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CNN Live At Daybreak

Secretary of State Condoleezza Rice's First Trip to Europe; Story of Survivor of California Train Wreck

Aired February 04, 2005 - 06:00   ET

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

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


(BEGIN VIDEO CLIP)
JOHN PHIPPS, TRAIN CRASH SURVIVOR: There was plenty of lead so I wrote "I heart my kids."

(END VIDEO CLIP)

CAROL COSTELLO, CNN ANCHOR: A father faces his own mortality. A heartfelt survivor's story.

The new secretary of state traveling abroad. First stop, Ten Downing Street. We'll have a live report from London.

And new allegations about Enron. How early did the scandal start?

It is Friday, February 4.

You are watching DAYBREAK.

And good morning to you.

From the Time Warner Center in New York, I'm Carol Costello, along with Chad Myers.

Now in the news, Pope John Paul II is spending a third day at a hospital in Rome. We are expecting a live news conference on the pontiff's condition later this hour and when that happens, we'll get you there.

Two more American soldiers have been killed in Iraq. The military says one was killed while on patrol south of Baghdad, and the other died when his military convoy was hit by a roadside bomb south of Mosul.

A search and rescue operation going on right now for an Afghan passenger jet missing during a snowstorm. The U.S. Embassy says at least three Americans are believed among the 104 on board that plane. A snowstorm prevented its landing at Kabul.

A search is underway in Florida for the couple accused of torturing five of their seven children in their home. Allegations against John and Linda Dollar include starving their children.

Let's head to the forecast center now and Chad -- good morning.

CHAD MYERS, CNN METEOROLOGIST: Good morning, Carol.

(WEATHER REPORT)

COSTELLO: Will the United States attack Iran? That question put right to Condoleezza Rice this morning. The new secretary of state is in London this morning. She had breakfast with Tony Blair and then she took reporters' questions along with Foreign Secretary Jack Straw. Rice stressed the use of diplomacy.

(BEGIN VIDEO CLIP)

CONDOLEEZZA RICE, NATIONAL SECURITY ADVISER: We expect more of our friends. Obviously, countries are going to move at their own pace. They are going to move toward the liberalization of their politics in the context of their own traditions, religious, historical and others. No one can seek to impose a particular model or a particular set of solutions.

(END VIDEO CLIP)

COSTELLO: CNN's European political editor, Robin Oakley, joins us now live from London with more.

And there was much talk about Iran during this press conference -- Robin.

ROBIN OAKLEY, CNN CORRESPONDENT: Indeed, Carol.

The focus very much on Iran, very forthright words from Condoleezza Rice, which will probably have some reverberation across the rest of Europe. There is a difference between the European Union countries and the United States in how Iran should be tackled.

She insisted this morning that there Iranian regime was destabilizing the region, that it was harboring terrorists and she insisted that it must not be allowed to use its civil nuclear program as a cover for developing a nuclear weapons program.

But when she was questioned directly by reporters as to whether that meant that the U.S. was prepared to contemplate military action, she said that question was simply not on the agenda yet, not at this point, she said, and there were plenty of diplomatic means at the disposal of those who wanted to deter the Iranians from going down that particular route. And she said the Iranians have the chance of demonstrating in their talks with the European Union countries -- France, Britain and Germany -- that they were prepared to live up to their international obligations -- Carol.

COSTELLO: Robin Oakley live in London this morning.

Thank you.

While Condoleezza Rice takes on her new diplomatic duties overseas, President Bush is selling his new Social Security plan to middle America. He's in Omaha, Nebraska this morning. He'll talk Social Security at the Quest Center later today. And then it's off to Little Rock, Arkansas and then to Tampa, Florida.

During a town hall meeting last night in Montana, President Bush again said if you have a good idea on Social Security, bring it on. And then he talked about his own plan -- voluntary retirement accounts.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: There are ways to make sure your fund can avoid swings in the market at very end of -- right before you retire. So there are some wise things we can do, just like we do for the federal government employees. See? They've got this plan. It's called the thrift savings plan. My attitude is if it's good enough for people working in the federal government, it ought to be good enough for people working elsewhere in America.

(END VIDEO CLIP)

COSTELLO: President Bush says Social Security reform is needed or else the system will go bankrupt by the year 2042.

FBI Director Robert Mueller is disappointed with delays in computer software upgrades and a Justice Department report says the millions of dollars spent on that technology has been largely wasted. Now the FBI's trying to determine if any part of its $170 million virtual case file project can be salvaged.

Federal investigators hope to interview the pilot today of a corporate jet that crashed in New Jersey. They say they have found no evidence of ice on the wings and there aren't that many clues in the wreckage.

Here's what the National Transportation Safety Board is working with.

(BEGIN VIDEO CLIP)

DEBORAH HERSMAN, NTSB: What I can tell you is that we have approximately 43 seconds of tape from the time that the engines spooled up until the time that the cockpit voice recorder stopped recording on impact.

(END VIDEO CLIP)

COSTELLO: Let's talk about what the plane hit. There was another car that the out of control plane hit.

Besides Rohan Foster, that driver remains in critical condition this morning.

(BEGIN VIDEO CLIP)

ROHAN FOSTER, SURVIVOR: I think that it's a miracle because when I see the car on TV, because one time I asked, when I was revived out of the guy when he was taking me out of the car, he said the car is totaled. That's when that guy was taking me out. He said the car is totaled. But I didn't see it. It was like, you know, I was messed up. And after I came here and I was looking at the TV and see the side of the car I said I can't believe that's the car I was in.

(END VIDEO CLIP)

COSTELLO: I apologize for not explaining that well. That was one of the people inside of a car that the jet hit. He survived. The person in the car with him remains in the hospital in critical condition this morning.

That commuter train crash in California, a heartfelt message written in blood. This morning, the mystery of who wrote that desperate good-bye is solved, as well as the happy ending behind it.

Ted Rowlands unravels it for you.

(BEGIN VIDEO TAPE)

TED ROWLANDS, CNN CORRESPONDENT (voice-over): While looking for signs of life in the twisted wreckage of a commuter train crash, Los Angeles firefighters came across John Phipps trapped in the twisted rubble.

CAPT. BOB ROSARIO, LOS ANGELES FIRE DEPARTMENT: To see a live person trapped inside all this rubble and debris was pretty amazing.

ROWLANDS: After pulling him out, firefighters noticed something, a message written in blood on the back of what was left of a passenger seat. "I love my kids," it said, using the heart sign. Below that, also in blood, it read, "I love Leslie."

Eleven people died in the train wreck, but John Phipps survived. And in an emotional meeting this afternoon with his wife Leslie and children, Shara, Jeremy, and Josh, John thanked the firefighters that pulled him out.

John, who still has 24 staples in his head, says blood was all over his hand when he wrote the note.

PHIPPS: "I heart Leslie." Then there was a little bar above that and I thought, well, there's plenty of blood. So I wrote, "I heart my kids."

LESLIE PHIPPS, WIFE: It's moving and it's thoughtful and it's chilling all at the same time, to think that you would think, I'm going to die here. I could die here. And to think of somebody else is amazing. It really is. And he thought of all of us. And that's just terrific.

JOHN PHIPPS: I got to tell my wife and my kids what I thought were going to be my last words. And God blessed me and made sure that they weren't my last words.

ROWLANDS: Words written by a man, who, when faced with death, truly appreciated the importance of life.

Ted Rowlands, CNN, Los Angeles.

(END VIDEOTAPE)

COSTELLO: A happy ending.

The man suspected of causing that train crash, by the way, still awaiting arraignment on 11 murder charges. Juan Alvarez's court appearance last week was postponed indefinitely for medical reasons.

A story of alleged deceit that impacted millions. Just ahead in our business headlines, tapes of Enron employees that some say reveal a plot to cause power blackouts.

Have you got your TV warmed up yet for the Super Bowl? We're live from Jacksonville, Florida with a Friday morning preview of the big game.

And later, we'll hear from Donald Rumsfeld on why he offered his resignation as secretary of defense, twice.

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

(COMMERCIAL BREAK)

COSTELLO: A bit of news just in to CNN about Pope John Paul II.

The Vatican has come up with an update on his medical condition and Reuters is reporting that even medical tests now confirm the pope's condition has stabilized. The pope is expected to make an address on Sunday and apparently the Vatican says he's eating normally, sleeping normally. The next update on his health will come on Monday.

Your news, money, weather and sports.

It's 6:12 Eastern.

Here's what's all new this morning.

Secretary of State Condoleezza Rice held a news conference last hour with British Foreign Secretary Jack Straw. Rice said the possibility of an attack on Iran is, quoting here, "not on the agenda at this point." She says Iran must comply with international efforts to control its nuclear development.

Japanese health officials say they've had their first human mad cow casualty. The man, who died in December, is believed to have been infected during a trip to Britain in 1989. Accurate tests for the human form of mad cow can only be performed after the patient dies.

In money news, interest rates on a 30-year fixed mortgage fell for a fifth straight week. Other short-term rates ended up just a smidge. The Federal Reserve boosted short-term interest rates on Wednesday. In culture, the notes from the "Washington Post's" reporting on Watergate go on display in Austin, Texas today. The papers, written by Bob Woodward and Carl Bernstein, were purchased by the University of Texas for $5 million.

In sports, Emmitt Smith says he had offers to keep playing, but he decided to retire instead. The NFL's all time leading rusher became emotional as he thanked past and present teammates. He also thanked Cowboys owner Jerry Jones for believing in him.

(BEGIN VIDEO CLIP)

EMMITT SMITH, RETIRING RUNNING BACK: You took a chance on me. And I thank you for that. You've given me an opportunity to have a life greater than I can ever imagine.

(END VIDEO CLIP)

COSTELLO: And, I guess, Chad, he signed a one day contract with the Dallas Cowboys...

MYERS: Yes.

COSTELLO: ... so he could retire as a Cowboy.

MYERS: That's right. And he was clutching that helmet as he said the words, so, yes. Obviously one of the greatest out there.

Hey, good morning, Carol.

(WEATHER REPORT)

COSTELLO: Chad, you know, in the words of Lionel Ritchie...

MYERS: What's that?

COSTELLO: There's a party going on right now, a celebration that will last all through the year.

MYERS: Is that in Jacksonville?

COSTELLO: Yes. The here would be in Jacksonville, Florida. The Super Bowl isn't until Sunday, but the party has already begun.

Let's head live there now and check in with Larry Smith -- good morning, Larry.

LARRY SMITH, CNN CORRESPONDENT: Oh, good morning to you.

It's a chilly morning here, but certainly the partygoers were out in full force last night. As you get to the weekend now, two days away from the kickoff of Super Bowl 39, between the Philadelphia Eagles and the New England Patriots.

Now, as you know, the key to success for any football team is its defense and turnovers. Every time a team fumbles the ball away and throws an interception, it's one less scoring chance for that team and one more scoring chance for the other team.

And therein lies the key to the Patriots' success. They have been outstanding this season. In fact, in terms of getting turnovers, only two teams forced more turnovers in the regular season than New England, which forced seven more turnovers in two playoff games, to now stand on the brink of their third Super Bowl crown in four years, something only the Dallas Cowboys have ever achieved, and that was nearly a decade ago.

(BEGIN VIDEO CLIP)

BILL BELICHICK, PATRIOTS COACH: And I wish we could say well, here's our turnover defense. We're going to call this one and we'll get a turnover when we need it. It's -- I think it's really more of a situation where the defense is able to take advantage of an opportunity to get their hands on the ball.

DONOVAN MCNABB, EAGLES QUARTERBACK: It's difficult to avoid turnovers, obviously, because of what they've been doing, you know, stripping the ball and, you know, that ball is in the air. But I think, you know, that what we have to do is we have to run our offense and not worry about, you know, are they going to strip the ball here or, you know, intercept us here. You have to play the game.

(END VIDEO CLIP)

SMITH: Well, the Patriots also -- the Patriots also gave up -- they're tied for second in the NFL this season for points allowed, just over 16 points a game is what they gave up. After shutting down star quarterbacks Peyton Manning and Ben Roethlisberger in these playoffs, certainly the challenge is here for Philadelphia Eagles' quarterback Donovan McNabb -- Carol, let's get back to you.

COSTELLO: Larry...

SMITH: Yes?

COSTELLO: And, I know, Chad, you want to know this, too. We want to know about Terrell Owens.

SMITH: Oh.

MYERS: Oh, right.

SMITH: Terrell Owens, you know, he has been saying that he is spiritually healed. He does plan to play on Sunday, so certainly it appears that he, Coach Andy Reid and the Eagles' team doctors will make that decision at some point. But he said yesterday that, in talking to the media, he said, you know, I kind of feel like another Philadelphia athlete, Smarty Jones, the thoroughbred, the former Triple Crown candidate. And he says I'm a work horse, they work me like a horse trying to get ready for Sunday. He is determined to play in this, his first Super Bowl in his great 10 year career.

MYERS: Hey, Larry, what do the Eagles think about being seven point underdogs? SMITH: You know, I think at this point, really, neither team looks into that. I mean they, you know, they're going to come in and challenge like, you know what? We've got to take the field, they've got to take the field. This is the year of parity, an era of parity in the NFL where the -- certainly the Patriots have dominated it. There's no question. But just, at the same, as a Eagles aren't concerned about the point spread, neither are the Patriots. They say you know what? We've won two titles before but it's not going to help us win a game on Sunday.

MYERS: Larry, I know you've been down there and we haven't.

What's the security like down there? Is it really like a fortress or what does it feel? What's the feel down there?

SMITH: You know, the feel for this one is not so much a fortress as it was, say, last year in Houston. I mean certainly we're right here on the St. John's River. That does pose -- pose its own set of circumstances in terms of making sure that the water is secured. The stadium sits on the water, just across the river here.

There are the cruise ships you may have heard and read about. They've made sure that those are safe. The Coast Guard is in play.

But I was out last night for a couple of hours and it seemed like everyone was out, a great fireworks display that was really spectator. I mean 4th of July celebrations would be jealous of this display last night.

But so far so good. Everyone is having a good time.

Security force very much, a very visible presence by the police here. And for first time hosts, they're doing a great job so far.

COSTELLO: OK. And I know you're excited for the half game show and Paul McCartney, aren't you, Larry? Oh, yes. That'll be rocking.

SMITH: Of course. Of course. That's right.

COSTELLO: Talk about like a sharp turn from last year's Super Bowl celebration at half-time.

SMITH: You know, I think the only wardrobe malfunction that Paul McCartney could have is if his shoe comes untied while he's singing "Hey Jude."

COSTELLO: Oh, it's like Paul McCartney!!!

SMITH: Nothing like last year, that's for sure.

COSTELLO: All right, Larry Smith, Chad, thanks.

MYERS: Take care.

SMITH: Take care. COSTELLO: Well, he is frail but he is apparently making great progress this morning. We'll get you the latest on the pope's condition straight ahead.

And a Peterson family member writes a book saying the jury got it right, Scott Peterson is guilty of murder. Straight ahead we'll tell you who she is and what she has to say.

(COMMERCIAL BREAK)

CARRIE LEE, CNN CORRESPONDENT: Good morning, everyone.

I'm Carrie Lee at the Nasdaq market site.

New audiotapes show that bankrupt energy trader Enron plotted to take a power plant offline in order to jack up electric prices in western states, prompting rolling blackouts in California the same day. This according to tapes released by a Washington State utility. The utility says traders made up phony repairs.

(BEGIN AUDIO CLIP)

UNIDENTIFIED MALE: I want you guys to get a little creative...

UNIDENTIFIED MALE: OK.

UNIDENTIFIED MALE: ... and come up with a reason to go down.

(END AUDIO CLIP)

LEE: Other tapes show traders discussing price gouging and the tapes also indicate that Enron used similar tactics in Canada and that traders were aware that these tactics were illegal.

Now, Enron, of course, collapsed about three years ago after revelations that its chief financial officer was running partnerships that allowed the company to keep hundreds of millions of dollars in debt off of its books.

So that is the latest on Enron.

Turning to the markets, futures are looking slightly higher for this Friday's session. A lot of investors waiting for the January jobs report, coming out in about two hours. Wall Street widely expecting a gain of 200,000 jobs during the month, although in recent months those expectations have been way off. So that's the big economic story of the day and that is the latest from the Nasdaq.

One stock to watch quickly, Boeing. Japan Airlines ordering 30 Boeing jets.

DAYBREAK will be right back.

(COMMERCIAL BREAK)

COSTELLO: Good news about the pope this morning. The Vatican says his condition has now stabilized. He's eating normally.

But let's get more from a man who's actually there.

CNN's Jim Bittermann live at Gemelli Hospital -- good morning.

JIM BITTERMANN, CNN CORRESPONDENT: Good morning, Carol.

Yes, just a few minutes ago, we got a very brief statement from the hospital and from the Vatican at the same time basically saying exactly what you said, the pope's condition continuing to stabilize, that he is eating normally and, interestingly enough, feeding himself, and that his overall health has improved.

Now, adding to that, a couple of things that we've heard from the Vatican about what he plans to do this weekend, apparently trying to at least put up the image of the pope returning to normal duties. He is going to give an Angelus on Sunday, his normal Angelus, noon on Sunday, normally delivered from his apartments on St. Peter's Square. The Vatican says that they hope that they will be able to set up an audio link from the hospital here to St. Peter's Square and he'll be able to deliver that Angelus live from his hospital room.

The other thing is that a group of seminarians who are in town and hope to meet the pope tomorrow are apparently going to meet him in a video conference. They're going to try to set up some kind of video conference from the hospital here.

So a couple of signs that his condition is returning to normal.

And the other thing is that the Vatican is saying it's going to issue no further medical bulletins until Monday. So I think they're pointing to the fact by that that they don't expect any change in the pope's condition over the weekend -- Carol.

COSTELLO: Good news.

Jim Bittermann live in Rome this morning.

Thank you.

Donald Rumsfeld and the Abu Ghraib prisoner abuse scandal. Hear what he says in an exclusive interview with our Larry King about his offers to resign.

And parents accused of horrible abuse against their children. Details for you just ahead on DAYBREAK.

(COMMERCIAL BREAK)

COSTELLO: Good morning.

Welcome to the last half hour of DAYBREAK.

From the Time Warner Center in New York, I'm Carol Costello, along with Chad Myers. Now in the news, Secretary of State Condoleezza Rice is in London meeting with Britain's prime minister, Tony Blair, and Foreign Secretary Jack Straw. It's the first stop on Rice's whirlwind tour of Europe, plus Israel and the Palestinian territories.

The Massachusetts jury in the sexual abuse case against defrocked priest Paul Shanley returns to deliberations this morning. A 27-year- old man testified that Shanley raped him repeatedly but that he had repressed the memories until recently.

Johnny Lee Williams back in Tyler, Texas after being extradited from Arizona. Williams is being held on $1 million bond. He is accused in the abduction and killing of a Wal-Mart clerk, Megan Holder, in Tyler, Texas.

Five finalists have been named for a national memorial to those who died abroad United Flight 93. The plane crashed in Pennsylvania after being hijacked by terrorists on September 11.

To the forecast center now 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 February 4, 2005 - 06:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEO CLIP)
JOHN PHIPPS, TRAIN CRASH SURVIVOR: There was plenty of lead so I wrote "I heart my kids."

(END VIDEO CLIP)

CAROL COSTELLO, CNN ANCHOR: A father faces his own mortality. A heartfelt survivor's story.

The new secretary of state traveling abroad. First stop, Ten Downing Street. We'll have a live report from London.

And new allegations about Enron. How early did the scandal start?

It is Friday, February 4.

You are watching DAYBREAK.

And good morning to you.

From the Time Warner Center in New York, I'm Carol Costello, along with Chad Myers.

Now in the news, Pope John Paul II is spending a third day at a hospital in Rome. We are expecting a live news conference on the pontiff's condition later this hour and when that happens, we'll get you there.

Two more American soldiers have been killed in Iraq. The military says one was killed while on patrol south of Baghdad, and the other died when his military convoy was hit by a roadside bomb south of Mosul.

A search and rescue operation going on right now for an Afghan passenger jet missing during a snowstorm. The U.S. Embassy says at least three Americans are believed among the 104 on board that plane. A snowstorm prevented its landing at Kabul.

A search is underway in Florida for the couple accused of torturing five of their seven children in their home. Allegations against John and Linda Dollar include starving their children.

Let's head to the forecast center now and Chad -- good morning.

CHAD MYERS, CNN METEOROLOGIST: Good morning, Carol.

(WEATHER REPORT)

COSTELLO: Will the United States attack Iran? That question put right to Condoleezza Rice this morning. The new secretary of state is in London this morning. She had breakfast with Tony Blair and then she took reporters' questions along with Foreign Secretary Jack Straw. Rice stressed the use of diplomacy.

(BEGIN VIDEO CLIP)

CONDOLEEZZA RICE, NATIONAL SECURITY ADVISER: We expect more of our friends. Obviously, countries are going to move at their own pace. They are going to move toward the liberalization of their politics in the context of their own traditions, religious, historical and others. No one can seek to impose a particular model or a particular set of solutions.

(END VIDEO CLIP)

COSTELLO: CNN's European political editor, Robin Oakley, joins us now live from London with more.

And there was much talk about Iran during this press conference -- Robin.

ROBIN OAKLEY, CNN CORRESPONDENT: Indeed, Carol.

The focus very much on Iran, very forthright words from Condoleezza Rice, which will probably have some reverberation across the rest of Europe. There is a difference between the European Union countries and the United States in how Iran should be tackled.

She insisted this morning that there Iranian regime was destabilizing the region, that it was harboring terrorists and she insisted that it must not be allowed to use its civil nuclear program as a cover for developing a nuclear weapons program.

But when she was questioned directly by reporters as to whether that meant that the U.S. was prepared to contemplate military action, she said that question was simply not on the agenda yet, not at this point, she said, and there were plenty of diplomatic means at the disposal of those who wanted to deter the Iranians from going down that particular route. And she said the Iranians have the chance of demonstrating in their talks with the European Union countries -- France, Britain and Germany -- that they were prepared to live up to their international obligations -- Carol.

COSTELLO: Robin Oakley live in London this morning.

Thank you.

While Condoleezza Rice takes on her new diplomatic duties overseas, President Bush is selling his new Social Security plan to middle America. He's in Omaha, Nebraska this morning. He'll talk Social Security at the Quest Center later today. And then it's off to Little Rock, Arkansas and then to Tampa, Florida.

During a town hall meeting last night in Montana, President Bush again said if you have a good idea on Social Security, bring it on. And then he talked about his own plan -- voluntary retirement accounts.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: There are ways to make sure your fund can avoid swings in the market at very end of -- right before you retire. So there are some wise things we can do, just like we do for the federal government employees. See? They've got this plan. It's called the thrift savings plan. My attitude is if it's good enough for people working in the federal government, it ought to be good enough for people working elsewhere in America.

(END VIDEO CLIP)

COSTELLO: President Bush says Social Security reform is needed or else the system will go bankrupt by the year 2042.

FBI Director Robert Mueller is disappointed with delays in computer software upgrades and a Justice Department report says the millions of dollars spent on that technology has been largely wasted. Now the FBI's trying to determine if any part of its $170 million virtual case file project can be salvaged.

Federal investigators hope to interview the pilot today of a corporate jet that crashed in New Jersey. They say they have found no evidence of ice on the wings and there aren't that many clues in the wreckage.

Here's what the National Transportation Safety Board is working with.

(BEGIN VIDEO CLIP)

DEBORAH HERSMAN, NTSB: What I can tell you is that we have approximately 43 seconds of tape from the time that the engines spooled up until the time that the cockpit voice recorder stopped recording on impact.

(END VIDEO CLIP)

COSTELLO: Let's talk about what the plane hit. There was another car that the out of control plane hit.

Besides Rohan Foster, that driver remains in critical condition this morning.

(BEGIN VIDEO CLIP)

ROHAN FOSTER, SURVIVOR: I think that it's a miracle because when I see the car on TV, because one time I asked, when I was revived out of the guy when he was taking me out of the car, he said the car is totaled. That's when that guy was taking me out. He said the car is totaled. But I didn't see it. It was like, you know, I was messed up. And after I came here and I was looking at the TV and see the side of the car I said I can't believe that's the car I was in.

(END VIDEO CLIP)

COSTELLO: I apologize for not explaining that well. That was one of the people inside of a car that the jet hit. He survived. The person in the car with him remains in the hospital in critical condition this morning.

That commuter train crash in California, a heartfelt message written in blood. This morning, the mystery of who wrote that desperate good-bye is solved, as well as the happy ending behind it.

Ted Rowlands unravels it for you.

(BEGIN VIDEO TAPE)

TED ROWLANDS, CNN CORRESPONDENT (voice-over): While looking for signs of life in the twisted wreckage of a commuter train crash, Los Angeles firefighters came across John Phipps trapped in the twisted rubble.

CAPT. BOB ROSARIO, LOS ANGELES FIRE DEPARTMENT: To see a live person trapped inside all this rubble and debris was pretty amazing.

ROWLANDS: After pulling him out, firefighters noticed something, a message written in blood on the back of what was left of a passenger seat. "I love my kids," it said, using the heart sign. Below that, also in blood, it read, "I love Leslie."

Eleven people died in the train wreck, but John Phipps survived. And in an emotional meeting this afternoon with his wife Leslie and children, Shara, Jeremy, and Josh, John thanked the firefighters that pulled him out.

John, who still has 24 staples in his head, says blood was all over his hand when he wrote the note.

PHIPPS: "I heart Leslie." Then there was a little bar above that and I thought, well, there's plenty of blood. So I wrote, "I heart my kids."

LESLIE PHIPPS, WIFE: It's moving and it's thoughtful and it's chilling all at the same time, to think that you would think, I'm going to die here. I could die here. And to think of somebody else is amazing. It really is. And he thought of all of us. And that's just terrific.

JOHN PHIPPS: I got to tell my wife and my kids what I thought were going to be my last words. And God blessed me and made sure that they weren't my last words.

ROWLANDS: Words written by a man, who, when faced with death, truly appreciated the importance of life.

Ted Rowlands, CNN, Los Angeles.

(END VIDEOTAPE)

COSTELLO: A happy ending.

The man suspected of causing that train crash, by the way, still awaiting arraignment on 11 murder charges. Juan Alvarez's court appearance last week was postponed indefinitely for medical reasons.

A story of alleged deceit that impacted millions. Just ahead in our business headlines, tapes of Enron employees that some say reveal a plot to cause power blackouts.

Have you got your TV warmed up yet for the Super Bowl? We're live from Jacksonville, Florida with a Friday morning preview of the big game.

And later, we'll hear from Donald Rumsfeld on why he offered his resignation as secretary of defense, twice.

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

(COMMERCIAL BREAK)

COSTELLO: A bit of news just in to CNN about Pope John Paul II.

The Vatican has come up with an update on his medical condition and Reuters is reporting that even medical tests now confirm the pope's condition has stabilized. The pope is expected to make an address on Sunday and apparently the Vatican says he's eating normally, sleeping normally. The next update on his health will come on Monday.

Your news, money, weather and sports.

It's 6:12 Eastern.

Here's what's all new this morning.

Secretary of State Condoleezza Rice held a news conference last hour with British Foreign Secretary Jack Straw. Rice said the possibility of an attack on Iran is, quoting here, "not on the agenda at this point." She says Iran must comply with international efforts to control its nuclear development.

Japanese health officials say they've had their first human mad cow casualty. The man, who died in December, is believed to have been infected during a trip to Britain in 1989. Accurate tests for the human form of mad cow can only be performed after the patient dies.

In money news, interest rates on a 30-year fixed mortgage fell for a fifth straight week. Other short-term rates ended up just a smidge. The Federal Reserve boosted short-term interest rates on Wednesday. In culture, the notes from the "Washington Post's" reporting on Watergate go on display in Austin, Texas today. The papers, written by Bob Woodward and Carl Bernstein, were purchased by the University of Texas for $5 million.

In sports, Emmitt Smith says he had offers to keep playing, but he decided to retire instead. The NFL's all time leading rusher became emotional as he thanked past and present teammates. He also thanked Cowboys owner Jerry Jones for believing in him.

(BEGIN VIDEO CLIP)

EMMITT SMITH, RETIRING RUNNING BACK: You took a chance on me. And I thank you for that. You've given me an opportunity to have a life greater than I can ever imagine.

(END VIDEO CLIP)

COSTELLO: And, I guess, Chad, he signed a one day contract with the Dallas Cowboys...

MYERS: Yes.

COSTELLO: ... so he could retire as a Cowboy.

MYERS: That's right. And he was clutching that helmet as he said the words, so, yes. Obviously one of the greatest out there.

Hey, good morning, Carol.

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COSTELLO: Chad, you know, in the words of Lionel Ritchie...

MYERS: What's that?

COSTELLO: There's a party going on right now, a celebration that will last all through the year.

MYERS: Is that in Jacksonville?

COSTELLO: Yes. The here would be in Jacksonville, Florida. The Super Bowl isn't until Sunday, but the party has already begun.

Let's head live there now and check in with Larry Smith -- good morning, Larry.

LARRY SMITH, CNN CORRESPONDENT: Oh, good morning to you.

It's a chilly morning here, but certainly the partygoers were out in full force last night. As you get to the weekend now, two days away from the kickoff of Super Bowl 39, between the Philadelphia Eagles and the New England Patriots.

Now, as you know, the key to success for any football team is its defense and turnovers. Every time a team fumbles the ball away and throws an interception, it's one less scoring chance for that team and one more scoring chance for the other team.

And therein lies the key to the Patriots' success. They have been outstanding this season. In fact, in terms of getting turnovers, only two teams forced more turnovers in the regular season than New England, which forced seven more turnovers in two playoff games, to now stand on the brink of their third Super Bowl crown in four years, something only the Dallas Cowboys have ever achieved, and that was nearly a decade ago.

(BEGIN VIDEO CLIP)

BILL BELICHICK, PATRIOTS COACH: And I wish we could say well, here's our turnover defense. We're going to call this one and we'll get a turnover when we need it. It's -- I think it's really more of a situation where the defense is able to take advantage of an opportunity to get their hands on the ball.

DONOVAN MCNABB, EAGLES QUARTERBACK: It's difficult to avoid turnovers, obviously, because of what they've been doing, you know, stripping the ball and, you know, that ball is in the air. But I think, you know, that what we have to do is we have to run our offense and not worry about, you know, are they going to strip the ball here or, you know, intercept us here. You have to play the game.

(END VIDEO CLIP)

SMITH: Well, the Patriots also -- the Patriots also gave up -- they're tied for second in the NFL this season for points allowed, just over 16 points a game is what they gave up. After shutting down star quarterbacks Peyton Manning and Ben Roethlisberger in these playoffs, certainly the challenge is here for Philadelphia Eagles' quarterback Donovan McNabb -- Carol, let's get back to you.

COSTELLO: Larry...

SMITH: Yes?

COSTELLO: And, I know, Chad, you want to know this, too. We want to know about Terrell Owens.

SMITH: Oh.

MYERS: Oh, right.

SMITH: Terrell Owens, you know, he has been saying that he is spiritually healed. He does plan to play on Sunday, so certainly it appears that he, Coach Andy Reid and the Eagles' team doctors will make that decision at some point. But he said yesterday that, in talking to the media, he said, you know, I kind of feel like another Philadelphia athlete, Smarty Jones, the thoroughbred, the former Triple Crown candidate. And he says I'm a work horse, they work me like a horse trying to get ready for Sunday. He is determined to play in this, his first Super Bowl in his great 10 year career.

MYERS: Hey, Larry, what do the Eagles think about being seven point underdogs? SMITH: You know, I think at this point, really, neither team looks into that. I mean they, you know, they're going to come in and challenge like, you know what? We've got to take the field, they've got to take the field. This is the year of parity, an era of parity in the NFL where the -- certainly the Patriots have dominated it. There's no question. But just, at the same, as a Eagles aren't concerned about the point spread, neither are the Patriots. They say you know what? We've won two titles before but it's not going to help us win a game on Sunday.

MYERS: Larry, I know you've been down there and we haven't.

What's the security like down there? Is it really like a fortress or what does it feel? What's the feel down there?

SMITH: You know, the feel for this one is not so much a fortress as it was, say, last year in Houston. I mean certainly we're right here on the St. John's River. That does pose -- pose its own set of circumstances in terms of making sure that the water is secured. The stadium sits on the water, just across the river here.

There are the cruise ships you may have heard and read about. They've made sure that those are safe. The Coast Guard is in play.

But I was out last night for a couple of hours and it seemed like everyone was out, a great fireworks display that was really spectator. I mean 4th of July celebrations would be jealous of this display last night.

But so far so good. Everyone is having a good time.

Security force very much, a very visible presence by the police here. And for first time hosts, they're doing a great job so far.

COSTELLO: OK. And I know you're excited for the half game show and Paul McCartney, aren't you, Larry? Oh, yes. That'll be rocking.

SMITH: Of course. Of course. That's right.

COSTELLO: Talk about like a sharp turn from last year's Super Bowl celebration at half-time.

SMITH: You know, I think the only wardrobe malfunction that Paul McCartney could have is if his shoe comes untied while he's singing "Hey Jude."

COSTELLO: Oh, it's like Paul McCartney!!!

SMITH: Nothing like last year, that's for sure.

COSTELLO: All right, Larry Smith, Chad, thanks.

MYERS: Take care.

SMITH: Take care. COSTELLO: Well, he is frail but he is apparently making great progress this morning. We'll get you the latest on the pope's condition straight ahead.

And a Peterson family member writes a book saying the jury got it right, Scott Peterson is guilty of murder. Straight ahead we'll tell you who she is and what she has to say.

(COMMERCIAL BREAK)

CARRIE LEE, CNN CORRESPONDENT: Good morning, everyone.

I'm Carrie Lee at the Nasdaq market site.

New audiotapes show that bankrupt energy trader Enron plotted to take a power plant offline in order to jack up electric prices in western states, prompting rolling blackouts in California the same day. This according to tapes released by a Washington State utility. The utility says traders made up phony repairs.

(BEGIN AUDIO CLIP)

UNIDENTIFIED MALE: I want you guys to get a little creative...

UNIDENTIFIED MALE: OK.

UNIDENTIFIED MALE: ... and come up with a reason to go down.

(END AUDIO CLIP)

LEE: Other tapes show traders discussing price gouging and the tapes also indicate that Enron used similar tactics in Canada and that traders were aware that these tactics were illegal.

Now, Enron, of course, collapsed about three years ago after revelations that its chief financial officer was running partnerships that allowed the company to keep hundreds of millions of dollars in debt off of its books.

So that is the latest on Enron.

Turning to the markets, futures are looking slightly higher for this Friday's session. A lot of investors waiting for the January jobs report, coming out in about two hours. Wall Street widely expecting a gain of 200,000 jobs during the month, although in recent months those expectations have been way off. So that's the big economic story of the day and that is the latest from the Nasdaq.

One stock to watch quickly, Boeing. Japan Airlines ordering 30 Boeing jets.

DAYBREAK will be right back.

(COMMERCIAL BREAK)

COSTELLO: Good news about the pope this morning. The Vatican says his condition has now stabilized. He's eating normally.

But let's get more from a man who's actually there.

CNN's Jim Bittermann live at Gemelli Hospital -- good morning.

JIM BITTERMANN, CNN CORRESPONDENT: Good morning, Carol.

Yes, just a few minutes ago, we got a very brief statement from the hospital and from the Vatican at the same time basically saying exactly what you said, the pope's condition continuing to stabilize, that he is eating normally and, interestingly enough, feeding himself, and that his overall health has improved.

Now, adding to that, a couple of things that we've heard from the Vatican about what he plans to do this weekend, apparently trying to at least put up the image of the pope returning to normal duties. He is going to give an Angelus on Sunday, his normal Angelus, noon on Sunday, normally delivered from his apartments on St. Peter's Square. The Vatican says that they hope that they will be able to set up an audio link from the hospital here to St. Peter's Square and he'll be able to deliver that Angelus live from his hospital room.

The other thing is that a group of seminarians who are in town and hope to meet the pope tomorrow are apparently going to meet him in a video conference. They're going to try to set up some kind of video conference from the hospital here.

So a couple of signs that his condition is returning to normal.

And the other thing is that the Vatican is saying it's going to issue no further medical bulletins until Monday. So I think they're pointing to the fact by that that they don't expect any change in the pope's condition over the weekend -- Carol.

COSTELLO: Good news.

Jim Bittermann live in Rome this morning.

Thank you.

Donald Rumsfeld and the Abu Ghraib prisoner abuse scandal. Hear what he says in an exclusive interview with our Larry King about his offers to resign.

And parents accused of horrible abuse against their children. Details for you just ahead on DAYBREAK.

(COMMERCIAL BREAK)

COSTELLO: Good morning.

Welcome to the last half hour of DAYBREAK.

From the Time Warner Center in New York, I'm Carol Costello, along with Chad Myers. Now in the news, Secretary of State Condoleezza Rice is in London meeting with Britain's prime minister, Tony Blair, and Foreign Secretary Jack Straw. It's the first stop on Rice's whirlwind tour of Europe, plus Israel and the Palestinian territories.

The Massachusetts jury in the sexual abuse case against defrocked priest Paul Shanley returns to deliberations this morning. A 27-year- old man testified that Shanley raped him repeatedly but that he had repressed the memories until recently.

Johnny Lee Williams back in Tyler, Texas after being extradited from Arizona. Williams is being held on $1 million bond. He is accused in the abduction and killing of a Wal-Mart clerk, Megan Holder, in Tyler, Texas.

Five finalists have been named for a national memorial to those who died abroad United Flight 93. The plane crashed in Pennsylvania after being hijacked by terrorists on September 11.

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

MYERS: Good morning, Carol.

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