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American Morning

Interview with Education Secretary Margaret Spellings; Tough Words From Both Sides of Aisle for President Bush Over Government's Response to Hurricane Katrina

Aired September 07, 2005 - 08:00   ET

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

SOLEDAD O'BRIEN, CNN ANCHOR: Good morning.
I'm Soledad O'Brien reporting live from Baton Rouge this morning.

For those who refused to leave their homes in Baton Rouge -- in New Orleans, rather -- the mayor says it is time to go. A mandatory evacuation order there. People will have to get out of that city, by force even. We're live in New Orleans this morning.

In Washington, the price of the disaster is going up. The president is looking for another $30 billion to $50 billion to pay for Katrina. Some Republicans are starting to lash out at the federal response. We'll have a live report from Capitol Hill ahead.

And the warm waters off the coast of Florida are producing yet another tropical storm. We're tracking Ophelia on this AMERICAN MORNING.

Good morning and welcome.

We're coming to you live from the River Center in Baton Rouge, which is home now, a temporary home, to about 4,500 people at the Red Cross shelter that's been set up here. Baton Rouge itself has doubled its population, making it now the largest city in Louisiana. And while some people complain a little bit about the traffic issues and sometimes the security issues, overwhelmingly the folks that we've spoken to, the local people, have said that they're happy to open their doors and their hearts, in many cases, to people who are in incredible need.

We want to show you some pictures of the supply section of this Red Cross shelter. And you can see things just stacked up the walls to the brim -- diapers, obviously. Ten percent of the population here are children; lots of baby food, as well, supplies, shampoo, anything anybody might need for a relatively long stay here, because, of course, back in New Orleans, things are a mess and there are mandatory evacuation orders. No one will be getting back to the city any time soon.

Karl Penhaul, though, is in New Orleans for us.

He's got the latest for us from there.

Hey -- Karl, good morning.

KARL PENHAUL, CNN CORRESPONDENT: Good morning, Soledad.

So far, we've seen no sign yet of this mandatory evacuation order coming into effect after that announcement by Mayor Ray Nagin. But we do expect over the next few hours that to come into operation.

But it's certainly not clear how this will be carried out. You might suggest also that if it's taken this long to actually get the survivors who want to be rescued out of the city, then how long will it actually take to mandatorily evacuate the whole city? You know, are we going to see law enforcement officials coming down from helicopters or going along in rubber dingies to pull people out of their own homes?

Also adding to a somewhat confusing picture this morning, the military high command has come out and said they will not participate in forcibly evacuating citizens from their own homes. They've said that they will continue to give food and water to those people who wish to stay in New Orleans. And, in fact, that's the situation that I saw yesterday when I was out on the streets with paratroopers from the 82nd Airborne. They were helping some old people in their homes and saying even if the order comes down, they say we can't but help these people. These are Americans, after all -- Soledad.

S. O'BRIEN: Well, Karl, you're describing a situation that's going to be very problematic. If federal officials are saying, or the military, essentially, saying that they're going to help out these people, give them food and supplies, and the mayor is saying no way, that they're going to have to be maybe even arrested or however they're going to forcibly remove them, you're really setting up a potential conflict between these two groups now that haven't necessarily gotten along since the start of the wake of the storm.

PENHAUL: Exactly. I wouldn't necessarily expect there would be a potential conflict between the two groups. I don't expect that we would see the military acting in counter point to police and Border Patrol, for example, who are also present in the city. But obviously they would be acting kind of at counter purposes if they continue to feed people. It's sending a mixed message to the population, can they stay or should they go? And if they can continue to support themselves here, then obviously that will allow them to stay.

But what the military are quite clearly saying is they're neither going to act as law enforcement to get these people out, nor will they starve the people out. So they are indicating they will continue to give those vital supplies to the citizens -- Soledad.

S. O'BRIEN: And, of course, many people have said that they've got to get out, the city is just utterly uninhabitable and utterly destroyed.

Karl Penhaul for us this morning.

Karl, thank you.

Let's get back to Miles in New York -- Miles.

M. O'BRIEN: Thanks, Soledad.

Let's take a look at mission critical news for u.

The official death toll in Louisiana is 83, but the New Orleans mayor says it could be as high as 10,000 in his city alone.

In Mississippi, the death toll now at 196. That, too, expected to rise.

As many as a quarter million hurricane evacuees thought to be staying in Texas this morning, many of them not interested in moving. Relief workers say people are refusing to go to other states because they don't want to be farther away from home.

And the president today is expected to ask Congress for somewhere between $30 billion and $50 billion in money to help pay for the aftermath of Katrina. Senate Minority Leader Harry Reid says the final price tag could exceed $150 billion.

Some extremely tough words from both sides of the aisle for President Bush and members of his cabinet over the federal government's response to hurricane Katrina.

Ed Henry tracking all this from Capitol Hill -- Ed, good morning.

ED HENRY, CNN CORRESPONDENT: Good morning, Miles.

That's right, several of the president's cabinet secretaries faced three hours of grilling late last night, a closed door meeting of the full House of Representatives. One Democrat and Republican after another hammering away at the Bush administration, saying they had a slow response to hurricane Katrina.

After Homeland Security Secretary Michael Chertoff and several of his colleagues gave relatively rosy reports about how the government was getting the situation under control, one Republican stood up and we're told he basically told the cabinet secretaries that they deserved failing marks for how they handled the situation.

Chertoff also raised eyebrows when he told the lawmakers that the situation at the Superdome was not really bad -- as bad as it looked in those gripping television images we saw last week.

Now, there were also fireworks earlier yesterday at a White House meeting where House Democratic leader Nancy Pelosi directly told the president she believes the FEMA director, Michael Brown, is incompetent and should be fired. Republicans know that this whole situation is politically sensitive. This charge that the government, which is run entirely by Republicans, was asleep at the switch, moved too slowly to react.

That's why House Majority Leader Tom DeLay is now circling the wagons. He came out of this meeting with the cabinet secretaries last night and told reporters that the federal government is not to blame for what happened in Louisiana.

(BEGIN VIDEO CLIP)

REP. TOM DELAY (R-TX), MAJORITY LEADER: But the emergency response system was set up to work from the bottom up and it's the local officials trying to handle the problem. When they can't handle the problem, they go to the state and the state does what they can do. And if they need assistance from FEMA and the federal government, they ask for it and it's given.

(END VIDEO CLIP)

HENRY: Now, right here on AMERICAN MORNING today, Senator Hillary Clinton rejected that assertion and said instead it's time for an independent commission to come in and take a close look at what went wrong with the federal government.

(BEGIN VIDEO CLIP)

SEN. HILLARY RODHAM CLINTON (D), NEW YORK: On August 27, the president signed an emergency declaration at his ranch in Crawford in which he said that it would be an emergency and the federal government would take the lead in coordinating response.

I think the buck stops at the federal government.

(END VIDEO CLIP)

HENRY: Now, Tom DeLay said that he does not want an independent commission to come in and investigate that. He said instead the focus now should be on these rescue and relief missions. When I directly asked Mr. DeLay last night whether or not he still has confidence in Michael Brown at FEMA leading those rescue efforts, Mr. DeLay pointedly did not mention Mr. Brown and instead said in general he still has confidence in the general rescue efforts -- Miles.

M. O'BRIEN: Interesting for what he didn't say there.

What about a move here to have some hearings right away? I assume some members of Congress would like to do that?

HENRY: Absolutely. What's interesting is yesterday we saw a bipartisan group, Democrat Joe Lieberman and Republican Susan Collins in the Senate, say that they will be moving ahead pretty quickly with some hearings. But even more interesting is that on the House side yesterday, early on, Republican Congressman Tom Davis announced he's having hearings, as well. Later in the night, Tom DeLay got wind of that -- he did not know that that was coming -- and basically put the kibosh on that and said no, hearings in the House of Representatives will not go forward.

That's why Democrats are now charging that Republicans are trying to sweep this under the rescuing -- Miles.

M. O'BRIEN: Well, why is DeLay trying to delay the hearings?

HENRY: DeLay is basically saying that he thanks it would be more advantageous, number one, to delay these hearings until the rescue efforts are over. He's worried more lives will be lost if these FEMA officials are dragged up to Capitol Hill to testify.

And, secondly, DeLay says he prefer that there be a joint House and Senate committee investigation rather than separate, multiple investigations, that could become, again, very time consuming for these relief officials.

M. O'BRIEN: All right.

HENRY: Democrats are rejecting that, but that's what DeLay says.

M. O'BRIEN: Well, no one wants to see pressing needs not meant because some guy is testifying on Capitol Hill, that's for sure.

Ed Henry, thanks very much.

Let's get the headlines now.

Carol Costello here with that -- good morning, Carol.

CAROL COSTELLO, CNN ANCHOR: Good morning, Miles.

Good morning to all of you.

Now in the news, seven American casualties in Iraq this morning. We begin in Basra. A U.S. diplomatic convoy struck by a roadside bomb, killing four private security contractors. Further north in Baghdad, an improvised explosive device hit a U.S. Army Humvee. At least three U.S. soldiers were injured. One is said to be in critical condition.

The Iraqi president, Jalal Talabani, says Saddam Hussein is confessing. Talabani says the former leader admitted to ordering the execution of thousands of Kurds in the late 1980s. But a legal consultant for Saddam's family is skeptical and says Saddam did not mention any alleged confession during a meeting on Monday. Saddam's first trial is set to begin on October 19th.

A bill approving same-sex marriages in California is now heading for Governor Arnold Schwarzenegger's desk. The statue legislature endorsed same-sex marriages Tuesday, becoming the first state assembly to do so. The bill defines marriage more generally as between two people, not specifically between a man and a woman.

And rapper Kanye West says entertainment is the only thing he will be offering this week. West is set to perform at Thursday's NFL kickoff concert in Los Angeles. At last week's telethon for hurricane relief, West slammed President Bush, saying he didn't care about black people. But West is promising no repeat of that performance at Thursday's show. West says he won't detract from Thursday's show because entertainment can provide comfort in times of need.

A new tropical storm is threatening the Southeast.

Chad is tracking that storm -- what's the latest?

CHAD MYERS, CNN METEOROLOGIST: We talked about it yesterday, Carol.

Good morning.

Ophelia, O-P-H-E-L-I-A. Kind of an odd name, but there you go. There it is, circulating here to the east of Orlando, to the east, actually, of Cape Canaveral. We can go to our Titan and show you the circulation. I hate it when I can show you a tropical system on radar, because that means it's close to land, close enough for the radar to see.

High surf advisories, though, all the way from Jacksonville. Thunderstorms coming onshore right now right around St. Augustine. But all the way up the coast, all the way even into North Carolina, the winds are 30 to 40 miles per hour, pushing eight to 10 foot waves right onshore from Myrtle Beach down into Charleston this morning and more high surf later today.

Here is what Ophelia looks like for the next five days, moving less than 200 miles. At least that's the official National Hurricane Center forecast.

Now, the error, the error, the cone of uncertainty still very, very wide, all the way, really, from central Florida back all the way into the Atlantic Ocean. And you ask why, Miles? We show you this spaghetti map every once in a while. Twelve different computer models, 12 different answers, because there were 12 different programmers. Still really don't have an idea of where this thing is going.

M. O'BRIEN: It looks like where oil prices are headed or something.

Chad, why do you keep spelling this storm, just out of curiosity?

MYERS: Because it's so...

M. O'BRIEN: You didn't spell Katrina for us.

MYERS: ... strange.

M. O'BRIEN: OK. Yes, well...

MYERS: Isn't that -- OK. Sorry. I'll stop.

M. O'BRIEN: With apologies to the Ophelias in our audience. We think it's a fine name.

MYERS: I assume you get it now.

M. O'BRIEN: Thank you.

Still to come on the program, we're going to check back in with Soledad, who is at a shelter in Baton Rouge, where folks are getting up, the lights are on. And she'll tell us how everything is working and perhaps not working there, in just a few moments.

Stay with us for more AMERICAN MORNING.

(COMMERCIAL BREAK)

S. O'BRIEN: Welcome back, everybody.

The River Center is now a shelter being run by the American Red Cross.

And we've asked Peter Teahan, who is a spokesman for the American Red Cross, to talk to us about it this morning.

It's nice to see you.

Thanks for talking with us.

PETER TEAHAN, AMERICAN RED CROSS: Good morning.

S. O'BRIEN: You've got a lot of clothes. Obviously, the people who came here often came with just the filthy clothes on their back.

How does it work? They come by and they can pick out whatever they need?

TEAHAN: Folks can come buy, pick out whatever they need, a wide assortment. This is in cooperation with St. Vincent de Paul and the Salvation Army, who actually do clothing. And this has been essential. We had people come up with just a blanket over their shoulders.

So they've been able to put together some outfits and been real pleased. We've got shoes.

S. O'BRIEN: They are going to ship these out because you don't actually -- the Red Cross doesn't actually manage clothes, do they?

TEAHAN: The Red Cross doesn't manage clothes. That's Salvation Army and St. Vincent de Paul. But they -- and they were here to make sure that people were dressed properly and had something that they could call their own.

S. O'BRIEN: Everybody is now.

Let's walk back over here and kind of show the scope of all the stuff that you get in. You've got these trailers of supplies.

How much physical stuff are you moving in every day?

TEAHAN: We have semi truckloads coming in from suppliers all over. And these are purchased by donated money. The American public is giving the Red Cross everything. This is a city that is -- exists of 5,000 people, so we need everything from diapers to baby formula to shampoo to toothpaste. And we, with the donated dollar, we go out and purchase it and make it available to the families here.

S. O'BRIEN: How do you dole it out? I mean do you -- every mom who comes in here gets a package of diapers? TEAHAN: Well, we have a comfort kit that takes care of the basic needs, the toothpaste and soap and things. And then whatever a family needs. They're in our shelter, they're in our home here, and as they go through the packages of diapers, they just come back and get more. It's not intended to go off site with. It's to care for them while they're here in our facility.

S. O'BRIEN: Let's walk down this way a little bit, Jay, and we can give a kind of a better sense.

Are some goods just donated? I mean a lot of this looks like Wal-Mart donated a bunch of grills.

What do you do with something like that?

TEAHAN: We have corporations that we work with and in kind donations that also go into their inventory. As we say, we need these, they now fill our needs. But it's basically the basic human needs that goes along with sheltering and feeding. The grills are fairly unusual.

S. O'BRIEN: When -- do the people who are now the clients of the shelter, do they get to come back here and pick? I noticed you've got a bunch of snacks and pretzels and crackers. How does that work exactly, logistically?

TEAHAN: This is our work area. And so we have various sites throughout the facility where there are snack tables. And during the day when it's not mealtime, they can go up and pick up snacks. And we're constantly rotating the stock of food so that they can get it. And we try to make sure there's a variety, from some of us who are chocolate lovers to others who like the salty stuff. We always try to have that type of variety out for them to kind of take a little bit of pleasure during the day.

S. O'BRIEN: Water. Obviously, you've got to have a lot of water. Let's get a shot of this over here, Jay, so we can just show it. how many workers are responsible for this, as you called it, you know, sort of city that sort of sprung up on Tuesday after the storm?

TEAHAN: Right. We have over 200 workers here, some from -- Red Cross volunteers who have come in from all over the country and quite a few from the local community who have come in and volunteered to make this happen. But it is taking care of every need, as we'll see, from medical needs to, you know, babysitting. We have cheerleaders who come to do babysitting for us. Entertainers. We had a concert going on, a jazz concert, last night, movies going on. And it was trying to create the diversity -- and we can only do that with the volunteers we're given.

S. O'BRIEN: I know. You're trying to sort of make the best of things, as well, because this is going to be a long haul for a lot of people and it's not going to be a temporary short-term quick turnaround shelter. TEAHAN: No one wants to live in a shelter. So you try to make it as pleasant as you can, as safe as you can and as healthy as you can.

S. O'BRIEN: All right, well, local time now, it's just about 20 minutes after 7:00, which means people are beginning to wake up. We're going to go out on the floor and talk to some of the people who are here now. You can see some pictures of the lights now, I think about -- are either on or about to come on. And people begin to start their day with breakfast, which I guess begins in a couple of minutes.

TEAHAN: Right. Breakfast is over around 8:00. They'll start lights on at 7:30. The city is wakening and it will become an active, diverse city of culture and social events going on the entire day.

S. O'BRIEN: And a busy day for you.

TEAHAN: Absolutely.

S. O'BRIEN: Peter Teahan, thank you very much.

Let's get back to Miles.

M. O'BRIEN: All right, thank you very much, Soledad.

Still to come, the blame game in Washington. Can the president diffuse the criticism he faced in the aftermath of Katrina? A closer look at that coming up next on AMERICAN MORNING.

(COMMERCIAL BREAK)

M. O'BRIEN: President Bush pledging to review what went wrong in the initial response to hurricane Katrina. But he says he's not going to focus on blame just yet.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I think one of the things that people want us to do here is to play a blame game. We've got to solve problems. We're problem solvers. There'll be ample time for people to figure out what went right and what went wrong.

(END VIDEO CLIP)

M. O'BRIEN: It appears Americans aren't placing blame yet either. According to a CNN/"USA Today"/Gallup poll, it's a new one, 38 percent of Americans say no one in government is responsible for the current problems in New Orleans. Twenty-five percent say local officials are most responsible. Sixty-three percent say no top federal official should be fired. Twenty-nine percent say federal officials should be fired.

Joining us now is David Gergen.

He is the editor-at-large for "U.S. News & World Report." He's also been an adviser to Presidents Nixon, Ford, Reagan and Clinton.

David, good to see you.

Of course, we should point out, no one in the Katrina stricken area was polled. They don't have phones. So I suspect the numbers would be slightly different there.

But when the administration reads those numbers, should they take some solace?

DAVID GERGEN, "U.S. NEWS & WORLD REPORT": I think that it would be illusory to depend upon those polls. It may well be that a good chunk of the country didn't tune it, wasn't watching television last week and didn't understand the suffering and the long agonizing waits that so many victims went through.

But there is a rising tide of anger in large chunks of the country, including the South, and among blacks and among low income people, that should not be ignored. This -- there were fundamental mistakes by government in this case and the president, already accused of being indifferent to the whole situation, should now be on the offensive to understand and find out what went wrong.

I was here last night at Southern Methodist University, SMU, with General Colin Powell. And General Powell made an interesting point. He said in the Army, after a battle of any sort or any sort of episode, there is an after battle -- everybody sits down and does go through an after battle analysis of what happened that went right and what happened that went wrong, without attaching blame.

So the whole point of the after exercise is not to attach blame, but to figure out what went right and what went wrong, so they can do battle better the next time.

That's exactly what the country needs here because there are going to be more storms. And there may be terrorist attacks. And if we're so ill-prepared for something that was so obvious and if, you know, and there was this indecent, immoral response to those who were suffering, surely we want to be better prepared for the next hit.

M. O'BRIEN: The president has found a way to bring both parties together, and that is in opposition to the way he's handled this.

GERGEN: Yes.

M. O'BRIEN: Suddenly we had some bipartisanship, and that's not the kind of bipartisanship he wants, certainly. That first visit to the stricken region was quite disastrous. There were a lot of -- he was joking around about going to New Orleans and partying and the good times he had in Houston, completely, really, a tin ear, I think.

What do you think?

GERGEN: Well, I worked for Richard Nixon and I remember when the protesters came to Washington and he went out one night in the really, really early hours of the morning, before dawn, and visited the protesters who were sleeping in the Lincoln Memorial. And he went up to them and started talking to them about their football back in their hometowns, when they had come there to protest the war. And that was regarded as one of these egregious examples of a tin ear and not getting it.

And I do think that the -- that memory came back to mind as I heard the president's first remarks.

But I -- let's give credit where it's due. This president has shown enormous compassion when he has been exposed to things. When he went to New York for the 9/11 and picked up that bullhorn and talked to the firefighters. He did show enormous compassion. As governor, he showed enormous compassion.

Somehow this just didn't -- his aides didn't bring him in to let him see the suffering so he didn't pick up on it...

M. O'BRIEN: Well, is he...

GERGEN: And I think...

M. O'BRIEN: Is he in too much of a bubble, David?

GERGEN: Well, you wonder about that because it's -- in the first term, these folks seemed to be enormously sensitive to what was going on around them. They were. And they were politically adept. But this second term, you know, with the Schiavo case and then when Cindy Sheehan was out there on the driveway in Crawford, and here in the initial reactions to New Orleans, this doesn't seem like the same team on the field. And I -- it's -- there is an imperial quality about it, which I am sure that does not represent what the president himself wants.

I do believe in his heart of hearts he really does care about suffering. And I...

M. O'BRIEN: All right, I want to give you an opportunity to offer some free advice...

GERGEN: All right, sure.

M. O'BRIEN: ... as I frequently do, on the air here.

GERGEN: OK.

M. O'BRIEN: What would you tell, if you were inside the administration now, knowing the mistakes that have been made, to try to dig themselves out of this one? You mentioned Colin Powell. Would you hire somebody like him to be your Katrina czar?

GERGEN: They absolutely need to have someone in there who can take names and kick tail, if I may say so. And Colin Powell would be a perfect example of someone who can do that. But they clearly don't have -- there's nobody yet in charge. We're more than a week into this and who is in charge?

M. O'BRIEN: There's no dealership.

GERGEN: Can you tell?

M. O'BRIEN: It's an absence of leadership is what it is.

GERGEN: Yes, and you can't tell who's running anything. Now, I know they've got problems with the governor and the governor is, for strange, mysterious reasons, is not leading either. I mean there's no Rudy Giuliani in this story. And we need somebody like that on the ground representing the state and local. And we need somebody like that at the federal level. But I don't think it stops there, Miles.

I think this has to be a sustained effort to ensure that a year from now, or two years from now, we're not reading about families who were promised things and then it wasn't delivered.

M. O'BRIEN: Yes.

GERGEN: You know, things are -- the relief efforts in Florida from some of these storms go back one, two, three years and they're still not finished.

M. O'BRIEN: Yes.

GERGEN: So that's got to be done. And I do think we need a bipartisan -- and let me emphasize bipartisan -- investigation of what went wrong and what went right after this is over. It does not necessarily need to start in two weeks. I think we need to focus now on the victims and make sure they're taken care of. But when this settles down a little bit and when it's under better control then we've got, we're in the midst of a storm season. Another storm could be hitting us any time now.

M. O'BRIEN: Oh, boy. Let's hope not.

GERGEN: And you realize, you know, last year Louisiana officials spent five days planning with FEMA officials for a hurricane three -- hurricane Pam, as it was called. This is what came out of five days of planning?

M. O'BRIEN: Yes.

GERGEN: This is how far they got? I mean that's outrageous. And this, as I say, I think that there was a -- there is a -- what -- the polls do not fully reflect the anger and just the sense of indecency that is afflicting so many Americans.

M. O'BRIEN: All right, we've got to go.

GERGEN: OK.

M. O'BRIEN: Sorry, we're out of time, David.

GERGEN: Thank you. OK.

M. O'BRIEN: David Gergen, editor-at-large for "U.S. News & World Report."

Appreciate your time.

GERGEN: Right.

M. O'BRIEN: Still to come, schools in New Orleans could be closed all year, who knows? Maybe longer. We'll look at what's being done to get thousands of young evacuees back in classrooms. Stay with us for that as AMERICAN MORNING continues.

(COMMERCIAL BREAK)

S. O'BRIEN: Welcome back. You're looking at some live pictures at what's going on inside the Red Cross shelter, and now at the River Center. Some 4,500 people spent the night here. They're just beginning to wake up, and some people already at the first aid station getting whatever medical care they might need. Anybody who needs any medical care can come here. We will show you a look at exactly what is in this first aid station. Pretty much anything you need over the counter. I'm going to bring you right this way. The nurses move out of our way a little bit. A former E.R. doc is going to talk to us in just a few minutes about what motivated to get on a plane to come here and try to help. That's just ahead, Miles.

M. O'BRIEN: You know, those stories. We just talked to that those three kids -- you the three kids from Duke. The amount of spontaneous volunteerism is about the best thing I've heard out of this whole thing. It's wonderful.

S. O'BRIEN: This doctor will tell us the same thing. Following coverage, essentially, he said he was motivated to get on a plane, come right here and help out with no affiliation, ended up with the Red Cross, and now he's doing 12-hour shifts here.

M. O'BRIEN: Good for him. All right. We look forward to meeting him.

Thank you, Soledad.

Families displaced by Hurricane Katrina are concerned about food, shelter and finding a place where their children can go to school. More than 6,000 children evacuated from the disaster zone began school in Texas on Tuesday. Officials there expect 50,000 to 60,000 new students as families become situated there. Overall 300,000 children, 300,000, will need to find schools.

U.S. Education Secretary Margaret Spellings is doing everything she can to get kids registered across state lines, get money for school districts taking in the young hurricane victims. She joins us now live from the White House.

Mrs. Spellings, it's a big job. It's going to cost a lot of money, isn't it?

MARGARET SPELLINGS. SECY. OF EDUCATION: It is. We're working on resources in the short-term, as well as longer term plans. The president has asked me to develop a plan to make sure that we have adequate funding for these kids, wherever they may end up.

M. O'BRIEN: Well, you know, it would be unfair to ask these local districts to pay for it. Have you put a price tag on it yet?

SPELLINGS: We're working on it. We're still trying to figure out where exactly they're going to be, how much they spend per pupil, and all of those sorts of policy matters. But here very shortly, we'll know kind of where kids are, how many there are, and what the dollar figure will be on that. But the president is clearly committed to providing adequate resources so that those school districts are compensated for meeting the needs of these kids, which they've, you know, agreed with without hesitation to do and are doing so enthusiastically.

M. O'BRIEN: Now as far as getting down to brass tacks here, getting these kids into schools.

SPELLINGS: Right.

M. O'BRIEN: The sense we're getting is the school systems in general are really opening up their arms, doing extraordinary work to get the kids in school.

SPELLINGS: They really are.

M. O'BRIEN: Have you run into places where they're putting up barriers, or they're making it easy?

SPELLINGS: I have not. I mean, I think all around the country, educators are embracing these children and wanting to rise to the occasion. And that this is the best of America, as you've just talked about a bit ago in your other segment. And that's surely true of the education community as well, they are really welcoming these kids. And schools are one of the most stable things in a child's life. Schools across America largely look same. I think kids will are going to comfort in seeing a teacher and a school library, a school bus, a cafeteria, all of the things really that they are used to seeing back home.

M. O'BRIEN: But still, in the long run here, I'm sure there is concern that these schools will be bursting at the seams. I'm sure they'll be issues with class space, and putting them in trailers and all those sorts of things. Are you worried that the welcome will wear thin over time?

SPELLINGS: Well, I think as long as we're smart about providing adequate resources and being smart about providing administrative flexibility, both at the state level and the federal level, to accommodate these kids, then I think we'll work through those details.

Still we're in the assessment phase about who's going to end up where and the like. I know Houston has a lot of capacity in the schools. They can accommodate an additional 30,000 or 40,000 kids and are prepared to do so. These kids are going to end up all over the country. This is going to be a national issue. But I think if we're smart about this policy wise and provide adequate resources, we can certainly serve the kids.

M. O'BRIEN: A lot of school districts are concerned about No Child Left Behind, in particular the accountability portion of that, testing kids. They don't meet certain levels, the school is determined to failure, and that causes all kinds of problems. Will you give waivers to some of the schools who are overtaxed?

SPELLINGS: Well, certainly we are going to be smart about how we implement No Child Left Behind this year. I've said all during my term that we need to implement No Child Left Behind in a sensible way and workable way, and that's certainly true here in this case.

And you know, we don't really know yet to know what the questions are, but of course we're going to be flexible with states and with students. But likewise, we don't want to write off this school year, because we know that these kids need to get back into some sort of normalcy. It's good for them educationally, emotionally. And we're committed to doing that, and local educators are as well.

M. O'BRIEN: Margaret Spellings if the secretary of education. A big job ahead. We wish you well.

SPELLINGS: Thank you.

M. O'BRIEN: Let's check some other headlines now. Carol Costello here with that.

Good morning, Carol.

CAROL COSTELLO, CNN ANCHOR: Good morning, Miles. Good morning to all of you.

Now in the news, a formal goodbye to Chief Justice William Rehnquist this afternoon. Rehnquist will lie in repose at the Supreme Court until noon Eastern. A funeral service will be held at St. Matthew's Cathedral, where President Bush and Justice Sandra Day O'Connor are expected to speak, among others. Rehnquist will be buried at Arlington National Cemetery later today.

Overseas now, polls are open in Egypt's first-ever multicandidate elections. President Hosni Mubarak is expected to win a fifth six- year term. He faces nine other candidates, but most of them are not very well know. Polls close in four hours. Final results could be in on Friday.

U.S. lawmakers are taking a closer look at the July 7th bombings in London. A group from the House Homeland Security Committee is meeting in about an hour to learn to review what has been learned from these bombings. The attack on London's transit system killed 52 people and four suspected suicide bombers. A group claiming an Al Qaeda link have claimed responsibility. And the design of the September 11th memorial in Shanksville, Pennsylvania set to be unveiled today. A jury chose the winning plan from more than 1,00 designs. It honors the 40 passengers and crew who died when flight 93 crashed in a Pennsylvania field. Organizers are hoping to raise $30 million in private donations to help fund the project.

(WEATHER REPORT)

S. O'BRIEN: We want to introduce you to Dr. Sander Oren. He was following the aftermath of Hurricane Katrina when he realized that his training as a former emergency room doctor could come in very handy. Hopped on a plane, found his way here to the shelter that's being run by the Red Cross.

Good morning. Nice to talk to you.

DR. SANDER OREN, VOLUNTEER FROM BOULDER, CO: Good morning.

S. O'BRIEN: This is essentially where people who are not feeling well will come and can be triaged, I guess. Before we talk a little bit about what happens here, I want to talk about what happened in your mind that made you hop on a plane without any kind of affiliation. How did you get here?

OREN: I just got on an airplane and managed to get a reservation and flew down. I just felt like it was the thing to do.

S. O'BRIEN: What kind of injuries have been seeing?

OREN: Well, we've seen a lot of immersion injuries from people who have been in the water for long periods of time. We've seen a lot of gastrointestinal illness. A lot of kids with vomiting and diarrhea. We've seen a lot of upper respiratory infections. We've seen a lot of folks without their medications who haven't had them for over a week.

S. O'BRIEN: What did you do when people come to you and they have no history, they have no chart? They have no -- you know, I'm sure after being through such a traumatic event, can't really remember what they were taking?

OREN: That's correct. We just do the best we can. We give it our best shot.

S. O'BRIEN: How many people can you see here at one time?

OREN: Well, we saw -- we estimate about a hundred people in about a four-hour time span last night. So we can do a lot, but it generally isn't that busy.

S. O'BRIEN: I know you're pretty exhausted. You've been...

OREN: I'm pretty tired.

S. O'BRIEN: ... working 12-hour shifts. OREN: Yes.

S. O'BRIEN: People must feel very grateful, though, to be able to see a doctor, if they have -- you know, once they've come in. Because you might be the first medical person they've seen.

OREN: What strikes me is that these are very resilient folks. They are uncomplaining. They are grateful. And they just have an attitude of, we're going to make it through. It's very impressive.

S. O'BRIEN: How worried are you in an enclosed place where people could have disease about something -- they were talking about a cholera-like cousin. How concerned are you that something like that could break out?

OREN: Well, we are concerned about it and we urge people to wash their hands frequently and take those sort of precautions. There are 6,000 people here in a relatively small area, and so that's definitely a concern. But so far, we're seeing mild -- relatively mild gastroenteritis, stomach flus basically, and respiratory infections.

S. O'BRIEN: We've been seeing tons and tubs of that hand sanitizer.

OREN: Yes.

S. O'BRIEN: I want you to walk me around what we're seeing here. You kind of made this little make-shift pharmacy, all right. A make- shift pharmacy. Anybody -- if you take me down this way, you've got the basic pharmaceuticals, over-the-counters. And then what over here?

OREN: Well, these are just dressings and other supplies for dealing with wounds.

S. O'BRIEN: Are these donated?

OREN: Most of this is donated, yes.

S. O'BRIEN: Patients who come in will comment -- Jay, if you show a shot just of this table here. I see you've started files on patients?

OREN: Right. We're trying to keep some medical records, because some of these folks come in multiple times and we need to know what happens to them so that we can follow them progressively.

S. O'BRIEN: People here will be here for a long time?

OREN: We don't know. We suspect so.

S. O'BRIEN: Let me put it this way. They probably won't be going back to New Orleans any time soon?

OREN: It doesn't seem that way.

S. O'BRIEN: Psychologically, how are the folks?

OREN: They -- as I said, they're remarkably resilient people. It's very impressive how they -- most people are coping with this. And they're making it through and they seem to have a very good attitude about it for the most part.

S. O'BRIEN: I have to say, I'm always really impressed when people like yourself are just -- volunteer and come and help out. You have a skill and you give up your time and you're exhausted.

OREN: There are a lot of really, really fine volunteers down here. We have paramedics that are just outstanding, and EMTs and nurses. And without them, there wouldn't be any point in my being here.

S. O'BRIEN: It's nice to see people answering the call. Dr. Oren, thank you for your time. Get some rest.

OREN: I will. Thank you.

S. O'BRIEN: We're going to send him out of here. And we're going to throw this back to Miles -- Miles.

M. O'BRIEN: All right. He deserves the rest, certainly. Wow. All right.

S. O'BRIEN: He's so tired. You have you no idea.

M. O'BRIEN: I can only imagine. I can only imagine what he's going through there. Thank you, Soledad, appreciate that.

Still to come in the program, some of Katrina's victims get their first look at the disaster they left behind. A closer look at a very painful homecoming. That's ahead on AMERICAN MORNING.

(COMMERCIAL BREAK)

S. O'BRIEN: Welcome back, everybody. You're taking a look live at Jackson Square in the French Quarter, right near the Mississippi. You can see the USS Iwo Jima. That ship right now providing assistance to the Coast Guard. They can land there. And also providing some medical care for any evacuees who are brought there, as well.

Here in Baton Rouge, where there were 4,500 evacuees overnight at this Red Cross shelter at the River Center, the lights are now on, the day is really just getting underway. Volunteers have been arriving and things have really picked up. It's gotten much, much busier.

Evacuees, though, who left everything behind -- obviously, some of them want a chance to get back in their homes, see how things are there.

Dan Lothian has the story of one man who did just that.

(BEGIN VIDEOTAPE) DAN LOTHIAN, CNN CORRESPONDENT (voice-over): Craig Schiambra left his Orleans Parish home by car more than a week ago. Now, for the first time since Katrina hit, he returned by boat to see what's left.

CRAIG SCHIAMBRA, NEW ORLEANS HOMEOWNER: I have a two-story house about six foot above grade, so we're hoping to save some stuff off the second floor.

LOTHIAN: We went along as two local boaters Schiambra past submerged houses and cars, street signs and stoplights, by the local church, and barely under branches that were once high off the ground. Twenty-five minutes after launching into filthy floodwaters, we turned on Catina (ph) Street and into once desirable community known as Lakeview.

UNIDENTIFIED MALE: The white columns right there, up there on the left?

SCHIAMBRA: I never thought in a million years I'd see something this bad.

LOTHIAN: More than a week ago, he was able to walk out the front door. Now, he has to be hoisted over the second floor balcony, and enters the house filled with the stench of standing water.

SCHIAMBRA: My baby's room's upstairs. I'm going to try to get her some clothes and see if I can grab some pictures.

LOTHIAN: Rushing from room to room, Schiambra grabs his 1-year- old daughter Riley's (ph) and pictures, an armful of her pictures, and some files, all stuffed into clothes baskets and one suitcase.

SCHIAMBRA: It's like a numbing feeling, you know? It's just -- I got chills. I mean, what can you do, what can you say? You don't expect to see something else. It's sad, it's sad. This neighborhood was beautiful.

LOTHIAN: He believes it's a total loss. As we push off from his balcony, Schiambra doesn't look back. The chemical engineer and his family will be staying in an apartment they own in Baton Rouge. Beyond that, there's uncertainty.

SCHIAMBRA: A lot of questions still to be answered. We don't know what we're going to do.

LOTHIAN (on camera): Is there anger? Is there frustration?

SCHIAMBRA: Just kind of tired, you know? Just tired of worrying and wondering what I was going to come back to.

LOTHIAN (voice-over): But he does feel fortunate. His family is safe, and a few items thought lost to the flood are in his arms once again.

Dan Lothian, CNN, New Orleans. (END VIDEOTAPE)

S. O'BRIEN: Pretty lucky, actually, to be able to grab even a few things.

As they get busy at the American Red Cross shelter, we're going to move out of the way a little bit. They're bringing some supplies through. This makeshift city is really starting to move, as it is just about 8:00 local time -- Miles.

M. O'BRIEN: A lot of activity there, Soledad. It looks like it's fairly orderly as well.

S. O'BRIEN: Oh, very much so. We really cannot emphasize that enough. I really have to highlight for you the difference between the convention center in New Orleans that we went to that was used as a temporary shelter, or even the Superdome as well, the difference between those locations and this, which is so calm, and so collected and organized, and everything is running. I mean, there's a lot going on, but there is no chaos, there is no high drama. It's all just moving along like a city, just getting up.

M. O'BRIEN: It's organized. No high drama. I'm sure there is a fair amount of sadness beneath the surface, but it's good to see at least people are moving forward.

Soledad, thanks.

S. O'BRIEN: Yes, that's right.

M. O'BRIEN: Still to come, Katrina took a huge toll on the oil industry. Now there's word the steel business could take a hit as well. Andy will explain that next on AMERICAN MORNING.

(COMMERCIAL BREAK)

M. O'BRIEN: What do the steel industry and the Vioxx cases have in common? Only Andy Serwer could put those two together and give you a Hurricane Katrina business sidebar.

Good to see you, Andy.

ANDY SERWER, "FORTUNE" MAGAZINE: Good to see you, Miles.

I guess the word would be disruptions. That's the watch-phrase here. We're going to be talking about disruptions, I'm sure, over the coming days and weeks.

Let's talk about steel, first of all, Miles. Steel expected to rise as much as 20 percent in the wake of this giant storm.

First of all, because of difficulties of moving scrap metal around the country, particularly around the Gulf region, of course.

Also, though, liquid hydrogen is a key component in the manufacture of steel. And there's a plant down in New Orleans run by a company called air products and chemicals. That plant has been damaged so the supply of liquid hydrogen has been called into question here.

M. O'BRIEN: Who knew? That's rocket fuel.

SERWER: That's right, and it's used to heat things, obviously.

Now, as far as the Vioxx trial goes, the federal part of these trials, there are hundreds of these cases, have been assembled, are being assembled in New Orleans under the jurisdiction of U.S. district Court Judge Eldon Fallon. Well, he has picked up his operation and moved to Houston. Obviously, you can't do any business in New Orleans of this sort.

Here is the interesting part. They're looking to have these cases begin November 28th, but according to the Associated Press, Judge Fallon has no authority to conduct trials in Houston, Texas. So while he's coordinating these trials, he can't actually begin the process of starting them up.

M. O'BRIEN: Can't they give him a special waiver?

SERWER: They could give him a special waiver, or they could presumably move them back somewhere near New Orleans, perhaps Baton Rouge, over the coming weeks and months. Just another small piece of the matter of business that's trying to be sorted out here in the wake of Katrina.

M. O'BRIEN: There really is no end to the list.

SERWER: And we could just keep going and going and going.

M. O'BRIEN: We will.

SERWER: And we are.

M. O'BRIEN: All right, Andy Serwer, thank you very much.

SERWER: You're welcome.

M. O'BRIEN: We're going to take a break. When we come back, we'll take a look at some live pictures right now, aerials over the city of New Orleans on this morning. We are told right now, 60 percent of that city is inundated with just a putrid mix of foul water, and -- but that's better than it was. It was 80 percent. The Corps of Engineers is draining the city. It's going to take a long time to do that, and there is all kinds of issue that remains once it is dry, of course. But it's another day in New Orleans, and at least they're heading in the right direction.

Back with more in a moment.

(COMMERCIAL BREAK)

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