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Oil Executives on Capitol Hill; Election Undertones; School Shooting in Tennessee; Fight Back Against Gas Gouging Tips

Aired November 09, 2005 - 10:00   ET

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

SOLEDAD O'BRIEN, CNN ANCHOR: Going to pick up the rest of the story. She's, obviously, monitoring this too.
Daryn, good morning.

DARYN KAGAN, CNN ANCHOR: Good morning. You guys have a great day in New York City.

That is exactly where we are picking up our day, with the oil executives under the gun on Capitol Hill. Let's go right back to that live picture. While we're paying more at the pump, they are recording record profits. So what's the deal here? Extensive live coverage of the hearings, plus oil and gas experts weigh in as well. We're going to answer your questions, how about that, all this hour on CNN LIVE TODAY.

First, though, let's go ahead and take a look at some other stories "Now in the News."

A lot of American consumers may have something new to worry about. ChoicePoint, in a filing with the SEC, says it has sent out an additional 17,000 notices to people warning them they may be victims of fraud. That would raise the total number of consumers affected by fraudulent data access to 162,000. ChoicePoint is a national provider of identification and credential verification services.

In France, signs that emergency measures may be helping dampen the riots that have plagued the country for nearly two weeks. Violence flared overnight for the 13th straight night, but it was not as widespread as in previous nights. A number of cities now have curfews in place trying to stop the violence.

In China's capital, the U.S. embassy is warning Americans traveling to that country to use caution. That decision after officials learned of a possible terror threat. In an advisory, the embassy says it learned that Chinese police have advised that Islamic extremists could be planning to attack four and five star hotels in China sometime next week.

Controversial Iraqi Deputy Prime Minister Ahmed Chalabi is back in Washington. He's meeting this hour with Secretary of State Condoleezza Rice. Chalabi was once considered close to the Bush administration when he led an exile group, the Iraqi National Congress. Then he fell out of favor and his return to the U.S. is drawing anger from critics.

Good morning to you on this Wednesday morning. I'm Daryn Kagan at CNN Center in Atlanta.

Let's start with those gas prices. They soared to record levels over the summer. And while they have ebbed with the waning weeks of the hurricane season, the resentment is still simmering over oil companies' staggering profits. So this hour on Capitol Hill, senators are demanding answers from those companies top executives. Our Congressional Correspondent Ed Henry is setting the stage.

Ed, good morning.

ED HENRY, CNN CORRESPONDENT: Good morning, Daryn.

You probably will not be surprised to learn that it was only about one minute into this hearing that lawmakers had their first skirmish. It was over the fact that Democrats Maria Cantwell, Barbara Boxer and others were pushing to get these five big oil executives to actually stand up and raise their right hands to officially be sworn in at the beginning of the hearing. What they were trying was, obviously, some theatrics to mirror what happened to the tobacco executives, that infamous photo, you remember of them all standing there being sworn in several years ago.

This move was actually rejected by the Republican Chairman Ted Stevens. He said there was no need for extra theatrics. Instead, clearly these executives will be under oath and he says no need to actually get them to stand up. But, obviously, every word these executives say will be watched very closely.

And there is at least one thing that both parties can agree on, they want to call these executives on the carpet. They want to know, obviously, as you mentioned, why there have been record profits. But yet there seems to be little or no relief for consumers, either at the gas pump or in home heating prices. Here's the Senate Energy Chairman Pete Domenici.

(BEGIN VIDEO CLIP)

SEN. PETE DOMENICI, (R) ENERGY COMMITTEE CHAIRMAN: Some senators are proposing a windfall profits tax. From all I know, it didn't work before, it probably won't work again. Still, I expect the oil companies witnesses to provide some assurances about how you plan to use your recent profits to provide a stable source of energy to the United States and to pursue to the maximum extent possible lower oil prices and lower gas prices.

(END VIDEO CLIP)

HENRY: Now you can hear Senator Domenici there referring to the windfall tax proposal mostly pushed by Democrats, but also embraced by some Republicans up here on The Hill to try to pass on some of those profits back to consumers. What Democrats are basically saying, what they would say in response to Domenici there, is that they basically feel Republicans are all about rhetoric at this hearing. But Democrats are waiting to see whether or not there will actually be action after this hearing. Take a look at the profits of some of the companies these executives who are testifying. Exxon Mobil, year-to-dates, $24.9 billion. Shell, $20.9 billion. BP $18.7 billion. ConocoPhillips $9.8 billion and $7.9 billion for Chevron. Republicans insist they're serious, although they have not actually come up with a full legislative proposal to deal with all of this. And Democrats are insisting it's all about 2006. Republicans are calling these executives in because they're nervous about a backlash at the polls next year.

Daryn.

KAGAN: Well, and my Ed Henry question of the day goes, to give us a little context here, aren't these the same lawmakers that passed a bill earlier this year that had $14.5 billion in incentives for the energy industry?

HENRY: That's been one of the chief complaints from the Democrats heading into this hearing. That basically the chief remedy, legislative remedy, if you will, that has been passed by this Congress, signed into law by President Bush earlier this year, basically did give a lot of tax breaks to some of the very companies that I just ticked through that are making billions and billions of dollars. But Republicans say the answer is to not just demand taxes, more tax money from these folks. That will only increase our dependence on foreign oil. It will actually, if you take a look at the windfall tax that was in place in the early '80s, oil executives say that actually hurt the U.S. economy.

So you can hear the battle back and forth. But, you're right, the problem for this Congress, led by Republicans and a Republican White House, is the only proposal that they have passed this year actually helped the companies. Consumers don't really think it helped them.

Daryn.

KAGAN: All right, Ed, we'll be back with you. Thank you.

And for those of you watching at homes, and all these executives in suits all look the same to you, that's the head of ConocoPhillips who was up to bat right now in front of the Senate Energy Committee.

Now, here, this is how we're here for you. We're taking big oil, big profits and we want to hear from you. So e-mail us. Our address is livetoday@cnn.com. What we especially want to hear, you know, this is a chance for you to blow off steam. But, also, do you have questions? Do you have questions about how you can save on energy? Or questions exactly about how the energy industry works? We have two experts coming up for you, both at the bottom of this hour and next hour, as well. So send us those questions livetoday@cnn.com.

Other news from Capitol Hill. Republican congressional leaders have launched an investigation into the possible leak of classified information about U.S. secret prisons overseas. But one Republican senator is suggesting the blame may lie within the Republican Party itself. Mississippi Senator Trent Lott says the information about the prisons revealed in a "Washington Post" story was the same data given in a closed-door GOP briefing just last week. Lott says that briefing was led by Vice President Dick Cheney. And as Lott put it, and we're quoting here, "every word that was said in there went right to the newspaper. We can't keep our mouths shut." Lott says the Republican- ordered investigation may result in an embarrassing ethics probe of one of the GOP's own.

Well, it is the morning after election day in a lot of states and Democrats saying voters are showing growing discontent with Republican policies and policymakers. Democrats won in two big races. Senator Jon Corzine easily won the New Jersey governor's office. And in Republican-leaning Virginia, voters elected Democrat Tim Kaine and rejected his Republican challenger who had embraced President Bush in the final days. And California voters rejected all four of the proposals backed by GOP Governor Arnold Schwarzenegger.

Let's get some perspective right now from our Senior Political Analyst Bill Schneider who is still in L.A., which was a hotbed, California, for political action.

I bet it was an interesting night.

BILL SCHNEIDER, CNN CORRESPONDENT: It was indeed an interesting night. It was a very bad night for Governor Schwarzenegger, as it was, as you said, for President Bush. The voters, I think, seem to be sending the same message to both politicians, don't divide us. Stop doing that. The Republican losses in New Jersey and Virginia were very bitter for President Bush because, as you said, he was an issue in both races. Jon Corzine, the victorious Democrat for governor of New Jersey, linked his opponent to President Bush. And at the 11th hour, President Bush showed up to campaign for the Republican candidate in Virginia and thereby put his own influence to the test. And he lost.

KAGAN: Let's talk a little bit about what's happening there in California and Arnold Schwarzenegger. And explain again what he was trying to do by going around the state legislature and going to the people and what it means for his political future?

SCHNEIDER: Well, he's always said he wants to govern with the coalition of himself and the voters against the legislature and this special interests and the public service unions. He got elected in 2003 as a bridge builder. Someone who could cut across the partisan divide. And in 2004, his first year in office, he had a lot of success in doing that. Scored some big breakthroughs in budget reform and workers compensation reform.

This year he chose a more confrontational tactic with the legislature, and the unions, and the special interests. And the voters handed his head to him in the election yesterday. On election night, Governor Schwarzenegger started to sing last night a very different tune. Let's listen.

(BEGIN VIDEO CLIP) GOV ARNOLD SCHWARZENEGGER, (R) CALIFORNIA: Californians believe that the state is on a wrong track. Californians believe that we need reform. We need change. But the people of California are sick and tired of all the fighting. And they are sick and tired of all those negative TV ads.

(END VIDEO CLIP)

SCHNEIDER: Sick and tired of the fighting. He learned that lesson very strongly from the election. But his critics say, you know what, he's the one who started this fight.

KAGAN: Well, and he continues to stay in it because he's going to run for re-election, right?

SCHNEIDER: He's going to run for re-election. But apparently he wants to go back to the first Schwarzenegger, terminator I we might call it, of 2004, the reconciler, the one who tried to reach out to Democrats and independents and did that with some success.

KAGAN: Well, as it happens in Hollywood, the sequel doesn't often do as well as the original movie does in the first place.

SCHNEIDER: We're all waiting for Terminator III.

KAGAN: There you go.

And looking ahead, general trends. This, I think, would launch the season for midterm elections. Is that fair to say?

SCHNEIDER: Yes, indeed. Mid-term elections are one year away. A year is an eternity in politics. Look, one year ago, George Bush got re-elected by a bigger than expected margin. And now look at what happened to him. Well, the good news for Republicans is, they've got another year to try to figure out what to do so that they'll be on a stronger standing for the mid-term elections.

KAGAN: Hey, Bill, stay with me here. I want to take a look right now, live pictures from Virginia, the governor-elect, Tim Kaine, speaking about his victory. Let's listen in.

TIM KAINE, GOVERNOR-ELECT, VIRGINIA: My dear, dear friend Senator Cre Deeds. Where is Cre? Oh, he was here earlier. He was here earlier in the room and I just want to acknowledge his presence. As all of you know, the margin in the attorney general's race is within in the half point under which, if there is a request, there will be a state-paid recount. The Deeds campaign is working to make sure that every vote is counted. They have put both a transition committee and a recount committee in place. And more news on that will be forthcoming. But I just wanted to acknowledge Cre for his wonderful campaign, for his great service to the commonwealth and our prayers are with him for a positive result in the days ahead.

I want to do two things. One, first, talk about the transition over the next 66 days and introduce the leaders of the transition who are here. Now, first the transition committee . . . KAGAN: OK, that's sounding a little local for folks in Virginia, so we're going to get out of that. But, Bill, let's comment on this. You did touch on this race a little bit. This is the governor-elect, Tim Kaine, the soon to be former lieutenant governor. And he was going up against Jerry Kilgore. And President Bush, the appearance and lack of appearance, did play apparently into this race.

SCHNEIDER: That's right. It may have mobilized some of the critics, some of Bush's critics to vote and come out and vote for the Democrat. But I'll tell you, there was another winner beside Tim Kaine who we just saw, and that was Mark Warner, the incumbent Democratic governor of Virginia, who is amazingly popular, especially for a governor who raised taxes. He's very popular in Virginia. Tim Kaine is his lieutenant governor. Tim Kaine ran as part of the Warner/Kaine administration and Warner campaigned hard for Kaine. It worked. Kaine won. And, you know what? Mark Warner is thinking about running for the Democratic nomination for president in 2008. And this election gives him a big boost.

KAGAN: Showing that he has some coattails there.

SCHNEIDER: Right.

KAGAN: Bill, enjoy the rest of your time in L.A.

SCHNEIDER: Thank you.

KAGAN: Bill Schneider, thank you.

Other election news for you on this Wednesday morning. Let's talk about gay rights and the ballot box. In Texas, voters overwhelmingly approved a constitutional amendment banning same-sex marriage. But in Maine, voters rejected the measure that would have repealed a state law that bans discrimination based on sexual orientation.

The battle over intelligent design was waged at the ballot box in Dover, Pennsylvania. Voters there ousted eight of the nine school board members who added so-called intelligent design to the high school science curriculum. Eight Democrats captured those school board seats with vows to strike down that decision. Intelligent design maintains that the universe is so complex that it must have been created by a higher force.

So did you know that U.S. consumers were paying more than a third less for gasoline this time last year? It was a cruel or make that crude summer at the pump for all of us, but not for the oil companies. They had record profits. Right now we're looking at live pictures as members of the Senate are demanding to know why and what the oil companies plan to do with those profits. Our extensive live coverage continues this hour.

And don't forget, we're looking for your e-mail. Your thoughts and questions about high oil and gas prices. We're going to get them answered for you. Also this hour, gunfire inside of a Tennessee school leaves one dead. The sheriff is holding a news conference right now. We'll get the latest on the investigation.

And returning to the ruins in Southern Indiana. Victims of Sunday's deadly tornado get a look at the damage.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: My teacher had been talking about Columbine right before they called lockdown. And it's scary to think of something like that.

(END VIDEO CLIP)

KAGAN: Shock and sadness and anger in a small town in Tennessee as students and teachers try to deal with a shooting at the town's high school. A 15-year-old boy is accused of pulling out a gun and opening fire on three school administrators, killing an assistant principal. CNN's David Mattingly is at the sheriff's department news conference in Jacksboro, Tennessee, and bringing us the latest.

David, hello.

(BEGIN VIDEOTAPE)

DAVID MATTINGLY, CNN CORRESPONDENT: Hi, Daryn.

We came to the courthouse expecting to hear the sheriff and law enforcement speak about what they've been finding out in this case. Instead, we heard completely from Paul Phillips, he's the district attorney general for Campbell County. And he tells us that the suspect, the 15-year-old suspect, is being held in detention and will be charged with a number of juvenile charges, including, he says, first degree murder. They expect him to be arraigned sometime soon within the next couple of days. And as soon as they can, they will ask the court that the suspect be tried as an adult. So this 15-year- old could be facing charges as an adult for the murder of an assistant principal and the critical wounding of two other school administrators yesterday.

And having said that, the D.A. then instructed all law enforcement not to talk about this case anymore. They want to be very careful with the information they have in this case. They want to make sure they don't do anything wrong that might hurt them in the courtroom as they pursue this very, very sad case that has rocked this community to its roots.

There is hardly anyone you find in this small town that doesn't know someone at that school, either a student or an administrator. So this hitting very close to home for everybody here today.

Daryn.

KAGAN: Any word on motive?

MATTINGLY: There is no official word on motive at all. Some students who say that they knew him said that he was troubled and that he had had disciplinary problems in the past. We have also heard and the sheriff earlier confirmed that he heard, as well, that students at the school actually alerted administrators that this 15-year-old was carrying a gun and that's how he came to be at the office and that's how the confrontation occurred. But again, no official confirmation on that today. And it looks like we may have to wait until the trial actually happens before we find out for sure.

Now, what I can tell you is that the D.A. says there are no other charges pending at this time against anyone else. That the 15-year- old brought the gun from his own house and that no one was involved in getting that gun into his hands and into school property.

KAGAN: David Mattingly from Jacksboro, Tennessee, thank you.

We're just about 20 minutes after the hour. Residents of an Indiana mobile home park devastated by a tornado will be allowed to return home today to gather what's left of their belongings. Eighteen people at the park in Evansville were among the 22 who died when the fierce storm hit before dawn on Sunday. Crews finished draining a four acre retention pond where five bodies were found. President Bush has declared Vanderburgh and Warrick Counties in Southwestern Indiana as federal disaster areas.

Chad's been keeping an eye on that. Looks like you're more focused on, what, the Great Lakes and Midwest right now?

(WEATHER REPORT)

KAGAN: Want to show you live pictures we're getting from Hollywood, Florida. We're told from our affiliate WFDN, for providing us these pictures. This line is only for people who are waiting in line to get food stamps. Victims of Hurricane Wilma. South Florida so hard hurt by that hurricane, some people still without power and telephone and apparently here a lot of folks needing food stamps as well. More on that ahead.

In world news, Osama bin Laden. Remember him? It's been awhile since we've heard from him. Is he alive? And if so, where is he? We'll talk about that ahead on CNN LIVE TODAY.

And those who drill are getting grilled. The profits of oil companies under the microscope on Capitol Hill.

With gas prices higher than we'd like, Gerri Willis has some tips on how to get even.

Hi, Ger.

GERRI WILLIS, CNN CORRESPONDENT: Hi there. There's getting mad and there's getting even. We'll show you small steps that you can take to even the score. "Five Tips" is next.

(COMMERCIAL BREAK)

KAGAN: Earlier this hour, we told you about a Capitol Hill hearing on the oil companies' big profits as U.S. motorists struggle with record gas prices. So how do you, the consumer, combat what many feel is price gouging? Our Personal Finance Editor Gerri Willis joins us with her "Top Five Tips."

Good morning, Gerri.

WILLIS: Hey, good morning, Daryn. Good to see you.

Let's just look at how big these profits are. For Exxon Mobil in the third quarter, the profits were $10 billion. What does that mean? Well it means $75,000 each and every minute in that quarter that Exxon Mobil was making. Daryn, if you add up the profits from Shell and Exxon from that quarter and compare it to Denmark's economic output, guess which is bigger?

KAGAN: Hmm.

WILLIS: The oil profits are bigger. So this is a lot of money we're talking about.

KAGAN: It is a lot of money.

OK, if you're at the pump and you're more than ticked off, you really think you're getting price gouged, what do you do?

WILLIS: Well, there's a way to find out if you're getting gas gouged. It's actually pretty easy. Check out the prices in your area. Then go to the AAA Web site fuelgaugereport.com. They have prices by area. So you can see if the price you're being charged with really out of line. And then, you can nag. Go to naag.org. This is the Web site for the National Association of Attorneys General. They care deeply if you're getting gouged. Report people who are gouging to them or to the federal government, at gaswatch.energy.gov.

KAGAN: It's one thing to spend too much on gas, but where you can really blow your wallet is in those mini marts.

WILLIS: And this is where the big profit margins are, really. Some of these convenience stores at gas stations are actually company owned so you can do some damage there by not buying the coffee, the candy, the stuff that really has a higher margin than the gas.

KAGAN: And what if you really want to blow off some steam?

WILLIS: Well, if you really want to blow off some steam, you want to vent, go to some of the Web sites that are out there where you can talk to other drivers in your area. For example, in Seattle it's seattlegasprices.com. Do a Google search. You'll probably find one in your area. And, Daryn, if there isn't one, you can start your own blog at blogger.com.

KAGAN: Good choice.

And but there might be some relief on the way.

WILLIS: Well, I mean, the good news here is that prices have actually come down a little bit. They're about 23 cents a gallon lower than they were two weeks ago. But you're still paying more than you were last year when gas prices were about 40 cents a gallon lower. So I can't promise you that gas prices are going to go any lower here, but we're going to have to just watch and, you know, complain. It's your right as a consumer.

KAGAN: Free speech.

WILLIS: That's right.

KAGAN: That part is free. Thank you, Ger.

WILLIS: You're welcome.

KAGAN: Coming up next, much more on the hearing take places on Capitol Hill. Oil executives being asked why are we paying so much for gas?

And why are those companies making so much? We'll talk to a couple of experts and get the reaction to the hearing from the folks filling up in New Orleans. We're back after this.

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