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CNN Newsnight Aaron Brown

Individuals Who in Small Ways Change the World

Aired February 08, 2005 - 22:00   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.


AARON BROWN, CNN ANCHOR: Good evening again everyone.
Often we think of news as being about great issues and grand debates and that it is, at least it's one way to look at it. But here is another. Individuals who in small ways change the world, perhaps not as intended but change it nevertheless.

(BEGIN VIDEOTAPE)

BROWN (voice-over): He was just an average Joe and then he became famous, sort of.

JOE GRUSHECKY: Well, I can just remember going home and remembering I actually had a record. I had made a record.

BROWN: Then it ended, sort of, the life and legend of an ordinary star.

Famous, sort of, funny you bet.

KINKY FRIEDMAN: I'm a bastard child of twin cultures, Texas and Jewish and the only thing they have in common is we both like to wear our hats indoors.

BROWN: Now try this hat on for size, Governor Kinky Friedman.

Call this one a blue ribbon snafu, Purple Hearts adding insult to injury.

CPL TRAVIS EICHELBERGER, U.S. MARINES: To have it taken away, I know how it made me feel, so I can only imagine how it can make somebody else feel.

BROWN: Also, revisiting the worst of times.

UNIDENTIFIED MALE: What we're talking about is history, making sure that history is told to my grandchildren and their grandchildren what actually happened that horrific morning.

BROWN: The fight over the recordings of 9/11.

(END VIDEOTAPE)

BROWN: So, it's a busy hour ahead. We begin tonight with fame, fame the condition, fame the ambition, fame the gears and pulleys for making more fame, especially overnight fame and what an industry that has become.

In some respects, Walter Winchell and Hedda Hopper would hardly recognize it, in other ways though nothing much has changed. Stars are still different from the rest of us, yet these days it seems anybody can be a star. In a moment as star maker, first though a guy who did it the old-fashioned way or at least he tried.

(BEGIN VIDEOTAPE)

BRUCE SPRINGSTEEN: I'd like to bring out the most handsome man in the world of Pittsburgh show business Joe Grushecky.

GRUSHECKY: I had a great band called the Houserockers, recorded a lot of albums over the years.

BROWN (voice-over): Unless you're from Pittsburgh, you've probably never heard of Joe Grushecky.

GRUSHECKY: The first record came out on MCA. It was in 1979, quite a thrill. I just remember going home and remembering I actually had a record, you know. I made a record. "Rolling Stone" called it the debut record of the year.

ANTHONY DECURTIS, "ROLLING STONE" CONTRIBUTING EDITOR: Everyone was really excited. This was the sound of the times. This is muscular rock and roll and, you know, people were really gripped by what they were doing.

GRUSHECKY: We came this close to making it to the big, big time.

ANNOUNCER: Welcome to "Solid Gold."

MARILYN MCCOO, "SOLID GOLD" HOST: Critics are saying that they'll soon be one of rock's superstar bands. Here singing our pick hit of the week "Friday Night," the Iron City Houserockers.

BROWN: But Joe Grushecky never struck gold, never had a hit record, just a family to support. So, he decided to teach and not teach the easy kids. Grushecky teaches severely disturbed children.

GRUSHECKY: They're really the forgotten kids. There was once upon a time when there was TV without cable. Some of their backgrounds are so unbelievably hard you wonder how they survive on a day-to-day basis.

BROWN: Joe Grushecky has been doing this difficult, high burnout job for more than 25 years but this is still just his day job. By night, he still heads up what has been called one of the best bar bands in America. A lot of Grushecky's gigs are for charities. Over the years he's raised hundreds of thousands of dollars for a multitude of causes.

GRUSHECKY: I always thought, you know, part of being a musician and an artist was giving back to the community. Bruce Springsteen and I met in New York City in 1980.

BROWN: Bruce Springsteen collaborates a lot with Grushecky. They even co-wrote some songs.

DECURTIS: Recently, Joe Grushecky called Bruce up to do a benefit for flood victims in Pennsylvania. They ended up raising a quarter of a million dollars.

GRUSHECKY: If things would have worked differently then, I wouldn't be where I'm at today. I'm, you know, very happy with my wife and my family. I think it's silly to sit around and think about what might have been or have regrets. Fame is really not important and how do you determine success? I mean I've certainly done just about everything I've set out to do except make money or have a big hit record, you know.

DECURTIS: He's a working class guy but, you know, he sees himself as somebody who has gotten a lot from this society and is giving something back.

(END VIDEOTAPE)

BROWN: Well, sometimes good things come to good people. "Code of Silence," the song that Joe wrote with Bruce Springsteen is up for a Grammy this weekend in Los Angeles.

Now, the process that Grushecky managed to avoid or that managed to avoid him perhaps a little of both, for years, Merv Griffin has made himself rich by making himself and others famous, talk show host, talent spotter, hotel owner, hugely successful producer of TV programs. We spoke to Mr. Griffin a bit earlier this afternoon.

(BEGIN VIDEOTAPE)

BROWN: I guess for as long as there has bee television certainly and I gather in radio too there have been talent shows of one sort or another, Ted Mack, "Star Search," now "American Idol." What is it about talent shows that always seems to work?

MERV GRIFFIN, ENTERTAINER: Well, it's the public doing their thing. You left out the biggest one of all on radio, Major (UNINTELLIGIBLE). Frank Sinatra was a winner on Major (UNINTELLIGIBLE).

Then came Ted after that and then a lot of other kind of shows where even a show that I did as soon as a couple of years ago, I wasn't on it, called "Dance Fever," that's the public, you know, strutting their stuff and it's good.

Of course, there's an added addition to "American Idol" and that's in the form of Simon. You know he's tough and he's tough on the people on the show. That never happened before.

BROWN: Is that how they've changed then that they're a little more -- they got a little more attitude?

GRIFFIN: Attitude and edge, yes, yes. And, you know, they put on people in their auditions, like the boy that sang, you know, the Ricky Martin song, Bam Bam and Bang Bang or whatever that was. He had a whole career out of being bad. I hope he's not hearing this. Maybe he doesn't know he's bad.

BROWN: Well, I often wonder that because there are people who are truly horrible and I wonder whether they know they're truly horrible of if they think, like most of us do when we sing in the shower, we sound great.

GRIFFIN: Right.

BROWN: Yes.

GRIFFIN: Well, it's funny. I sing great when I'm out of the shower so I take baths now but I sound good in the bath. Everybody sounds good in the bathroom because of the resonance of the walls and everything.

And, of course, they got a great host on that show, Ryan Seacrest is my discovery. A number, a few years ago I put him on his first network show, which was a quiz show really for kids but we found that adults were playing too called "Click" and that was where Ryan got his first break.

BROWN: And what is it you saw in him? When you discover someone what is it you discover and why haven't you discovered me?

GRIFFIN: Energy. See, you put that in the form of a question and if I answered it correctly, I'd be insulting you.

BROWN: Oh, no.

GRIFFIN: You're not supposed to have -- you're not supposed to have that kind of energy. You're calm and soothing and knowledgeable. Ryan, the first show we ever did we had an entrance form and he came out just like a regular host but there was audience placed in pods around the stage. The boy came out and leaped over the top of the audience.

BROWN: Yes.

GRIFFIN: And my first reaction was do we have insurance? I mean he's got that incredible energy that, you know, and Simon kids him all the time for saying, you know, you don't sound in person like you do when you get up there on the show but that's his energy, show business.

BROWN: And that's -- that's a pretty undefinable thing.

GRIFFIN: Scathing.

BROWN: It's something you either see, which is I guess your talent, or you don't see it, right?

GRIFFIN: It was like when I hired Vanna for "Wheel of Fortune," I hired her because she was on a picture on my desk with 12 other models and her face just popped. And so when I talked to the press why did you pick her? And I said because her head is big for her body and her face pops. Well, of course, that caused a terrible problem with Vanna, who made an appointment and came in to see me. She said, "Is my head too big?" And I said, "No, no, no, no, no. Did you ever see Marilyn Monroe or Joan Crawford or Aaron Brown? Their heads are big, you know, for their bodies."

BROWN: Yes, that could be. Tell me what -- one of your great talents has been to sort of predict what the next big deal is. What's the next big deal?

GRIFFIN: Well, as you said at the beginning everything is cyclical. I mean the amateur shows, now what they do -- a big agent at William Morris one time said to me, "Merv, go back and look at the radio schedules, all the shows that were on there and then bring them in to this decade all dressed up in glitz and everything else and, you know, it's cyclical. You'll have a hit." And I suppose in a way he was right.

BROWN: It's nice to see you again. We appreciate your time tonight.

GRIFFIN: Thank you, Aaron. Come back anytime.

BROWN: Thank you. Well, no you come back anytime.

GRIFFIN: No. I'm the one that's getting older.

BROWN: All right. Good to have you. Thank you.

GRIFFIN: Thanks, Aaron.

(END VIDEOTAPE)

BROWN: Merv Griffin, we talked with him earlier this evening.

OK, the reason for our next guest is a simple one. Brad Pitt couldn't make it. So, by way of cushioning the blow to give you all a minute or two to get used to the idea here's an introduction from CNN's Bruce Burkhardt.

(BEGIN VIDEOTAPE)

BRUCE BURKHARDT, CNN CORRESPONDENT (voice-over): Is it possible, is it just possible that we may be looking at the next governor of the great state of Texas?

ARNOLD GARCIA, AUSTIN AMERICAN STATEMENTS: Well, you know, Texas elected a country singer to the governorship in the 1940s. It's not -- it's not unprecedented that this could happen.

BURKHARDT: You can't get much more politically incorrect than Kinky Friedman. He's been that way ever since he pioneered the Jewish country music genre with his band Kinky Friedman and the Texas Jew Boys.

FRIEDMAN: I'm a bastard child of twin cultures, Texas and Jewish and the only thing they have in common is we both like to wear our hats indoors.

BURKHARDT: It blended Kinky's gift for satire with a genuine love of country music with songs like "They ain't making Jews like Jesus anymore" and "Ride 'Em Jewboy" Kinky had a cult following but never really hit it big.

So, in the mid-'80s he turned to something else writing mystery novels with himself, the Kinkster, as a private eye.

FRIEDMAN: Well, I think there's 18 novels that I've churned out, I mean carefully crafted.

BURKHARDT: A talented writer, he counts both Bill Clinton and George W. Bush among his fans. Both have had him as a guest at the White House. Maybe that's what gave him a taste for politics.

FRIEDMAN: People are so fed up with career politicians lying to them and also if Willie and Lance Armstrong stay out of the race, I think you're talking to the next governor of Texas.

BURKHARDT: Bruce Burkhardt, CNN, Kerrville, Texas.

(END VIDEOTAPE)

BROWN: Which means we too could be talking to the next governor of Texas, so you can be sure we'll observe all the necessary protocol. Mr. Friedman joins us tonight from Austin, Texas, nice to see you.

FRIEDMAN: Nice to see you, Aaron, how are you?

BROWN: I'm fine, thank you.

What do you need this aggravation for? You got a terrific life. What would you put yourself out there for to be chewed up by the likes of us?

FRIEDMAN: Well, you know, I've achieved many of my dreams in my life and I -- I'd just like for some others, particularly younger Texans, to have a chance to achieve theirs. And, besides, I need the closet space.

BROWN: One of your political heroes is Jesse Ventura.

FRIEDMAN: That's right.

BROWN: And I think one of the things that Jesse found is it's a lot more fun running for governor, in some sense being governor than it is doing the work of governor.

FRIEDMAN: That's correct. I admire Jesse very much. He just didn't realize that wrestling is real and politics is fixed.

BROWN: What do you care about? What are the issues you care about?

FRIEDMAN: I care about education. I think Texas teachers are getting screwed right now, screwed, blued and tattooed and the system doesn't care and I say no teacher left behind. Teachers are my heroes, like cops and firefighters and cowboys.

BROWN: So, what does that mean, are you going to pay them more?

FRIEDMAN: We're going to -- I'm going to try to legalize casino gambling so it can help pay for education. And I'm going to institute a thing called the Texas Peace Corps, which will bring in people like Willie Nelson or Laura Bush to help with the public schools, which have been stripped of all, you know, music classes or arts or anything like that. And I'm going to care about the teacher. I'm the teacher's friend and I want them to know that.

There's another thing too. You know we're first in executions, Texas is, and we're 49th in funding public education, so I'm going to try to fix that little booger if I can too.

BROWN: Doesn't that tell you something about what the -- seriously what the people of Texas where their priorities are? I mean people make a choice about how they want their money spent and it would seem they want their money spent less on education than you do.

FRIEDMAN: I don't think that's right. I think there's a great slumbering giant of Texas Independents that we're going to wake up. Texas is a maverick state. It's an underdog state and it's a cowboy state and I don't like the way the word cowboy is being used derogatorily lately.

Cowboys are people that -- they're not bullies. They're people that care about the little people and they're like knights out of time and Texans appreciate that. So, Texans want a good education for their kids.

BROWN: How serious are you?

FRIEDMAN: Well, I use humor. Humor is my weapon to joust against the windmill and the name of the windmill is politics as usual. This is not a political campaign.

It's a spiritual calling and 2,000 years ago we executed an innocent man named Jesus Christ and my question is what have we learned in 2,000 years? I'm not anti death penalty but I damn sure an anti the wrong guy getting executed.

BROWN: How do you (UNINTELLIGIBLE) we had Jerry Springer, I'm not comparing you to Jerry Springer exactly, we had Jerry Springer on the program sometime back and asked him the same question when he wanted to run for the Senate. How do you get people to see that you are serious?

FRIEDMAN: Well, there's a -- you know the joke is, the joke really is that the last gubernatorial race in Texas they spent $100 million for a job that pays only $100,000. Now, I mean crunch the numbers. Do the math. You can see that this has got to be a joke.

I mean this is absolutely ridiculous. I don't think Jesus Christ or Gandhi or Martin Luther King, they all died broke. None of them spent $100 million to win an election.

BROWN: Well, good luck. The country in one respect or another would probably be better off with a governor named Kinky anyway.

FRIEDMAN: And may the God of your choice bless you, Aaron.

BROWN: Thank you very much. I hope he does too. Thanks, good to talk to you.

Ahead on the program tonight it's been a long, long time since we last saw a photo op like that one, Israelis and Palestinians shaking hands as a new peace process begins, we underscore begins.

And later, American smart bombs have been striking Iraqi insurgents for months now, how many insurgents are left, what the Pentagon says and much more.

This is NEWSNIGHT on CNN.

(COMMERCIAL BREAK)

BROWN: For decades handshakes have held out the hope for peace in the Middle East, in Jerusalem, at Camp David, on the White House lawn. Today, Egypt was the setting for the first meeting between Israeli and Palestinian leaders in more than four years. As the cameras rolled, a ceasefire was announced. What it means, whether it lasts are questions as familiar as the handshakes.

Here's CNN's Ben Wedeman.

(BEGIN VIDEOTAPE)

BEN WEDEMAN, CNN CORRESPONDENT (voice-over): Will this be the handshake that ends four and a half years of bloodshed or just another handshake? Israeli Prime Minister Ariel Sharon and Palestinian Leader Mahmoud Abbas met Tuesday in Sharm El Sheikh for what was billed as a summit of hope to end the conflict often described as hopeless, perennial pessimism tentatively replaced by a glimmer of optimism.

The Palestinians pledged an end to attacks on Israel, Israel responding that it will suspend military operations in the West Bank and Gaza, the tone suddenly very different.

MAHMOUD ABBAS, PALESTINIAN PRIME MINISTER (through translator): We look forward to that day and hoping that it will come as soon as possible in order that the language of negotiations will replace the language of bullets and cannons.

ARIEL SHARON, ISRAELI PRIME MINISTER (through translator): This is a very fragile opportunity and we know that there are extremists who are just waiting to close this window of opportunity.

WEDEMAN: On the Israeli side, hard line settlers in Gaza and the West Bank are vehemently opposed to any Israeli pullback. And, although Palestinian militant groups have agreed to hold their fire, Hamas for one says it's not bound by any ceasefire agreement. The host of the summit, Egyptian President Hosni Mubarak said he hoped progress between Israel and the Palestinians would spark a revival of talks with Lebanon and Syria. And the meeting ended with the announcement that Jordan and Egypt are ready to return their ambassadors to Tel Aviv after a four year absence.

(on camera): But for all the progress apparently achieved here today, the real issues that sparked the Palestinian uprising in the first place, including the final status of Jerusalem and the Palestinian right of return, are no closer to resolution today than they were four and a half years ago but this handshake at least suggests a new beginning.

Ben Wedeman CNN, Sharm El Sheikh, Egypt.

(END VIDEOTAPE)

BROWN: Next on the program tonight why some Marines who were wounded in service of their country were wounded again by the bureaucracy.

And later, what we know about who we're fighting in Iraq. We take a break first.

From New York this is NEWSNIGHT.

(COMMERCIAL BREAK)

BROWN: For almost two years the fog of war has been a thread in our reporting from Iraq and it returns again tonight. Eleven American Marines, who were among the first wave of casualties to return home from the war, have had their Purple Hearts expunged from their records.

Marine Corps officials say the medals were mistakenly awarded to those Marines whose injuries were not caused directly or indirectly by enemy action. A year long investigation led to the decision and the Marine Corps says it takes full responsibility for putting these young men in awkward situations.

One of the Marines, Marine Corporal Travis Eichelberger appeared earlier tonight on "Paula Zahn Now" and had this to say.

(BEGIN VIDEO CLIP)

EICHELBERGER: I definitely hope this does not happen to any other Marines anytime soon and in wars now and in wars of the future because I know how it made me feel and how -- what I told my hometown and it made my mother and father proud and to have it taken away, I know how it made me feel. So, I can only imagine how it could make somebody else feel.

(END VIDEO CLIP)

BROWN: And, again, there are at least ten other Marines in the same situation. There have been other surprises for veterans wounded in Iraq. One hundred twenty-nine soldiers were mistakenly sent bills for expenses after returning home from the war. In some cases, they got the bills instead of final paychecks.

One soldier, who lost his arm, has been told that he had been overpaid for the time he spent in a military hospital. The Army's Vice Chief of Staff now says all of the soldiers' debts have been erased and that the Army has made changes to prevent similar mistakes.

Members of Congress, as late as last week, criticized the Pentagon for not having hard numbers on the size of the insurgency in Iraq. Tonight, a senior Pentagon official is telling CNN the military estimates now the insurgents number between 12,000 and 17,000. Most are Sunnis who supported Saddam and his ruling Ba'athist Party.

And today the insurgents showed their numbers, big or small depending on how you see it. A suicide bomber detonated his explosives at a police recruiting station in Baghdad, killing at least 22 would-be officers.

Senior Pentagon Correspondent Jamie McIntyre has more now on how the Pentagon breaks down the number of insurgents but he begins his report with rarely released video clips that reveal the fiercest of the battle to beat them.

(BEGIN VIDEOTAPE)

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT (voice-over): This newly-released video from a U.S. Air Force Predator spy plane shows a Hellfire missile launched at a window a sniper was using to pin down Marines in Najaf last summer.

Another video shows a dark patch in a road near Baghdad where insurgents are thought to be melting the asphalt to bury a bomb. A missile is launched by Air Force pilots who control the unmanned spy plane, not from Iraq but half a world away at Nellis Air Force Base, Nevada.

All tolled, the U.S. believes it has killed between 10,000 and 15,000 insurgents in Iraq last year, including an estimated 3,000 enemy deaths in the siege of Falluja alone.

But even as U.S. commanders claim success, a senior military official tells CNN there are still as many insurgents left as have been killed. According to an internal estimate, some 12,000 to 15,000 are Sunni Baathist insurgents. As many as 1,000 are fighters loyal to Abu Musab al-Zarqawi. And 500 or fewer are listed as foreign fighters.

But the highly committed insurgents are thought to number only 5,000 to 7,000, with the rest so-called fence sitters, who the U.S. hopes will begin to support the new Iraqi government.

GEN. RICHARD MYERS, JOINT CHIEFS CHAIRMAN: I think one of the things that we know from the elections, there will be a lot less fence-sitters, because they saw their fellow citizens go out and vote.

MCINTYRE: Some Iraqi estimates have put the number of hard-core insurgents as high as 40,000, 200,000 if you count part-timers. U.S. commanders dismiss that as being vastly overstated, but having underestimated the insurgency early on, the Pentagon is reluctant to make its estimates public, even as Congress presses for hard numbers.

SEN. JOHN MCCAIN (R), ARIZONA: I don't know how you defeat an insurgency unless you have some handle on the number of people that you are facing.

MCINTYRE: Defense Secretary Donald Rumsfeld recently suggested that the Iraqi elections might be a tipping point in the war against the insurgents, but also cautioned it's too soon to tell.

Jamie McIntyre, CNN, the Pentagon.

(END VIDEOTAPE)

BROWN: We have more reporting from Iraq tonight as we continue, beginning with a crude reality. Iraq sits on a sea of oil, but Iraqis can't begin to fill their tanks.

And later, the battle over who will get to hear the phone calls made to emergency services on the morning of September 11, 2001, 9/11.

We're break first. Around the world, this is NEWSNIGHT.

(COMMERCIAL BREAK)

BROWN: Like any country in the midst of change, Iraq finds itself a land of contradictions. And here is one. Fuel is in short supply, although the country sits atop pools of oil. But it's post- election Iraq now, so fingers are being pointed in different directions. An elected government has yet to be installed, but expectations are already changing.

Just how much reported by CNN's Jane Arraf.

(BEGIN VIDEOTAPE)

JANE ARRAF, CNN BAGHDAD BUREAU CHIEF (voice-over): It's a weekday morning at a gas station in oil-rich Iraq and the drivers are seething. Ahmed Khadem and his friends say they've been waiting for seven hours now to be let through this gate to fill their tanks.

"This is Bush and Allawi's democracy," Khadem says, referring to the Iraqi prime minister, "no oil, no diesel, no gasoline, no country."

The fuel shortage is one of the biggest problems in Iraq. In some places, a tax on every part of the oil industry have brought fuel distribution to a virtual halt. It's a problem that U.S. forces will be handing over to a newly elected Iraqi government.

(on camera): The U.S. military still plays a large role in most parts of the country. But, increasingly, people here seem to be blaming their problems on Iraqi leaders, rather than American officials and looking to Iraqi leaders to solve them.

"Let Allawi come here. Iyad Allawi, Iyad Allawi, where are you?" shouts Salah Hasanobas (ph). He says he's been waiting since 4:00 a.m., trying to make enough money to feed his seven children. "This never happened in Saddam's time," he adds.

At about five cents a liter, this is some of the cheapest diesel in the world, but there isn't enough of it. Moufed Fleiyeh brings foodstuffs from the port of Baquba in Jordan. He says he's allowed only 300 liters of diesel at a time.

MOUFED FLEIYEH, IRAQI CITIZEN (through translator): I can't even get to the border on that. I spend 10 or fifteen days to get enough gas for the trip.

ARRAF: Even before the results are announced, these men have high expectations that a new Iraqi government will be able to solve problems the Americans didn't.

Jane Arraf, CNN, near Maqtoviah (ph), Iraq.

(END VIDEOTAPE)

BROWN: The budget when we come back, but whose budget? A look at the contours of a $2.5 trillion battlefield. "New York Times" columnist Paul Krugman joins us for that.

Later, should some very painful private moments from 9/11 become part of the public record?

And morning papers, too.

This is NEWSNIGHT on CNN.

(COMMERCIAL BREAK)

BROWN: This is budget week, the administration trying to sell its budget for 2006 to the country, to the Congress. There are plenty of skeptics, skeptics because the plan calls for some of the most drastic cuts since Ronald Reagan was in office, but still leaves a record deficit. In fact, it's kind of a misnomer to call it the president's budget. It belongs just as much to Congress, or it will when Congress rewrites it.

But, even in that regard, traditional roles have changed.

We begin this with CNN's Bruce Morton.

(BEGIN VIDEOTAPE)

BRUCE MORTON, CNN NATIONAL CORRESPONDENT (voice-over): The first thing you need to know about the president's budget is that it doesn't exist. Sure, there's a book and all those briefings. But likely nothing close to what he's asking for will ever happen because it all has to go through Congress.

Last year Mr. Bush asked Congress to eliminate 65 government programs for a savings of $4. 9 billion. Congress eliminated just four of the 65, saving less than $300 million.

This year he's asking Congress to cut or eliminate 150 programs. How well do you think he'll do?

(on camera): For every government program there's probably an industry that gives money to politicians that wants the program kept alive. There may be a trade union that gives money that wants to keep those jobs. There will be a congressional subcommittee that supervises the program. And if it dies, what will they be in charge of?

(voice-over): When Ronald Reagan said the closest thing to eternal life on this Earth was a government program he wasn't kidding. And it isn't just the programs. It's the little goodies, a park for your district, a research program for the college in my district that congressman stick into spending bills. Earmarks they're called.

The watchdog group Citizens Against Government Waste estimates that in fiscal 2005 there were 13,900 earmarks worth just under $26. 5 billion. A record.

The president can veto appropriations bills, of course. The whole bill. He doesn't have a line item veto. But this president has never done that. In fact, the whole issue has changed. Deficit hawks used to be Republicans. The constitutional amendment to balance the budget was part of Newt Gingrich's contract with America back in the 1990s when the Republicans won control of the House. But it was Democrat Bill Clinton who actually ended deficits and ran surpluses. And so the issue has switched sides.

KEATING HOLLAND, CNN POLITICAL DIRECTOR: Now Democrats are almost twice as likely as Republicans to say that the federal deficit is a very important issue the Congress and the president have to deal with in the coming year.

MORTON: It's way too early to know what the budget Congress actually passes will look like. What we know is it won't look much like the one the president sent them this week. It never does.

Bruce Morton, CNN, Washington.

(END VIDEOTAPE)

BROWN: "New York Times" columnist Paul Krugman joins us. He's been writing about the budget. He's been writing about Social Security. Sometimes he writes about them both the same day. So I feel free to talk about them both.

Nice to see you again.

PAUL KRUGMAN, COLUMNIST, "THE NEW YORK TIMES": Good to see you. BROWN: There's a little bit of a disconnect here, it seems to me, when we say that the Democrats have become the budget hawks, because, in fact, a lot of the programs that are being cut are programs that are traditionally supported by Democrats, talking about Medicaid programs, for one, assistance to the poor, education programs and others.

KRUGMAN: Well, but the elephant in the room, of course, is taxes.

Under Bush, the taxes that fall most heavily on the affluent, which is the personal income tax and the corporate profits tax, are at their lowest level since 1942. So Democrats are deficit hawks in the sense they say, look, we need more revenue. And Bush is not prepared to do anything along those lines.

BROWN: I may have missed this, but the problem here is nobody really believes, do they, that they're undertaxed?

KRUGMAN: Well, I think you are. And I think I am, actually, relatively speaking.

(CROSSTALK)

BROWN: Speak for yourself here, if you don't mind.

(LAUGHTER)

KRUGMAN: OK.

No, but the truth is that what we've had is a revenue collapse. If you look at why is there is a budget deficit, it's because tax collection, not on the middle class, who mostly pay the payroll tax, but on the high-income people, has really fallen drastically off, partly because of the Bush tax cuts, partly for reasons we don't -- you know, for other reasons.

BROWN: I think was yesterday -- I think I saw it this morning. The budget director said that, in fact, the rich, which in this definition -- whoever is rich, this definition seems to change a -- but I think it was $140,000 a year or more -- were actually paying a little bit more of the total income taxes.

KRUGMAN: That's the trick. That's the income tax, which is the one that -- but not total -- their share of the total tax burden has fallen quite a lot.

BROWN: Right.

KRUGMAN: So -- and the thing is -- the thing about the Bush budget is, if you're serious about tackling the budget deficit, you go where the money is, which is either tax increases or Social Security and Medicare.

BROWN: Right.

KRUGMAN: And where he is going is where the money isn't, like food stamps.

BROWN: That's chump change by comparison.

KRUGMAN: Exactly; $1.1 billion in food stamps does a lot -- which is the cut that is in the budget -- that does a lot of harm to a lot of people. But it's nothing. That's -- well, it's a day in Iraq -- not quite. But it's about a week's tax cuts for people over $1 million.

BROWN: One of the things you talked about today, which I think is the great -- I've been saying for a while -- going to be the great debate in the country this year, is what this -- what privatizing Social Security or parts of Social Security, whatever, what that really is about. And you make the argument today -- it's not the first time -- that this is really an attack on the central pillar of what conservative America considers the welfare state.

KRUGMAN: Yes. I mean, if you think of what -- look at what the Cato -- people at the Cato Institute, who -- it's basically people from the Cato Institute who are devising this plan, who are on the...

(CROSSTALK)

BROWN: This is a think tank on the right.

KRUGMAN: Think tank.

And they -- you know, I quoted one this morning who said Social Security is the soft underbelly of the welfare state. Let's jab a spear through it. And if you look at the president's plan, there's been a lot of misunderstanding about it. People will say, oh, it's just a small part. Actually, if you look at it, by the time that people who are young, who are not yet in the work force, by the time they retire under that plan, Social Security as we know it would be gone.

BROWN: Do you think they see a world where this is no guaranteed at-retirement check of some amount?

KRUGMAN: That's what -- just run the numbers on the Bush plan. The typical worker who was born in 1990 will be getting 8 percent of his or her wages in guaranteed checks, which is nothing.

BROWN: And do you believe they see a world where there is medical care -- there is no Medicare at 65?

KRUGMAN: I think that's what they're looking for. Now, that, they have not said. That's -- I'm guessing. But they certainly have spoken out against a whole set of programs. And Social Security is the -- again, what we have, the hard stuff we have is a plan that will essentially eliminate any guaranteed retirement income.

BROWN: Just really quickly, yes or no, do you think the president will win on privatizing Social Security?

KRUGMAN: I don't think so. I think they weren't ready for the pushback.

BROWN: Nice to see you. I hope you will come back.

KRUGMAN: Good to see you.

BROWN: You're a splendid writer.

BROWN: Still ahead on the program, one of the more heartrending legal battles to flow out of the attacks of 9/11. How many can there be? We'll tell you that story.

Morning papers are around again, so we've got some stuff to do.

We'll be right back. This is NEWSNIGHT.

(COMMERCIAL BREAK)

BROWN: It's fair to say the legal battles born on September 11 will be fought for years to come. One of them will take another turn tomorrow in New York's capital, Albany, where a group of 9/11 families will argue before the state appeals court, New York's highest court.

On the face, what they want is simple. But, as with all things born of 9/11, the case before the court is neither simple, nor easy.

Reporting for us tonight, CNN's Deborah Feyerick.

(BEGIN VIDEOTAPE)

DEBORAH FEYERICK, CNN CORRESPONDENT (voice-over): When the second plane hit the World Trade Center, insurance broker Richard Gabrielle was blown back into a marble wall, pinning his legs, any chance of escape crushed.

MONICA GABRIELLE, WIFE OF SEPTEMBER 11 VICTIM: He had no choice but to wait for someone to help him out. He couldn't walk. He was pinned.

FEYERICK: His widow, Monica, learned what happened days later from co-workers who made it out. But Sally and Al Regenhard, whose son, Christian, was a firefighter, say they've never been told the haunting details of his final minutes.

SALLY REGENHARD, MOTHER OF SEPTEMBER 11 VICTIM: When I look at the pictures, I realize what happened and I realize that he has disappeared.

FEYERICK: The two families feel there's more to know. They're fighting to unseal thousands of emergency 911 calls, many of them made from inside the towers.

NORMAN SIEGEL, ATTORNEY FOR SEPTEMBER 11 FAMILIES: What we're talking about is history, making sure that history is told to my grandchildren and their grandchildren what actually happened that horrific morning. FEYERICK: New York City sealed those 911 calls, along with interviews from 500 firefighters made soon after the tragedy. In court papers, the city says the tapes "would be grist for sensational exploitation" and that "if there were any practical information to be gleaned from those records, it would already have been harvested."

The September 11 Commission did get to hear those 911 calls and examine the firefighter interviews. Among their findings, that emergency operators didn't have information vital to getting people out. The city says that problem has been fixed, with ranking officers giving greater guidance to operators during emergencies.

But for widow Monica Gabrielle, those changes are just the start of a campaign to make skyscrapers safer.

GABRIELLE: That would essentially be the dead speaking back to the living about what went wrong, what deadly mistakes were made that prevented these people from getting out. And we can only learn from that information.

AL REGENHARD, FATHER OF SEPTEMBER 11 VICTIM: If this happens in the future, we can deal with it better. I owe my son that. That's his legacy.

FEYERICK: A legacy and a search for truth, the painful truth of final moments and final words.

Deborah Feyerick, CNN, New York.

(END VIDEOTAPE)

BROWN: That's coming up tomorrow in Albany.

Here's what's coming up tomorrow on "AMERICAN MORNING."

(BEGIN VIDEO CLIP)

SOLEDAD O'BRIEN, CNN ANCHOR: Thanks, Aaron.

Tomorrow on "AMERICAN MORNING," the man who revolutionized television by getting viewers in touch with reality. TV innovator Mark Burnett, the brains behind the programs like "Survivor" and "The Apprentice," is our guest. His life story includes more twists and turns than the toughest immunity challenge you could ever think of, how he went from British paratrooper to broken-down nanny to one of the hottest producers in showbiz.

That's CNN tomorrow, 7:00 a.m. Eastern. We'll see you then -- Aaron.

(END VIDEO CLIP)

BROWN: Soledad.

Our own reality program continues with morning papers after the break. (COMMERCIAL BREAK)

(ROOSTER CROWING)

BROWN: That's pretty cool. Tomorrow, I think -- I think it's tomorrow -- begins the year of the rooster, so it will be a big year for morning papers for us, our own year.

"The Christian Science Monitor." Here we go. "Why This Deal Might Be Different. Israeli, Palestinian Leaders Met For First Time in Four Years Yesterday at Summit" -- in Iraq -- I hope it was different, because all the other times, it hasn't worked out at all.

Over here, "New Englanders Ponder New Status. Are We Winners?" Yes, you are. Down here, Tedy Bruschi. I just mention that because I think that's the best football name since Bronco Nagurski. That's just a great football name. You're too young to remember Bronco Nagurski. Well, I'm too young to remember Bronco Nagurski.

Anyway, "The Dallas Morning News" over here. "Steroid Inquiry Widens. District Looking For Student Dealers. More Possible Users Identified." This is a good story. High school kids are using steroids? Can you imagine down in the state of Texas this was going on because they wanted to be better football players?

Speaking of important issues making their way to legislative bodies, "The Washington Times" here: "Droopy Drawers Bill Seeks End to Overexposure of Underwear." A legislator in Virginia has introduced a bill which would fine young men or I suppose young women $50 if their underwear showed in an unseemly way. I guess if their underwear showed in a seemly way, it would be OK.

I'm sorry. It just seems like there are other bigger problems. My view of things. I'm not that crazy about the hip-huggers, OK, that my daughter wears, but I just don't think it's the legislature's job.

"Pledges for Peace," the "Rocky Mountain News" headline. "Sharon, Abbas Vow to Halt Violence." I hope they succeed. And that will give them time to take on the droopy underwear problem that I'm sure affects both of those fine countries.

We welcome to the program tonight -- I'll leave that alone now -- "The Fairchild Connection." This is out of Fairchild Air Force Base in Spokane, Washington. And lots of good friends out that. "Fairchild Security Troop, K--9 Unit Return From Iraq." Can you imagine how many levels of Pentagon public relations officers this had to go through before these fine people could send us their paper? Thank you. We're glad to have it. I hope you will send it again tomorrow.

How much time we got? Thank you. Not much.

I did that one already. How did that get back?

"The Des Moines Register." "Seniors Get Turn at Tax Breaks." You may remember last week or so, the problem was, they were going to give tax breaks to kids.

The weather tomorrow in Chicago is "rush slush."

And we will see you tomorrow. Until then, good night for all of us.

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 8, 2005 - 22:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
AARON BROWN, CNN ANCHOR: Good evening again everyone.
Often we think of news as being about great issues and grand debates and that it is, at least it's one way to look at it. But here is another. Individuals who in small ways change the world, perhaps not as intended but change it nevertheless.

(BEGIN VIDEOTAPE)

BROWN (voice-over): He was just an average Joe and then he became famous, sort of.

JOE GRUSHECKY: Well, I can just remember going home and remembering I actually had a record. I had made a record.

BROWN: Then it ended, sort of, the life and legend of an ordinary star.

Famous, sort of, funny you bet.

KINKY FRIEDMAN: I'm a bastard child of twin cultures, Texas and Jewish and the only thing they have in common is we both like to wear our hats indoors.

BROWN: Now try this hat on for size, Governor Kinky Friedman.

Call this one a blue ribbon snafu, Purple Hearts adding insult to injury.

CPL TRAVIS EICHELBERGER, U.S. MARINES: To have it taken away, I know how it made me feel, so I can only imagine how it can make somebody else feel.

BROWN: Also, revisiting the worst of times.

UNIDENTIFIED MALE: What we're talking about is history, making sure that history is told to my grandchildren and their grandchildren what actually happened that horrific morning.

BROWN: The fight over the recordings of 9/11.

(END VIDEOTAPE)

BROWN: So, it's a busy hour ahead. We begin tonight with fame, fame the condition, fame the ambition, fame the gears and pulleys for making more fame, especially overnight fame and what an industry that has become.

In some respects, Walter Winchell and Hedda Hopper would hardly recognize it, in other ways though nothing much has changed. Stars are still different from the rest of us, yet these days it seems anybody can be a star. In a moment as star maker, first though a guy who did it the old-fashioned way or at least he tried.

(BEGIN VIDEOTAPE)

BRUCE SPRINGSTEEN: I'd like to bring out the most handsome man in the world of Pittsburgh show business Joe Grushecky.

GRUSHECKY: I had a great band called the Houserockers, recorded a lot of albums over the years.

BROWN (voice-over): Unless you're from Pittsburgh, you've probably never heard of Joe Grushecky.

GRUSHECKY: The first record came out on MCA. It was in 1979, quite a thrill. I just remember going home and remembering I actually had a record, you know. I made a record. "Rolling Stone" called it the debut record of the year.

ANTHONY DECURTIS, "ROLLING STONE" CONTRIBUTING EDITOR: Everyone was really excited. This was the sound of the times. This is muscular rock and roll and, you know, people were really gripped by what they were doing.

GRUSHECKY: We came this close to making it to the big, big time.

ANNOUNCER: Welcome to "Solid Gold."

MARILYN MCCOO, "SOLID GOLD" HOST: Critics are saying that they'll soon be one of rock's superstar bands. Here singing our pick hit of the week "Friday Night," the Iron City Houserockers.

BROWN: But Joe Grushecky never struck gold, never had a hit record, just a family to support. So, he decided to teach and not teach the easy kids. Grushecky teaches severely disturbed children.

GRUSHECKY: They're really the forgotten kids. There was once upon a time when there was TV without cable. Some of their backgrounds are so unbelievably hard you wonder how they survive on a day-to-day basis.

BROWN: Joe Grushecky has been doing this difficult, high burnout job for more than 25 years but this is still just his day job. By night, he still heads up what has been called one of the best bar bands in America. A lot of Grushecky's gigs are for charities. Over the years he's raised hundreds of thousands of dollars for a multitude of causes.

GRUSHECKY: I always thought, you know, part of being a musician and an artist was giving back to the community. Bruce Springsteen and I met in New York City in 1980.

BROWN: Bruce Springsteen collaborates a lot with Grushecky. They even co-wrote some songs.

DECURTIS: Recently, Joe Grushecky called Bruce up to do a benefit for flood victims in Pennsylvania. They ended up raising a quarter of a million dollars.

GRUSHECKY: If things would have worked differently then, I wouldn't be where I'm at today. I'm, you know, very happy with my wife and my family. I think it's silly to sit around and think about what might have been or have regrets. Fame is really not important and how do you determine success? I mean I've certainly done just about everything I've set out to do except make money or have a big hit record, you know.

DECURTIS: He's a working class guy but, you know, he sees himself as somebody who has gotten a lot from this society and is giving something back.

(END VIDEOTAPE)

BROWN: Well, sometimes good things come to good people. "Code of Silence," the song that Joe wrote with Bruce Springsteen is up for a Grammy this weekend in Los Angeles.

Now, the process that Grushecky managed to avoid or that managed to avoid him perhaps a little of both, for years, Merv Griffin has made himself rich by making himself and others famous, talk show host, talent spotter, hotel owner, hugely successful producer of TV programs. We spoke to Mr. Griffin a bit earlier this afternoon.

(BEGIN VIDEOTAPE)

BROWN: I guess for as long as there has bee television certainly and I gather in radio too there have been talent shows of one sort or another, Ted Mack, "Star Search," now "American Idol." What is it about talent shows that always seems to work?

MERV GRIFFIN, ENTERTAINER: Well, it's the public doing their thing. You left out the biggest one of all on radio, Major (UNINTELLIGIBLE). Frank Sinatra was a winner on Major (UNINTELLIGIBLE).

Then came Ted after that and then a lot of other kind of shows where even a show that I did as soon as a couple of years ago, I wasn't on it, called "Dance Fever," that's the public, you know, strutting their stuff and it's good.

Of course, there's an added addition to "American Idol" and that's in the form of Simon. You know he's tough and he's tough on the people on the show. That never happened before.

BROWN: Is that how they've changed then that they're a little more -- they got a little more attitude?

GRIFFIN: Attitude and edge, yes, yes. And, you know, they put on people in their auditions, like the boy that sang, you know, the Ricky Martin song, Bam Bam and Bang Bang or whatever that was. He had a whole career out of being bad. I hope he's not hearing this. Maybe he doesn't know he's bad.

BROWN: Well, I often wonder that because there are people who are truly horrible and I wonder whether they know they're truly horrible of if they think, like most of us do when we sing in the shower, we sound great.

GRIFFIN: Right.

BROWN: Yes.

GRIFFIN: Well, it's funny. I sing great when I'm out of the shower so I take baths now but I sound good in the bath. Everybody sounds good in the bathroom because of the resonance of the walls and everything.

And, of course, they got a great host on that show, Ryan Seacrest is my discovery. A number, a few years ago I put him on his first network show, which was a quiz show really for kids but we found that adults were playing too called "Click" and that was where Ryan got his first break.

BROWN: And what is it you saw in him? When you discover someone what is it you discover and why haven't you discovered me?

GRIFFIN: Energy. See, you put that in the form of a question and if I answered it correctly, I'd be insulting you.

BROWN: Oh, no.

GRIFFIN: You're not supposed to have -- you're not supposed to have that kind of energy. You're calm and soothing and knowledgeable. Ryan, the first show we ever did we had an entrance form and he came out just like a regular host but there was audience placed in pods around the stage. The boy came out and leaped over the top of the audience.

BROWN: Yes.

GRIFFIN: And my first reaction was do we have insurance? I mean he's got that incredible energy that, you know, and Simon kids him all the time for saying, you know, you don't sound in person like you do when you get up there on the show but that's his energy, show business.

BROWN: And that's -- that's a pretty undefinable thing.

GRIFFIN: Scathing.

BROWN: It's something you either see, which is I guess your talent, or you don't see it, right?

GRIFFIN: It was like when I hired Vanna for "Wheel of Fortune," I hired her because she was on a picture on my desk with 12 other models and her face just popped. And so when I talked to the press why did you pick her? And I said because her head is big for her body and her face pops. Well, of course, that caused a terrible problem with Vanna, who made an appointment and came in to see me. She said, "Is my head too big?" And I said, "No, no, no, no, no. Did you ever see Marilyn Monroe or Joan Crawford or Aaron Brown? Their heads are big, you know, for their bodies."

BROWN: Yes, that could be. Tell me what -- one of your great talents has been to sort of predict what the next big deal is. What's the next big deal?

GRIFFIN: Well, as you said at the beginning everything is cyclical. I mean the amateur shows, now what they do -- a big agent at William Morris one time said to me, "Merv, go back and look at the radio schedules, all the shows that were on there and then bring them in to this decade all dressed up in glitz and everything else and, you know, it's cyclical. You'll have a hit." And I suppose in a way he was right.

BROWN: It's nice to see you again. We appreciate your time tonight.

GRIFFIN: Thank you, Aaron. Come back anytime.

BROWN: Thank you. Well, no you come back anytime.

GRIFFIN: No. I'm the one that's getting older.

BROWN: All right. Good to have you. Thank you.

GRIFFIN: Thanks, Aaron.

(END VIDEOTAPE)

BROWN: Merv Griffin, we talked with him earlier this evening.

OK, the reason for our next guest is a simple one. Brad Pitt couldn't make it. So, by way of cushioning the blow to give you all a minute or two to get used to the idea here's an introduction from CNN's Bruce Burkhardt.

(BEGIN VIDEOTAPE)

BRUCE BURKHARDT, CNN CORRESPONDENT (voice-over): Is it possible, is it just possible that we may be looking at the next governor of the great state of Texas?

ARNOLD GARCIA, AUSTIN AMERICAN STATEMENTS: Well, you know, Texas elected a country singer to the governorship in the 1940s. It's not -- it's not unprecedented that this could happen.

BURKHARDT: You can't get much more politically incorrect than Kinky Friedman. He's been that way ever since he pioneered the Jewish country music genre with his band Kinky Friedman and the Texas Jew Boys.

FRIEDMAN: I'm a bastard child of twin cultures, Texas and Jewish and the only thing they have in common is we both like to wear our hats indoors.

BURKHARDT: It blended Kinky's gift for satire with a genuine love of country music with songs like "They ain't making Jews like Jesus anymore" and "Ride 'Em Jewboy" Kinky had a cult following but never really hit it big.

So, in the mid-'80s he turned to something else writing mystery novels with himself, the Kinkster, as a private eye.

FRIEDMAN: Well, I think there's 18 novels that I've churned out, I mean carefully crafted.

BURKHARDT: A talented writer, he counts both Bill Clinton and George W. Bush among his fans. Both have had him as a guest at the White House. Maybe that's what gave him a taste for politics.

FRIEDMAN: People are so fed up with career politicians lying to them and also if Willie and Lance Armstrong stay out of the race, I think you're talking to the next governor of Texas.

BURKHARDT: Bruce Burkhardt, CNN, Kerrville, Texas.

(END VIDEOTAPE)

BROWN: Which means we too could be talking to the next governor of Texas, so you can be sure we'll observe all the necessary protocol. Mr. Friedman joins us tonight from Austin, Texas, nice to see you.

FRIEDMAN: Nice to see you, Aaron, how are you?

BROWN: I'm fine, thank you.

What do you need this aggravation for? You got a terrific life. What would you put yourself out there for to be chewed up by the likes of us?

FRIEDMAN: Well, you know, I've achieved many of my dreams in my life and I -- I'd just like for some others, particularly younger Texans, to have a chance to achieve theirs. And, besides, I need the closet space.

BROWN: One of your political heroes is Jesse Ventura.

FRIEDMAN: That's right.

BROWN: And I think one of the things that Jesse found is it's a lot more fun running for governor, in some sense being governor than it is doing the work of governor.

FRIEDMAN: That's correct. I admire Jesse very much. He just didn't realize that wrestling is real and politics is fixed.

BROWN: What do you care about? What are the issues you care about?

FRIEDMAN: I care about education. I think Texas teachers are getting screwed right now, screwed, blued and tattooed and the system doesn't care and I say no teacher left behind. Teachers are my heroes, like cops and firefighters and cowboys.

BROWN: So, what does that mean, are you going to pay them more?

FRIEDMAN: We're going to -- I'm going to try to legalize casino gambling so it can help pay for education. And I'm going to institute a thing called the Texas Peace Corps, which will bring in people like Willie Nelson or Laura Bush to help with the public schools, which have been stripped of all, you know, music classes or arts or anything like that. And I'm going to care about the teacher. I'm the teacher's friend and I want them to know that.

There's another thing too. You know we're first in executions, Texas is, and we're 49th in funding public education, so I'm going to try to fix that little booger if I can too.

BROWN: Doesn't that tell you something about what the -- seriously what the people of Texas where their priorities are? I mean people make a choice about how they want their money spent and it would seem they want their money spent less on education than you do.

FRIEDMAN: I don't think that's right. I think there's a great slumbering giant of Texas Independents that we're going to wake up. Texas is a maverick state. It's an underdog state and it's a cowboy state and I don't like the way the word cowboy is being used derogatorily lately.

Cowboys are people that -- they're not bullies. They're people that care about the little people and they're like knights out of time and Texans appreciate that. So, Texans want a good education for their kids.

BROWN: How serious are you?

FRIEDMAN: Well, I use humor. Humor is my weapon to joust against the windmill and the name of the windmill is politics as usual. This is not a political campaign.

It's a spiritual calling and 2,000 years ago we executed an innocent man named Jesus Christ and my question is what have we learned in 2,000 years? I'm not anti death penalty but I damn sure an anti the wrong guy getting executed.

BROWN: How do you (UNINTELLIGIBLE) we had Jerry Springer, I'm not comparing you to Jerry Springer exactly, we had Jerry Springer on the program sometime back and asked him the same question when he wanted to run for the Senate. How do you get people to see that you are serious?

FRIEDMAN: Well, there's a -- you know the joke is, the joke really is that the last gubernatorial race in Texas they spent $100 million for a job that pays only $100,000. Now, I mean crunch the numbers. Do the math. You can see that this has got to be a joke.

I mean this is absolutely ridiculous. I don't think Jesus Christ or Gandhi or Martin Luther King, they all died broke. None of them spent $100 million to win an election.

BROWN: Well, good luck. The country in one respect or another would probably be better off with a governor named Kinky anyway.

FRIEDMAN: And may the God of your choice bless you, Aaron.

BROWN: Thank you very much. I hope he does too. Thanks, good to talk to you.

Ahead on the program tonight it's been a long, long time since we last saw a photo op like that one, Israelis and Palestinians shaking hands as a new peace process begins, we underscore begins.

And later, American smart bombs have been striking Iraqi insurgents for months now, how many insurgents are left, what the Pentagon says and much more.

This is NEWSNIGHT on CNN.

(COMMERCIAL BREAK)

BROWN: For decades handshakes have held out the hope for peace in the Middle East, in Jerusalem, at Camp David, on the White House lawn. Today, Egypt was the setting for the first meeting between Israeli and Palestinian leaders in more than four years. As the cameras rolled, a ceasefire was announced. What it means, whether it lasts are questions as familiar as the handshakes.

Here's CNN's Ben Wedeman.

(BEGIN VIDEOTAPE)

BEN WEDEMAN, CNN CORRESPONDENT (voice-over): Will this be the handshake that ends four and a half years of bloodshed or just another handshake? Israeli Prime Minister Ariel Sharon and Palestinian Leader Mahmoud Abbas met Tuesday in Sharm El Sheikh for what was billed as a summit of hope to end the conflict often described as hopeless, perennial pessimism tentatively replaced by a glimmer of optimism.

The Palestinians pledged an end to attacks on Israel, Israel responding that it will suspend military operations in the West Bank and Gaza, the tone suddenly very different.

MAHMOUD ABBAS, PALESTINIAN PRIME MINISTER (through translator): We look forward to that day and hoping that it will come as soon as possible in order that the language of negotiations will replace the language of bullets and cannons.

ARIEL SHARON, ISRAELI PRIME MINISTER (through translator): This is a very fragile opportunity and we know that there are extremists who are just waiting to close this window of opportunity.

WEDEMAN: On the Israeli side, hard line settlers in Gaza and the West Bank are vehemently opposed to any Israeli pullback. And, although Palestinian militant groups have agreed to hold their fire, Hamas for one says it's not bound by any ceasefire agreement. The host of the summit, Egyptian President Hosni Mubarak said he hoped progress between Israel and the Palestinians would spark a revival of talks with Lebanon and Syria. And the meeting ended with the announcement that Jordan and Egypt are ready to return their ambassadors to Tel Aviv after a four year absence.

(on camera): But for all the progress apparently achieved here today, the real issues that sparked the Palestinian uprising in the first place, including the final status of Jerusalem and the Palestinian right of return, are no closer to resolution today than they were four and a half years ago but this handshake at least suggests a new beginning.

Ben Wedeman CNN, Sharm El Sheikh, Egypt.

(END VIDEOTAPE)

BROWN: Next on the program tonight why some Marines who were wounded in service of their country were wounded again by the bureaucracy.

And later, what we know about who we're fighting in Iraq. We take a break first.

From New York this is NEWSNIGHT.

(COMMERCIAL BREAK)

BROWN: For almost two years the fog of war has been a thread in our reporting from Iraq and it returns again tonight. Eleven American Marines, who were among the first wave of casualties to return home from the war, have had their Purple Hearts expunged from their records.

Marine Corps officials say the medals were mistakenly awarded to those Marines whose injuries were not caused directly or indirectly by enemy action. A year long investigation led to the decision and the Marine Corps says it takes full responsibility for putting these young men in awkward situations.

One of the Marines, Marine Corporal Travis Eichelberger appeared earlier tonight on "Paula Zahn Now" and had this to say.

(BEGIN VIDEO CLIP)

EICHELBERGER: I definitely hope this does not happen to any other Marines anytime soon and in wars now and in wars of the future because I know how it made me feel and how -- what I told my hometown and it made my mother and father proud and to have it taken away, I know how it made me feel. So, I can only imagine how it could make somebody else feel.

(END VIDEO CLIP)

BROWN: And, again, there are at least ten other Marines in the same situation. There have been other surprises for veterans wounded in Iraq. One hundred twenty-nine soldiers were mistakenly sent bills for expenses after returning home from the war. In some cases, they got the bills instead of final paychecks.

One soldier, who lost his arm, has been told that he had been overpaid for the time he spent in a military hospital. The Army's Vice Chief of Staff now says all of the soldiers' debts have been erased and that the Army has made changes to prevent similar mistakes.

Members of Congress, as late as last week, criticized the Pentagon for not having hard numbers on the size of the insurgency in Iraq. Tonight, a senior Pentagon official is telling CNN the military estimates now the insurgents number between 12,000 and 17,000. Most are Sunnis who supported Saddam and his ruling Ba'athist Party.

And today the insurgents showed their numbers, big or small depending on how you see it. A suicide bomber detonated his explosives at a police recruiting station in Baghdad, killing at least 22 would-be officers.

Senior Pentagon Correspondent Jamie McIntyre has more now on how the Pentagon breaks down the number of insurgents but he begins his report with rarely released video clips that reveal the fiercest of the battle to beat them.

(BEGIN VIDEOTAPE)

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT (voice-over): This newly-released video from a U.S. Air Force Predator spy plane shows a Hellfire missile launched at a window a sniper was using to pin down Marines in Najaf last summer.

Another video shows a dark patch in a road near Baghdad where insurgents are thought to be melting the asphalt to bury a bomb. A missile is launched by Air Force pilots who control the unmanned spy plane, not from Iraq but half a world away at Nellis Air Force Base, Nevada.

All tolled, the U.S. believes it has killed between 10,000 and 15,000 insurgents in Iraq last year, including an estimated 3,000 enemy deaths in the siege of Falluja alone.

But even as U.S. commanders claim success, a senior military official tells CNN there are still as many insurgents left as have been killed. According to an internal estimate, some 12,000 to 15,000 are Sunni Baathist insurgents. As many as 1,000 are fighters loyal to Abu Musab al-Zarqawi. And 500 or fewer are listed as foreign fighters.

But the highly committed insurgents are thought to number only 5,000 to 7,000, with the rest so-called fence sitters, who the U.S. hopes will begin to support the new Iraqi government.

GEN. RICHARD MYERS, JOINT CHIEFS CHAIRMAN: I think one of the things that we know from the elections, there will be a lot less fence-sitters, because they saw their fellow citizens go out and vote.

MCINTYRE: Some Iraqi estimates have put the number of hard-core insurgents as high as 40,000, 200,000 if you count part-timers. U.S. commanders dismiss that as being vastly overstated, but having underestimated the insurgency early on, the Pentagon is reluctant to make its estimates public, even as Congress presses for hard numbers.

SEN. JOHN MCCAIN (R), ARIZONA: I don't know how you defeat an insurgency unless you have some handle on the number of people that you are facing.

MCINTYRE: Defense Secretary Donald Rumsfeld recently suggested that the Iraqi elections might be a tipping point in the war against the insurgents, but also cautioned it's too soon to tell.

Jamie McIntyre, CNN, the Pentagon.

(END VIDEOTAPE)

BROWN: We have more reporting from Iraq tonight as we continue, beginning with a crude reality. Iraq sits on a sea of oil, but Iraqis can't begin to fill their tanks.

And later, the battle over who will get to hear the phone calls made to emergency services on the morning of September 11, 2001, 9/11.

We're break first. Around the world, this is NEWSNIGHT.

(COMMERCIAL BREAK)

BROWN: Like any country in the midst of change, Iraq finds itself a land of contradictions. And here is one. Fuel is in short supply, although the country sits atop pools of oil. But it's post- election Iraq now, so fingers are being pointed in different directions. An elected government has yet to be installed, but expectations are already changing.

Just how much reported by CNN's Jane Arraf.

(BEGIN VIDEOTAPE)

JANE ARRAF, CNN BAGHDAD BUREAU CHIEF (voice-over): It's a weekday morning at a gas station in oil-rich Iraq and the drivers are seething. Ahmed Khadem and his friends say they've been waiting for seven hours now to be let through this gate to fill their tanks.

"This is Bush and Allawi's democracy," Khadem says, referring to the Iraqi prime minister, "no oil, no diesel, no gasoline, no country."

The fuel shortage is one of the biggest problems in Iraq. In some places, a tax on every part of the oil industry have brought fuel distribution to a virtual halt. It's a problem that U.S. forces will be handing over to a newly elected Iraqi government.

(on camera): The U.S. military still plays a large role in most parts of the country. But, increasingly, people here seem to be blaming their problems on Iraqi leaders, rather than American officials and looking to Iraqi leaders to solve them.

"Let Allawi come here. Iyad Allawi, Iyad Allawi, where are you?" shouts Salah Hasanobas (ph). He says he's been waiting since 4:00 a.m., trying to make enough money to feed his seven children. "This never happened in Saddam's time," he adds.

At about five cents a liter, this is some of the cheapest diesel in the world, but there isn't enough of it. Moufed Fleiyeh brings foodstuffs from the port of Baquba in Jordan. He says he's allowed only 300 liters of diesel at a time.

MOUFED FLEIYEH, IRAQI CITIZEN (through translator): I can't even get to the border on that. I spend 10 or fifteen days to get enough gas for the trip.

ARRAF: Even before the results are announced, these men have high expectations that a new Iraqi government will be able to solve problems the Americans didn't.

Jane Arraf, CNN, near Maqtoviah (ph), Iraq.

(END VIDEOTAPE)

BROWN: The budget when we come back, but whose budget? A look at the contours of a $2.5 trillion battlefield. "New York Times" columnist Paul Krugman joins us for that.

Later, should some very painful private moments from 9/11 become part of the public record?

And morning papers, too.

This is NEWSNIGHT on CNN.

(COMMERCIAL BREAK)

BROWN: This is budget week, the administration trying to sell its budget for 2006 to the country, to the Congress. There are plenty of skeptics, skeptics because the plan calls for some of the most drastic cuts since Ronald Reagan was in office, but still leaves a record deficit. In fact, it's kind of a misnomer to call it the president's budget. It belongs just as much to Congress, or it will when Congress rewrites it.

But, even in that regard, traditional roles have changed.

We begin this with CNN's Bruce Morton.

(BEGIN VIDEOTAPE)

BRUCE MORTON, CNN NATIONAL CORRESPONDENT (voice-over): The first thing you need to know about the president's budget is that it doesn't exist. Sure, there's a book and all those briefings. But likely nothing close to what he's asking for will ever happen because it all has to go through Congress.

Last year Mr. Bush asked Congress to eliminate 65 government programs for a savings of $4. 9 billion. Congress eliminated just four of the 65, saving less than $300 million.

This year he's asking Congress to cut or eliminate 150 programs. How well do you think he'll do?

(on camera): For every government program there's probably an industry that gives money to politicians that wants the program kept alive. There may be a trade union that gives money that wants to keep those jobs. There will be a congressional subcommittee that supervises the program. And if it dies, what will they be in charge of?

(voice-over): When Ronald Reagan said the closest thing to eternal life on this Earth was a government program he wasn't kidding. And it isn't just the programs. It's the little goodies, a park for your district, a research program for the college in my district that congressman stick into spending bills. Earmarks they're called.

The watchdog group Citizens Against Government Waste estimates that in fiscal 2005 there were 13,900 earmarks worth just under $26. 5 billion. A record.

The president can veto appropriations bills, of course. The whole bill. He doesn't have a line item veto. But this president has never done that. In fact, the whole issue has changed. Deficit hawks used to be Republicans. The constitutional amendment to balance the budget was part of Newt Gingrich's contract with America back in the 1990s when the Republicans won control of the House. But it was Democrat Bill Clinton who actually ended deficits and ran surpluses. And so the issue has switched sides.

KEATING HOLLAND, CNN POLITICAL DIRECTOR: Now Democrats are almost twice as likely as Republicans to say that the federal deficit is a very important issue the Congress and the president have to deal with in the coming year.

MORTON: It's way too early to know what the budget Congress actually passes will look like. What we know is it won't look much like the one the president sent them this week. It never does.

Bruce Morton, CNN, Washington.

(END VIDEOTAPE)

BROWN: "New York Times" columnist Paul Krugman joins us. He's been writing about the budget. He's been writing about Social Security. Sometimes he writes about them both the same day. So I feel free to talk about them both.

Nice to see you again.

PAUL KRUGMAN, COLUMNIST, "THE NEW YORK TIMES": Good to see you. BROWN: There's a little bit of a disconnect here, it seems to me, when we say that the Democrats have become the budget hawks, because, in fact, a lot of the programs that are being cut are programs that are traditionally supported by Democrats, talking about Medicaid programs, for one, assistance to the poor, education programs and others.

KRUGMAN: Well, but the elephant in the room, of course, is taxes.

Under Bush, the taxes that fall most heavily on the affluent, which is the personal income tax and the corporate profits tax, are at their lowest level since 1942. So Democrats are deficit hawks in the sense they say, look, we need more revenue. And Bush is not prepared to do anything along those lines.

BROWN: I may have missed this, but the problem here is nobody really believes, do they, that they're undertaxed?

KRUGMAN: Well, I think you are. And I think I am, actually, relatively speaking.

(CROSSTALK)

BROWN: Speak for yourself here, if you don't mind.

(LAUGHTER)

KRUGMAN: OK.

No, but the truth is that what we've had is a revenue collapse. If you look at why is there is a budget deficit, it's because tax collection, not on the middle class, who mostly pay the payroll tax, but on the high-income people, has really fallen drastically off, partly because of the Bush tax cuts, partly for reasons we don't -- you know, for other reasons.

BROWN: I think was yesterday -- I think I saw it this morning. The budget director said that, in fact, the rich, which in this definition -- whoever is rich, this definition seems to change a -- but I think it was $140,000 a year or more -- were actually paying a little bit more of the total income taxes.

KRUGMAN: That's the trick. That's the income tax, which is the one that -- but not total -- their share of the total tax burden has fallen quite a lot.

BROWN: Right.

KRUGMAN: So -- and the thing is -- the thing about the Bush budget is, if you're serious about tackling the budget deficit, you go where the money is, which is either tax increases or Social Security and Medicare.

BROWN: Right.

KRUGMAN: And where he is going is where the money isn't, like food stamps.

BROWN: That's chump change by comparison.

KRUGMAN: Exactly; $1.1 billion in food stamps does a lot -- which is the cut that is in the budget -- that does a lot of harm to a lot of people. But it's nothing. That's -- well, it's a day in Iraq -- not quite. But it's about a week's tax cuts for people over $1 million.

BROWN: One of the things you talked about today, which I think is the great -- I've been saying for a while -- going to be the great debate in the country this year, is what this -- what privatizing Social Security or parts of Social Security, whatever, what that really is about. And you make the argument today -- it's not the first time -- that this is really an attack on the central pillar of what conservative America considers the welfare state.

KRUGMAN: Yes. I mean, if you think of what -- look at what the Cato -- people at the Cato Institute, who -- it's basically people from the Cato Institute who are devising this plan, who are on the...

(CROSSTALK)

BROWN: This is a think tank on the right.

KRUGMAN: Think tank.

And they -- you know, I quoted one this morning who said Social Security is the soft underbelly of the welfare state. Let's jab a spear through it. And if you look at the president's plan, there's been a lot of misunderstanding about it. People will say, oh, it's just a small part. Actually, if you look at it, by the time that people who are young, who are not yet in the work force, by the time they retire under that plan, Social Security as we know it would be gone.

BROWN: Do you think they see a world where this is no guaranteed at-retirement check of some amount?

KRUGMAN: That's what -- just run the numbers on the Bush plan. The typical worker who was born in 1990 will be getting 8 percent of his or her wages in guaranteed checks, which is nothing.

BROWN: And do you believe they see a world where there is medical care -- there is no Medicare at 65?

KRUGMAN: I think that's what they're looking for. Now, that, they have not said. That's -- I'm guessing. But they certainly have spoken out against a whole set of programs. And Social Security is the -- again, what we have, the hard stuff we have is a plan that will essentially eliminate any guaranteed retirement income.

BROWN: Just really quickly, yes or no, do you think the president will win on privatizing Social Security?

KRUGMAN: I don't think so. I think they weren't ready for the pushback.

BROWN: Nice to see you. I hope you will come back.

KRUGMAN: Good to see you.

BROWN: You're a splendid writer.

BROWN: Still ahead on the program, one of the more heartrending legal battles to flow out of the attacks of 9/11. How many can there be? We'll tell you that story.

Morning papers are around again, so we've got some stuff to do.

We'll be right back. This is NEWSNIGHT.

(COMMERCIAL BREAK)

BROWN: It's fair to say the legal battles born on September 11 will be fought for years to come. One of them will take another turn tomorrow in New York's capital, Albany, where a group of 9/11 families will argue before the state appeals court, New York's highest court.

On the face, what they want is simple. But, as with all things born of 9/11, the case before the court is neither simple, nor easy.

Reporting for us tonight, CNN's Deborah Feyerick.

(BEGIN VIDEOTAPE)

DEBORAH FEYERICK, CNN CORRESPONDENT (voice-over): When the second plane hit the World Trade Center, insurance broker Richard Gabrielle was blown back into a marble wall, pinning his legs, any chance of escape crushed.

MONICA GABRIELLE, WIFE OF SEPTEMBER 11 VICTIM: He had no choice but to wait for someone to help him out. He couldn't walk. He was pinned.

FEYERICK: His widow, Monica, learned what happened days later from co-workers who made it out. But Sally and Al Regenhard, whose son, Christian, was a firefighter, say they've never been told the haunting details of his final minutes.

SALLY REGENHARD, MOTHER OF SEPTEMBER 11 VICTIM: When I look at the pictures, I realize what happened and I realize that he has disappeared.

FEYERICK: The two families feel there's more to know. They're fighting to unseal thousands of emergency 911 calls, many of them made from inside the towers.

NORMAN SIEGEL, ATTORNEY FOR SEPTEMBER 11 FAMILIES: What we're talking about is history, making sure that history is told to my grandchildren and their grandchildren what actually happened that horrific morning. FEYERICK: New York City sealed those 911 calls, along with interviews from 500 firefighters made soon after the tragedy. In court papers, the city says the tapes "would be grist for sensational exploitation" and that "if there were any practical information to be gleaned from those records, it would already have been harvested."

The September 11 Commission did get to hear those 911 calls and examine the firefighter interviews. Among their findings, that emergency operators didn't have information vital to getting people out. The city says that problem has been fixed, with ranking officers giving greater guidance to operators during emergencies.

But for widow Monica Gabrielle, those changes are just the start of a campaign to make skyscrapers safer.

GABRIELLE: That would essentially be the dead speaking back to the living about what went wrong, what deadly mistakes were made that prevented these people from getting out. And we can only learn from that information.

AL REGENHARD, FATHER OF SEPTEMBER 11 VICTIM: If this happens in the future, we can deal with it better. I owe my son that. That's his legacy.

FEYERICK: A legacy and a search for truth, the painful truth of final moments and final words.

Deborah Feyerick, CNN, New York.

(END VIDEOTAPE)

BROWN: That's coming up tomorrow in Albany.

Here's what's coming up tomorrow on "AMERICAN MORNING."

(BEGIN VIDEO CLIP)

SOLEDAD O'BRIEN, CNN ANCHOR: Thanks, Aaron.

Tomorrow on "AMERICAN MORNING," the man who revolutionized television by getting viewers in touch with reality. TV innovator Mark Burnett, the brains behind the programs like "Survivor" and "The Apprentice," is our guest. His life story includes more twists and turns than the toughest immunity challenge you could ever think of, how he went from British paratrooper to broken-down nanny to one of the hottest producers in showbiz.

That's CNN tomorrow, 7:00 a.m. Eastern. We'll see you then -- Aaron.

(END VIDEO CLIP)

BROWN: Soledad.

Our own reality program continues with morning papers after the break. (COMMERCIAL BREAK)

(ROOSTER CROWING)

BROWN: That's pretty cool. Tomorrow, I think -- I think it's tomorrow -- begins the year of the rooster, so it will be a big year for morning papers for us, our own year.

"The Christian Science Monitor." Here we go. "Why This Deal Might Be Different. Israeli, Palestinian Leaders Met For First Time in Four Years Yesterday at Summit" -- in Iraq -- I hope it was different, because all the other times, it hasn't worked out at all.

Over here, "New Englanders Ponder New Status. Are We Winners?" Yes, you are. Down here, Tedy Bruschi. I just mention that because I think that's the best football name since Bronco Nagurski. That's just a great football name. You're too young to remember Bronco Nagurski. Well, I'm too young to remember Bronco Nagurski.

Anyway, "The Dallas Morning News" over here. "Steroid Inquiry Widens. District Looking For Student Dealers. More Possible Users Identified." This is a good story. High school kids are using steroids? Can you imagine down in the state of Texas this was going on because they wanted to be better football players?

Speaking of important issues making their way to legislative bodies, "The Washington Times" here: "Droopy Drawers Bill Seeks End to Overexposure of Underwear." A legislator in Virginia has introduced a bill which would fine young men or I suppose young women $50 if their underwear showed in an unseemly way. I guess if their underwear showed in a seemly way, it would be OK.

I'm sorry. It just seems like there are other bigger problems. My view of things. I'm not that crazy about the hip-huggers, OK, that my daughter wears, but I just don't think it's the legislature's job.

"Pledges for Peace," the "Rocky Mountain News" headline. "Sharon, Abbas Vow to Halt Violence." I hope they succeed. And that will give them time to take on the droopy underwear problem that I'm sure affects both of those fine countries.

We welcome to the program tonight -- I'll leave that alone now -- "The Fairchild Connection." This is out of Fairchild Air Force Base in Spokane, Washington. And lots of good friends out that. "Fairchild Security Troop, K--9 Unit Return From Iraq." Can you imagine how many levels of Pentagon public relations officers this had to go through before these fine people could send us their paper? Thank you. We're glad to have it. I hope you will send it again tomorrow.

How much time we got? Thank you. Not much.

I did that one already. How did that get back?

"The Des Moines Register." "Seniors Get Turn at Tax Breaks." You may remember last week or so, the problem was, they were going to give tax breaks to kids.

The weather tomorrow in Chicago is "rush slush."

And we will see you tomorrow. Until then, good night for all of us.

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