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Hope for Middle East; Pope Stepping Down?; Bush's Budget

Aired February 08, 2005 - 09:01   ET

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


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


SOLEDAD O'BRIEN, CNN ANCHOR: Another moment of hope for the Middle East with a bold promise at the summit this morning: the pledge to cease all violence.
Would the pope consider resigning due to his poor health? One Vatican official gives a surprising answer.

And a hero's welcome in New England for this woman. Her trip around the world is a legend in the making on this AMERICAN MORNING.

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

O'BRIEN: Good morning. Welcome back, everybody. Mr. Hemmer's got the day off. He's recovering from the Super Bowl.

ROB MARCIANO, CNN ANCHOR: Still. Two days' worth.

O'BRIEN: I know. Exactly.

MARCIANO: Big party.

O'BRIEN: Rob Marciano is filling in for him this morning.

It's nice to have you. Thank you very much.

MARCIANO: Absolutely. You're welcome.

O'BRIEN: Let's get back to the Middle East summit in just a few moments. Some pretty impressive statements being made by Palestinian Authority President Mahmoud Abbas and the Israeli prime minister, Ariel Sharon, this morning. Will this time, though, be different from other times? We're going to take a look at that ahead.

MARCIANO: Also, a closer look inside the president's $2.5 trillion budget. A lot of popular programs could get cut, including ones that help farmers. We'll talk about the impact of that with the president -- or at least with the president of the National Corn Growers Association a little bit later.

O'BRIEN: Mr. Cafferty, good morning.

JACK CAFFERTY, CNN ANCHOR: Hi.

They got this brand new real estate development down there in Arkansas. Everything's going along smoothly. They're selling these houses until it's discovered that a convicted sex offender has bought one of the houses. And now, sales have come to a screeching halt.

The developer is suing the sex offender and the real estate company that sold him the house on the basis that he -- his presence there has caused his business to suddenly evaporate. They're not selling anymore homes.

Should this be allowed? Should the developer be able to do this based on this presence of this guy in this development? AM@CNN.com. We'll read some letters in a few minutes.

O'BRIEN: Some interesting feedback, I think, from people who said, well, if you let that go...

CAFFERTY: It's an interesting story, yes.

O'BRIEN: ... then, you know, you say African-Americans move in...

CAFFERTY: The technicalities have to do I think with the fact that, for example, the house was bought in his wife's name only. And the lawyers are saying they intentionally concealed the fact that this sex offender was purchasing the property by virtue of the fact that his name wasn't included in the contract, yadda, yadda, yadda.

It's -- you know what it is? It's another way for the lawyers to buy another vacation home. That's what these things always turn out to be about.

MARCIANO: Thirty percent, at least.

O'BRIEN: Yes.

O'BRIEN: Interesting feedback. All right, Jack. Thank you.

CAFFERTY: Sure.

O'BRIEN: In a face-to-face meeting in Egypt today, Israeli Prime Minister Ariel Sharon and Palestinian leader Mahmoud Abbas agreed to end violence against one another, paving a new road to possible peace in the Middle East.

CNN's John Vause is in Sharm El Sheikh with more for us this morning.

Good morning, John.

JOHN VAUSE, CNN CORRESPONDENT: Hello, Soledad.

"A newborn opportunity for peace, let us protect it," is how the president of the Palestinian Authority described this agreement to end the violence between the Israelis and the Palestinians, end more than four years of bloodshed. But the president of the Palestinian Authority warned that there were still many differences yet to be overcome.

(BEGIN VIDEO CLIP) MAHMOUD ABBAS, PRESIDENT, PALESTINIAN AUTHORITY (through translator): We have agreed with the Prime Minister Ariel Sharon to cease all acts of violence against the Israelis and against the Palestinians wherever they are. Tranquility and quiet will be witnessed in our land starting today is the beginning for a new era. The beginning of peace and hope.

(END VIDEO CLIP)

VAUSE: Now, he said that many of these differences, such as the building of settlements -- Jewish settlements in occupied Palestinian territories, the barrier which Israel is building through the West Bank, and also the right of return for refugees, the release of prisoners, would only be resolved through international negotiations.

As for the Israeli prime minister, Ariel Sharon, he described this as a major turning point. But he warned that there are still those out there who wish to destroy this new chance at peace.

(BEGIN VIDEO CLIP)

ARIEL SHARON, ISRAELI PRIME MINISTER (through translator): This day will be the day that marks the re-launching of the process for a better future that will lead us towards mutual respect and peace for the Middle East.

(END VIDEO CLIP)

VAUSE: Now, the Israeli prime minister spoke directly to the Palestinian people. He said Israel respects their right to live independently, and he said that Israel does not want to rule their lives -- Soledad.

O'BRIEN: John Vause for us this morning. John, thank you -- Rob.

MARCIANO: Let's check another look at the headlines. Here's Heidi Collins again.

Good morning.

HEIDI COLLINS, CNN ANCHOR: Good morning, guys. And good morning to you once again, everybody.

"Now in the News" this morning, Secretary of State Condoleezza Rice has arrived in Paris with -- within the past 15 minutes, that is. She is preparing to deliver what is being billed as a major foreign policy address.

Earlier, Secretary Rice met with the number two Vatican official. Rice says she chose to give today's speech in Paris because France was a major critic of the Iraq war. CNN will have live coverage of Secretary Rice's address beginning at 11:00 a.m. Eastern.

Another deadly attack in Iraq this morning. An explosion rocking a National Guard base in central Baghdad. According to U.S. military sources, as many as 21 people are dead. Nearly 30 others are injured.

Here in the United States, the full Senate is expected to vote today on the nominee for Homeland Security secretary. Yesterday, a Senate committee approved Michael Chertoff's nomination, 14-0. Chertoff is the last member of Bush's second-term cabinet still awaiting Senate approval.

And the scientists who cloned Dolly the sheep is getting the green light now to clone human embryos for medical research. A British agency has granted him a license for Ian Wilmut, who led the team that created Dolly the sheep back in 1996.

Wilmut says he wants to study the stem cells so that he can pinpoint what causes motor neuron disease. But some critics are opposed to that type of research. Lots of debate about stem cell research in any way, shape or form. That's for sure.

O'BRIEN: Heidi, thanks.

COLLINS: Yes.

MARCIANO: Thanks, Heidi.

Well, it's been a week since John Paul II was rushed to a Rome hospital suffering from the flu and a severe respiratory infection. And while the 84-year-old pontiff's health continues to improve this morning, there's talk from the Vatican about the possibility of the pope actually stepping down.

Alessio Vinci is CNN's Rome bureau chief. He's live with us with details.

Alessio, this is new.

ALESSIO VINCI, CNN ROME BUREAU CHIEF: Good morning, Rob.

Well, cardinals rarely make comments about papal succession. And so when they do, no matter what really they say, it does make news.

And yesterday, when the Vatican number two, Cardinal Angelo Sodano, pressed by reporters about the possibility that the pope would step down, he answered "Well, we should leave the hypothesis up to the pope's conscience." Now, this answer puzzled some observers here, because basically the cardinal did not rule out the fact that the pope might step down.

Now, I should also add that in further comments, the cardinal did not say or hint that the pope was about to resign, or whether there was any talk inside the Vatican whether the pope should resign or not at this point because he is too frail to lead the Catholic Church. What the -- what the cardinal basically said is reiterating -- reiterating what the canon law which governs the church law basically says. And that is that the pope, if he wishes to do so, he can resign, but he cannot be forced to do so.

So nobody -- nobody can force the pope to resign other than he himself deciding in front of god, if you want, to step downp. So this cardinal's comments were perhaps taken by the media as another opportunity to dissect, if you want, the pope's true state of health. But at the same time, no indication whatsoever that time that the pope is about to resign himself. On Sunday, delivering the angelus through an aide, the pope said that he continues to lead the Catholic Church even from his hospital bed -- Rob.

MARCIANO: Alessio, Secretary of State Condoleezza Rice was at the Vatican today, met with Cardinal Sodano. What did they discuss?

VINCI: Well, as they usually do when a top U.S. official travels to the Vatican, she was supposed to meet with the pope. But as you know, he is in the hospital. So she met with Angelo Sodano, the number two.

They discussed a series of international issues. And that's what the Vatican is telling us. That is, the situation in the Middle East, of course, as well as an issue that presses, that is really at the core, if you want, within the Vatican. That is, religion and freedom around the world, especially in countries such as China and Saudi Arabia.

So these are the two main issues that the two have discussed. And according to a Vatican statement that was issued right after the meeting, the two also worked in reaffirming their willingness to cooperate in promoting also spiritual values -- Rob.

MARCIANO: OK, Alessio, thanks very much. Alessio Vinci live for us in Rome -- Soledad.

O'BRIEN: A 28-year-old English woman is back on dry land this morning after setting a record for sailing solo around the world. Ellen MacArthur finished her 26,000-mile circumnavigation on Monday. Her final time: 71 days, 14 hours, 18 minutes, 33 seconds, over one day faster than the previous record holder.

She began her journey on a 75-foot trimaran on November 28, sleeping just an average of about 30 minutes at a time. During the trip MacArthur endured stormy seas, strong winds, a broken sail and a close encounter with a whale. It all turned out well, though, in the end.

Time to check in on the weather again. Chad Myers at the CNN Center with the latest forecast for us.

Hey, Chad. Good morning.

CHAD MYERS, CNN METEOROLOGIST: Good morning, Soledad.

(WEATHER REPORT)

O'BRIEN: Oh, like they need any more snow in Boston. Like we need any.

MARCIANO: They have two championships. You know? With the good comes the bad. O'BRIEN: Oh, come on. All right. Thanks, Chad.

MARCIANO: Thanks, Chad.

Well, there's new speculation now on the biggest mystery in American politics. Who was Woodward and Bernstein's infamous Deep Throat? A professor says his students already have the answer.

O'BRIEN: Also, the president's new budget plan calls for sweeping cuts. A piece of Americana could be the hardest hit. We'll explain.

MARCIANO: And another female teacher accused of having a sexual affair with a younger student. The details ahead on AMERICAN MORNING.

(COMMERCIAL BREAK)

O'BRIEN: President Bush is going to Michigan today to promote his newly-released 2006 budget. The nearly $2.6 trillion budget proposes the largest spending cut since the Reagan administration.

The president's goal was to cut the budget deficit by half by 2009. To do that, he proposes cutting the budgets of 12 of the 23 major government agencies.

Among the hardest hit, Housing and Urban Development cut by 11.5 percent. Agriculture cut by over 9.5 percent. In the agriculture budget, there are subsidies to U.S. Farmers. The president wants a 5 percent across-the-board cut in price supports.

How had that affect farmers? What do they think of the plan? Let's check in with Len Corzine. He's a farmer from Illinois. He's also the president of the National Corn Growers Association.

Nice to see you, Mr. Corzine. Thank you for talking with us.

Give me a sense of how this program works anyway. $15 billion annually is what I understand farmers get in subsidies to produce things like corn and cotton and rice and wheat. How does that work?

LEN CORZINE, PRESIDENT, NATIONAL CORN GROWERS ASSOCIATION: Well, good morning. The way it works on our farm -- and we are a family farm. I'm the fifth generation on our farm, and my son now is back on the farm, the sixth generation.

And what this farm program does is it helps us provide some stability. It's truly a safety net program. And what that means is that we provide food, feed, fiber and now also fuel to the American consumer. And what that does is, is with the safety net program to provide the stability when we need it the most, it means food security for the U.S. consumer, as well now working towards energy security with what we're doing with corn.

O'BRIEN: So then a 5 percent across-the-board cut would mean what specifically to your family farm?

CORZINE: It's very difficult to say. It is a very complex bill.

We never know what we're really going to get from the farm program. What we do as the National Corn Growers Association is we work very hard on market development and to do things to where we truly get most of our income or all of it from the marketplace.

But the way this 2002 farm bill is structured is, when farm prices go down, that's when the price -- the safety net kicks in. And we get -- we receive more support from the -- from the federal government. And that works very well.

And it is very easy to see the track record of the 2002 farm bill. Actually, we have saved a little over $15 billion in the first three years of the program versus what it was anticipated when the bill was passed we would spend.

O'BRIEN: What's your expectation if the president's budget passes in the forum that it is now being presented? Which, we have to add, is incredibly unlikely.

CORZINE: Well, as we all know, this is very complex as far as the budget and all the discussions that will be going on. It will take several months, I'm sure. Maybe even longer to see where it all ends up.

It is very difficult for a farmer like myself to understand or to really know what, for example, a payment limit issue would do because it really is dependent on what the market prices are. As I mentioned, when the market prices are higher, why, we don't get very much from the government, from the federal government. When prices go down, why, that's when the safety net kicks in.

What that really...

O'BRIEN: Well, so then maybe my question would be, do you predict dire consequences potentially for some farmers? Not just necessarily the corporate farmers who I think have a lot of these deals, but the family farmers like yourself?

CORZINE: Well, you've hit on it. The farm program means the most and the safety net to the family farmers. And what we have to really be careful of with the -- with the payment limitations that -- by the way, the 2002 farm bill reduced the payment limits from what they were in previous bills. So we already have payment limits.

And the concern is that in those times when market prices may be the lowest and we need on the family farm the most help from the federal government, why, that's when the payment limits would have the most adverse affect on the family farms. And that also talks -- leads to the food security.

And what we've been able to do with this farm program, it helps farmers make long-term decisions, farm families. And also, that leads to the food security where we know as a business we're going to be able to provide food for the American consumer. O'BRIEN: Agriculture lobby is a huge and powerful lobby. What do you think are the chances that the president will actually be able to get this part of the budget through?

CORZINE: Very difficult to anticipate. We will see where it goes. Our policy is we support the 2002 farm bill as it is written and as it is currently funded. And we will work towards that.

We're very grassroots organizations. And we're in discussions almost weekly with -- or daily sometimes with our -- with our state members and with our members out there in the countryside. So we will continue to work towards that end.

I think we need to remind folks this 2002 farm bill really has worked. That's why we really -- and we're proud that we've been able to provide the safest, the most abundant, the healthiest food supply that the world has ever seen. And that the U.S. consumer spends less dollars on their food than anywhere in the world. It is truly the envy of the world.

O'BRIEN: Len Corzine is the president of the National Corn Growers Association. Thanks for talking with us this morning with your perspective. Appreciate it.

President Bush promotes his budget to the Detroit Economic Club today. Stay tuned for live coverage of the speech at noon Eastern Time -- Rob.

MARCIANO: Well, here we go again. A female elementary school teacher is accused of having a sexual affair with an under-age boy. Twenty-seven-year-old Pamela Rogers Turner (ph) is a phys ed teacher in Warren County, Tennessee. The D.A. says the affair went on from November of last year until January while the boy was still 13 years old.

(BEGIN VIDEO CLIP)

DALE POTTER, DISTRICT ATTORNEY: We've got 15 counts of sexual battery by an authority figure based on the position as a teacher and that she had with this student at Center Town Elementary School (ph). There's 13 counts of statutory rape.

(END VIDEO CLIP)

MARCIANO: Potter says the acts occurred in the school and in the boy's home, where Turner actually lived for a short time -- Soledad.

O'BRIEN: And on a different note, it is the biggest party this side of New Year's Eve. The parades, the lights, the beads. We're going to see how The Big Easy wakes up during Mardi Gras ahead on AMERICAN MORNING.

(COMMERCIAL BREAK)

MARCIANO: Well, Happy Mardi Gras. It's Fat Tuesday, the last day of Mardi Gras celebrations in New Orleans. And revelers this year follow a tradition dating back to the 15th century, when the French settled in the area.

Mardi Gras is French for "Fat Tuesday." It's the day before Ash Wednesday and the official beginning of Lent. Mardi Gras was declared a legal holiday in Louisiana back in 1875. Mike Castellucci from our affiliate WFAA is in The Big Easy this morning with a bird's eye view of Bourbon Street.

Good morning, Mike, and happy Mardi Gras.

MIKE CASTELLUCCI, REPORTER, WFAA: That's right. Happy Mardi Gras to you, Rob.

We are safe and sound up on a balcony above Bourbon Street. A lot of people still out on the street. Some leftovers from a long night, others just getting here for one of 11 parades that will happen throughout the French Quarter this morning.

Now, this is what the scene looked like earlier this morning at about 5:00, 5:30 in the morning. The street on Bourbon just completely packed with people.

Now, business owners say that business has been down a little bit from previous years, but they blame that on the calendar and the weather. The calendar because Mardi Gras happened earlier in the season than when it normally does, when it normally warms up. And there has been some rain here.

But we've got to show you this scene. Interesting that the locals tell me that they rate Mardi Gras and its success on the amount of trash that's generated. They actually go to the landfills and weigh it. So judging from Bourbon Street right here this morning, it looks like it's been a smashing success.

Also, you know, Rob, it's all about the beads here at Mardi Gras. And they're everywhere. Even in the gutters on the roof.

That's it. We're live at Bourbon Street in New Orleans. Back to you.

MARCIANO: Valuable material there, Mike. Mike Castellucci, our CNN affiliate WFAA, joining us live. Happy Mardi Gras.

CASTELLUCCI: Thank you.

MARCIANO: Jack, happy Mardi Gras.

Happy Mardi Gras.

O'BRIEN: What are you doing to celebrate Mardi Gras?

CAFFERTY: Well, my youngest daughter is a student at Tulane University. And she's somewhere down there.

You better not be coming home with no beads, young lady. None of that.

(LAUGHTER)

CAFFERTY: The question today has to do with an Arkansas developer who has filed a $2 million lawsuit claiming that new home sales in a subdivision he built have come to a screeching halt after a registered sex offender, Randall Collins, and his wife moved into the development.

Collins is a level-three sex offender, convicted of molesting girls. The lawsuit claims sales have come to a standstill because the developer is now required to tell other potential buyers about Collins' presence. He's also suing the real estate company because apparently the contract under which the home was sold contained only Collins' wife's name, intentionally, he claims, concealing the man's past.

The question is, can a real estate developer sue a sex offender for slowing home sales?

Elizabeth in Toronto writes: "Sure, he can sue. Can he win? Maybe. You'd have to look at the contract of sale for the house to see if the developer's lawyer had the smarts to include a nondisclosure clause which might allow the seller an out."

Dean in New Jersey writes: "I don't know and it's too early in the morning for such a complicated question."

(LAUGHTER)

CAFFERTY: Les in Urbandale, Iowa, "My first thought was he should not be able to sue. Then I thought, I have a 14-year-old daughter. I wouldn't move next to him. He did buy the house on his wife's name to avoid the knowledge of his past."

And there's one more here if I can get the page turned. Marty writes: "Can a real estate developer sue a sex offender for slowing home sales? Sure. And the sex offender can then countersue for emotional and monetary damages. All part of legal beagle's full employment act."

In other words, the lawyers are the ones who win in these things usually.

O'BRIEN: I wonder if it would be worth their while to just pay him to move.

CAFFERTY: Well, he apparently made an offer that if they come up with a quarter of a million dollars he'd find a new address. But so far the developer's not come up with the cash. So...

O'BRIEN: You've got to imagine if it goes to court that might be worth it in the end.

CAFFERTY: Well, and the threat of a lawsuit might be enough to encourage him to move without paying him off, because if he goes to court they will have to sit in an open courtroom and revisit the reasons for the lawsuit, won't we. Maybe he doesn't want to do that. O'BRIEN: All right, Jack. Thank you.

MARCIANO: Thanks, Jack.

O'BRIEN: A new clue this week in the biggest mystery in American politics. Who was Woodward and Bernstein's Deep Throat? The likely suspects named ahead on AMERICAN MORNING.

(COMMERCIAL BREAK)

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Aired February 8, 2005 - 09:01   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
SOLEDAD O'BRIEN, CNN ANCHOR: Another moment of hope for the Middle East with a bold promise at the summit this morning: the pledge to cease all violence.
Would the pope consider resigning due to his poor health? One Vatican official gives a surprising answer.

And a hero's welcome in New England for this woman. Her trip around the world is a legend in the making on this AMERICAN MORNING.

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

O'BRIEN: Good morning. Welcome back, everybody. Mr. Hemmer's got the day off. He's recovering from the Super Bowl.

ROB MARCIANO, CNN ANCHOR: Still. Two days' worth.

O'BRIEN: I know. Exactly.

MARCIANO: Big party.

O'BRIEN: Rob Marciano is filling in for him this morning.

It's nice to have you. Thank you very much.

MARCIANO: Absolutely. You're welcome.

O'BRIEN: Let's get back to the Middle East summit in just a few moments. Some pretty impressive statements being made by Palestinian Authority President Mahmoud Abbas and the Israeli prime minister, Ariel Sharon, this morning. Will this time, though, be different from other times? We're going to take a look at that ahead.

MARCIANO: Also, a closer look inside the president's $2.5 trillion budget. A lot of popular programs could get cut, including ones that help farmers. We'll talk about the impact of that with the president -- or at least with the president of the National Corn Growers Association a little bit later.

O'BRIEN: Mr. Cafferty, good morning.

JACK CAFFERTY, CNN ANCHOR: Hi.

They got this brand new real estate development down there in Arkansas. Everything's going along smoothly. They're selling these houses until it's discovered that a convicted sex offender has bought one of the houses. And now, sales have come to a screeching halt.

The developer is suing the sex offender and the real estate company that sold him the house on the basis that he -- his presence there has caused his business to suddenly evaporate. They're not selling anymore homes.

Should this be allowed? Should the developer be able to do this based on this presence of this guy in this development? AM@CNN.com. We'll read some letters in a few minutes.

O'BRIEN: Some interesting feedback, I think, from people who said, well, if you let that go...

CAFFERTY: It's an interesting story, yes.

O'BRIEN: ... then, you know, you say African-Americans move in...

CAFFERTY: The technicalities have to do I think with the fact that, for example, the house was bought in his wife's name only. And the lawyers are saying they intentionally concealed the fact that this sex offender was purchasing the property by virtue of the fact that his name wasn't included in the contract, yadda, yadda, yadda.

It's -- you know what it is? It's another way for the lawyers to buy another vacation home. That's what these things always turn out to be about.

MARCIANO: Thirty percent, at least.

O'BRIEN: Yes.

O'BRIEN: Interesting feedback. All right, Jack. Thank you.

CAFFERTY: Sure.

O'BRIEN: In a face-to-face meeting in Egypt today, Israeli Prime Minister Ariel Sharon and Palestinian leader Mahmoud Abbas agreed to end violence against one another, paving a new road to possible peace in the Middle East.

CNN's John Vause is in Sharm El Sheikh with more for us this morning.

Good morning, John.

JOHN VAUSE, CNN CORRESPONDENT: Hello, Soledad.

"A newborn opportunity for peace, let us protect it," is how the president of the Palestinian Authority described this agreement to end the violence between the Israelis and the Palestinians, end more than four years of bloodshed. But the president of the Palestinian Authority warned that there were still many differences yet to be overcome.

(BEGIN VIDEO CLIP) MAHMOUD ABBAS, PRESIDENT, PALESTINIAN AUTHORITY (through translator): We have agreed with the Prime Minister Ariel Sharon to cease all acts of violence against the Israelis and against the Palestinians wherever they are. Tranquility and quiet will be witnessed in our land starting today is the beginning for a new era. The beginning of peace and hope.

(END VIDEO CLIP)

VAUSE: Now, he said that many of these differences, such as the building of settlements -- Jewish settlements in occupied Palestinian territories, the barrier which Israel is building through the West Bank, and also the right of return for refugees, the release of prisoners, would only be resolved through international negotiations.

As for the Israeli prime minister, Ariel Sharon, he described this as a major turning point. But he warned that there are still those out there who wish to destroy this new chance at peace.

(BEGIN VIDEO CLIP)

ARIEL SHARON, ISRAELI PRIME MINISTER (through translator): This day will be the day that marks the re-launching of the process for a better future that will lead us towards mutual respect and peace for the Middle East.

(END VIDEO CLIP)

VAUSE: Now, the Israeli prime minister spoke directly to the Palestinian people. He said Israel respects their right to live independently, and he said that Israel does not want to rule their lives -- Soledad.

O'BRIEN: John Vause for us this morning. John, thank you -- Rob.

MARCIANO: Let's check another look at the headlines. Here's Heidi Collins again.

Good morning.

HEIDI COLLINS, CNN ANCHOR: Good morning, guys. And good morning to you once again, everybody.

"Now in the News" this morning, Secretary of State Condoleezza Rice has arrived in Paris with -- within the past 15 minutes, that is. She is preparing to deliver what is being billed as a major foreign policy address.

Earlier, Secretary Rice met with the number two Vatican official. Rice says she chose to give today's speech in Paris because France was a major critic of the Iraq war. CNN will have live coverage of Secretary Rice's address beginning at 11:00 a.m. Eastern.

Another deadly attack in Iraq this morning. An explosion rocking a National Guard base in central Baghdad. According to U.S. military sources, as many as 21 people are dead. Nearly 30 others are injured.

Here in the United States, the full Senate is expected to vote today on the nominee for Homeland Security secretary. Yesterday, a Senate committee approved Michael Chertoff's nomination, 14-0. Chertoff is the last member of Bush's second-term cabinet still awaiting Senate approval.

And the scientists who cloned Dolly the sheep is getting the green light now to clone human embryos for medical research. A British agency has granted him a license for Ian Wilmut, who led the team that created Dolly the sheep back in 1996.

Wilmut says he wants to study the stem cells so that he can pinpoint what causes motor neuron disease. But some critics are opposed to that type of research. Lots of debate about stem cell research in any way, shape or form. That's for sure.

O'BRIEN: Heidi, thanks.

COLLINS: Yes.

MARCIANO: Thanks, Heidi.

Well, it's been a week since John Paul II was rushed to a Rome hospital suffering from the flu and a severe respiratory infection. And while the 84-year-old pontiff's health continues to improve this morning, there's talk from the Vatican about the possibility of the pope actually stepping down.

Alessio Vinci is CNN's Rome bureau chief. He's live with us with details.

Alessio, this is new.

ALESSIO VINCI, CNN ROME BUREAU CHIEF: Good morning, Rob.

Well, cardinals rarely make comments about papal succession. And so when they do, no matter what really they say, it does make news.

And yesterday, when the Vatican number two, Cardinal Angelo Sodano, pressed by reporters about the possibility that the pope would step down, he answered "Well, we should leave the hypothesis up to the pope's conscience." Now, this answer puzzled some observers here, because basically the cardinal did not rule out the fact that the pope might step down.

Now, I should also add that in further comments, the cardinal did not say or hint that the pope was about to resign, or whether there was any talk inside the Vatican whether the pope should resign or not at this point because he is too frail to lead the Catholic Church. What the -- what the cardinal basically said is reiterating -- reiterating what the canon law which governs the church law basically says. And that is that the pope, if he wishes to do so, he can resign, but he cannot be forced to do so.

So nobody -- nobody can force the pope to resign other than he himself deciding in front of god, if you want, to step downp. So this cardinal's comments were perhaps taken by the media as another opportunity to dissect, if you want, the pope's true state of health. But at the same time, no indication whatsoever that time that the pope is about to resign himself. On Sunday, delivering the angelus through an aide, the pope said that he continues to lead the Catholic Church even from his hospital bed -- Rob.

MARCIANO: Alessio, Secretary of State Condoleezza Rice was at the Vatican today, met with Cardinal Sodano. What did they discuss?

VINCI: Well, as they usually do when a top U.S. official travels to the Vatican, she was supposed to meet with the pope. But as you know, he is in the hospital. So she met with Angelo Sodano, the number two.

They discussed a series of international issues. And that's what the Vatican is telling us. That is, the situation in the Middle East, of course, as well as an issue that presses, that is really at the core, if you want, within the Vatican. That is, religion and freedom around the world, especially in countries such as China and Saudi Arabia.

So these are the two main issues that the two have discussed. And according to a Vatican statement that was issued right after the meeting, the two also worked in reaffirming their willingness to cooperate in promoting also spiritual values -- Rob.

MARCIANO: OK, Alessio, thanks very much. Alessio Vinci live for us in Rome -- Soledad.

O'BRIEN: A 28-year-old English woman is back on dry land this morning after setting a record for sailing solo around the world. Ellen MacArthur finished her 26,000-mile circumnavigation on Monday. Her final time: 71 days, 14 hours, 18 minutes, 33 seconds, over one day faster than the previous record holder.

She began her journey on a 75-foot trimaran on November 28, sleeping just an average of about 30 minutes at a time. During the trip MacArthur endured stormy seas, strong winds, a broken sail and a close encounter with a whale. It all turned out well, though, in the end.

Time to check in on the weather again. Chad Myers at the CNN Center with the latest forecast for us.

Hey, Chad. Good morning.

CHAD MYERS, CNN METEOROLOGIST: Good morning, Soledad.

(WEATHER REPORT)

O'BRIEN: Oh, like they need any more snow in Boston. Like we need any.

MARCIANO: They have two championships. You know? With the good comes the bad. O'BRIEN: Oh, come on. All right. Thanks, Chad.

MARCIANO: Thanks, Chad.

Well, there's new speculation now on the biggest mystery in American politics. Who was Woodward and Bernstein's infamous Deep Throat? A professor says his students already have the answer.

O'BRIEN: Also, the president's new budget plan calls for sweeping cuts. A piece of Americana could be the hardest hit. We'll explain.

MARCIANO: And another female teacher accused of having a sexual affair with a younger student. The details ahead on AMERICAN MORNING.

(COMMERCIAL BREAK)

O'BRIEN: President Bush is going to Michigan today to promote his newly-released 2006 budget. The nearly $2.6 trillion budget proposes the largest spending cut since the Reagan administration.

The president's goal was to cut the budget deficit by half by 2009. To do that, he proposes cutting the budgets of 12 of the 23 major government agencies.

Among the hardest hit, Housing and Urban Development cut by 11.5 percent. Agriculture cut by over 9.5 percent. In the agriculture budget, there are subsidies to U.S. Farmers. The president wants a 5 percent across-the-board cut in price supports.

How had that affect farmers? What do they think of the plan? Let's check in with Len Corzine. He's a farmer from Illinois. He's also the president of the National Corn Growers Association.

Nice to see you, Mr. Corzine. Thank you for talking with us.

Give me a sense of how this program works anyway. $15 billion annually is what I understand farmers get in subsidies to produce things like corn and cotton and rice and wheat. How does that work?

LEN CORZINE, PRESIDENT, NATIONAL CORN GROWERS ASSOCIATION: Well, good morning. The way it works on our farm -- and we are a family farm. I'm the fifth generation on our farm, and my son now is back on the farm, the sixth generation.

And what this farm program does is it helps us provide some stability. It's truly a safety net program. And what that means is that we provide food, feed, fiber and now also fuel to the American consumer. And what that does is, is with the safety net program to provide the stability when we need it the most, it means food security for the U.S. consumer, as well now working towards energy security with what we're doing with corn.

O'BRIEN: So then a 5 percent across-the-board cut would mean what specifically to your family farm?

CORZINE: It's very difficult to say. It is a very complex bill.

We never know what we're really going to get from the farm program. What we do as the National Corn Growers Association is we work very hard on market development and to do things to where we truly get most of our income or all of it from the marketplace.

But the way this 2002 farm bill is structured is, when farm prices go down, that's when the price -- the safety net kicks in. And we get -- we receive more support from the -- from the federal government. And that works very well.

And it is very easy to see the track record of the 2002 farm bill. Actually, we have saved a little over $15 billion in the first three years of the program versus what it was anticipated when the bill was passed we would spend.

O'BRIEN: What's your expectation if the president's budget passes in the forum that it is now being presented? Which, we have to add, is incredibly unlikely.

CORZINE: Well, as we all know, this is very complex as far as the budget and all the discussions that will be going on. It will take several months, I'm sure. Maybe even longer to see where it all ends up.

It is very difficult for a farmer like myself to understand or to really know what, for example, a payment limit issue would do because it really is dependent on what the market prices are. As I mentioned, when the market prices are higher, why, we don't get very much from the government, from the federal government. When prices go down, why, that's when the safety net kicks in.

What that really...

O'BRIEN: Well, so then maybe my question would be, do you predict dire consequences potentially for some farmers? Not just necessarily the corporate farmers who I think have a lot of these deals, but the family farmers like yourself?

CORZINE: Well, you've hit on it. The farm program means the most and the safety net to the family farmers. And what we have to really be careful of with the -- with the payment limitations that -- by the way, the 2002 farm bill reduced the payment limits from what they were in previous bills. So we already have payment limits.

And the concern is that in those times when market prices may be the lowest and we need on the family farm the most help from the federal government, why, that's when the payment limits would have the most adverse affect on the family farms. And that also talks -- leads to the food security.

And what we've been able to do with this farm program, it helps farmers make long-term decisions, farm families. And also, that leads to the food security where we know as a business we're going to be able to provide food for the American consumer. O'BRIEN: Agriculture lobby is a huge and powerful lobby. What do you think are the chances that the president will actually be able to get this part of the budget through?

CORZINE: Very difficult to anticipate. We will see where it goes. Our policy is we support the 2002 farm bill as it is written and as it is currently funded. And we will work towards that.

We're very grassroots organizations. And we're in discussions almost weekly with -- or daily sometimes with our -- with our state members and with our members out there in the countryside. So we will continue to work towards that end.

I think we need to remind folks this 2002 farm bill really has worked. That's why we really -- and we're proud that we've been able to provide the safest, the most abundant, the healthiest food supply that the world has ever seen. And that the U.S. consumer spends less dollars on their food than anywhere in the world. It is truly the envy of the world.

O'BRIEN: Len Corzine is the president of the National Corn Growers Association. Thanks for talking with us this morning with your perspective. Appreciate it.

President Bush promotes his budget to the Detroit Economic Club today. Stay tuned for live coverage of the speech at noon Eastern Time -- Rob.

MARCIANO: Well, here we go again. A female elementary school teacher is accused of having a sexual affair with an under-age boy. Twenty-seven-year-old Pamela Rogers Turner (ph) is a phys ed teacher in Warren County, Tennessee. The D.A. says the affair went on from November of last year until January while the boy was still 13 years old.

(BEGIN VIDEO CLIP)

DALE POTTER, DISTRICT ATTORNEY: We've got 15 counts of sexual battery by an authority figure based on the position as a teacher and that she had with this student at Center Town Elementary School (ph). There's 13 counts of statutory rape.

(END VIDEO CLIP)

MARCIANO: Potter says the acts occurred in the school and in the boy's home, where Turner actually lived for a short time -- Soledad.

O'BRIEN: And on a different note, it is the biggest party this side of New Year's Eve. The parades, the lights, the beads. We're going to see how The Big Easy wakes up during Mardi Gras ahead on AMERICAN MORNING.

(COMMERCIAL BREAK)

MARCIANO: Well, Happy Mardi Gras. It's Fat Tuesday, the last day of Mardi Gras celebrations in New Orleans. And revelers this year follow a tradition dating back to the 15th century, when the French settled in the area.

Mardi Gras is French for "Fat Tuesday." It's the day before Ash Wednesday and the official beginning of Lent. Mardi Gras was declared a legal holiday in Louisiana back in 1875. Mike Castellucci from our affiliate WFAA is in The Big Easy this morning with a bird's eye view of Bourbon Street.

Good morning, Mike, and happy Mardi Gras.

MIKE CASTELLUCCI, REPORTER, WFAA: That's right. Happy Mardi Gras to you, Rob.

We are safe and sound up on a balcony above Bourbon Street. A lot of people still out on the street. Some leftovers from a long night, others just getting here for one of 11 parades that will happen throughout the French Quarter this morning.

Now, this is what the scene looked like earlier this morning at about 5:00, 5:30 in the morning. The street on Bourbon just completely packed with people.

Now, business owners say that business has been down a little bit from previous years, but they blame that on the calendar and the weather. The calendar because Mardi Gras happened earlier in the season than when it normally does, when it normally warms up. And there has been some rain here.

But we've got to show you this scene. Interesting that the locals tell me that they rate Mardi Gras and its success on the amount of trash that's generated. They actually go to the landfills and weigh it. So judging from Bourbon Street right here this morning, it looks like it's been a smashing success.

Also, you know, Rob, it's all about the beads here at Mardi Gras. And they're everywhere. Even in the gutters on the roof.

That's it. We're live at Bourbon Street in New Orleans. Back to you.

MARCIANO: Valuable material there, Mike. Mike Castellucci, our CNN affiliate WFAA, joining us live. Happy Mardi Gras.

CASTELLUCCI: Thank you.

MARCIANO: Jack, happy Mardi Gras.

Happy Mardi Gras.

O'BRIEN: What are you doing to celebrate Mardi Gras?

CAFFERTY: Well, my youngest daughter is a student at Tulane University. And she's somewhere down there.

You better not be coming home with no beads, young lady. None of that.

(LAUGHTER)

CAFFERTY: The question today has to do with an Arkansas developer who has filed a $2 million lawsuit claiming that new home sales in a subdivision he built have come to a screeching halt after a registered sex offender, Randall Collins, and his wife moved into the development.

Collins is a level-three sex offender, convicted of molesting girls. The lawsuit claims sales have come to a standstill because the developer is now required to tell other potential buyers about Collins' presence. He's also suing the real estate company because apparently the contract under which the home was sold contained only Collins' wife's name, intentionally, he claims, concealing the man's past.

The question is, can a real estate developer sue a sex offender for slowing home sales?

Elizabeth in Toronto writes: "Sure, he can sue. Can he win? Maybe. You'd have to look at the contract of sale for the house to see if the developer's lawyer had the smarts to include a nondisclosure clause which might allow the seller an out."

Dean in New Jersey writes: "I don't know and it's too early in the morning for such a complicated question."

(LAUGHTER)

CAFFERTY: Les in Urbandale, Iowa, "My first thought was he should not be able to sue. Then I thought, I have a 14-year-old daughter. I wouldn't move next to him. He did buy the house on his wife's name to avoid the knowledge of his past."

And there's one more here if I can get the page turned. Marty writes: "Can a real estate developer sue a sex offender for slowing home sales? Sure. And the sex offender can then countersue for emotional and monetary damages. All part of legal beagle's full employment act."

In other words, the lawyers are the ones who win in these things usually.

O'BRIEN: I wonder if it would be worth their while to just pay him to move.

CAFFERTY: Well, he apparently made an offer that if they come up with a quarter of a million dollars he'd find a new address. But so far the developer's not come up with the cash. So...

O'BRIEN: You've got to imagine if it goes to court that might be worth it in the end.

CAFFERTY: Well, and the threat of a lawsuit might be enough to encourage him to move without paying him off, because if he goes to court they will have to sit in an open courtroom and revisit the reasons for the lawsuit, won't we. Maybe he doesn't want to do that. O'BRIEN: All right, Jack. Thank you.

MARCIANO: Thanks, Jack.

O'BRIEN: A new clue this week in the biggest mystery in American politics. Who was Woodward and Bernstein's Deep Throat? The likely suspects named ahead on AMERICAN MORNING.

(COMMERCIAL BREAK)

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