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CNN Live At Daybreak

An Arrest in a $10 Million Arson Case; D.C., Pro Baseball Play Hardball Over Funding for New Stadium

Aired December 17, 2004 - 05:00   ET

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

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


CAROL COSTELLO, CNN ANCHOR: Straight ahead on DAYBREAK, an arrest in a $10 million arson case. The defendant says you've got the wrong man.
Plus, hold the celebration. D.C. and pro baseball play hardball over funding for a new stadium.

And that umbrella twirling, magical English nanny is back, but we guarantee this is not the Mary Poppins you knew.

It is Friday, December 17.

This is DAYBREAK.

And good morning to you.

From the Time Warner Center in New York, I'm Carol Costello.

Now in the news, President Bush signs the intelligence reform legislation this morning. It promises major changes, creating what could be a powerful new director of national intelligence. CNN plans live coverage of that signing. It will happen at 9:55 Eastern.

Indonesian police say they found several homemade bombs in two separate locations today. Britain, the U.S. and Australia have warned Indonesia that terrorists may be planning an attack on Western interests before Christmas.

Israeli troops today raid a refugee camp in southern Gaza. One report says at least five Palestinians have been killed. The Israelis say they're targeting sites where rockets are launched at Jewish settlements.

And a U.S. Marine with the 1st Expeditionary Force has been killed in Iraq's Al Anbar Province. Since Sunday, at least 10 Marines have been killed in the province noted for insurgent activity.

To the forecast center now -- good morning, Chad Myers.

CHAD MYERS, CNN METEOROLOGIST: Good morning, Carol.

A little warmer where you are this morning.

COSTELLO: Thank goodness.

MYERS: Well, don't get used to it. By noon the cold front comes through and fixes all of that.

(WEATHER REPORT)

COSTELLO: It is a huge arson case, $10 million in damage to new homes under construction in an upscale Maryland subdivision. And this morning, 21-year-old Aaron Speed, that man, will appear before a federal judge.

Kelli Arena has more for you.

(BEGIN VIDEO TAPE)

AARON SPEED, ARSON SUSPECT: They've got the wrong man.

KELLI ARENA, CNN CORRESPONDENT (voice-over): That was 21-year- old Aaron Speed, arrested in connection with the fires that swept through a high priced housing development in suburban Washington.

SPEED: They've humiliated me. They humiliated my family. OK? Everything that I'm doing, I'm doing willingly to prove to them I am innocent.

ARENA: Authorities searched the home of his parents, where Speed and his family were staying.

GEORGE COCHRAN, NEIGHBOR: Cars and vans here until midnight. And they were in and out of the house. They were back in the shed with flashlights. And said they -- something about fire on Sunday.

ARENA: Prosecutors charged Speed with arson in the fires that damaged 26 homes, 10 destroyed, causing an estimated $10 million in damage. Authorities would not go into a possible motive, but do say Speed is cooperating and they say others may have been involved.

Speed worked for Security Services of America. That's the company that was hired to guard the housing development. A company spokeswoman had no comment.

(on camera): Speed is scheduled to appear in federal court later today. The maximum penalty for arson is 20 years in prison.

Kelli Arena, CNN, Washington.

(END VIDEO TAPE)

COSTELLO: In news across America this morning, a bizarre and tragic story out of Skidmore, Missouri. Listen to this. Police there are looking for a missing fetus that had been cut from the womb of a murder victim who was eight months pregnant. Police are also looking for the husband of the 23-year-old victim. Officials say there is a chance the fetus survived.

A gunman now holed up inside the famed Crystal Cathedral in Garden Grove, California. Hours earlier, he opened fire with a handgun. No one was hurt. The building has been evacuated. SWAT teams and police negotiators now on the scene. The man, who police say is in his 50s, is a church employee and a choir member.

In Fort Lauderdale, Florida, a janitor has been charged with stealing medals from the Swimming Hall of Fame. Among the hundreds of Olympic medals stolen are the awards won by Johnny Weissmuller in 1924. Authorities say the medals are worth nearly a half million dollars. The theft was discovered when the janitor began selling the items over the Internet.

The U.S. Army says they're accelerating the production of armored vehicles at plants in the United States. Their hope is to have several hundred new vehicles ready to go in the next few months. Also in the works, kits that let troops armor their own Humvees.

CNN's Ed Lavandera has more on that story.

(BEGIN VIDEO TAPE)

ED LAVANDERA, CNN CORRESPONDENT (voice-over): Ricardo Hernandez knows his job is about life, death and soldiers he's never met.

RICARDO HERNANDEZ, ARMOUR OF AMERICA: Every night my wife and I think about how they're doing over there in Iraq and what we can do to improve this type of protection for them.

LAVANDERA: Ricardo is in charge of sewing together all the soft and heavy armor packs manufactured by Armour of America in this Los Angeles factory. He's also the stepfather of a U.S. army sergeant who drives a Humvee in Iraq. A few months ago, his stepson e-mailed to say that his vehicle had finally been outfitted with the soft Kevlar armor kit that Ricardo and 30 employees have made here.

(on camera): Does it help you sleep at night knowing that he's driving around in the product you made here?

HERNANDEZ: Of course. Of course. I'm very happy. My wife's very confident of what I do because that protects my -- our son. I'm very happy and I'm proud of what I'm doing.

LAVANDERA (voice-over): In the last year, Armour of America has made almost 3,000 armor kits for military vehicles in Iraq. Some are soft Kevlar, which slide on the Humvee doors and protect soldiers from roadside bombs.

JOHN NEHMENS, ARMOUR OF AMERICA: In less than five minutes you've armored the outside of the vehicle. This system is a soft -- it feels like a soft blanket for fragmentation.

LAVANDERA: Some kits are hard armor, which manager John Nehmens demonstrated for us.

NEHMENS: This is a hard plate, the same concept. And the hard plate will stop AK-47 and M-16 rounds.

LAVANDERA: John believes this is the kind of protection soldiers want on their vehicles. NEHMENS: They want to be able to stop a round. They want to be able to stop the fragmentation. And they want to have the ability to shoot back. That's exactly what they want to do.

LAVANDERA: These days, business is mostly quiet as John waits for the go ahead to make another $20 million worth of armor kits for the U.S. military. Just in case, he's already started on the armor for Humvee doors.

(on camera): Trying to get ahead of the curve here?

NEHMENS: Absolutely. This is the hardest part of the process.

LAVANDERA (voice-over): The military units John has been working with ship out in the next three to four months.

NEHMENS: They are very interested in getting this on before they leave, but, again, they're constrained by the dollars.

LAVANDERA: The military says there are some 20,000 vehicles in Iraq. About 4,300 still need armor. For those vehicles, help is also coming, from places like the Red River Army Depot in northeast Texas.

COL. MICHAEL SAVONE: This is where everything comes together.

LAVANDERA: Colonel Michael Savone (ph) oversees the delivery of Humvee armor kits. These units will be shipped to the Middle East and put on in the field. Production is ramping up again with new designs to help soldiers in battle.

SAVONE: This thing will open up now all the way out, which allows the trooper to be able to have a better firing angle if he needs to lay down suppressor fire to get out of an ambush.

LAVANDERA: Ricardo Hernandez fears his stepson is always in danger on missions to the Iraqi countryside. For him, this work is personal.

HERNANDEZ: This may save a life. And I don't want nothing to fail.

(END VIDEO TAPE)

COSTELLO: That was CNN's Ed Lavandera reporting from Los Angeles.

Will it be a blue Christmas at Graceland? The Elvis Presley estate is getting all shook up. We'll tell you how the king's daughter is taking care of business at 17 minutes past.

And are you ready for a Mary Poppins who's not too concerned about that spoonful of sugar? We'll meet a darker version of the magical nanny at 40 minutes past. Who knew?

And at 57 minutes past, are you still wishing folks a Merry Christmas or have you shifted into a more generic holiday greeting? We'll dive into diversity at 57 minutes past.

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

(COMMERCIAL BREAK)

(STOCK MARKET REPORT)

COSTELLO: We are, as always here at CNN, on "Security Watch" this morning. Today, we're focusing on security at the nation's ports. Things are getting better, but as CNN's Frank Buckley reports, port officials say there is still a long way to go.

(BEGIN VIDEO TAPE)

FRANK BUCKLEY, CNN NATIONAL CORRESPONDENT (voice-over): Twenty thousand containers enter the U.S. every day and their potential use as platforms of terror keeps the head of Seattle's port awake at night with worry.

M.R. DINSMORE, CEO, PORT OF SEATTLE: Here we are three years, three months older from 9/11. We're doing a lot, but I think there's a tremendous amount of additional things we should do to make this nation safer.

BUCKLEY: M.R. Dinsmore says the nation's ports are doing a better job of monitoring for radiation and x-raying containers. Other efforts include boarding ships at sea to inspect cargo.

(on camera): But with so many containers coming into the U.S., Customs and border protection inspectors only physically examine the contents of some 6 percent of the containers.

RANDOLPH HALL, USC HOMELAND SECURITY CENTER: Each container contains many cartons. Each carton contains many packages. Does that mean that we open up every carton coming into this country or we open up every box to see what's inside? I think most people would say that's impractical.

BUCKLEY: Homeland security officials say international cooperation, including U.S. inspectors in 32 international ports, has tightened security significantly before containers ever approach U.S. waters.

TOM RIDGE, HOMELAND SECURITY SECRETARY: These new defenses begin thousands of miles away before a container is even loaded onto a cargo vessel bound for our shores.

BUCKLEY: But the Port of Seattle's Dinsmore says a network that tracks cargo from its source with cargo that's sealed and monitored is the ideal, and more than three years after 9/11 it should be in place.

DINSMORE: Three years, three months older, we still do not have an implementation of a network at the national level. We're still testing. That's disconcerting. BUCKLEY: Because, Dinsmore warns, it would take just one container shipped by terrorists to severely damage international trade and potentially cripple the U.S. economy.

Frank Buckley, CNN, Los Angeles.

(END VIDEOTAPE)

COSTELLO: Your news, money, weather and sports.

It's 5:14 Eastern.

Here's what's all new this morning.

A security guard is set to appear in court today on charges he set a series of fires in a Maryland subdivision nearly two weeks ago. Ten homes were destroyed, 30 others damages. So far, no motive, not even eco-terrorism.

President Bush is expected to sign the intelligence reform bill today. The bill includes many of the key recommendations from the 9/11 Commission, including the creation of a national intelligence chief.

In money news, Hershey is taking a bigger bite out of your pocket. The candy maker says it's going to hike prices immediately to combat rising production costs. The price of the signature Hershey bar going up nearly 6 percent.

In culture, Lisa Marie Presley is selling her father, so to speak, in a deal worth $100 million. A New York investor is getting 85 percent of the company that controls Elvis' likeness, his music and Graceland.

In sports, former University of Nebraska Head Coach Frank Solich has resurfaced in Ohio. Solich takes over an Ohio University football team that finished four and seven this year.

To the forecast center and Chad.

MYERS: Oh, wouldn't the Huskers like him back now?

COSTELLO: Yes, they would.

MYERS: After that fiasco of a West Coast offense in the Midwest.

Good luck, Frank.

Hey, one little piece of advice -- don't do the West Coast. Not yet.

(WEATHER REPORT)

COSTELLO: Hey, the Washington Nationals, Chad?

MYERS: Yes, what's up with that? COSTELLO: Maybe not.

MYERS: Oh.

COSTELLO: It looks like the deal is pretty much dead, so don't put away your Montreal Expos cap just yet.

MYERS: Yes.

COSTELLO: A snag in the team's deal to become the Washington Nationals may force them back to Canada. The issue? Who is going to pay for the stadium.

Leslie Foster of CNN affiliate WUSA in Washington has more on the story.

(BEGIN VIDEO TAPE)

LESLIE FOSTER, WUSA CORRESPONDENT (voice-over): D.C. Council Chair Linda Cropp says she wants baseball in the district, but not if it's going to break the bank.

LINDA CROPP, WASHINGTON CITY COUNCIL: The only thing that the Council is saying now is that we want to take opportunities to get private financing.

FOSTER: The opportunity to get that private funding is just days away. The Council's final legislative session for the year is next Tuesday and baseball wants a decision on how to fund the stadium by December 31. Cropp wants baseball to extend that deadline.

CROPP: It truly, at this point, does absolutely no harm to major league baseball. So I think that would be a move of good faith, I think, on their part to the District's citizens.

FOSTER: The mayor says he's talked to baseball officials and they are sticking to their time line. While he says the deal is in jeopardy, he says all is not lost. MAYOR TONY WILLIAMS, WASHINGTON, D.C.: I'm confident that in the next couple of things -- the next couple of days we can resuscitate this.

FOSTER: Each side is trying to come up with a compromise. Cropp says there are proposals for private funding out there and the mayor is attempting to broker other deals, too.

Meantime, baseball has rejected any changes to the original funding plan, even going so far as to shut down all events promoting D.C. baseball.

Ward One Councilman Jim Graham doesn't see this as a positive step.

JIM GRAHAM, WASHINGTON CITY COUNCIL: You know, I think their whole attitude has been one of throwing down the gauntlet in a way that, you know, I think all of us, you know, have a level of upset about that. I mean we're part of this process. FOSTER: Baseball fans hope cooler heads will prevail in the process, to finally bring the game back to the nation's capital.

(END VIDEO TAPE)

COSTELLO: That was Leslie Foster of CNN affiliate WUSA in Washington.

The original stadium deal called for a tax on businesses and government buildings to raise, get this, $530 million. Oh, Chad.

MYERS: Yes?

COSTELLO: There's an e-mail question begging to be asked, don't you think?

MYERS: It sounds like it.

COSTELLO: $530 million, all paid by the taxpayers. Should that be? Who should pay for pro sports venues? Who? Should it be the cities, the team owners, or should players give up a portion of their salaries for a new place to play? Oh, right!

MYERS: Couldn't it be part of the ticket price? You get a little bond that says OK, we're giving you this bond but you've got to give us $5 from every ticket to pay back the bond? Couldn't it just -- can't we all just get along?

COSTELLO: Couldn't it just be the wealthy owners paying for their own stinking stadiums?

MYERS: I'm not sure this guy's that wealthy, though. I'm not sure that this is all that smooth, is it?

COSTELLO: That's right. Because who owns the Montreal Expos? See, this is a very complicated issue this time.

MYERS: They've been losing money a long time.

COSTELLO: Oh, yes. But we want your comments this morning.

MYERS: Yes.

COSTELLO: So send your e-mails to us. Daybreak@cnn.com. That's daybreak@cnn.com. And, of course, we are eager for your responses and we'll read some of them at the end of our program.

Police in Maryland have arrested a man they say is involved in setting the fires that destroyed 10 homes and damaged 30 others. We'll bring you the latest on this from Charles County.

Plus, how safe are prescription drugs you take? We intelligent.

You are watching DAYBREAK for a Friday.

(COMMERCIAL BREAK) COSTELLO: It's time to check out -- oh, actually, it's time to laugh a little bit Chad.

MYERS: Yes.

COSTELLO: Are you ready?

MYERS: I am. I'm standing right here. Leno and Letterman?

COSTELLO: Yes, we have them both. So let's roll the tape.

(BEGIN VIDEO CLIP FROM "THE TONIGHT SHOW WITH JAY LENO," COURTESY NBC)

JAY LENO, HOST: I don't know if anybody else has had this problem. My tree has been up less than a week. It's already completely dried out. Needles everywhere. It looks like the floor of a major league locker room.

Viktor Yushchenko, you hear about this guy? He was poisoned. His blood contained the second highest of dioxin poisoning ever recorded in a human being, more than 6,000 times the normal concentration. They said it was as if he had spent his whole life in Jersey.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP FROM "THE LATE SHOW WITH DAVID LETTERMAN, COURTESY CBS/WORLDWIDE PANTS)

DAVID LETTERMAN, HOST: How about that Bernie Kerik, that Bernard Kerik? Woo, huh? The former police commissioner who was going to be the head of the homeland security. Man, alive. He, you know, he was going to -- I think he would have made a great homeland security director. This guy had three wives and two mistresses. I mean he's used to fighting terrorism, isn't he, when you think about it?

(END VIDEO CLIP)

COSTELLO: Oh, I liked that one.

MYERS: It was all right.

COSTELLO: Leno was weak, but Letterman was good.

MYERS: You know, New Jersey can always be the butt of any joke, so.

COSTELLO: I know. That's just wrong.

MYERS: It was a little lame.

COSTELLO: You know, the Eagles' Terrell Owens visits Dave tonight.

MYERS: Yes. COSTELLO: And who knows? Who knows, Chad, maybe that desperate housewife, Nicolette Sheridan, will drop in, too, to drop something.

MYERS: See who shows up in a towel.

COSTELLO: That would be really funny, actually.

MYERS: That would be.

COSTELLO: Let's call him.

Time to check out our Web clicks this morning, the most popular stories on cnn.com.

Number one is "The Apprentice." Why are people into this program?

MYERS: Well, 19 percent less viewership than last year. But still, 19 million people tuned into this.

COSTELLO: Crazy. You want to know who The Donald chose?

MYERS: Yes.

COSTELLO: Software executive Kelly Perdew, who's 37. And she will join his staff during the season finale of "The Apprentice" on Thursday.

MYERS: Wait, she?

COSTELLO: Oh, I'm sorry, he. See, I don't watch the show.

MYERS: Yes. Actually, the young lady that you saw there, she was in charge of doing a basketball fundraiser. He was in charge of doing a polo fundraiser. It rained on his. She had the guest, the key guest cancel on her. They did all this stuff to see who could actually make the most money, who could make the best fundraiser and Donald just thought that he did a much better job.

COSTELLO: You watch this show, don't you?

MYERS: I've watched a few things because you know what? When the baby's not sleeping, you have to kind of get some idle time, because you can't go anywhere.

COSTELLO: It's a change of life kind of thing, isn't it?

MYERS: It certainly is.

COSTELLO: The number two most popular story on cnn.com is about this huge shark that killed a teenager in Australia.

MYERS: Yes.

COSTELLO: This is just like the movie "Jaws." They're going to go out and hunt this thing down. MYERS: Well, the scariest thing, I think, is that this has now happened three times in the past six months. And they did not believe that great whites hunted in pairs. But now on this occasion the witnesses said they thought that there were two sharks. And on the second to last occasion, they thought that there were two sharks. And so they're looking for one, but they actually may find two, which is a little scary.

COSTELLO: These things are big. They're 16 feet long.

MYERS: Yes, they're out by Adelaide and they don't care if they're out in the ocean, but they can't be near the beaches and obviously they can't be attacking people so.

COSTELLO: All right, well, we're going to take a short break.

We'll be back with much more on DAYBREAK.

MYERS: All right.

(COMMERCIAL BREAK)

COSTELLO: And good morning to you.

Welcome to the second half hour of DAYBREAK.

From the Time Warner Center in New York, I'm Carol Costello.

Thank you for waking up with us.

Now in the news, this morning, President Bush will sign into law the most sweeping reform of U.S. intelligence services since World War 2. The signing ceremony is set for 9:55 a.m. Eastern and CNN does plan live coverage for you.

In northwestern Missouri, an amber alert has been issued for a missing girl, baby girl that could have survived the killing of her mother. Authorities believe the woman was strangled and the 8-month- old female fetus was cut from the mother's womb.

A shootout in Gaza. Israeli troops entering the Khan Unis refugee camp exchanged fire with Palestinian militants, killing five of them. The Israelis went into the camp looking for stores of mortar rounds.

A U.S. Marine has been killed in action in Al Anbar Province, west of Baghdad. The U.S. military says only that the Marine was killed during security and stabilization operations.

To the forecast center and Chad -- good morning.

MYERS: Good morning, Carol.

(WEATHER REPORT)

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 December 17, 2004 - 05:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL COSTELLO, CNN ANCHOR: Straight ahead on DAYBREAK, an arrest in a $10 million arson case. The defendant says you've got the wrong man.
Plus, hold the celebration. D.C. and pro baseball play hardball over funding for a new stadium.

And that umbrella twirling, magical English nanny is back, but we guarantee this is not the Mary Poppins you knew.

It is Friday, December 17.

This is DAYBREAK.

And good morning to you.

From the Time Warner Center in New York, I'm Carol Costello.

Now in the news, President Bush signs the intelligence reform legislation this morning. It promises major changes, creating what could be a powerful new director of national intelligence. CNN plans live coverage of that signing. It will happen at 9:55 Eastern.

Indonesian police say they found several homemade bombs in two separate locations today. Britain, the U.S. and Australia have warned Indonesia that terrorists may be planning an attack on Western interests before Christmas.

Israeli troops today raid a refugee camp in southern Gaza. One report says at least five Palestinians have been killed. The Israelis say they're targeting sites where rockets are launched at Jewish settlements.

And a U.S. Marine with the 1st Expeditionary Force has been killed in Iraq's Al Anbar Province. Since Sunday, at least 10 Marines have been killed in the province noted for insurgent activity.

To the forecast center now -- good morning, Chad Myers.

CHAD MYERS, CNN METEOROLOGIST: Good morning, Carol.

A little warmer where you are this morning.

COSTELLO: Thank goodness.

MYERS: Well, don't get used to it. By noon the cold front comes through and fixes all of that.

(WEATHER REPORT)

COSTELLO: It is a huge arson case, $10 million in damage to new homes under construction in an upscale Maryland subdivision. And this morning, 21-year-old Aaron Speed, that man, will appear before a federal judge.

Kelli Arena has more for you.

(BEGIN VIDEO TAPE)

AARON SPEED, ARSON SUSPECT: They've got the wrong man.

KELLI ARENA, CNN CORRESPONDENT (voice-over): That was 21-year- old Aaron Speed, arrested in connection with the fires that swept through a high priced housing development in suburban Washington.

SPEED: They've humiliated me. They humiliated my family. OK? Everything that I'm doing, I'm doing willingly to prove to them I am innocent.

ARENA: Authorities searched the home of his parents, where Speed and his family were staying.

GEORGE COCHRAN, NEIGHBOR: Cars and vans here until midnight. And they were in and out of the house. They were back in the shed with flashlights. And said they -- something about fire on Sunday.

ARENA: Prosecutors charged Speed with arson in the fires that damaged 26 homes, 10 destroyed, causing an estimated $10 million in damage. Authorities would not go into a possible motive, but do say Speed is cooperating and they say others may have been involved.

Speed worked for Security Services of America. That's the company that was hired to guard the housing development. A company spokeswoman had no comment.

(on camera): Speed is scheduled to appear in federal court later today. The maximum penalty for arson is 20 years in prison.

Kelli Arena, CNN, Washington.

(END VIDEO TAPE)

COSTELLO: In news across America this morning, a bizarre and tragic story out of Skidmore, Missouri. Listen to this. Police there are looking for a missing fetus that had been cut from the womb of a murder victim who was eight months pregnant. Police are also looking for the husband of the 23-year-old victim. Officials say there is a chance the fetus survived.

A gunman now holed up inside the famed Crystal Cathedral in Garden Grove, California. Hours earlier, he opened fire with a handgun. No one was hurt. The building has been evacuated. SWAT teams and police negotiators now on the scene. The man, who police say is in his 50s, is a church employee and a choir member.

In Fort Lauderdale, Florida, a janitor has been charged with stealing medals from the Swimming Hall of Fame. Among the hundreds of Olympic medals stolen are the awards won by Johnny Weissmuller in 1924. Authorities say the medals are worth nearly a half million dollars. The theft was discovered when the janitor began selling the items over the Internet.

The U.S. Army says they're accelerating the production of armored vehicles at plants in the United States. Their hope is to have several hundred new vehicles ready to go in the next few months. Also in the works, kits that let troops armor their own Humvees.

CNN's Ed Lavandera has more on that story.

(BEGIN VIDEO TAPE)

ED LAVANDERA, CNN CORRESPONDENT (voice-over): Ricardo Hernandez knows his job is about life, death and soldiers he's never met.

RICARDO HERNANDEZ, ARMOUR OF AMERICA: Every night my wife and I think about how they're doing over there in Iraq and what we can do to improve this type of protection for them.

LAVANDERA: Ricardo is in charge of sewing together all the soft and heavy armor packs manufactured by Armour of America in this Los Angeles factory. He's also the stepfather of a U.S. army sergeant who drives a Humvee in Iraq. A few months ago, his stepson e-mailed to say that his vehicle had finally been outfitted with the soft Kevlar armor kit that Ricardo and 30 employees have made here.

(on camera): Does it help you sleep at night knowing that he's driving around in the product you made here?

HERNANDEZ: Of course. Of course. I'm very happy. My wife's very confident of what I do because that protects my -- our son. I'm very happy and I'm proud of what I'm doing.

LAVANDERA (voice-over): In the last year, Armour of America has made almost 3,000 armor kits for military vehicles in Iraq. Some are soft Kevlar, which slide on the Humvee doors and protect soldiers from roadside bombs.

JOHN NEHMENS, ARMOUR OF AMERICA: In less than five minutes you've armored the outside of the vehicle. This system is a soft -- it feels like a soft blanket for fragmentation.

LAVANDERA: Some kits are hard armor, which manager John Nehmens demonstrated for us.

NEHMENS: This is a hard plate, the same concept. And the hard plate will stop AK-47 and M-16 rounds.

LAVANDERA: John believes this is the kind of protection soldiers want on their vehicles. NEHMENS: They want to be able to stop a round. They want to be able to stop the fragmentation. And they want to have the ability to shoot back. That's exactly what they want to do.

LAVANDERA: These days, business is mostly quiet as John waits for the go ahead to make another $20 million worth of armor kits for the U.S. military. Just in case, he's already started on the armor for Humvee doors.

(on camera): Trying to get ahead of the curve here?

NEHMENS: Absolutely. This is the hardest part of the process.

LAVANDERA (voice-over): The military units John has been working with ship out in the next three to four months.

NEHMENS: They are very interested in getting this on before they leave, but, again, they're constrained by the dollars.

LAVANDERA: The military says there are some 20,000 vehicles in Iraq. About 4,300 still need armor. For those vehicles, help is also coming, from places like the Red River Army Depot in northeast Texas.

COL. MICHAEL SAVONE: This is where everything comes together.

LAVANDERA: Colonel Michael Savone (ph) oversees the delivery of Humvee armor kits. These units will be shipped to the Middle East and put on in the field. Production is ramping up again with new designs to help soldiers in battle.

SAVONE: This thing will open up now all the way out, which allows the trooper to be able to have a better firing angle if he needs to lay down suppressor fire to get out of an ambush.

LAVANDERA: Ricardo Hernandez fears his stepson is always in danger on missions to the Iraqi countryside. For him, this work is personal.

HERNANDEZ: This may save a life. And I don't want nothing to fail.

(END VIDEO TAPE)

COSTELLO: That was CNN's Ed Lavandera reporting from Los Angeles.

Will it be a blue Christmas at Graceland? The Elvis Presley estate is getting all shook up. We'll tell you how the king's daughter is taking care of business at 17 minutes past.

And are you ready for a Mary Poppins who's not too concerned about that spoonful of sugar? We'll meet a darker version of the magical nanny at 40 minutes past. Who knew?

And at 57 minutes past, are you still wishing folks a Merry Christmas or have you shifted into a more generic holiday greeting? We'll dive into diversity at 57 minutes past.

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

(COMMERCIAL BREAK)

(STOCK MARKET REPORT)

COSTELLO: We are, as always here at CNN, on "Security Watch" this morning. Today, we're focusing on security at the nation's ports. Things are getting better, but as CNN's Frank Buckley reports, port officials say there is still a long way to go.

(BEGIN VIDEO TAPE)

FRANK BUCKLEY, CNN NATIONAL CORRESPONDENT (voice-over): Twenty thousand containers enter the U.S. every day and their potential use as platforms of terror keeps the head of Seattle's port awake at night with worry.

M.R. DINSMORE, CEO, PORT OF SEATTLE: Here we are three years, three months older from 9/11. We're doing a lot, but I think there's a tremendous amount of additional things we should do to make this nation safer.

BUCKLEY: M.R. Dinsmore says the nation's ports are doing a better job of monitoring for radiation and x-raying containers. Other efforts include boarding ships at sea to inspect cargo.

(on camera): But with so many containers coming into the U.S., Customs and border protection inspectors only physically examine the contents of some 6 percent of the containers.

RANDOLPH HALL, USC HOMELAND SECURITY CENTER: Each container contains many cartons. Each carton contains many packages. Does that mean that we open up every carton coming into this country or we open up every box to see what's inside? I think most people would say that's impractical.

BUCKLEY: Homeland security officials say international cooperation, including U.S. inspectors in 32 international ports, has tightened security significantly before containers ever approach U.S. waters.

TOM RIDGE, HOMELAND SECURITY SECRETARY: These new defenses begin thousands of miles away before a container is even loaded onto a cargo vessel bound for our shores.

BUCKLEY: But the Port of Seattle's Dinsmore says a network that tracks cargo from its source with cargo that's sealed and monitored is the ideal, and more than three years after 9/11 it should be in place.

DINSMORE: Three years, three months older, we still do not have an implementation of a network at the national level. We're still testing. That's disconcerting. BUCKLEY: Because, Dinsmore warns, it would take just one container shipped by terrorists to severely damage international trade and potentially cripple the U.S. economy.

Frank Buckley, CNN, Los Angeles.

(END VIDEOTAPE)

COSTELLO: Your news, money, weather and sports.

It's 5:14 Eastern.

Here's what's all new this morning.

A security guard is set to appear in court today on charges he set a series of fires in a Maryland subdivision nearly two weeks ago. Ten homes were destroyed, 30 others damages. So far, no motive, not even eco-terrorism.

President Bush is expected to sign the intelligence reform bill today. The bill includes many of the key recommendations from the 9/11 Commission, including the creation of a national intelligence chief.

In money news, Hershey is taking a bigger bite out of your pocket. The candy maker says it's going to hike prices immediately to combat rising production costs. The price of the signature Hershey bar going up nearly 6 percent.

In culture, Lisa Marie Presley is selling her father, so to speak, in a deal worth $100 million. A New York investor is getting 85 percent of the company that controls Elvis' likeness, his music and Graceland.

In sports, former University of Nebraska Head Coach Frank Solich has resurfaced in Ohio. Solich takes over an Ohio University football team that finished four and seven this year.

To the forecast center and Chad.

MYERS: Oh, wouldn't the Huskers like him back now?

COSTELLO: Yes, they would.

MYERS: After that fiasco of a West Coast offense in the Midwest.

Good luck, Frank.

Hey, one little piece of advice -- don't do the West Coast. Not yet.

(WEATHER REPORT)

COSTELLO: Hey, the Washington Nationals, Chad?

MYERS: Yes, what's up with that? COSTELLO: Maybe not.

MYERS: Oh.

COSTELLO: It looks like the deal is pretty much dead, so don't put away your Montreal Expos cap just yet.

MYERS: Yes.

COSTELLO: A snag in the team's deal to become the Washington Nationals may force them back to Canada. The issue? Who is going to pay for the stadium.

Leslie Foster of CNN affiliate WUSA in Washington has more on the story.

(BEGIN VIDEO TAPE)

LESLIE FOSTER, WUSA CORRESPONDENT (voice-over): D.C. Council Chair Linda Cropp says she wants baseball in the district, but not if it's going to break the bank.

LINDA CROPP, WASHINGTON CITY COUNCIL: The only thing that the Council is saying now is that we want to take opportunities to get private financing.

FOSTER: The opportunity to get that private funding is just days away. The Council's final legislative session for the year is next Tuesday and baseball wants a decision on how to fund the stadium by December 31. Cropp wants baseball to extend that deadline.

CROPP: It truly, at this point, does absolutely no harm to major league baseball. So I think that would be a move of good faith, I think, on their part to the District's citizens.

FOSTER: The mayor says he's talked to baseball officials and they are sticking to their time line. While he says the deal is in jeopardy, he says all is not lost. MAYOR TONY WILLIAMS, WASHINGTON, D.C.: I'm confident that in the next couple of things -- the next couple of days we can resuscitate this.

FOSTER: Each side is trying to come up with a compromise. Cropp says there are proposals for private funding out there and the mayor is attempting to broker other deals, too.

Meantime, baseball has rejected any changes to the original funding plan, even going so far as to shut down all events promoting D.C. baseball.

Ward One Councilman Jim Graham doesn't see this as a positive step.

JIM GRAHAM, WASHINGTON CITY COUNCIL: You know, I think their whole attitude has been one of throwing down the gauntlet in a way that, you know, I think all of us, you know, have a level of upset about that. I mean we're part of this process. FOSTER: Baseball fans hope cooler heads will prevail in the process, to finally bring the game back to the nation's capital.

(END VIDEO TAPE)

COSTELLO: That was Leslie Foster of CNN affiliate WUSA in Washington.

The original stadium deal called for a tax on businesses and government buildings to raise, get this, $530 million. Oh, Chad.

MYERS: Yes?

COSTELLO: There's an e-mail question begging to be asked, don't you think?

MYERS: It sounds like it.

COSTELLO: $530 million, all paid by the taxpayers. Should that be? Who should pay for pro sports venues? Who? Should it be the cities, the team owners, or should players give up a portion of their salaries for a new place to play? Oh, right!

MYERS: Couldn't it be part of the ticket price? You get a little bond that says OK, we're giving you this bond but you've got to give us $5 from every ticket to pay back the bond? Couldn't it just -- can't we all just get along?

COSTELLO: Couldn't it just be the wealthy owners paying for their own stinking stadiums?

MYERS: I'm not sure this guy's that wealthy, though. I'm not sure that this is all that smooth, is it?

COSTELLO: That's right. Because who owns the Montreal Expos? See, this is a very complicated issue this time.

MYERS: They've been losing money a long time.

COSTELLO: Oh, yes. But we want your comments this morning.

MYERS: Yes.

COSTELLO: So send your e-mails to us. Daybreak@cnn.com. That's daybreak@cnn.com. And, of course, we are eager for your responses and we'll read some of them at the end of our program.

Police in Maryland have arrested a man they say is involved in setting the fires that destroyed 10 homes and damaged 30 others. We'll bring you the latest on this from Charles County.

Plus, how safe are prescription drugs you take? We intelligent.

You are watching DAYBREAK for a Friday.

(COMMERCIAL BREAK) COSTELLO: It's time to check out -- oh, actually, it's time to laugh a little bit Chad.

MYERS: Yes.

COSTELLO: Are you ready?

MYERS: I am. I'm standing right here. Leno and Letterman?

COSTELLO: Yes, we have them both. So let's roll the tape.

(BEGIN VIDEO CLIP FROM "THE TONIGHT SHOW WITH JAY LENO," COURTESY NBC)

JAY LENO, HOST: I don't know if anybody else has had this problem. My tree has been up less than a week. It's already completely dried out. Needles everywhere. It looks like the floor of a major league locker room.

Viktor Yushchenko, you hear about this guy? He was poisoned. His blood contained the second highest of dioxin poisoning ever recorded in a human being, more than 6,000 times the normal concentration. They said it was as if he had spent his whole life in Jersey.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP FROM "THE LATE SHOW WITH DAVID LETTERMAN, COURTESY CBS/WORLDWIDE PANTS)

DAVID LETTERMAN, HOST: How about that Bernie Kerik, that Bernard Kerik? Woo, huh? The former police commissioner who was going to be the head of the homeland security. Man, alive. He, you know, he was going to -- I think he would have made a great homeland security director. This guy had three wives and two mistresses. I mean he's used to fighting terrorism, isn't he, when you think about it?

(END VIDEO CLIP)

COSTELLO: Oh, I liked that one.

MYERS: It was all right.

COSTELLO: Leno was weak, but Letterman was good.

MYERS: You know, New Jersey can always be the butt of any joke, so.

COSTELLO: I know. That's just wrong.

MYERS: It was a little lame.

COSTELLO: You know, the Eagles' Terrell Owens visits Dave tonight.

MYERS: Yes. COSTELLO: And who knows? Who knows, Chad, maybe that desperate housewife, Nicolette Sheridan, will drop in, too, to drop something.

MYERS: See who shows up in a towel.

COSTELLO: That would be really funny, actually.

MYERS: That would be.

COSTELLO: Let's call him.

Time to check out our Web clicks this morning, the most popular stories on cnn.com.

Number one is "The Apprentice." Why are people into this program?

MYERS: Well, 19 percent less viewership than last year. But still, 19 million people tuned into this.

COSTELLO: Crazy. You want to know who The Donald chose?

MYERS: Yes.

COSTELLO: Software executive Kelly Perdew, who's 37. And she will join his staff during the season finale of "The Apprentice" on Thursday.

MYERS: Wait, she?

COSTELLO: Oh, I'm sorry, he. See, I don't watch the show.

MYERS: Yes. Actually, the young lady that you saw there, she was in charge of doing a basketball fundraiser. He was in charge of doing a polo fundraiser. It rained on his. She had the guest, the key guest cancel on her. They did all this stuff to see who could actually make the most money, who could make the best fundraiser and Donald just thought that he did a much better job.

COSTELLO: You watch this show, don't you?

MYERS: I've watched a few things because you know what? When the baby's not sleeping, you have to kind of get some idle time, because you can't go anywhere.

COSTELLO: It's a change of life kind of thing, isn't it?

MYERS: It certainly is.

COSTELLO: The number two most popular story on cnn.com is about this huge shark that killed a teenager in Australia.

MYERS: Yes.

COSTELLO: This is just like the movie "Jaws." They're going to go out and hunt this thing down. MYERS: Well, the scariest thing, I think, is that this has now happened three times in the past six months. And they did not believe that great whites hunted in pairs. But now on this occasion the witnesses said they thought that there were two sharks. And on the second to last occasion, they thought that there were two sharks. And so they're looking for one, but they actually may find two, which is a little scary.

COSTELLO: These things are big. They're 16 feet long.

MYERS: Yes, they're out by Adelaide and they don't care if they're out in the ocean, but they can't be near the beaches and obviously they can't be attacking people so.

COSTELLO: All right, well, we're going to take a short break.

We'll be back with much more on DAYBREAK.

MYERS: All right.

(COMMERCIAL BREAK)

COSTELLO: And good morning to you.

Welcome to the second half hour of DAYBREAK.

From the Time Warner Center in New York, I'm Carol Costello.

Thank you for waking up with us.

Now in the news, this morning, President Bush will sign into law the most sweeping reform of U.S. intelligence services since World War 2. The signing ceremony is set for 9:55 a.m. Eastern and CNN does plan live coverage for you.

In northwestern Missouri, an amber alert has been issued for a missing girl, baby girl that could have survived the killing of her mother. Authorities believe the woman was strangled and the 8-month- old female fetus was cut from the mother's womb.

A shootout in Gaza. Israeli troops entering the Khan Unis refugee camp exchanged fire with Palestinian militants, killing five of them. The Israelis went into the camp looking for stores of mortar rounds.

A U.S. Marine has been killed in action in Al Anbar Province, west of Baghdad. The U.S. military says only that the Marine was killed during security and stabilization operations.

To the forecast center and Chad -- good morning.

MYERS: Good morning, Carol.

(WEATHER REPORT)

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