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Latest On the Battle For Falluja; Deep Jury Divisions in Peterson Trial? Interview With John Danforth

Aired November 09, 2004 - 07:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


SOLEDAD O'BRIEN, CNN ANCHOR: The battle of Falluja begins. Thousands of coalition troops move to take the volatile city from insurgents. Meanwhile, violence spreads across Iraq.
The jury in the Scott Peterson trial gets a lecture from the judge. Is the case destined to end with a hung jury?

And an Olympic superstar runs into trouble with police. How he apologized on this AMERICAN MORNING.

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

BILL HEMMER, CNN ANCHOR: Good morning, everyone. On Tuesday, 7:00 here in New York. Soledad back with us today. Good morning.

O'BRIEN: Good morning.

HEMMER: Feeling all right?

O'BRIEN: Much better. I had vertigo, you know. It's really awful. I wouldn't wish it on anybody.

HEMMER: Especially with four kids.

O'BRIEN: Yeah, they just kept moving -- all of them.

HEMMER: That's right. There were eight all of a sudden. Well, welcome back.

In a moment here, the battle for Falluja well underway, but some U.N. officials are worried that a full-scale assault would just stir up the insurgency rather than snuff it out. Well, we'll talk to the U.S. ambassador to the U.N., John Danforth, and find out what he thinks about those thoughts in a moment here.

O'BRIEN: Also this morning, questions today about whether the jury in the Scott Peterson trial has reached an impasse. Yesterday, the judge in the case lectured the jurors about the importance of deliberating with open minds. In just a moment, we're going to talk to Lisa Bloom of Court TV, also jury consultant Robert Hirschhorn about what might be going on behind the scenes.

HEMMER: All right. Jack Cafferty, too -- good morning.

JACK CAFFERTY, CNN ANCHOR: How you doing? Social Security is in big trouble in this country. Right now, it represents something in the neighborhood of $37 trillion unfunded liability. Why unfunded? Because the government spends the Social Security money you send in to Washington. They don't put it aside for your retirement; they spend it on other stuff.

Something has got to be done, or there won't be enough money to pay the retirees when the baby boom generation begins to retire and on beyond that. We'll take a look at how the problem may be addressed in a few minutes.

O'BRIEN: Excellent. Nice easy question to have your viewers handle today.

CAFFERTY: We'll get the thing handled for those guys in Washington, and then they can move on to something else.

O'BRIEN: Three short hours we've got.

CAFFERTY: yeah, so just listen up.

O'BRIEN: Thanks. Let's turn to Kelly Wallace now. She's in doing the news at our newsdesk this morning. Good morning.

KELLY WALLACE, CNN ANCHOR: Good morning, Soledad. Welcome back. Glad you are back. Good morning, Bill. Good morning, Jack. Good morning, everyone.

Now in the news -- within the past half hour, a high-level Palestinian delegation has arrived at a military hospital in France to get a first-hand look at ailing Palestinian leader Yasser Arafat. The four top officials arrived in Paris last night. Earlier, a spokesman for the hospital where Arafat is being treated said the 75-year-old's condition had worsened and that he had fallen into a deeper coma.

The U.S. government says it will appeal a ruling that stopped the case against Osama bin Laden's alleged driver. A federal judge yesterday halted proceedings against Salim Hamdan, ruling that his status as an enemy combatant must first be determined by a, quote, "competent tribunal."

Lawyers for Kobe Bryant's accuser may try to move the civil lawsuit against the NBA star to California. The attorneys say they are considering the move because of Colorado's restrictions on financial damages. That could open the door to a multimillion-dollar suit against Bryant. Final decision is expected to be made in about a month.

And six-time Olympic gold medalist Michael Phelps could face up to a year in prison for drunk driving. The 19-year-old swimming champion was stopped last week after he allegedly ran a stop sign. Word of the incident came out yesterday. Phelps offered an apology, calling his actions a mistake. Tough news there about Michael Phelps.

Back to you, Soledad.

O'BRIEN: Yeah, I bet this is one time he doesn't like to be in the spotlight.

WALLACE: Absolutely.

O'BRIEN: All right. Kelly Wallace for us. Thanks, Kelly, appreciate it.

Day two for the battle of Falluja, and more than 10,000 U.S. troops, 2,000 Iraqi forces pounding targets in that city. Military officials say as many as 5,000 insurgents may still be inside Falluja, but the whereabouts of terrorist Abu Musab al-Zarqawi, believed to have been in the insurgent stronghold, are still unknown according to Defense Secretary Donald Rumsfeld.

Interim Prime Minister Ayad Allawi says the removal of insurgents in Falluja will help pave the way for the January elections. Let's go right now to Michael Ware. He is "TIME" magazine's Baghdad Bureau chief. He is one of our embedded reporters for us this morning.

Michael, good morning. What can you tell us?

MICHAEL WARE, BAGHDAD BUREAU CHIEF, "TIME" MAGAZINE: The U.S. Army is currently leading this assault on the insurgent stronghold of Falluja. The Army units that I'm attached, from Task Force 22 of the 2nd Battalion 2nd Infantry regiment have punched deep (INAUDIBLE) the resistance that was put up by the insurgents through the night and the early hours of this morning. We have reached significant landmarks and now control significant parts of the city.

The advance was plagued by continued attacks from the insurgents, explosions from booby-traps all over the city, and by sustained mortar and rocket-propelled grenade fire. However, the fierce battle that we were led to believe would occur has yet to take place. The insurgents, while resisting in street-to-street gun battles, have yet to organize themselves into a stiff resistance.

So, the question remains as to whether the insurgents can still be rooted out or whether, in fact, they have already fled the city.

O'BRIEN: Michael, can I ask you a question about casualties that you are seeing where you are?

WARE: The U.S. Army unit that I am with has suffered only light casualties, none of them life threatening. The platoon that I have been with has sustained two casualties, one of which was more serious, yet again that one was not life threatening.

However, I believe they have been able to inflict some damage on the insurgents that they have confronted. and certainly there has been considerable collateral damage to the buildings and the mosques and the infrastructure of Falluja.

O'BRIEN: You said, Michael, that you have been seeing street-to- street fighting by the insurgents, not a real organized resistance. Can you give me a sense, a lot of resistance, a minimal amount of resistance -- how would you put it? WARE: It's been minimal -- that's another explosion. The battle is still continuing as I speak, so you'll have to excuse me. It's been minimal. Perhaps it's been crafted as such by the insurgents. They allowed us to enter the city to a certain degree before they began assaulting our positions.

But once they began attacking, the attacks were fierce, with mortar fire, rocket-propelled grenades, and very, very close quarters, small arms fire. We were literally fighting house to house. So, when they stopped to fight, they really put up quite a battle.

However, the largest concentration of insurgents that I have seen so far has been no more than 20 to 25 individuals. By and large, they are operating in small teams or squads, picking us off with sniper fire and ambushes.

O'BRIEN: Michael Ware is "TIME" magazine's Baghdad Bureau chief reporting for us this morning where he is embedded with the 22nd Task Force. Michael, thank you very much and, obviously, stay safe. Appreciate it -- Bill?

HEMMER: Seven minutes past the hour now. Jurors deciding the double murder case against Scott Peterson are heading now into their fifth day of deliberations.

There are some who believe deep divisions have now developed in that jury room. Let's talk about that with jury consultant Robert Hirschhorn, who's in Dallas this morning. Robert, good morning to you.

ROBERT HIRSCHHORN, JURY CONSULTANT: Good morning, Bill.

HEMMER: And here in New York City, Court TV's Lisa Bloom back with us, as well. Good morning, Lisa.

LISA BLOOM, COURT TV: Good morning.

HEMMER: Let's start with you as we try and read the judge's mind and try and read the jurors' mind. You say you would not be surprised at all if this jury does not reach a verdict. Why not?

BLOOM: Well, I've always thought that a hung jury is probably the most likely outcome. This is a very pro-defense jury to begin with, selected by Jo-Ellan Dimitrius, jury consultant for the defense. It includes a woman who married a convicted murder. And it includes a number of people who seem to be very favorable toward Mark Geragos during the trial.

On the other hand, there also seems to be a faction that very strongly favors conviction based on their nods and their gestures and so on during the trial.

It's a tough case. There are good arguments on both sides of this case. The fact that the jury is now in their fifth day of deliberations asking for a lot of evidence I think shows how divided they are. HEMMER: Robert, what do we make of when the judge addresses the jurors? And he says things like this, "the importance of deliberating with an open mind." One would think that that was an assumption going in.

What do you make of those comments from the bench yesterday?

HIRSCHHORN: Well, Bill, I think what the judge wants to do is prophylactically treat a potential problem -- the potential problem being the hung jury. But I got to tell you, in this particular case, it's a five-month trial, dozens and dozens of witnesses. There's a lot of evidence for the jury to go through.

And as I tell my kids, Troy and Mickey, don't make momentary decisions the effects of which will be felt for a lifetime. Scott Peterson's life is on the line. I think the jury is going to take a very thorough review of this evidence. When I picked the jury in the Bob Durst case, that was a one-month trial. It took five days for that jury to reach a verdict. So, I have got a lot of hope for this jury. I think, in fact, they will reach a verdict, it's just going to be a very thorough deliberation.

HEMMER: Another thing the judge said, Lisa, it's "rarely helpful" -- a quote now from yesterday -- "rarely helpful for a juror at the beginning of deliberations to express an emphatic opinion on the case."

BLOOM: Yeah, I call that the attitude adjustment charge. Get back in there. Keep an open mind. Smile. Work together as a team.

But you know, we Americans are so individualistic. Many of us have very strong feelings about the Scott Peterson case. I think we can all imagine if we were on that jury and somebody had a diametrically opposed point of view, we might not want to just make nice and listen to their point of view. We might want to strongly argue for our position. That's probably what's going on behind closed doors.

HEMMER: You know, Robert, let's go back to you about the whole idea about the psychology that happens among this jury team. When they're in that room and they're deliberating, you strongly believe that few times a juror's not going to make a decision. Why do you arrive at that?

HIRSCHHORN: Absolutely, Bill. As a jury consultant, I do. I have done literally hundreds and hundreds of mock trials and focus groups where I've watched juries deliberate. And what I found is that the longer a jury is invested in a case, the stronger the pull toward reaching a verdict.

All of us, when we've invested a lot of time in anything in anything -- in a relationship or a project -- we want to see it to fruition. We want to see it to conclusion, and that's why I believe the jury is going to do everything in their power to reach a verdict in the case. BLOOM: Well, but Robert, look at the Tyco case. Look at the Jayson Williams case that ended in a hung jury on the top charge. It does happen, especially in high-profile cases, especially in long cases. Now, the prosecution made this a long, complicated case. That could come back to bite them.

HIRSCHHORN: Oh, absolutely, Lisa. But you know, I picked the jury in the embassy bombing case in New York. That was a nine-month trial. That was a very controversial case. The jury reach a verdict there.

I agree with you, Lisa. There are certain cases where jurors have a hard time and are irreparably divided, but just I think in the vast majority of the cases, jurors are really going to strive to try to reach a verdict.

BLOOM: And let me say, Bill, the prosecution usually wins on the retrial. Scott Peterson would stay behind bars pending a retrial.

HIRSCHHORN: And I absolutely agree with Lisa, because the prosecution gets to see the whole defense case, so they have an absolute leg up on the defense.

HEMMER: Let's not get too far in front of this, but quickly under the time we have left here, what happens if they can't reach a verdict? What if they come back today or tomorrow and say, "You know what, judge? We tried, and we just can't get there."

BLOOM: Good question. There's two options. The judge would give them a second, stronger admonition to get back in there, adjust your attitude, keep working. And the judge in California has the option to remove a juror who really is not deliberating in good faith -- not just because they take a different point of view, but if they're not deliberating, they could be booted off that jury, bring on an alternate, and keep going.

HEMMER: Thank you, Lisa.

HIRSCHHORN: Well, the jury's going to keep going. They'll reach a verdict. Just watch.

HEMMER: Thank you, Robert. Appreciate your time.

HIRSCHHORN: Thanks, Bill.

HEMMER: Robert Hirschhorn in Dallas. Lisa Bloom here in New York City. We'll watch again today.

BLOOM: OK.

HEMMER: Soledad?

O'BRIEN: Well, he still has another week in office, but New Jersey Governor Jim McGreevey is looking toward the future, he says. After a standing ovation yesterday in Trenton, the 47-year-old Democrat said goodbye to his staff. Back in August, McGreevey announced that he's gay, that he had an extramarital affair with a man. He said he's not apologizing for being a gay American, but instead for what he calls bad decisions.

(BEGIN VIDEO CLIP)

GOV. JIM MCGREEVEY (D), NEW JERSEY: I have to begin today with humility by simply saying I am sorry -- so, so sorry that mistakes in my judgment made this day necessary for us all.

I am sorry that my actions have hurt those I love, in my personal and political lives.

(END VIDEO CLIP)

O'BRIEN: The governor officially steps down on Monday. State Senate President Richard Codey will serve out the rest of McGreevey's term. That ends in 2006 -- Bill?

HEMMER: Soledad, about 13 minutes past the hour now. Want to check in with Chad Myers, first time today on a Tuesday morning, looking at the weather outside and the temperatures are dropping here in the northeast, Chad. Winter is knocking. You can see that.

(WEATHER REPORT)

HEMMER: Thank you, Chad.

O'BRIEN: Still to come this morning, a silvery note if you're a holiday shopper. Beware of your returns, the stores are watching. Could get you on a blacklist. You could not get your money back.

HEMMER: Also, Helen Walton, matriarch of the Wal-Mart fortune, one of the richest women in America. She was there at the beginning. Andy Serwer has her story today, and you'll hear about it on this AMERICAN MORNING.

(COMMERCIAL BREAK)

O'BRIEN: From Falluja to what's happening in Darfur, John Danforth is the U.S. ambassador to the United Nations. He is watching all of these unfold from here in New York. Nice to have you. Thanks for being with us.

JOHN DANFORTH, U.S. AMBASSADOR TO THE U.N.: Thank you.

O'BRIEN: Let's begin with Falluja, and we have lots to cover this morning. There has been -- said by Kofi Annan last week that he was concerned that any kind of attack on Falluja could impact the elections in a big way. Where do you stand on that?

DANFORTH: Well, the position that our government takes and also that the government of Iraq takes is that Falluja is a real hotbed of the insurgency. And if the elections are going to happen in a timely fashion, which is exceptionally important, then Falluja has to be taken care of. It can't be the hotbed that it is right now. O'BRIEN: There are some, though, who say, well, you could pick in either direction, and if you go and attack, you could tip it in the direction -- where, as the attorney general says, people get so angry that they rise up and oust the insurgents. Or it could tip in the other direction.

DANFORTH: It's a judgment call, and who's to make that judgment? Now, there's a government in Iraq. The government wants to have an election take place. So, our view is that they should make that judgment.

O'BRIEN: Let's talk a little bit about your future. Your name has been coming up all over the place -- secretary of state, attorney general -- any of those jobs? Which of those two jobs would you like to have, sir?

DANFORTH: That is not the question to ask me, come on.

O'BRIEN: No comment on it?

DANFORTH: No.

O'BRIEN: Or you don't want either, is that what you're saying?

DANFORTH: Well, I came here from private life, and I enjoyed that. And it's a privilege to be the U.S. Ambassador to the U.N. It's an important job. And I'm happy doing what I'm doing. But I'm happy doing a lot of things.

O'BRIEN: Avoiding my question.

Let's turn to the Darfur region in Sudan. There's a meeting -- and I know you've been sort of playing a big role in this meeting that's going to take place in Kenya on the 18th and the 19th. Why in Kenya? Why is it not a meeting that can't be done say here in New York?

DANFORTH: Well, the peace talks in Sudan are going on in Kenya. And so, this is the site -- if there is to be a political settlement of this terrible tragedy in Sudan, that's the place that it will happen.

The Security Council of the United Nations has only met three other times outside of New York. It is highly unusual to have a meeting someplace else. The fact that it is going to be meeting in Nairobi next week underscores the extreme importance of trying to resolve this terrible tragedy.

The situation in Sudan is the most serious humanitarian tragedy there is now. In the western part of Sudan, Darfur has been just a major catastrophe. The general consensus is if the problem in Darfur is to be fixed, it's going to require the kind of political settlement that can take place in the Nairobi peace talks. So, it is just exceptionally important.

O'BRIEN: What would be success? There's 70,000 people died -- 1.5 million so far the numbers we're getting for people who have just been ousted from their home. What's the first step...

DANFORTH: The success is to create a government in Sudan which can accommodate all of these various interests, various factions located in different parts of the country, people who believe they have been disenfranchised for a long period of time -- to incorporate them into the governmental structure.

So, it's an exceptionally important series of peace talks that have been going on. They've really stalled out now. And we hope to give them new life by our presence. And also, to demonstrate by our presence the continuing interest of the international community in Sudan if there is a peace agreement.

O'BRIEN: A lot that the international community is focusing on, of course, with Falluja and Darfur and many other things. John Danforth is the U.S. representative to the U.N. Nice to see you. Thanks for coming in to talk to us.

DANFORTH: Thank you.

O'BRIEN: Bill?

HEMMER: Soledad, in a moment here, we'll get back to Iraq and the insurgents paying an extremely high price as U.S. forces advance to the center of Falluja.

Also, nominations to the U.S. Supreme Court could be the next political battle in Washington. And the president might be ready to challenge history if he needs to choose a new chief justice.

We'll talk about that as we continue in a moment, from New York City live on a Tuesday morning right after this.

(COMMERCIAL BREAK)

HEMMER: Merck is now the center of an investigation all due to Vioxx, and Andy Serwer checking in now for a segment of "Minding Your Business" on a Tuesday.

This is big trouble for this company.

ANDY SERWER, "FORTUNE" MAGAZINE: It is more big trouble for the pharmaceutical giant based in New Jersey. Two government agencies now probing Merck: the Securities and Exchange Commission instituting an informal investigation; meanwhile, the Department of Justice has begun a criminal probe.

As you said, Bill, this all has to do with Vioxx. And as of October 31st, Merck has said it now has 375 lawsuits against the company representing a thousand plaintiffs. Twenty million Americans have taken this drug, and the stock has fallen from 45 to 27 since the company announced the news in late September.

Let's talk a little bit about the markets yesterday, because the streak continues. Four days in a row up for the Dow. Nine out of 10 past sessions we've been up. Tomorrow morning is the big Fed meeting, so we await that with bated breath -- or at least some of us do. And also, techs should be a little bit weaker this morning because futures are down a bit.

HEMMER: We have seen a rally. A bit of a cooling off yesterday, but still...

SERWER: Not bad. Not bad at all.

HEMMER: Thank you, Andy.

SERWER: You're welcome.

O'BRIEN: Guess what? This morning, Jack solved Social Security. Good morning.

SERWER: Yes!

CAFFERTY: Peace of cake.

SERWER: Yes!

CAFFERTY: Here we go. President Bush wants to partially privatize Social Security. In its present form, the system one runs out of money -- and not very long from now, either, as the huge baby boom generation moves into retirement.

The president wants to allow people to put part of their money into private accounts. There are politicians in Washington opposed to the idea, because they say it will create $2.3 trillion in deficits over the next 10 years.

The way the system is structured now, Social Security represents a $37 trillion unfunded liability. There ain't no money. The phrase Social Security Trust Fund is a joke. There is no trust. The politicians have raped Social Security for years and years and years, using the money as part of the general revenue stream to pay for their pork barrel projects and various -- but it ain't used for Social Security. They just write the checks as the need arises.

So, the question we'll address this morning -- and we're counting on to you come up with the right answer here -- is: How do you fix Social Security?

The 2.3 trillion over the short term would represent the loss of money that people would put into private accounts, therefore the politicians couldn't get their grubby little hands all over it. And they don't like the idea of going without every nickel of your money that they can get their hands on down there.

HEMMER: We have two-and-a-half hours. We can figure this out.

CAFFERTY: We'll get this thing done.

O'BRIEN: Tomorrow, world peace.

CAFFERTY: Well, let's don't get too ambitious. SERWER: Well, it's a good thing for a second-term president to actually address, because...

CAFFERTY: Sure.

SERWER: ... it's a very, very difficult situation.

HEMMER: Top of his list, too. Thanks, guys.

In a moment here, the stakes very high in Falluja. We know about that. We also know about the danger. Back there live in a moment.

Also, retailers are out to put a stop to so-called serial returners. But the technology they're using could make you think twice about taking something back. We'll check it out right after this.

(COMMERCIAL BREAK)

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 November 9, 2004 - 07:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
SOLEDAD O'BRIEN, CNN ANCHOR: The battle of Falluja begins. Thousands of coalition troops move to take the volatile city from insurgents. Meanwhile, violence spreads across Iraq.
The jury in the Scott Peterson trial gets a lecture from the judge. Is the case destined to end with a hung jury?

And an Olympic superstar runs into trouble with police. How he apologized on this AMERICAN MORNING.

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

BILL HEMMER, CNN ANCHOR: Good morning, everyone. On Tuesday, 7:00 here in New York. Soledad back with us today. Good morning.

O'BRIEN: Good morning.

HEMMER: Feeling all right?

O'BRIEN: Much better. I had vertigo, you know. It's really awful. I wouldn't wish it on anybody.

HEMMER: Especially with four kids.

O'BRIEN: Yeah, they just kept moving -- all of them.

HEMMER: That's right. There were eight all of a sudden. Well, welcome back.

In a moment here, the battle for Falluja well underway, but some U.N. officials are worried that a full-scale assault would just stir up the insurgency rather than snuff it out. Well, we'll talk to the U.S. ambassador to the U.N., John Danforth, and find out what he thinks about those thoughts in a moment here.

O'BRIEN: Also this morning, questions today about whether the jury in the Scott Peterson trial has reached an impasse. Yesterday, the judge in the case lectured the jurors about the importance of deliberating with open minds. In just a moment, we're going to talk to Lisa Bloom of Court TV, also jury consultant Robert Hirschhorn about what might be going on behind the scenes.

HEMMER: All right. Jack Cafferty, too -- good morning.

JACK CAFFERTY, CNN ANCHOR: How you doing? Social Security is in big trouble in this country. Right now, it represents something in the neighborhood of $37 trillion unfunded liability. Why unfunded? Because the government spends the Social Security money you send in to Washington. They don't put it aside for your retirement; they spend it on other stuff.

Something has got to be done, or there won't be enough money to pay the retirees when the baby boom generation begins to retire and on beyond that. We'll take a look at how the problem may be addressed in a few minutes.

O'BRIEN: Excellent. Nice easy question to have your viewers handle today.

CAFFERTY: We'll get the thing handled for those guys in Washington, and then they can move on to something else.

O'BRIEN: Three short hours we've got.

CAFFERTY: yeah, so just listen up.

O'BRIEN: Thanks. Let's turn to Kelly Wallace now. She's in doing the news at our newsdesk this morning. Good morning.

KELLY WALLACE, CNN ANCHOR: Good morning, Soledad. Welcome back. Glad you are back. Good morning, Bill. Good morning, Jack. Good morning, everyone.

Now in the news -- within the past half hour, a high-level Palestinian delegation has arrived at a military hospital in France to get a first-hand look at ailing Palestinian leader Yasser Arafat. The four top officials arrived in Paris last night. Earlier, a spokesman for the hospital where Arafat is being treated said the 75-year-old's condition had worsened and that he had fallen into a deeper coma.

The U.S. government says it will appeal a ruling that stopped the case against Osama bin Laden's alleged driver. A federal judge yesterday halted proceedings against Salim Hamdan, ruling that his status as an enemy combatant must first be determined by a, quote, "competent tribunal."

Lawyers for Kobe Bryant's accuser may try to move the civil lawsuit against the NBA star to California. The attorneys say they are considering the move because of Colorado's restrictions on financial damages. That could open the door to a multimillion-dollar suit against Bryant. Final decision is expected to be made in about a month.

And six-time Olympic gold medalist Michael Phelps could face up to a year in prison for drunk driving. The 19-year-old swimming champion was stopped last week after he allegedly ran a stop sign. Word of the incident came out yesterday. Phelps offered an apology, calling his actions a mistake. Tough news there about Michael Phelps.

Back to you, Soledad.

O'BRIEN: Yeah, I bet this is one time he doesn't like to be in the spotlight.

WALLACE: Absolutely.

O'BRIEN: All right. Kelly Wallace for us. Thanks, Kelly, appreciate it.

Day two for the battle of Falluja, and more than 10,000 U.S. troops, 2,000 Iraqi forces pounding targets in that city. Military officials say as many as 5,000 insurgents may still be inside Falluja, but the whereabouts of terrorist Abu Musab al-Zarqawi, believed to have been in the insurgent stronghold, are still unknown according to Defense Secretary Donald Rumsfeld.

Interim Prime Minister Ayad Allawi says the removal of insurgents in Falluja will help pave the way for the January elections. Let's go right now to Michael Ware. He is "TIME" magazine's Baghdad Bureau chief. He is one of our embedded reporters for us this morning.

Michael, good morning. What can you tell us?

MICHAEL WARE, BAGHDAD BUREAU CHIEF, "TIME" MAGAZINE: The U.S. Army is currently leading this assault on the insurgent stronghold of Falluja. The Army units that I'm attached, from Task Force 22 of the 2nd Battalion 2nd Infantry regiment have punched deep (INAUDIBLE) the resistance that was put up by the insurgents through the night and the early hours of this morning. We have reached significant landmarks and now control significant parts of the city.

The advance was plagued by continued attacks from the insurgents, explosions from booby-traps all over the city, and by sustained mortar and rocket-propelled grenade fire. However, the fierce battle that we were led to believe would occur has yet to take place. The insurgents, while resisting in street-to-street gun battles, have yet to organize themselves into a stiff resistance.

So, the question remains as to whether the insurgents can still be rooted out or whether, in fact, they have already fled the city.

O'BRIEN: Michael, can I ask you a question about casualties that you are seeing where you are?

WARE: The U.S. Army unit that I am with has suffered only light casualties, none of them life threatening. The platoon that I have been with has sustained two casualties, one of which was more serious, yet again that one was not life threatening.

However, I believe they have been able to inflict some damage on the insurgents that they have confronted. and certainly there has been considerable collateral damage to the buildings and the mosques and the infrastructure of Falluja.

O'BRIEN: You said, Michael, that you have been seeing street-to- street fighting by the insurgents, not a real organized resistance. Can you give me a sense, a lot of resistance, a minimal amount of resistance -- how would you put it? WARE: It's been minimal -- that's another explosion. The battle is still continuing as I speak, so you'll have to excuse me. It's been minimal. Perhaps it's been crafted as such by the insurgents. They allowed us to enter the city to a certain degree before they began assaulting our positions.

But once they began attacking, the attacks were fierce, with mortar fire, rocket-propelled grenades, and very, very close quarters, small arms fire. We were literally fighting house to house. So, when they stopped to fight, they really put up quite a battle.

However, the largest concentration of insurgents that I have seen so far has been no more than 20 to 25 individuals. By and large, they are operating in small teams or squads, picking us off with sniper fire and ambushes.

O'BRIEN: Michael Ware is "TIME" magazine's Baghdad Bureau chief reporting for us this morning where he is embedded with the 22nd Task Force. Michael, thank you very much and, obviously, stay safe. Appreciate it -- Bill?

HEMMER: Seven minutes past the hour now. Jurors deciding the double murder case against Scott Peterson are heading now into their fifth day of deliberations.

There are some who believe deep divisions have now developed in that jury room. Let's talk about that with jury consultant Robert Hirschhorn, who's in Dallas this morning. Robert, good morning to you.

ROBERT HIRSCHHORN, JURY CONSULTANT: Good morning, Bill.

HEMMER: And here in New York City, Court TV's Lisa Bloom back with us, as well. Good morning, Lisa.

LISA BLOOM, COURT TV: Good morning.

HEMMER: Let's start with you as we try and read the judge's mind and try and read the jurors' mind. You say you would not be surprised at all if this jury does not reach a verdict. Why not?

BLOOM: Well, I've always thought that a hung jury is probably the most likely outcome. This is a very pro-defense jury to begin with, selected by Jo-Ellan Dimitrius, jury consultant for the defense. It includes a woman who married a convicted murder. And it includes a number of people who seem to be very favorable toward Mark Geragos during the trial.

On the other hand, there also seems to be a faction that very strongly favors conviction based on their nods and their gestures and so on during the trial.

It's a tough case. There are good arguments on both sides of this case. The fact that the jury is now in their fifth day of deliberations asking for a lot of evidence I think shows how divided they are. HEMMER: Robert, what do we make of when the judge addresses the jurors? And he says things like this, "the importance of deliberating with an open mind." One would think that that was an assumption going in.

What do you make of those comments from the bench yesterday?

HIRSCHHORN: Well, Bill, I think what the judge wants to do is prophylactically treat a potential problem -- the potential problem being the hung jury. But I got to tell you, in this particular case, it's a five-month trial, dozens and dozens of witnesses. There's a lot of evidence for the jury to go through.

And as I tell my kids, Troy and Mickey, don't make momentary decisions the effects of which will be felt for a lifetime. Scott Peterson's life is on the line. I think the jury is going to take a very thorough review of this evidence. When I picked the jury in the Bob Durst case, that was a one-month trial. It took five days for that jury to reach a verdict. So, I have got a lot of hope for this jury. I think, in fact, they will reach a verdict, it's just going to be a very thorough deliberation.

HEMMER: Another thing the judge said, Lisa, it's "rarely helpful" -- a quote now from yesterday -- "rarely helpful for a juror at the beginning of deliberations to express an emphatic opinion on the case."

BLOOM: Yeah, I call that the attitude adjustment charge. Get back in there. Keep an open mind. Smile. Work together as a team.

But you know, we Americans are so individualistic. Many of us have very strong feelings about the Scott Peterson case. I think we can all imagine if we were on that jury and somebody had a diametrically opposed point of view, we might not want to just make nice and listen to their point of view. We might want to strongly argue for our position. That's probably what's going on behind closed doors.

HEMMER: You know, Robert, let's go back to you about the whole idea about the psychology that happens among this jury team. When they're in that room and they're deliberating, you strongly believe that few times a juror's not going to make a decision. Why do you arrive at that?

HIRSCHHORN: Absolutely, Bill. As a jury consultant, I do. I have done literally hundreds and hundreds of mock trials and focus groups where I've watched juries deliberate. And what I found is that the longer a jury is invested in a case, the stronger the pull toward reaching a verdict.

All of us, when we've invested a lot of time in anything in anything -- in a relationship or a project -- we want to see it to fruition. We want to see it to conclusion, and that's why I believe the jury is going to do everything in their power to reach a verdict in the case. BLOOM: Well, but Robert, look at the Tyco case. Look at the Jayson Williams case that ended in a hung jury on the top charge. It does happen, especially in high-profile cases, especially in long cases. Now, the prosecution made this a long, complicated case. That could come back to bite them.

HIRSCHHORN: Oh, absolutely, Lisa. But you know, I picked the jury in the embassy bombing case in New York. That was a nine-month trial. That was a very controversial case. The jury reach a verdict there.

I agree with you, Lisa. There are certain cases where jurors have a hard time and are irreparably divided, but just I think in the vast majority of the cases, jurors are really going to strive to try to reach a verdict.

BLOOM: And let me say, Bill, the prosecution usually wins on the retrial. Scott Peterson would stay behind bars pending a retrial.

HIRSCHHORN: And I absolutely agree with Lisa, because the prosecution gets to see the whole defense case, so they have an absolute leg up on the defense.

HEMMER: Let's not get too far in front of this, but quickly under the time we have left here, what happens if they can't reach a verdict? What if they come back today or tomorrow and say, "You know what, judge? We tried, and we just can't get there."

BLOOM: Good question. There's two options. The judge would give them a second, stronger admonition to get back in there, adjust your attitude, keep working. And the judge in California has the option to remove a juror who really is not deliberating in good faith -- not just because they take a different point of view, but if they're not deliberating, they could be booted off that jury, bring on an alternate, and keep going.

HEMMER: Thank you, Lisa.

HIRSCHHORN: Well, the jury's going to keep going. They'll reach a verdict. Just watch.

HEMMER: Thank you, Robert. Appreciate your time.

HIRSCHHORN: Thanks, Bill.

HEMMER: Robert Hirschhorn in Dallas. Lisa Bloom here in New York City. We'll watch again today.

BLOOM: OK.

HEMMER: Soledad?

O'BRIEN: Well, he still has another week in office, but New Jersey Governor Jim McGreevey is looking toward the future, he says. After a standing ovation yesterday in Trenton, the 47-year-old Democrat said goodbye to his staff. Back in August, McGreevey announced that he's gay, that he had an extramarital affair with a man. He said he's not apologizing for being a gay American, but instead for what he calls bad decisions.

(BEGIN VIDEO CLIP)

GOV. JIM MCGREEVEY (D), NEW JERSEY: I have to begin today with humility by simply saying I am sorry -- so, so sorry that mistakes in my judgment made this day necessary for us all.

I am sorry that my actions have hurt those I love, in my personal and political lives.

(END VIDEO CLIP)

O'BRIEN: The governor officially steps down on Monday. State Senate President Richard Codey will serve out the rest of McGreevey's term. That ends in 2006 -- Bill?

HEMMER: Soledad, about 13 minutes past the hour now. Want to check in with Chad Myers, first time today on a Tuesday morning, looking at the weather outside and the temperatures are dropping here in the northeast, Chad. Winter is knocking. You can see that.

(WEATHER REPORT)

HEMMER: Thank you, Chad.

O'BRIEN: Still to come this morning, a silvery note if you're a holiday shopper. Beware of your returns, the stores are watching. Could get you on a blacklist. You could not get your money back.

HEMMER: Also, Helen Walton, matriarch of the Wal-Mart fortune, one of the richest women in America. She was there at the beginning. Andy Serwer has her story today, and you'll hear about it on this AMERICAN MORNING.

(COMMERCIAL BREAK)

O'BRIEN: From Falluja to what's happening in Darfur, John Danforth is the U.S. ambassador to the United Nations. He is watching all of these unfold from here in New York. Nice to have you. Thanks for being with us.

JOHN DANFORTH, U.S. AMBASSADOR TO THE U.N.: Thank you.

O'BRIEN: Let's begin with Falluja, and we have lots to cover this morning. There has been -- said by Kofi Annan last week that he was concerned that any kind of attack on Falluja could impact the elections in a big way. Where do you stand on that?

DANFORTH: Well, the position that our government takes and also that the government of Iraq takes is that Falluja is a real hotbed of the insurgency. And if the elections are going to happen in a timely fashion, which is exceptionally important, then Falluja has to be taken care of. It can't be the hotbed that it is right now. O'BRIEN: There are some, though, who say, well, you could pick in either direction, and if you go and attack, you could tip it in the direction -- where, as the attorney general says, people get so angry that they rise up and oust the insurgents. Or it could tip in the other direction.

DANFORTH: It's a judgment call, and who's to make that judgment? Now, there's a government in Iraq. The government wants to have an election take place. So, our view is that they should make that judgment.

O'BRIEN: Let's talk a little bit about your future. Your name has been coming up all over the place -- secretary of state, attorney general -- any of those jobs? Which of those two jobs would you like to have, sir?

DANFORTH: That is not the question to ask me, come on.

O'BRIEN: No comment on it?

DANFORTH: No.

O'BRIEN: Or you don't want either, is that what you're saying?

DANFORTH: Well, I came here from private life, and I enjoyed that. And it's a privilege to be the U.S. Ambassador to the U.N. It's an important job. And I'm happy doing what I'm doing. But I'm happy doing a lot of things.

O'BRIEN: Avoiding my question.

Let's turn to the Darfur region in Sudan. There's a meeting -- and I know you've been sort of playing a big role in this meeting that's going to take place in Kenya on the 18th and the 19th. Why in Kenya? Why is it not a meeting that can't be done say here in New York?

DANFORTH: Well, the peace talks in Sudan are going on in Kenya. And so, this is the site -- if there is to be a political settlement of this terrible tragedy in Sudan, that's the place that it will happen.

The Security Council of the United Nations has only met three other times outside of New York. It is highly unusual to have a meeting someplace else. The fact that it is going to be meeting in Nairobi next week underscores the extreme importance of trying to resolve this terrible tragedy.

The situation in Sudan is the most serious humanitarian tragedy there is now. In the western part of Sudan, Darfur has been just a major catastrophe. The general consensus is if the problem in Darfur is to be fixed, it's going to require the kind of political settlement that can take place in the Nairobi peace talks. So, it is just exceptionally important.

O'BRIEN: What would be success? There's 70,000 people died -- 1.5 million so far the numbers we're getting for people who have just been ousted from their home. What's the first step...

DANFORTH: The success is to create a government in Sudan which can accommodate all of these various interests, various factions located in different parts of the country, people who believe they have been disenfranchised for a long period of time -- to incorporate them into the governmental structure.

So, it's an exceptionally important series of peace talks that have been going on. They've really stalled out now. And we hope to give them new life by our presence. And also, to demonstrate by our presence the continuing interest of the international community in Sudan if there is a peace agreement.

O'BRIEN: A lot that the international community is focusing on, of course, with Falluja and Darfur and many other things. John Danforth is the U.S. representative to the U.N. Nice to see you. Thanks for coming in to talk to us.

DANFORTH: Thank you.

O'BRIEN: Bill?

HEMMER: Soledad, in a moment here, we'll get back to Iraq and the insurgents paying an extremely high price as U.S. forces advance to the center of Falluja.

Also, nominations to the U.S. Supreme Court could be the next political battle in Washington. And the president might be ready to challenge history if he needs to choose a new chief justice.

We'll talk about that as we continue in a moment, from New York City live on a Tuesday morning right after this.

(COMMERCIAL BREAK)

HEMMER: Merck is now the center of an investigation all due to Vioxx, and Andy Serwer checking in now for a segment of "Minding Your Business" on a Tuesday.

This is big trouble for this company.

ANDY SERWER, "FORTUNE" MAGAZINE: It is more big trouble for the pharmaceutical giant based in New Jersey. Two government agencies now probing Merck: the Securities and Exchange Commission instituting an informal investigation; meanwhile, the Department of Justice has begun a criminal probe.

As you said, Bill, this all has to do with Vioxx. And as of October 31st, Merck has said it now has 375 lawsuits against the company representing a thousand plaintiffs. Twenty million Americans have taken this drug, and the stock has fallen from 45 to 27 since the company announced the news in late September.

Let's talk a little bit about the markets yesterday, because the streak continues. Four days in a row up for the Dow. Nine out of 10 past sessions we've been up. Tomorrow morning is the big Fed meeting, so we await that with bated breath -- or at least some of us do. And also, techs should be a little bit weaker this morning because futures are down a bit.

HEMMER: We have seen a rally. A bit of a cooling off yesterday, but still...

SERWER: Not bad. Not bad at all.

HEMMER: Thank you, Andy.

SERWER: You're welcome.

O'BRIEN: Guess what? This morning, Jack solved Social Security. Good morning.

SERWER: Yes!

CAFFERTY: Peace of cake.

SERWER: Yes!

CAFFERTY: Here we go. President Bush wants to partially privatize Social Security. In its present form, the system one runs out of money -- and not very long from now, either, as the huge baby boom generation moves into retirement.

The president wants to allow people to put part of their money into private accounts. There are politicians in Washington opposed to the idea, because they say it will create $2.3 trillion in deficits over the next 10 years.

The way the system is structured now, Social Security represents a $37 trillion unfunded liability. There ain't no money. The phrase Social Security Trust Fund is a joke. There is no trust. The politicians have raped Social Security for years and years and years, using the money as part of the general revenue stream to pay for their pork barrel projects and various -- but it ain't used for Social Security. They just write the checks as the need arises.

So, the question we'll address this morning -- and we're counting on to you come up with the right answer here -- is: How do you fix Social Security?

The 2.3 trillion over the short term would represent the loss of money that people would put into private accounts, therefore the politicians couldn't get their grubby little hands all over it. And they don't like the idea of going without every nickel of your money that they can get their hands on down there.

HEMMER: We have two-and-a-half hours. We can figure this out.

CAFFERTY: We'll get this thing done.

O'BRIEN: Tomorrow, world peace.

CAFFERTY: Well, let's don't get too ambitious. SERWER: Well, it's a good thing for a second-term president to actually address, because...

CAFFERTY: Sure.

SERWER: ... it's a very, very difficult situation.

HEMMER: Top of his list, too. Thanks, guys.

In a moment here, the stakes very high in Falluja. We know about that. We also know about the danger. Back there live in a moment.

Also, retailers are out to put a stop to so-called serial returners. But the technology they're using could make you think twice about taking something back. We'll check it out right after this.

(COMMERCIAL BREAK)

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