghdad today. We're following this story in Fallujah where apparently they are handing out leaflets, the Americans now, having handed over to Iraqi troops, handing out leaflets saying anyone who had their buildings or animals or property damaged during the siege can ask the Americans for compensation in Fallujah.

And then, of course, the big story in Najaf, the still unsolved problem of how to deal with the militia and Muqtada al-Sadr who is holed up in or near the mosque in the middle of that holy city.

COSTELLO: All right, we'll let you get back to it. David Clinch, many thanks to you.

CLINCH: All right.

COSTELLO: New evidence this morning that Israel has spent millions of dollars to build illegal outposts in the West Bank.

Let's head live to Jerusalem now and Matthew Chance for more.

Hello -- Matthew.

MATTHEW CHANCE, CNN CORRESPONDENT: Good morning to you, Carol, and quite an upset here in Israel. Well it's emerged that the country's Housing Ministry has over recent years been funneling millions of dollars of cash to the development, the construction of the unauthorized, illegal Jewish settlement outposts in the occupied West Bank.

Now Jewish settlers have constructed dozens of these unauthorized outposts over recent years. Some of them not much more than a few mobile homes sitting on top of barren hilltops. The Israeli government has officially said that it is committed to getting rid of these settlement outposts. But critics have long accused successive Israeli governments of nurturing these Jewish communities that are often just very small and remote by providing them with basic immunities like electricity supply and water and telephone lines, the kind of things that make them able to exist within Israel.

This latest scandal has thrown open the issue of the accountability of various government departments and the use of public funds in the occupied Palestinian territories. But there is this quite big political issue as well, how, on the one side, the Israeli government is committed to dismantling these outposts, but over the years has been, apparently, funding them.

COSTELLO: Yes, that does seem rather odd. So what is the Israeli government going to do about that?

CHANCE: Well there's not much they can do at the moment, because this report that was investigated, launched by the sort of watchdog of the Israeli government, the sort of auditor watchdog, refers to a period some time ago which ended just really when the current government came into -- came into office. But what they have said is that they are going to introduce some new auditing techniques to try and make sure this kind of essentially misuse of public funds doesn't occur again -- Carol.

COSTELLO: Matthew Chance live in Jerusalem this morning.

'Across America' this Thursday morning, this is the National Day of Prayer. President Bush marks the day with comments this afternoon from the East Room of the White House. The International Bible Reading Association is sponsoring its Annual Bible Reading Marathon and that will take place on The Mall in Washington.

No new trial for Martha Stewart, the judge says the problem with a juror does not mean that Stewart's original trial was unfair. The juror allegedly failed to disclose his criminal arrest record before Stewart's trial.

Security experts have started trying to track down the authors of Sasser, the computer worm that has infected more than a million machines worldwide. But the detective work is made more difficult by uncertainty about the motives of the hackers who created the Sasser Worm.

In the next hour, CNN technology correspondent Daniel Sieberg will tell you what you need to know about the Sasser Worm and what you can do to protect your home computer, your business computer. That's in the next hour of DAYBREAK.

And just ahead on DAYBREAK, thousands of acres burned, homes destroyed, how the weather is playing a role.

And ads for the finale of the hit show "Friends" are raking in the dollars you normally see for the Super Bowl. What's all the whoopla about? We're taking your e-mails today on the fascination with "Friends" and what you think the show has added to American pop culture. E-mail us at DAYBREAK@CNN.com. That's DAYBREAK@CNN.com.

We'll be right back.

(COMMERCIAL BREAK)

COSTELLO: Your news, money, weather and sports. It is 5:46 Eastern Time. Here is what's all new this morning.

A U.S. soldier and six Iraqis have been killed in a suicide car bombing in Baghdad today. Two soldiers and 23 Iraqis were hurt.

Controversial filmmaker Michael Moore is vowing to have his new documentary released, even if he has to personally drive it around from state to state. The movie, "Fahrenheit 9/11," is critical of President Bush. The Walt Disney Company has blocked its distribution.

In money news, OK, you know who you are and the IRS says it is willing to give you a break. The agency says taxpayers who used the "Son of Boss" tax shelter can avoid some penalties but you have to fess up by June 21.

In sports, a little pizzazz from the Mets Mike Piazza. He broke Carlton Fisk's Major League record home runs by a catcher. The new record 352. And for what it matters, the Mets beat the Giants 8 to 2.

In culture, a rare discovery in Guatemala. Archeologists have found the tomb and skeleton of a Mayan queen who lived 1,200 years ago. They found it while excavating a palace in the rain forest.

MYERS: Wow, very cool.

Good morning, Carol.

Some rain showers coming in to parts of Hawaii. You know I'm going to Hawaii in a week and a half and I still don't have a place to stay. So if you live in Hawaii and you have some ideas, e-mail me please. I've got nothing.

COSTELLO: Have a spare bedroom?

(WEATHER REPORT)

COSTELLO: Thank you, Chad.

Those are the latest headlines.

Out in California, the weather is cooler and the winds have died down and firefighters are making progress against the first major wildfires of the season. The Surreal Fire in Riverside County is now 65 percent contained.

To California now and CNN's Ted Rowlands.

(BEGIN VIDEOTAPE) TED ROWLANDS, CNN CORRESPONDENT (voice-over): The combination of a weather shift and around-the-clock work from thousands of firefighters is helping to bring the year's first round of California wildfires under control. Fourteen homes have been destroyed and more than 22,000 acres blackened by six separate fires since they started last weekend.

People evacuated from their homes are coming back to dramatically different scenes. This house near the city of Temecula, east of Los Angeles, was in the middle of the fire zone but was untouched.

JANET NICH, HOMEOWNER: I just couldn't believe it that the house was saved. It was fantastic.

ROWLANDS: People living at the Dorland Mountain Arts Colony are not as lucky. The only thing left of the world renowned artists' retreat is the charred remains of nine buildings and two cottages. Lost in the fire are decades worth of work and numerous antiques, including a 1920 Steinway concert grand piano which is said to have been played by Russian pianist Sergey Rachmaninov during visits to the colony.

KAREN PARROTT, EXECUTIVE DIRECTOR, DORLAND MOUNTAIN ARTS COLONY: Everything gone. It's been a bit to take in.

ROWLANDS: The combination of a three year drought and thousands of dead beetle infested trees has many people convinced that this is just the beginning of a long fire season ahead.

GILL PETERS, CALIF. DEPT. OF FORESTRY: There is still over 12 million dead trees in the San Bernardino and San Jacinto Mountains. I mean they're just dead. You know, that's dry gasoline if you will waiting to go up.

(END VIDEOTAPE)

COSTELLO: That report from CNN's Ted Rowlands. The wildfires have destroyed at least 14 homes and charred more than 26,000 acres.

In the next hour of DAYBREAK, damage control. President Bush goes on Arab TV over the Iraqi prison abuse scandal. Later, in a live report, reaction to what he had to say.

And next, how the hit show "Friends" is causing -- is cashing in big on its final episode.

We'll be right back.

(COMMERCIAL BREAK)

COSTELLO: When the final episode of "Friends" airs tonight, many of you just might be watching the show with tears in your eyes and NBC executives will watch it with dollar signs in theirs.

CNN Financial News correspondent Mary Snow has all the details for you. (BEGIN VIDEOTAPE)

MARY SNOW, CNN FINANCIAL NEWS CORRESPONDENT (voice-over): What started out a decade ago as coffee shop chatter about the angst of adulthood, is ending as a potential revenue record breaker in network television. As NBC bids farewell to "Friends," it's saying hello to its new pal, an estimated $40 million for one night's episode.

BILL KOENIGSBERG, HORIZON MEDIA: This is a kin to Haley's Comet. It doesn't come around very often.

SNOW: Hitching a star on the "Friends" bandwagon holds promise of cash. That's why advertisers have paid as much as $2 million for a 30-second spot.

TERRY STANLEY, ADAGE: The series finale for "Friends" will gather between probably 50 and 55 million people. And those are eyeballs for an advertiser that you absolutely can not find anyplace else on television.

SNOW: Companies advertising on "Friends" are hoping business will be there for them by hitching their message alongside the "Friends" stars.

UNIDENTIFIED MALE: But real life isn't scripted, so change can be scary. That's where Allstate can help.

SNOW: The insurance industry may have a reputation for being safe, but Allstate hopes to cash in on the coolness of "Friends." It's even created its own ad on the sitcom stage for the finale, trying to reach the target audience of young adults.

But the dollars don't stop when the show signs off.

KOENIGSBERG: There's money to be made in syndication and there is money to be made from the spin-off of these characters on "Friends." "Friends" in syndication, right now it's probably garnering around $150,000 a spot, which is significant in the syndication market, which shows that this -- that this show has legs out in the marketplace after network television.

SNOW: And if its TV neighbor "Seinfeld" is any hint, "Friends" may enjoy a nice retirement. "Seinfeld" bid farewell to NBC six years ago, but media buyers say it still garners roughly the same ad money that "Friends" currently fetches in syndication.

Mary Snow, CNN Financial News, New York.

(END VIDEOTAPE)

COSTELLO: It's crazy.

MYERS: Yes.

COSTELLO: Crazy how many people will watch the final episode of "Friends" tonight. We have been soliciting e-mail about, you know, what you think of "Friends," why is it such a big deal, why has it become such a big cultural phenomenon?

MYERS: Exactly.

COSTELLO: It's just a silly show, right? I think, though, that Rick (ph) from New Brunswick, New Jersey said it best. He calls himself the Generation X poster child.

MYERS: OK.

COSTELLO: It's kind of long so bear with me. It's great. He says "at the beginning of the decade, I and the rest of my fellow Generation Xers were outed in the press and cast as a bunch of coffeehouse slackers with McJobs and not much on the ball, just like the "Friends" characters we've watched on Thursday.

As we have gotten smarter, created the dot-com world and laid waste to the U.S. economy in the process, the "Friends" characters have marched right in step with us. Rachel goes from marginal coffeehouse waitress to fashion executive on her way to Paris. Joey goes from unemployed actor to become a TV doctor and Ross has commitment issue after commitment issue. Let's face it, this show has got our generation pegged."

MYERS: I did see one of the little trailers and Ross says don't get on that plane, I love you. Anyway, but I won't say who he -- who he said it to.

I've got a bunch of negative ones.

COSTELLO: Good, well, there you go.

MYERS: You know what, I've watched the season for -- I watched the show the first season and never went back. That was Richard (ph) from Miami Beach.

We should use this brain rotting show to weed out the bubbling misinformed morons and stop them from voting.

I'm glad "Friends" is gone. It did nothing more than create lazy people who had nothing more to do than watch silly television show when they should have been doing something more productive.

And then, and then I have a positive one that's in here somewhere.

COSTELLO: Please stop.

MYERS: Lesbian couples having children, parents that are drag queens, suicide of a parent, what "Friends" really did is it took dysfunctional family issues and gave them issues, enough humor and support that audiences found a release and a comfort zone even in the absurdities of life.

COSTELLO: Well apparently most of your...

MYERS: Wow!

COSTELLO: ... e-mailers are not from Generation X.

MYERS: Well I think Melinda (ph) liked it.

COSTELLO: Yes, she did.

MYERS: She was fine.

COSTELLO: It was very perceptive.

In the next hour of DAYBREAK, spring cleaning the outside of your house. Our friends from Home Depot will join Chad to teach you pressure washing 101.

And a live report from Washington with the latest on how the White House is trying to calm the furor over the Iraqi prison abuse photos.

(COMMERCIAL BREAK)

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Aired May 6, 2004 - 05:30   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL COSTELLO, CNN ANCHOR: In the bull's eye in Baghdad, a suicide car bomber strikes at U.S. soldiers and Iraqi citizens.
It is Thursday, May 6. This is DAYBREAK.

And good morning to you, welcome to the second half-hour of DAYBREAK. From the CNN Global Headquarters in Atlanta, I'm Carol Costello.

Here are the latest headlines for you.

In Baghdad this morning, a suicide car bomber exploded near the green zone where the coalition has its headquarters. A U.S. soldier and six Iraqis were killed. We're going to take you live to Baghdad in 60 seconds.

The International Red Cross says it's repeatedly urged the U.S. to take corrective action at Iraq's Abu Ghraib Prison. A Red Cross spokeswoman says the group had visited the prison since last year and was aware of what was going on.

Donald Rumsfeld is preparing for his testimony before the Senate Armed Services Committee. The Defense Secretary goes to Capitol Hill tomorrow morning for a public session on the abuse of Iraqi prisoners.

And the American truck driver who escaped from captivity in Iraq is expected to head home to Mississippi tomorrow. Thomas Hamill is at a hospital in Germany where he was reunited with his wife.

Cool weather and low winds are helping firefighters battle those southern California wildfires. More than 26,000 acres have burned and more than a dozen homes have been destroyed -- Chad.

CHAD MYERS, CNN METEOROLOGIST: Good morning, Carol.

(WEATHER REPORT)

COSTELLO: New bloodshed in Baghdad this morning. A suicide car bomber kills six people, one American soldier and five Iraqis. It happened near the so-called green zone.

Let's head live to Baghdad now and Ben Wedeman to tell us more.

Hello -- Ben.

BEN WEDEMAN, CNN CORRESPONDENT: Good morning, Carol. Well, that bomb wet off at about 7:30 a.m. local time right next to a checkpoint on a road that leads to the so-called green zone where the U.S.-led Coalition Provisional Authority is located, headquartered. It killed seven people, including five Iraqis, one U.S. soldier and the suicide bomber himself, in addition to wounding 25 people, among them, Iraqi policemen and two U.S. soldiers.

The bomb apparently contained artillery rounds, fragments of which were found littering the area where the blast went off. Coalition officials say that the bomb bears all the hallmarks of al Qaeda associate Abu Masabu Zarqwai (ph). This is the first car bomb in Baghdad since March 17 when a blast went off outside a hotel killing seven people.

Now regarding local reaction to President Bush's interviews on Arabic satellite news networks, here is one Baghdad newspaper that was published today. It says an apology is not enough for the torturing of the prisoners. And certainly this seems to be what many people are asking for here in Baghdad, they want a frank and sincere apology from the United States president. They have heard it from senior coalition officials, they have heard it from Major General Geoffrey Miller who runs Abu Ghraib Prison, but they would like to hear it from the man at the top -- Carol.

COSTELLO: Ben Wedeman live in Baghdad this morning.

The families of 12 Iraqis want an independent inquiry and damages for their deaths. The Iraqis were killed by British troops, but the military denies responsibility.

Let's head live to London now and Diana Muriel.

Diana, tell us more about this.

DIANA MURIEL, CNN CORRESPONDENT: Well, Carol, I have just been speaking with Phil Shiner who is the lawyer who went to the high court here in central London yesterday and produced the 12 witness statements for these dead Iraqis. He told me that he expects a decision early next week from the high court as to whether or not these test cases will be heard, whether or not an independent inquiry will be set up to investigate the causes of death and whether or not it will be possible to hold the Ministry of Defense here accountable for the unlawful killing of these 12 Iraqis. He's got 12 cases at the moment, but he understands that he may have a further few cases, taking the number possibly to 17 as more people come forward in Iraq.

He's very concerned that the -- this inquiry should happen very quickly. He is accusing the British troops in Basra of tampering with evidence, taking bullets out of walls and doors, for example, in an effort to frustrate any future inquiry should there be one set up.

Now what they want, what the families want, is accountability from the British government. They want the acceptance that their relatives were killed unlawfully by British soldiers there. They want this full, independent of the military, inquiry into what happened and they want what Shiner describes as proper damages. That is compensation for the deaths of their relatives.

Already the Ministry of Defense has paid out, in some cases, ex- gracia payments, donations if you like, of between $850 and $1,700, but it does not accept liability for the deaths of these Iraqis. It argues that they are not covered by the European Convention on Human Rights because they are outside of Europe and indeed because the Ministry of Defense argues that the British government is not in control of southern Basra. The lawyers say that effectively they run that part of the country and therefore, they are responsible -- Carol.

COSTELLO: Diana Muriel live from London this morning.

Want to bring in our senior international editor David Clinch right now.

You know you got to believe that lawsuits will soon be filed in the United States, too.

DAVID CLINCH, CNN SENIOR INTERNATIONAL EDITOR: That's a very interesting question. Iraqis watching closely in Britain to see if the high court takes that case.

The bigger story for us again today, the photographs of abuse. More photographs today. We have been reporting "The Washington Post" now has their hands on some more photographs. But front page of "The Washington Post" will be landing on people's doorsteps this morning with that photograph and others. You can see this woman, we've seen her before, but holding an Iraqi apparently by a leash inside Abu Ghraib Prison.

This woman has apparently told her family on the phone from where she is being detained now that she was in the wrong place at the wrong time. And really, in my view, that's sort of a metaphor for this whole story. Certainly for the Bush administration this is the wrong story at the wrong time for them and they are still dealing with it.

As we have been reporting, reaction to President Bush appearing on Arab TV stations mixed. There are some people demanding an apology. Others telling us in the Arab world that apologies really don't mean much there, what they want is punishment. But in some ways it's a no-win situation because the type of punishment they are talking about in an area of the world where eye for an eye means a lot, long, drawn out cases of investigations and mid-level people being held responsible may not add up to the kind of punishment they are looking at.

COSTELLO: And you have to wonder, too, how many more pictures will surface and where they are all coming from.

CLINCH: Right. "The Washington Post" has, I don't know, I think 3, 4, 5 in the paper today, but they say they have got their hands on many hundreds of photographs. And there is still a big question mark of exactly who was taking these photographs, so.

COSTELLO: Exactly, who was taking these pictures?

CLINCH: Well, it's not clear.

COSTELLO: And why were they -- I mean some of -- on some of these pictures the Americans portrayed seem to know a camera was present.

CLINCH: Yes.

COSTELLO: They seem to be mugging for the camera.

CLINCH: Very true. It's not clear, of course, whether the people handing over the photographs were the ones who took them. From the very beginning, certainly from "60 Minutes" showing the pictures, those handing them over were indicating that they thought they were doing good, that they thought they were exposing something that needed to be exposed.

There's also, of course, the question for those people who have handed over photographs, the story that we've been talking about for the last few days, these photographs creating a greater risk for American troops and Americans, perhaps, throughout the world. The people handing out over the photographs of course have to live with the fact that they are handing over the photographs and there are -- there are consequences to that, as we journalists reporting the story do too. So very interesting aspects there.

And we're also, of course, bomb in Baghdad today. We're following this story in Fallujah where apparently they are handing out leaflets, the Americans now, having handed over to Iraqi troops, handing out leaflets saying anyone who had their buildings or animals or property damaged during the siege can ask the Americans for compensation in Fallujah.

And then, of course, the big story in Najaf, the still unsolved problem of how to deal with the militia and Muqtada al-Sadr who is holed up in or near the mosque in the middle of that holy city.

COSTELLO: All right, we'll let you get back to it. David Clinch, many thanks to you.

CLINCH: All right.

COSTELLO: New evidence this morning that Israel has spent millions of dollars to build illegal outposts in the West Bank.

Let's head live to Jerusalem now and Matthew Chance for more.

Hello -- Matthew.

MATTHEW CHANCE, CNN CORRESPONDENT: Good morning to you, Carol, and quite an upset here in Israel. Well it's emerged that the country's Housing Ministry has over recent years been funneling millions of dollars of cash to the development, the construction of the unauthorized, illegal Jewish settlement outposts in the occupied West Bank.

Now Jewish settlers have constructed dozens of these unauthorized outposts over recent years. Some of them not much more than a few mobile homes sitting on top of barren hilltops. The Israeli government has officially said that it is committed to getting rid of these settlement outposts. But critics have long accused successive Israeli governments of nurturing these Jewish communities that are often just very small and remote by providing them with basic immunities like electricity supply and water and telephone lines, the kind of things that make them able to exist within Israel.

This latest scandal has thrown open the issue of the accountability of various government departments and the use of public funds in the occupied Palestinian territories. But there is this quite big political issue as well, how, on the one side, the Israeli government is committed to dismantling these outposts, but over the years has been, apparently, funding them.

COSTELLO: Yes, that does seem rather odd. So what is the Israeli government going to do about that?

CHANCE: Well there's not much they can do at the moment, because this report that was investigated, launched by the sort of watchdog of the Israeli government, the sort of auditor watchdog, refers to a period some time ago which ended just really when the current government came into -- came into office. But what they have said is that they are going to introduce some new auditing techniques to try and make sure this kind of essentially misuse of public funds doesn't occur again -- Carol.

COSTELLO: Matthew Chance live in Jerusalem this morning.

'Across America' this Thursday morning, this is the National Day of Prayer. President Bush marks the day with comments this afternoon from the East Room of the White House. The International Bible Reading Association is sponsoring its Annual Bible Reading Marathon and that will take place on The Mall in Washington.

No new trial for Martha Stewart, the judge says the problem with a juror does not mean that Stewart's original trial was unfair. The juror allegedly failed to disclose his criminal arrest record before Stewart's trial.

Security experts have started trying to track down the authors of Sasser, the computer worm that has infected more than a million machines worldwide. But the detective work is made more difficult by uncertainty about the motives of the hackers who created the Sasser Worm.

In the next hour, CNN technology correspondent Daniel Sieberg will tell you what you need to know about the Sasser Worm and what you can do to protect your home computer, your business computer. That's in the next hour of DAYBREAK.

And just ahead on DAYBREAK, thousands of acres burned, homes destroyed, how the weather is playing a role.

And ads for the finale of the hit show "Friends" are raking in the dollars you normally see for the Super Bowl. What's all the whoopla about? We're taking your e-mails today on the fascination with "Friends" and what you think the show has added to American pop culture. E-mail us at DAYBREAK@CNN.com. That's DAYBREAK@CNN.com.

We'll be right back.

(COMMERCIAL BREAK)

COSTELLO: Your news, money, weather and sports. It is 5:46 Eastern Time. Here is what's all new this morning.

A U.S. soldier and six Iraqis have been killed in a suicide car bombing in Baghdad today. Two soldiers and 23 Iraqis were hurt.

Controversial filmmaker Michael Moore is vowing to have his new documentary released, even if he has to personally drive it around from state to state. The movie, "Fahrenheit 9/11," is critical of President Bush. The Walt Disney Company has blocked its distribution.

In money news, OK, you know who you are and the IRS says it is willing to give you a break. The agency says taxpayers who used the "Son of Boss" tax shelter can avoid some penalties but you have to fess up by June 21.

In sports, a little pizzazz from the Mets Mike Piazza. He broke Carlton Fisk's Major League record home runs by a catcher. The new record 352. And for what it matters, the Mets beat the Giants 8 to 2.

In culture, a rare discovery in Guatemala. Archeologists have found the tomb and skeleton of a Mayan queen who lived 1,200 years ago. They found it while excavating a palace in the rain forest.

MYERS: Wow, very cool.

Good morning, Carol.

Some rain showers coming in to parts of Hawaii. You know I'm going to Hawaii in a week and a half and I still don't have a place to stay. So if you live in Hawaii and you have some ideas, e-mail me please. I've got nothing.

COSTELLO: Have a spare bedroom?

(WEATHER REPORT)

COSTELLO: Thank you, Chad.

Those are the latest headlines.

Out in California, the weather is cooler and the winds have died down and firefighters are making progress against the first major wildfires of the season. The Surreal Fire in Riverside County is now 65 percent contained.

To California now and CNN's Ted Rowlands.

(BEGIN VIDEOTAPE) TED ROWLANDS, CNN CORRESPONDENT (voice-over): The combination of a weather shift and around-the-clock work from thousands of firefighters is helping to bring the year's first round of California wildfires under control. Fourteen homes have been destroyed and more than 22,000 acres blackened by six separate fires since they started last weekend.

People evacuated from their homes are coming back to dramatically different scenes. This house near the city of Temecula, east of Los Angeles, was in the middle of the fire zone but was untouched.

JANET NICH, HOMEOWNER: I just couldn't believe it that the house was saved. It was fantastic.

ROWLANDS: People living at the Dorland Mountain Arts Colony are not as lucky. The only thing left of the world renowned artists' retreat is the charred remains of nine buildings and two cottages. Lost in the fire are decades worth of work and numerous antiques, including a 1920 Steinway concert grand piano which is said to have been played by Russian pianist Sergey Rachmaninov during visits to the colony.

KAREN PARROTT, EXECUTIVE DIRECTOR, DORLAND MOUNTAIN ARTS COLONY: Everything gone. It's been a bit to take in.

ROWLANDS: The combination of a three year drought and thousands of dead beetle infested trees has many people convinced that this is just the beginning of a long fire season ahead.

GILL PETERS, CALIF. DEPT. OF FORESTRY: There is still over 12 million dead trees in the San Bernardino and San Jacinto Mountains. I mean they're just dead. You know, that's dry gasoline if you will waiting to go up.

(END VIDEOTAPE)

COSTELLO: That report from CNN's Ted Rowlands. The wildfires have destroyed at least 14 homes and charred more than 26,000 acres.

In the next hour of DAYBREAK, damage control. President Bush goes on Arab TV over the Iraqi prison abuse scandal. Later, in a live report, reaction to what he had to say.

And next, how the hit show "Friends" is causing -- is cashing in big on its final episode.

We'll be right back.

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COSTELLO: When the final episode of "Friends" airs tonight, many of you just might be watching the show with tears in your eyes and NBC executives will watch it with dollar signs in theirs.

CNN Financial News correspondent Mary Snow has all the details for you. (BEGIN VIDEOTAPE)

MARY SNOW, CNN FINANCIAL NEWS CORRESPONDENT (voice-over): What started out a decade ago as coffee shop chatter about the angst of adulthood, is ending as a potential revenue record breaker in network television. As NBC bids farewell to "Friends," it's saying hello to its new pal, an estimated $40 million for one night's episode.

BILL KOENIGSBERG, HORIZON MEDIA: This is a kin to Haley's Comet. It doesn't come around very often.

SNOW: Hitching a star on the "Friends" bandwagon holds promise of cash. That's why advertisers have paid as much as $2 million for a 30-second spot.

TERRY STANLEY, ADAGE: The series finale for "Friends" will gather between probably 50 and 55 million people. And those are eyeballs for an advertiser that you absolutely can not find anyplace else on television.

SNOW: Companies advertising on "Friends" are hoping business will be there for them by hitching their message alongside the "Friends" stars.

UNIDENTIFIED MALE: But real life isn't scripted, so change can be scary. That's where Allstate can help.

SNOW: The insurance industry may have a reputation for being safe, but Allstate hopes to cash in on the coolness of "Friends." It's even created its own ad on the sitcom stage for the finale, trying to reach the target audience of young adults.

But the dollars don't stop when the show signs off.

KOENIGSBERG: There's money to be made in syndication and there is money to be made from the spin-off of these characters on "Friends." "Friends" in syndication, right now it's probably garnering around $150,000 a spot, which is significant in the syndication market, which shows that this -- that this show has legs out in the marketplace after network television.

SNOW: And if its TV neighbor "Seinfeld" is any hint, "Friends" may enjoy a nice retirement. "Seinfeld" bid farewell to NBC six years ago, but media buyers say it still garners roughly the same ad money that "Friends" currently fetches in syndication.

Mary Snow, CNN Financial News, New York.

(END VIDEOTAPE)

COSTELLO: It's crazy.

MYERS: Yes.

COSTELLO: Crazy how many people will watch the final episode of "Friends" tonight. We have been soliciting e-mail about, you know, what you think of "Friends," why is it such a big deal, why has it become such a big cultural phenomenon?

MYERS: Exactly.

COSTELLO: It's just a silly show, right? I think, though, that Rick (ph) from New Brunswick, New Jersey said it best. He calls himself the Generation X poster child.

MYERS: OK.

COSTELLO: It's kind of long so bear with me. It's great. He says "at the beginning of the decade, I and the rest of my fellow Generation Xers were outed in the press and cast as a bunch of coffeehouse slackers with McJobs and not much on the ball, just like the "Friends" characters we've watched on Thursday.

As we have gotten smarter, created the dot-com world and laid waste to the U.S. economy in the process, the "Friends" characters have marched right in step with us. Rachel goes from marginal coffeehouse waitress to fashion executive on her way to Paris. Joey goes from unemployed actor to become a TV doctor and Ross has commitment issue after commitment issue. Let's face it, this show has got our generation pegged."

MYERS: I did see one of the little trailers and Ross says don't get on that plane, I love you. Anyway, but I won't say who he -- who he said it to.

I've got a bunch of negative ones.

COSTELLO: Good, well, there you go.

MYERS: You know what, I've watched the season for -- I watched the show the first season and never went back. That was Richard (ph) from Miami Beach.

We should use this brain rotting show to weed out the bubbling misinformed morons and stop them from voting.

I'm glad "Friends" is gone. It did nothing more than create lazy people who had nothing more to do than watch silly television show when they should have been doing something more productive.

And then, and then I have a positive one that's in here somewhere.

COSTELLO: Please stop.

MYERS: Lesbian couples having children, parents that are drag queens, suicide of a parent, what "Friends" really did is it took dysfunctional family issues and gave them issues, enough humor and support that audiences found a release and a comfort zone even in the absurdities of life.

COSTELLO: Well apparently most of your...

MYERS: Wow!

COSTELLO: ... e-mailers are not from Generation X.

MYERS: Well I think Melinda (ph) liked it.

COSTELLO: Yes, she did.

MYERS: She was fine.

COSTELLO: It was very perceptive.

In the next hour of DAYBREAK, spring cleaning the outside of your house. Our friends from Home Depot will join Chad to teach you pressure washing 101.

And a live report from Washington with the latest on how the White House is trying to calm the furor over the Iraqi prison abuse photos.

(COMMERCIAL BREAK)

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