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CNN Live At Daybreak

Latest on American Hostages Being Held in Iraq; A Preview of Message President Bush Will Give at U.N. Today

Aired September 21, 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.


(BEGIN VIDEO CLIP)
PATTY HENSLEY, WIFE OF AMERICAN HOSTAGE: I am making another attempt at pleading with these captors to please open communications with us again.

(END VIDEO CLIP)

CAROL COSTELLO, CNN ANCHOR: Oh, but another deadline is nearing. The wife of an American hostage in Iraq makes a plea for her husband's release.

It is Tuesday, September 21.

This is DAYBREAK.

And good morning to you.

From the CNN Global Headquarters in Atlanta, I'm Carol Costello.

Now in the news, a gruesome execution and a new deadline. Iraqi insurgents beheaded American hostage Eugene Armstrong and they're now threatening to kill another hostage in 24 hours unless female Iraqi prisoners are freed.

And Iraq will be a major theme this morning as President Bush goes before the U.N. General Assembly. He's trying to reassure the world leaders that the post-war nation is moving toward democracy.

Big stakes for big tobacco -- the Justice Department's $280 billion lawsuit against the tobacco industry goes to trial today. The government accuses cigarette companies of lying to you for 50 years about the dangers of smoking.

At least 500 people are dead in Haiti from tropical storm Jeanne, which flooded the nation last week and authorities expect to find many more bodies this morning. That's according to U.N. and Haitian officials.

To the forecast center now and Chad -- good morning.

CHAD MYERS, CNN METEOROLOGIST: Hey, good morning, Carol.

I'm over here by our Vipir system. I want to show you the thunderstorm activity going on now in central and southern Florida. We'll zoom in here south of Fort Pierce and south of West Palm Beach. We'll get you right into this storm here, Del Ray Beach and points southward, really raining heavily here.

And here's now 24 hour rainfall totals. And I can put some numbers on here for Del Ray Beach, four inches there. And four inches, even some spots where there are five inches of rainfall.

Zooming back out, up here, Fort Pierce, as well, there was some very heavy rainfall overnight. We could see some ponding on the roadway, also some flooding going on this morning.

Currently, temperatures across the Northeast are in the 50s and 60s, a little bit warmer than yesterday. The rain showers will hold off, though, from the East Coast all the way down to almost Jacksonville. The rain showers, though, will be down in Florida, of course.

(WEATHER REPORT)

MYERS: We talked about Lisa yesterday, tropical storm Lisa. It's out there in the middle of the Atlantic. It is making its way to the west, although it is forecast to actually turn a little bit to the north and maybe move away from land. And that's some good news there.

We still have Jeanne out there and we still have Karl out there, Carol.

Jeanne making a loopdeloop. We'll have to see if that thing has got the sights set on the Carolinas. It's still out there and it's still gaining some strength. Tomorrow it could be a category two hurricane again -- back to you.

COSTELLO: All right, thank you, Chad.

Militants say the clock is ticking on an American and a Briton still held in Iraq. The hostage situation will surely be on President Bush's mind when he addresses the United Nations later today.

CNN's Bill Prasad live in Washington this morning with more on the effects of that deadline in Iraq -- good morning.

BILL PRASAD, CNN CORRESPONDENT: Good morning, Carol.

The president says that the U.S. will not negotiate with terrorists. That clock is ticking, though. It is now about 1:00 p.m. in Iraq.

The terrorists say they will execute the men today if their demands are not met.

(BEGIN VIDEO TAPE)

BILL PRASAD, CNN CORRESPONDENT (voice-over): The wife of an American hostage pleads for his release.

HENSLEY: These gentlemen were there to help the Iraqi people. They were not part of any security or military type operation. PRASAD: Militants kidnapped civilian contractors Jack Hensley and fellow American Eugene Armstrong and Briton Kenneth Bigley last Thursday. Yesterday, video on an Islamic Web site showed captors beheading Armstrong. Militants threatened the same for the other men unless U.S. officials release female inmates being held in two facilities.

DICK CHENEY, VICE PRESIDENT OF THE UNITED STATES: This is not an enemy we can reason with or negotiate with or appease. This is, to put it simply, an enemy that we must destroy.

PRASAD: Violence in Iraq is the backdrop as world leaders gather at the United Nations to talk about terrorism, humanitarian issues and world poverty. Mr. Bush will speak this morning. But even before the president takes the stage, the French president is standing by his opposition to the war.

PRES. JACQUES CHIRAC, FRANCE (THROUGH TRANSLATOR): French policy on Iraq has not changed and will not be changing.

(END VIDEO TAPE)

PRASAD: The White House says Iraq will not dominate the two week U.N. session. In fact, Mr. Bush says his speech later this morning will deal with a number of different issues, including world health, freedom and prosperity.

Carol -- back to you.

COSTELLO: Bill Prasad live in Washington this morning.

Thank you.

Relatives of the British hostage Ken Bigley are pleading with Prime Minister Tony Blair to get involved and help save Bigley's life. Bigley's brother says the family cannot do it alone.

(BEGIN VIDEO CLIP)

PHILIP BIGLEY, BROTHER OF HOSTAGE: We are not politicians. He is the political head of our country. It's he, it's the prime minister who has the power to save Ken's life. Prime minister, we as a family are begging you, please help us.

(END VIDEO CLIP)

COSTELLO: Blair says British officials are, in his words, "doing what we can," but he didn't say exactly what that might be.

President Bush defended his decision on Iraq during his annual address to the United Nations last year. But will this year be any different?

CNN chief international correspondent Christiane Amanpour joins us live from London this morning with more on the president's message -- good morning. CHRISTIANE AMANPOUR, CNN CORRESPONDENT: Carol, good morning.

And as you've just heard from your correspondent, it apparently appears that President Bush will not devote the majority of his speech to Iraq, as he did last year. However, in the rest of the world, it is the Iraq situation that basically shapes the world's view right now of American foreign policy. And most people, when polled around the world, have a very negative view of that American foreign policy; and most particularly, a negative view about what's going on in Iraq.

We've just talked about the latest captives who are being held in Iraq. One American beheaded, two others now, including a Briton, threatened with beheading. Britain, America's most stalwart ally, also embroiled in a diplomatic flap, a very highly distinguished and respected British diplomat saying in what were meant to be private comments over the weekend that President Bush was "the best recruiting sergeant for al Qaeda" and that the only people likely to celebrate a reelection of President Bush would be al Qaeda.

This, of course, was knocked down by the British government, saying that it did not reflect official British policy. But it goes to show that even amongst British allies, there -- or, rather, American allies -- there are serious misgivings about the continuation of the debacle in post-war Iraq. And this is what is shaping people's opinions around the world.

So no matter, really, what the president says -- and, of course, people will be listening very hard to what he says at the U.N. -- they will be looking for some kind of softer message from the president in terms of global foreign policy, not the sort of grim militaristic views that they believe have been espoused by the United States over the last few years.

But it is an extremely tense moment overseas. People feel very angst ridden, if I could use that word, because people here do use that word when describing how they feel about current, what they view as militaristic, unilateralist and ultimately dangerous U.S. foreign policy -- Carol.

COSTELLO: Christiane, the interim prime minister of Iraq is also going to speak.

Can he say anything to ease tensions within the United Nations over the subject of Iraq?

AMANPOUR: You know, he will say it, and he did say it in England en route to the United Nations. And the fact is that seeing an interim Iraqi leader at the U.N. after so many years of isolation, that will, in itself, be a measure of progress.

But the problem is that despite the optimistic scenarios that both the U.S.-backed interim government of Iraq espouse and the British government espouses and the U.S. administration espouses, the facts on the ground are very, very different. It's not just the kidnapping and beheadings of foreign contractors. It is also the increasing death toll amongst U.S. soldiers. It's the lack of reconstruction in any meaningful way in Iraq that would directly benefit the Iraqi people.

And as we know, billions of dollars are now being taken out of basic reconstruction projects in Iran -- in Iraq, rather -- to put into security. So the security situation dominates everything. And the fact is that the insurgents, over the last year and a half, have become immensely entrenched. An increasing swatch of Iraq are simply under the sway of the insurgents. And for most people there, they believe that it is the violence and the insurgency that is dictating the current pace of politics and reconstruction, and even potentially threatening elections, even if they do go ahead as scheduled in January.

COSTELLO: Christiane Amanpour reporting live from London.

Thank you.

President Bush's speech, by the way, to the U.N. General Assembly, is scheduled for 10:30 Eastern this morning. That's 7:30 Pacific time. CNN, of course, will bring that to you live.

More fallout over these memos CBS used in a report on President Bush's National Guard service. A John Kerry campaign adviser says that days before the story aired, he talked with Bill Burkett, the man who turned over the memos. But adviser Joe Lockhart adds, "We had nothing to do with these documents or forgeries or whatever they are. I did not talk to Burkett about any documents or even the National Guard story."

As for Burkett, he told CBS Anchor Dan Rather he bears some of the blame, but so does the network.

(BEGIN VIDEO CLIP FROM "CBS EVENING NEWS")

BILL BURKETT, CBS SOURCE: Well, I didn't totally mislead you. I did mislead you on the one individual. You know, your staff pressured me to a point to reveal that source.

DAN RATHER, CBS NEWS ANCHOR: Well, we were trying to get the chain of possession.

BURKETT: I understand that.

RATHER: And you said you had received it from someone.

BURKETT: I understand that.

RATHER: And you said you had received them from someone.

BURKETT: I understand that.

RATHER: And we did press you to say, well, you received them from someone and that someone was who?

BURKETT: Yes.

RATHER: And it's true, we pressured you because it was a very important point for us.

BURKETT: Yes, and I simply threw out a name that was basically -- it was, I guess, to get a little pressure off for a moment.

(END VIDEO CLIP)

COSTELLO: CBS now says it cannot confirm the authenticity of the memos. Dan Rather said on the air yesterday that he's sorry about that.

There was word this morning of a Delta deal that could save the airline. What airline officials plan to do that could keep them from a bankruptcy filing. That story in our business buzz in five minutes.

At 22 minutes past the hour we'll take you live to Washington for a preview of today's celebrations for the new Museum of the American Indian.

But first, here's a look at what else is making news this Tuesday morning.

(COMMERCIAL BREAK)

COSTELLO: Your news, money, weather and sports.

It's 6:14 Eastern.

Here's what's all new this morning.

Another hostage deadline looms in Iraq after a gruesome murder. Islamic militants behead American Eugene Armstrong. They now say a second hostage will be killed in 24 hours if the U.S. does not release Iraqi women from prisons.

Syria is redeploying its troops from central and northern Lebanon today. It's unclear if the forces are moving to other locations or simply pulling out of the country. The move comes amid growing international pressure.

The top detective in the Scott Peterson murder trial takes the stand again today. Yesterday, the officer testified Peterson's behavior and theories about his wife's disappearance made him suspicious early in the investigation.

In money news, analysts expect the interest rate to jump another 1/4 point during the Federal Reserve's meeting today. It would be the third straight hike this year.

In culture, now you, too, can walk all over Billy Joel. The 55- year-old singer is the latest to get a star on the Hollywood Walk of Fame. Joel wrote his signature song "Piano Man" after working in a Los Angeles piano bar.

In sports, let's talk "Monday Night Football" now. Donovan McNabb stepped up and took control as the Philadelphia Eagles beat the Minnesota Vikings 27-16. The Eagles' quarterback threw for two touchdowns and he ran for another. He's pretty darned amazing, isn't he -- Chad.

MYERS: He is. But how about those Lions for you, Carol?

COSTELLO: 2-0 baby.

MYERS: You know, you're not even from Detroit. I'm not -- I don't understand why you like the Lions.

COSTELLO: I like underdogs.

MYERS: But now you've got an underdog that's winning. How about that?

Good morning, everybody.

(WEATHER REPORT)

COSTELLO: Those are the latest headlines for you this morning.

(STOCK MARKET REPORT)

Time for a little business buzz how.

Delta and its pilots strike a tentative deal.

Carrie Lee has more on that story live from the NASDAQ market site.

This is good news for troubled Delta.

CARRIE LEE, CNN CORRESPONDENT: It certainly is, Carol. In fact, the stock was up about 10 percent last night in the after hours session. So investors really liking this news. Delta has announced a deal to temporarily bring back recently retired pilots in an effort to avoid staff shortages that the company has warned could force it into a bankruptcy filing.

Now, under the deal, Delta will be allowed to employ retired pilots on a contract basis if staffing levels fall dangerously low. Delta's seen an exodus of many of its most senior pilots recently. This has been a very troubling issue for Delta. So, Carol, it could potentially help Delta stave off bankruptcy protection. It doesn't mean that they won't file at all, but at least it's getting a little bit further away from that bankruptcy cliff that it's pretty close to.

COSTELLO: Carrie Lee live from the NASDAQ market site.

Thank you.

Still to come on DAYBREAK, new poll numbers on the presidential race from some of the hotly contested swing states. We also have some numbers on how you feel about the media. Oh, they're not too encouraging.

But first, experience history through art, photos and rare artifacts at the new Museum of the American Indian. A live report for you out of Washington, D.C. when DAYBREAK returns.

(COMMERCIAL BREAK)

COSTELLO: As many as 20,000 Native Americans will be marching through the streets of Washington, D.C. today. But it isn't a protest. It's a celebration. They're celebrating the dedication of a new museum devoted to their heritage and their history.

CNN's Skip Loescher joins us live from Washington with more on this museum -- good morning.

SKIP LOESCHER, CNN CORRESPONDENT: Carol, a good morning to you.

Thousands of people will, later today, be filling this sea of seats behind me to celebrate the grand opening of the Smithsonian's newest building, the National Museum of the American Indian.

(BEGIN VIDEO TAPE)

LOESCHER (voice-over): The exterior is clearly the most distinctive of any monument or museum on the National Mall, maybe in Washington. Fashioned with Kasota limestone from Minnesota and following a design process that included Indian designers and engineers from throughout the Western Hemisphere, the building suggests a form shaped over centuries by wind and water.

LAWRENCE SMALL, SECRETARY, SMITHSONIAN INSTITUTE: It's a beautiful blend of the old and the new. It's a blend of nature and technology, a blend of symbolism and significance.

LOESCHER: Visitors enter into the grand gathering place, called the Potomac. Its 120 foot high dome lighted by a massive prism window which projects rainbows of sunlight on the walls and floor below. And there are artifacts, thousands of them.

SMALL: An incredible collection of iconic objects from North, Central n South America. It's the finest collection of its kind in the world. The objects that are in the museum's collection span a period of 10,000 years.

LOESCHER: This museum, Small says, is a tribute to the rich fabric of Indian cultures, not only in the past, but in the present.

SMALL: It's a tribute, frankly, that is long overdue.

LOESCHER: Especially since Indian people lived in these hemispheres long before anyone called them America.

(END VIDEO TAPE)

LOESCHER: Beginning next week, the museum will be open from 10 in the morning until 5:30 in the afternoon every day except Christmas.

We're live on the National Mall.

I'm Skip Loescher. Carol -- back to you.

COSTELLO: Thank you, Skip.

You are watching DAYBREAK for a Tuesday morning.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

BIGLEY: The prime minister is a father. He has children. I'm a child. I have a father. He has the power to make a decision and we ask him to help us.

(END VIDEO CLIP)

COSTELLO: A desperate appeal to Tony Blair from the son of a British engineer being held hostage in Iraq.

It is Tuesday, September 21.

This is DAYBREAK.

And good morning to you.

From the CNN Global Headquarters in Atlanta, I'm Carol Costello.

Now in the news, we have some developing news to tell you about that will disturb many Americans, I'm sure.

Iran is saying this morning that it has started converting raw uranium into gas for enrichment, and that, of course, defies demands set by the U.N. atomic watchdog agency. The IAEA had demanded that Iran stop enriching uranium, which, of course, can be used to make nuclear weapons. We're sure to hear more about this in the hours to come. If we get more information for you, we'll pass it along to you on DAYBREAK.

The family of British citizen Kenneth Bigley is pleading for his life. Bigley and American Jack Hensley are being held by Islamic militants in Iraq. The militants killed American Eugene Armstrong on Monday. They're now threatening to behead their other two captives.

President Bush expected to defend his decision to invade Iraq in a speech this morning before the United Nations General Assembly. But the situation regarding Iraq is not expected to be the main focus of the president's comments.

And in just a few hours, a judge will begin hearing the government's $280 billion case against the tobacco industry. Several tobacco companies are accused of conspiring to mislead the public about the dangers of smoking.

Interest rates will probably go up this afternoon. Federal Reserve officials are expected to raise the short-term rate by a 1/4 point. It will be the third increase this year -- Chad. MYERS: Good morning, Carol.

(WEATHER REPORT)

MYERS: We are looking at hurricane Jeanne, a category one. Remember Jeanne? It was kind of going to go and was going to turn left and it was going to turn left and it was going to go into Florida? Well, it turned right instead.

Now look at the current hurricane forecast. From category one to a category two. Now we're looking at Thursday morning, a little bit of after Wednesday midnight. And then it makes the big loop and heads back toward the Carolinas again. This thing is crazy. And, in fact, it's even going back up from a category one, at this point, to a category two. Winds could be about 100 miles per hour for a while here in this storm. We have to keep watching this one and we also have to watch the one south of there. Tropical storm Lisa is forecast to become a cat one storm but it does look like it'll be north of the islands here and still obviously 1,000 miles from the U.S.

This hurricane season never stops.

COSTELLO: It's crazy.

MYERS: It certainly is.

COSTELLO: And scary.

Thank you, Chad.

MYERS: You're welcome.

COSTELLO: The clock is ticking in Iraq. Islamic hostage takers say they will kill another hostage if their demands are not met. This after word of a gruesome beheading.

CNN's Walter Rodgers has done extensive reporting from Iraq.

He joins us live now from Baghdad -- good morning.

WALTER RODGERS, CNN CORRESPONDENT: Hello, Carol.

It is not a good morning here. We are in the midst of another grizzly countdown to perhaps another execution. Today is the deadline set by Islamist militants for the decapitation of another Western hostage, either Jack Hensley, the American, or Kenneth John Bigley, the British subject whom they hold.

Last night, the insurgents released a videotape that was extraordinarily graphic. Indeed, it showed the actual beheading of Eugene Armstrong, one of the three Americans -- one of the three contractors who was beheaded. Armstrong was, indeed, an American.

As they were readying his death sentence, the Islamist militants said they were carrying out god's law. Then they proceeded to cut off his head in full view of a television camera. You could hear the poor man screaming. If you heard those screams, you'll never forget them as long as you live.

Philip Bigley, the brother of the remaining British hostage, says he pretty much expects the same fate for his brother Kenneth.

(BEGIN VIDEO CLIP)

PHILIP BIGLEY, BROTHER OF BRITISH HOSTAGE: We feel absolutely helpless. We do not have the power to save Ken's life.

(END VIDEO CLIP)

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 September 21, 2004 - 06:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEO CLIP)
PATTY HENSLEY, WIFE OF AMERICAN HOSTAGE: I am making another attempt at pleading with these captors to please open communications with us again.

(END VIDEO CLIP)

CAROL COSTELLO, CNN ANCHOR: Oh, but another deadline is nearing. The wife of an American hostage in Iraq makes a plea for her husband's release.

It is Tuesday, September 21.

This is DAYBREAK.

And good morning to you.

From the CNN Global Headquarters in Atlanta, I'm Carol Costello.

Now in the news, a gruesome execution and a new deadline. Iraqi insurgents beheaded American hostage Eugene Armstrong and they're now threatening to kill another hostage in 24 hours unless female Iraqi prisoners are freed.

And Iraq will be a major theme this morning as President Bush goes before the U.N. General Assembly. He's trying to reassure the world leaders that the post-war nation is moving toward democracy.

Big stakes for big tobacco -- the Justice Department's $280 billion lawsuit against the tobacco industry goes to trial today. The government accuses cigarette companies of lying to you for 50 years about the dangers of smoking.

At least 500 people are dead in Haiti from tropical storm Jeanne, which flooded the nation last week and authorities expect to find many more bodies this morning. That's according to U.N. and Haitian officials.

To the forecast center now and Chad -- good morning.

CHAD MYERS, CNN METEOROLOGIST: Hey, good morning, Carol.

I'm over here by our Vipir system. I want to show you the thunderstorm activity going on now in central and southern Florida. We'll zoom in here south of Fort Pierce and south of West Palm Beach. We'll get you right into this storm here, Del Ray Beach and points southward, really raining heavily here.

And here's now 24 hour rainfall totals. And I can put some numbers on here for Del Ray Beach, four inches there. And four inches, even some spots where there are five inches of rainfall.

Zooming back out, up here, Fort Pierce, as well, there was some very heavy rainfall overnight. We could see some ponding on the roadway, also some flooding going on this morning.

Currently, temperatures across the Northeast are in the 50s and 60s, a little bit warmer than yesterday. The rain showers will hold off, though, from the East Coast all the way down to almost Jacksonville. The rain showers, though, will be down in Florida, of course.

(WEATHER REPORT)

MYERS: We talked about Lisa yesterday, tropical storm Lisa. It's out there in the middle of the Atlantic. It is making its way to the west, although it is forecast to actually turn a little bit to the north and maybe move away from land. And that's some good news there.

We still have Jeanne out there and we still have Karl out there, Carol.

Jeanne making a loopdeloop. We'll have to see if that thing has got the sights set on the Carolinas. It's still out there and it's still gaining some strength. Tomorrow it could be a category two hurricane again -- back to you.

COSTELLO: All right, thank you, Chad.

Militants say the clock is ticking on an American and a Briton still held in Iraq. The hostage situation will surely be on President Bush's mind when he addresses the United Nations later today.

CNN's Bill Prasad live in Washington this morning with more on the effects of that deadline in Iraq -- good morning.

BILL PRASAD, CNN CORRESPONDENT: Good morning, Carol.

The president says that the U.S. will not negotiate with terrorists. That clock is ticking, though. It is now about 1:00 p.m. in Iraq.

The terrorists say they will execute the men today if their demands are not met.

(BEGIN VIDEO TAPE)

BILL PRASAD, CNN CORRESPONDENT (voice-over): The wife of an American hostage pleads for his release.

HENSLEY: These gentlemen were there to help the Iraqi people. They were not part of any security or military type operation. PRASAD: Militants kidnapped civilian contractors Jack Hensley and fellow American Eugene Armstrong and Briton Kenneth Bigley last Thursday. Yesterday, video on an Islamic Web site showed captors beheading Armstrong. Militants threatened the same for the other men unless U.S. officials release female inmates being held in two facilities.

DICK CHENEY, VICE PRESIDENT OF THE UNITED STATES: This is not an enemy we can reason with or negotiate with or appease. This is, to put it simply, an enemy that we must destroy.

PRASAD: Violence in Iraq is the backdrop as world leaders gather at the United Nations to talk about terrorism, humanitarian issues and world poverty. Mr. Bush will speak this morning. But even before the president takes the stage, the French president is standing by his opposition to the war.

PRES. JACQUES CHIRAC, FRANCE (THROUGH TRANSLATOR): French policy on Iraq has not changed and will not be changing.

(END VIDEO TAPE)

PRASAD: The White House says Iraq will not dominate the two week U.N. session. In fact, Mr. Bush says his speech later this morning will deal with a number of different issues, including world health, freedom and prosperity.

Carol -- back to you.

COSTELLO: Bill Prasad live in Washington this morning.

Thank you.

Relatives of the British hostage Ken Bigley are pleading with Prime Minister Tony Blair to get involved and help save Bigley's life. Bigley's brother says the family cannot do it alone.

(BEGIN VIDEO CLIP)

PHILIP BIGLEY, BROTHER OF HOSTAGE: We are not politicians. He is the political head of our country. It's he, it's the prime minister who has the power to save Ken's life. Prime minister, we as a family are begging you, please help us.

(END VIDEO CLIP)

COSTELLO: Blair says British officials are, in his words, "doing what we can," but he didn't say exactly what that might be.

President Bush defended his decision on Iraq during his annual address to the United Nations last year. But will this year be any different?

CNN chief international correspondent Christiane Amanpour joins us live from London this morning with more on the president's message -- good morning. CHRISTIANE AMANPOUR, CNN CORRESPONDENT: Carol, good morning.

And as you've just heard from your correspondent, it apparently appears that President Bush will not devote the majority of his speech to Iraq, as he did last year. However, in the rest of the world, it is the Iraq situation that basically shapes the world's view right now of American foreign policy. And most people, when polled around the world, have a very negative view of that American foreign policy; and most particularly, a negative view about what's going on in Iraq.

We've just talked about the latest captives who are being held in Iraq. One American beheaded, two others now, including a Briton, threatened with beheading. Britain, America's most stalwart ally, also embroiled in a diplomatic flap, a very highly distinguished and respected British diplomat saying in what were meant to be private comments over the weekend that President Bush was "the best recruiting sergeant for al Qaeda" and that the only people likely to celebrate a reelection of President Bush would be al Qaeda.

This, of course, was knocked down by the British government, saying that it did not reflect official British policy. But it goes to show that even amongst British allies, there -- or, rather, American allies -- there are serious misgivings about the continuation of the debacle in post-war Iraq. And this is what is shaping people's opinions around the world.

So no matter, really, what the president says -- and, of course, people will be listening very hard to what he says at the U.N. -- they will be looking for some kind of softer message from the president in terms of global foreign policy, not the sort of grim militaristic views that they believe have been espoused by the United States over the last few years.

But it is an extremely tense moment overseas. People feel very angst ridden, if I could use that word, because people here do use that word when describing how they feel about current, what they view as militaristic, unilateralist and ultimately dangerous U.S. foreign policy -- Carol.

COSTELLO: Christiane, the interim prime minister of Iraq is also going to speak.

Can he say anything to ease tensions within the United Nations over the subject of Iraq?

AMANPOUR: You know, he will say it, and he did say it in England en route to the United Nations. And the fact is that seeing an interim Iraqi leader at the U.N. after so many years of isolation, that will, in itself, be a measure of progress.

But the problem is that despite the optimistic scenarios that both the U.S.-backed interim government of Iraq espouse and the British government espouses and the U.S. administration espouses, the facts on the ground are very, very different. It's not just the kidnapping and beheadings of foreign contractors. It is also the increasing death toll amongst U.S. soldiers. It's the lack of reconstruction in any meaningful way in Iraq that would directly benefit the Iraqi people.

And as we know, billions of dollars are now being taken out of basic reconstruction projects in Iran -- in Iraq, rather -- to put into security. So the security situation dominates everything. And the fact is that the insurgents, over the last year and a half, have become immensely entrenched. An increasing swatch of Iraq are simply under the sway of the insurgents. And for most people there, they believe that it is the violence and the insurgency that is dictating the current pace of politics and reconstruction, and even potentially threatening elections, even if they do go ahead as scheduled in January.

COSTELLO: Christiane Amanpour reporting live from London.

Thank you.

President Bush's speech, by the way, to the U.N. General Assembly, is scheduled for 10:30 Eastern this morning. That's 7:30 Pacific time. CNN, of course, will bring that to you live.

More fallout over these memos CBS used in a report on President Bush's National Guard service. A John Kerry campaign adviser says that days before the story aired, he talked with Bill Burkett, the man who turned over the memos. But adviser Joe Lockhart adds, "We had nothing to do with these documents or forgeries or whatever they are. I did not talk to Burkett about any documents or even the National Guard story."

As for Burkett, he told CBS Anchor Dan Rather he bears some of the blame, but so does the network.

(BEGIN VIDEO CLIP FROM "CBS EVENING NEWS")

BILL BURKETT, CBS SOURCE: Well, I didn't totally mislead you. I did mislead you on the one individual. You know, your staff pressured me to a point to reveal that source.

DAN RATHER, CBS NEWS ANCHOR: Well, we were trying to get the chain of possession.

BURKETT: I understand that.

RATHER: And you said you had received it from someone.

BURKETT: I understand that.

RATHER: And you said you had received them from someone.

BURKETT: I understand that.

RATHER: And we did press you to say, well, you received them from someone and that someone was who?

BURKETT: Yes.

RATHER: And it's true, we pressured you because it was a very important point for us.

BURKETT: Yes, and I simply threw out a name that was basically -- it was, I guess, to get a little pressure off for a moment.

(END VIDEO CLIP)

COSTELLO: CBS now says it cannot confirm the authenticity of the memos. Dan Rather said on the air yesterday that he's sorry about that.

There was word this morning of a Delta deal that could save the airline. What airline officials plan to do that could keep them from a bankruptcy filing. That story in our business buzz in five minutes.

At 22 minutes past the hour we'll take you live to Washington for a preview of today's celebrations for the new Museum of the American Indian.

But first, here's a look at what else is making news this Tuesday morning.

(COMMERCIAL BREAK)

COSTELLO: Your news, money, weather and sports.

It's 6:14 Eastern.

Here's what's all new this morning.

Another hostage deadline looms in Iraq after a gruesome murder. Islamic militants behead American Eugene Armstrong. They now say a second hostage will be killed in 24 hours if the U.S. does not release Iraqi women from prisons.

Syria is redeploying its troops from central and northern Lebanon today. It's unclear if the forces are moving to other locations or simply pulling out of the country. The move comes amid growing international pressure.

The top detective in the Scott Peterson murder trial takes the stand again today. Yesterday, the officer testified Peterson's behavior and theories about his wife's disappearance made him suspicious early in the investigation.

In money news, analysts expect the interest rate to jump another 1/4 point during the Federal Reserve's meeting today. It would be the third straight hike this year.

In culture, now you, too, can walk all over Billy Joel. The 55- year-old singer is the latest to get a star on the Hollywood Walk of Fame. Joel wrote his signature song "Piano Man" after working in a Los Angeles piano bar.

In sports, let's talk "Monday Night Football" now. Donovan McNabb stepped up and took control as the Philadelphia Eagles beat the Minnesota Vikings 27-16. The Eagles' quarterback threw for two touchdowns and he ran for another. He's pretty darned amazing, isn't he -- Chad.

MYERS: He is. But how about those Lions for you, Carol?

COSTELLO: 2-0 baby.

MYERS: You know, you're not even from Detroit. I'm not -- I don't understand why you like the Lions.

COSTELLO: I like underdogs.

MYERS: But now you've got an underdog that's winning. How about that?

Good morning, everybody.

(WEATHER REPORT)

COSTELLO: Those are the latest headlines for you this morning.

(STOCK MARKET REPORT)

Time for a little business buzz how.

Delta and its pilots strike a tentative deal.

Carrie Lee has more on that story live from the NASDAQ market site.

This is good news for troubled Delta.

CARRIE LEE, CNN CORRESPONDENT: It certainly is, Carol. In fact, the stock was up about 10 percent last night in the after hours session. So investors really liking this news. Delta has announced a deal to temporarily bring back recently retired pilots in an effort to avoid staff shortages that the company has warned could force it into a bankruptcy filing.

Now, under the deal, Delta will be allowed to employ retired pilots on a contract basis if staffing levels fall dangerously low. Delta's seen an exodus of many of its most senior pilots recently. This has been a very troubling issue for Delta. So, Carol, it could potentially help Delta stave off bankruptcy protection. It doesn't mean that they won't file at all, but at least it's getting a little bit further away from that bankruptcy cliff that it's pretty close to.

COSTELLO: Carrie Lee live from the NASDAQ market site.

Thank you.

Still to come on DAYBREAK, new poll numbers on the presidential race from some of the hotly contested swing states. We also have some numbers on how you feel about the media. Oh, they're not too encouraging.

But first, experience history through art, photos and rare artifacts at the new Museum of the American Indian. A live report for you out of Washington, D.C. when DAYBREAK returns.

(COMMERCIAL BREAK)

COSTELLO: As many as 20,000 Native Americans will be marching through the streets of Washington, D.C. today. But it isn't a protest. It's a celebration. They're celebrating the dedication of a new museum devoted to their heritage and their history.

CNN's Skip Loescher joins us live from Washington with more on this museum -- good morning.

SKIP LOESCHER, CNN CORRESPONDENT: Carol, a good morning to you.

Thousands of people will, later today, be filling this sea of seats behind me to celebrate the grand opening of the Smithsonian's newest building, the National Museum of the American Indian.

(BEGIN VIDEO TAPE)

LOESCHER (voice-over): The exterior is clearly the most distinctive of any monument or museum on the National Mall, maybe in Washington. Fashioned with Kasota limestone from Minnesota and following a design process that included Indian designers and engineers from throughout the Western Hemisphere, the building suggests a form shaped over centuries by wind and water.

LAWRENCE SMALL, SECRETARY, SMITHSONIAN INSTITUTE: It's a beautiful blend of the old and the new. It's a blend of nature and technology, a blend of symbolism and significance.

LOESCHER: Visitors enter into the grand gathering place, called the Potomac. Its 120 foot high dome lighted by a massive prism window which projects rainbows of sunlight on the walls and floor below. And there are artifacts, thousands of them.

SMALL: An incredible collection of iconic objects from North, Central n South America. It's the finest collection of its kind in the world. The objects that are in the museum's collection span a period of 10,000 years.

LOESCHER: This museum, Small says, is a tribute to the rich fabric of Indian cultures, not only in the past, but in the present.

SMALL: It's a tribute, frankly, that is long overdue.

LOESCHER: Especially since Indian people lived in these hemispheres long before anyone called them America.

(END VIDEO TAPE)

LOESCHER: Beginning next week, the museum will be open from 10 in the morning until 5:30 in the afternoon every day except Christmas.

We're live on the National Mall.

I'm Skip Loescher. Carol -- back to you.

COSTELLO: Thank you, Skip.

You are watching DAYBREAK for a Tuesday morning.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

BIGLEY: The prime minister is a father. He has children. I'm a child. I have a father. He has the power to make a decision and we ask him to help us.

(END VIDEO CLIP)

COSTELLO: A desperate appeal to Tony Blair from the son of a British engineer being held hostage in Iraq.

It is Tuesday, September 21.

This is DAYBREAK.

And good morning to you.

From the CNN Global Headquarters in Atlanta, I'm Carol Costello.

Now in the news, we have some developing news to tell you about that will disturb many Americans, I'm sure.

Iran is saying this morning that it has started converting raw uranium into gas for enrichment, and that, of course, defies demands set by the U.N. atomic watchdog agency. The IAEA had demanded that Iran stop enriching uranium, which, of course, can be used to make nuclear weapons. We're sure to hear more about this in the hours to come. If we get more information for you, we'll pass it along to you on DAYBREAK.

The family of British citizen Kenneth Bigley is pleading for his life. Bigley and American Jack Hensley are being held by Islamic militants in Iraq. The militants killed American Eugene Armstrong on Monday. They're now threatening to behead their other two captives.

President Bush expected to defend his decision to invade Iraq in a speech this morning before the United Nations General Assembly. But the situation regarding Iraq is not expected to be the main focus of the president's comments.

And in just a few hours, a judge will begin hearing the government's $280 billion case against the tobacco industry. Several tobacco companies are accused of conspiring to mislead the public about the dangers of smoking.

Interest rates will probably go up this afternoon. Federal Reserve officials are expected to raise the short-term rate by a 1/4 point. It will be the third increase this year -- Chad. MYERS: Good morning, Carol.

(WEATHER REPORT)

MYERS: We are looking at hurricane Jeanne, a category one. Remember Jeanne? It was kind of going to go and was going to turn left and it was going to turn left and it was going to go into Florida? Well, it turned right instead.

Now look at the current hurricane forecast. From category one to a category two. Now we're looking at Thursday morning, a little bit of after Wednesday midnight. And then it makes the big loop and heads back toward the Carolinas again. This thing is crazy. And, in fact, it's even going back up from a category one, at this point, to a category two. Winds could be about 100 miles per hour for a while here in this storm. We have to keep watching this one and we also have to watch the one south of there. Tropical storm Lisa is forecast to become a cat one storm but it does look like it'll be north of the islands here and still obviously 1,000 miles from the U.S.

This hurricane season never stops.

COSTELLO: It's crazy.

MYERS: It certainly is.

COSTELLO: And scary.

Thank you, Chad.

MYERS: You're welcome.

COSTELLO: The clock is ticking in Iraq. Islamic hostage takers say they will kill another hostage if their demands are not met. This after word of a gruesome beheading.

CNN's Walter Rodgers has done extensive reporting from Iraq.

He joins us live now from Baghdad -- good morning.

WALTER RODGERS, CNN CORRESPONDENT: Hello, Carol.

It is not a good morning here. We are in the midst of another grizzly countdown to perhaps another execution. Today is the deadline set by Islamist militants for the decapitation of another Western hostage, either Jack Hensley, the American, or Kenneth John Bigley, the British subject whom they hold.

Last night, the insurgents released a videotape that was extraordinarily graphic. Indeed, it showed the actual beheading of Eugene Armstrong, one of the three Americans -- one of the three contractors who was beheaded. Armstrong was, indeed, an American.

As they were readying his death sentence, the Islamist militants said they were carrying out god's law. Then they proceeded to cut off his head in full view of a television camera. You could hear the poor man screaming. If you heard those screams, you'll never forget them as long as you live.

Philip Bigley, the brother of the remaining British hostage, says he pretty much expects the same fate for his brother Kenneth.

(BEGIN VIDEO CLIP)

PHILIP BIGLEY, BROTHER OF BRITISH HOSTAGE: We feel absolutely helpless. We do not have the power to save Ken's life.

(END VIDEO CLIP)

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