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LIVE FROM...

Authorities Suspect Remains of Slain New Hampshire Children Found in Ohio; Sport of Hunting on the Decline?; TSA Announces New Screening Procedures For Airports; FEMA's Recovery Channel

Aired December 2, 2005 - 15:00   ET

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


KYRA PHILLIPS, CNN ANCHOR: Top of the hour -- more news developing.
Tony Harris in the newsroom, what you got?

TONY HARRIS, CNN CORRESPONDENT: Hey, Kyra.

Later this hour, perhaps at the bottom of the hour, as early as then, we could very well see the final chapter of a very sad story play out before us in Hudson, Ohio, which is about 20 miles southeast of Cleveland, Ohio.

And, as we put these pictures of the beautiful kids up on the screen, Kyra, I'm sure you will remember this story immediately. Earlier this afternoon, we began getting reports that human remains had been found in the Hudson area, human remains that could very well be those of these two New Hampshire children, 14-year-old Sarah and 11-year-old Philip Gehring, who have been missing and presumed dead since 2003.

CNN's Keith Oppenheim in our Chicago bureau, and he is just off the phone with the FBI.

Keith, what can you tell us?

KEITH OPPENHEIM, CNN CORRESPONDENT: Well, Tony, this appears to be a pretty promising discovery, although none of this is confirmed, that the bodies that were found in Hudson, Ohio, are that of Sarah -- Sarah and Philip Gehring.

We're taking you a map. There's Hudson, Ohio. And, there, the FBI said that two bodies were found there around 4:00 p.m. this afternoon, when a woman went out walking her dog and made the discovery.

While the FBI will not say whether the discovery of those bodies are related to any specific case, I did speak to the mother of the deceased children, Terri Knight. And Terri tells me that she has been told about this by Concord, New Hampshire, police.

The background of this story is that, in July of 2003, the father of these two children, Manuel Gehring, was last seen with the children in New Hampshire. And then he was arrested one week later in California, without his children. Manuel Gehring then told police that he had shot his children, he buried them. And he gave a very general description of where he buried them, somewhere along Interstate 80, in the middle of the country.

Police had been looking with volunteers from basically western Pennsylvania to -- to -- through Ohio and Indiana, and into Illinois. And they hadn't found anything for a couple of years.

When Manuel Gehring gave a description, he gave details, but not a specific location. And, seven months after he gave all that information, he hanged himself in prison.

Terri Knight tells me that, while she does not know and has put a great deal of effort into trying to find her deceased children, she's not jumping to conclusions.

Tony, I had done a story with her last summer, when she came to the Midwest to try to get volunteers to help in the search to try to get more people to see if she could find out where her children were murdered and buried, all in an attempt to get closure on this terrible part of her life.

And there's a possibility now that she may be -- she may have found what she is looking for. But, again, like us, the mother of these two children is waiting -- Tony.

HARRIS: And, Keith, my understanding is that we may get a news conference from the authorities there in Hudson, perhaps in Cleveland -- I believe it's in Hudson -- perhaps as early as the bottom of the hour?

OPPENHEIM: There may be more news conferences coming from two locations, from Ohio, as well, I'm told, from Concord, New Hampshire. It's all in play.

HARRIS: OK. Keith Oppenheim in our Chicago bureau -- Keith, thank you -- Kyra, back to you.

PHILLIPS: Tony, thanks.

Well, "Thank you." That was a French woman's first word when she gave thanks to her doctors as she awoke from a landmark surgery to replace part of her face.

Reporter Sue Saville with ITV News has the latest on a remarkable case and its implications for other victim victims of facial injuries.

(BEGIN VIDEOTAPE)

SUE SAVILLE, ITV REPORTER (voice-over): This is the woman who has undergone the world's first facial transplant. Age 38, she lost most of her lower face when a dog mauled her.

One of the French surgeons said, when he saw the extent of her injuries, he didn't hesitate to go ahead with the transplant. In this box was her new face, taken from a donor, and rushed to the operating theater to make medical history.

This picture shows the area where the woman was injured. Most of her nose, lips, cheeks and chin were missing. These areas of her face were replaced with those from the donor. Surgeons carefully reconnected muscles, veins, arteries and nerves to the face of the recipient patient. Once recovered, the woman will have a functioning face, but she will look significantly different.

Surgeons here, though, say, there are still substantial risks associated with the operation.

PETER BUTLER, PLASTIC SURGEON CONSULTANT: But the risks, and immediate risks, are approximately 2 percent to 4 percent from a technical failure, and then there's a risk of rejection because of it being foreign tissue. And they can be, in the initial phases, in the first two, three years, up as high as 10 to 20 percent.

SAVILLE: Burned suffered during the Falklands War left Simon Weston (ph) with terrible facial injuries. And though he applauds the new transplant, he might not have chosen it.

UNIDENTIFIED MALE: Looking back at it, I probably would have thought about it, but not accepted it. It's not an easy option. I think I'm far happier with who I am. I have been able to live in my skin.

SAVILLE: Not only must the woman recover from the immense physical impact of the transplant, but experts say she now begins a huge psychological adjustment to having someone else's face.

Sue Saville, ITV News.

(END VIDEOTAPE)

PHILLIPS: And doctors at the Cleveland Clinic in Ohio are currently screening patients for a potential full-face transplant. It's the only U.S. institution that has the approval of its internal review board to do the procedure. Surgery would only be performed on severely disfigured patients.

Now we are talking about new jobs, strong growth, low taxes, bull markets. President Bush wonders what's not to like.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Third-quarter growth of this year was 4.3 percent. That's in spite of the fact that we had hurricanes and high gasoline prices. The unemployment rate is 5 percent. And that's lower than the average for the 1970s, 1980s, and 1990s. We have every reason to be optimistic about our economic future.

(END VIDEO CLIP)

PHILLIPS: Oh, yes, and what about a mountain of debt, ongoing deficits, and a looming avalanche of baby boom retirements?

Well, that glass-half-empty view is Fed Chief Alan Greenspan's, less than two month before his retirement, after 18 years as a monetary mastermind.

CNN senior political mastermind Bill Schneider has been crunching all the numbers.

(LAUGHTER)

PHILLIPS: I knew you would like that.

Bill, who's right? Anybody?

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Well, I would say that the economic numbers are better than expected. Americans see them as not too bad, given the fact that we have hurricane damage; we have an ongoing expensive war in Iraq; we have very high energy prices. They have come down a little bit, but they're still too high for most Americans.

The holiday season got off to a mixed start. Retailers aren't quite sure what to expect. Those job numbers are pretty good news, especially the economic growth in the third quarter, pretty good for a recovery at this stage, but not enough to really give Americans a lot of good holiday cheer.

PHILLIPS: Well, you mentioned high gas prices. We got to talk about hurricane damage, all the layoffs, of course.

SCHNEIDER: Yes.

PHILLIPS: I know you have been monitoring the polls.

SCHNEIDER: And what do they show?

(LAUGHTER)

SCHNEIDER: They show that Americans are mildly encouraged.

Right now, when asked -- this is actually two weeks ago -- when the Gallup poll asked people how they thought the economy was doing, just 37 percent said the economy is in excellent or good shape. Sixty-three percent said fair or poor.

Well, that looks pretty bad. But you have got to keep in mind, that 37 percent is actually up a bit. It's the highest it's been since back in June, when it was back down in -- in the 20s for most of the summer. So, while things are not good, they're looking up. Do people think it has anything to do what with what President Bush is doing?

Well, in a word, no. Right now, 21 percent say Bush's policies are helping the economy. Almost twice as many, 40 percent, say his policies are hurting the economy. And the rest say they're not making a lot of difference. So, yes, there's some mild encouragement out there.

But, you know, there's an old saying. When the economy is bad, the economy is the issue. When the economy is good, something else is the issue. And, right now, Americans are worrying about a lot of other things, aside from the economy, like the war in Iraq.

PHILLIPS: And no doubt -- a lot of talk about that.

Bill Schneider, thanks so much.

SCHNEIDER: Sure.

PHILLIPS: Constitutional law and Sam Alito's convictions not one and the same, according to President Bush's latest Supreme Court nominee, as reported by the chairman of the Senate Judiciary Committee.

Six weeks before the start of Alito's confirmation hearings, the federal judge met with Arlen Specter, who then met with reporters. Specter says that Alito promised not to let his personal views against abortion rights, for example, affect his interpretations of the Constitution.

(BEGIN VIDEO CLIP)

SEN. ARLEN SPECTER (R), PENNSYLVANIA: Judge Alito commented about those matters to me and raised a sharp distinction, as he put it, between his role as an advocate and his role as a judge.

And with respect to his personal views on a woman's right to choose, he says that that is not a matter to be considered in the deliberation on a constitutional issue with a woman's right to choose.

(END VIDEO CLIP)

PHILLIPS: Now, earlier on, in a Senate questionnaire, Alito embraced a concept near and dear to conservatives, that of judicial restraint.

And judges, as Alito put it, must avoid unnecessary interference with the authority and competence of the political branches of government.

Well, for 10 years, China fended off a United Nations' probe of alleged torture. Now the man who finally got inside for a closer look may know why Chinese officials were loath to cooperate.

As U.N. special investigator, Manfred Nowak wraps up a two-week trip. He says that he believes that inhumane treatment of prisoners remains common, and, although the practice of torture is on the decline, its use is still widespread, especially in urban areas.

Nowak, who visited detention centers and prisons in Beijing and -- and elsewhere made a point to emphasize that, throughout his trip, Chinese government authorities took pains to obstruct his efforts. He says he and his team were frequently under surveillance and that a number of alleged victims and family members were intimidated by security personnel. In some cases, he says witnesses were physically prevented from even meeting with him.

Also, in China, a planned staff shuffle or a chemical reaction? The director of China's Environmental Protection Administration steps down and is replaced by another administration official. Although the switch was reportedly planned, some observers wonder if last month's benzene spill into a major river affected that timetable.

Water service in Harbin, China, was cut off for four days after an explosion at a chemical plant. That incident sparked widespread anger and unease among residents who weren't told of the potential health hazard for the days following that spill.

Well, kids and guns, a lot of people say it's a bad combination. But hunters say, starting young is the only way to preserve an American tradition. Both sides have their say straight ahead on LIVE FROM.

(COMMERCIAL BREAK)

PHILLIPS: Back here live in B-control, we are talking about the Israeli military carrying out a successful test of its Arrow air defense system.

The Israeli missile intercepted and destroyed a missile similar to Iran's long-range Shahab-3 missile. Israel's defense minister says that the Arrow will serve as an effective shield in a potential nuclear confrontation with Iran. Iranian officials insist that their nuclear program will be used for peaceful purposes. But Israel has long considered a nuclear Iran its greatest potential threat.

And if you're flying home for Christmas and can use a little extra time to, you know, knit that muffler for Uncle Joe, well, this might be welcome news. Starting later this month, you can take your knitting needles on the plane.

My writer, Lisa Clark (ph), will be very happy about that. The Transportation Security Administration confirmed today that screeners will let airline passengers carry items like knitting needles, small scissors and small tools. That's supposed to give screeners time to concentrate on more serious threats.

CNN homeland security correspondent Jeanne Meserve has the details from Washington's Reagan National Airport.

(BEGIN VIDEOTAPE)

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: TSA Administrator Kip Hawley says he wants to see a system that is easy for passengers to navigate, but hard for terrorists to manipulate. So, he's introducing randomness and unpredictability into the screening system.

He also wants to see screeners spending more time looking for high-threat item like explosives. And, so, they are relaxing the rules on lower-threat items. Specifically, passengers will now be able to take in their carry-on luggage scissors that measure less than four inches in length and some tools that measure less than seven inches in length. Now, some flight attendants and others have raised objections to seeing any sharp objects in passenger cabins. But Hawley says the highest threat items will still be prohibited.

KIP HAWLEY, TRANSPORTATION SECURITY ADMINISTRATION DIRECTOR: Tools with cutting edges, bludgeons, crowbars, hammers, saws and drills will continue to be prohibited, along with any tool that is more than seven inches long.

Please note, contrary to early rumors you may have heard, TSA is not removing items like ice picks, box cutters or knives of any kind from the prohibited list.

MESERVE: Under the new procedures, random passengers will be pulled for pat-downs. The TSA insists that this will be done in a way that will not infringe on civil rights.

Also, TSA screeners are being given new training to detect bombs, specifically bomb detonators. Hawley says that none of these changes are being made in response to specific intelligence, but because of the general threat environment -- all the changes due to take effect on December 22.

Jeanne Meserve, CNN, Reagan National Airport.

(END VIDEOTAPE)

PHILLIPS: Well, some pretty unsettling numbers from the U.S.- Mexican border.

Since September of last year, Border Patrol agents have been taking the finger -- fingerprints of every illegal immigrant that they catch along the border and comparing them with an FBI database. Well, they say the program has resulted in more than 152,000 arrests, including the capture of nearly 600 homicide suspects, nearly 750 sexual assault suspects, and more than 15,000 drug suspects.

Among those nabbed, a suspected member of M-13, a notorious Central American criminal gang. And those only -- or those numbers, rather, only involve people who are actually caught while trying to enter the U.S. illegally.

Stay tuned to CNN day and night for the most reliable news that affects your security.

(COMMERCIAL BREAK)

PHILLIPS: Well, this story is for all you soccer fans out there.

Northern Ireland puts its best foot forward to bid farewell to a favorite son. The body of soccer superstar George Best arrived today in Belfast, where hundreds of thousands of mourners are expected to line the streets for a funeral procession tomorrow. The coffin was taken to the Belfast home where Best grew up. The celebrated athlete died last week of causes related to years of alcohol abuse. He was only 59 years old. A new survey shows that most U.S. companies are not prepared for a flu pandemic.

Kathleen Hays joins us live from the New York Stock Exchange.

But, Kathleen, we knew that. We have been talking about that for months and months, haven't we?

KATHLEEN HAYS, CNN CORRESPONDENT: That's true, Kyra.

Maybe we're all in denial. Maybe we have just got our fingers crossed that it won't happen. But you know what? Business leaders actually do believe that pandemic flu is a real threat. However, two- thirds haven't planned on how they will stay in business if it happens. That's according to research firm -- from the Deloitte Center for Health Solutions.

Public health representatives warn, a worldwide outbreak of the bird flu or some other strain of influenza could bankrupt many companies. The government next week plans to release a checklist of pandemic preparations companies should follow.

Number one on the list, get a contingency plan in place that could deal with up to 20 percent of the work force being out sick at any one time.

Turning to the markets, stocks are slightly lower, despite a pretty good-looking jobs report for November. And that's offset new warnings from Alan Greenspan about the budget deficit and how an adjustment could hurt the economy. As for the Dow industrials, they are lower right now by about 35 points. The Nasdaq composite is just fractionally higher.

As for the numbers on jobs, a rebound last month after a hurricane-related slowdown -- employers added 250,000 workers to their payrolls in November, the biggest gain since July. The unemployment rate held rock-steady at 5 percent.

The rebuilding process in the aftermath of the storms helped create 37,000 new construction jobs. That's certainly a bright spot.

And that's the latest from Wall Street.

LIVE FROM is coming right back.

(COMMERCIAL BREAK)

(BEGIN AUDIO CLIP)

VELMA MIDDLETON, SINGER (singing): I really can't stay.

LOUIS ARMSTRONG, MUSICIAN (singing): Mama, it's cold outside.

(END AUDIO CLIP)

(LAUGHTER) PHILLIPS: We love our Louis Armstrong here on the LIVE FROM team.

Looking ahead to the weekend now, there's some winter weather moving into the Northeast. This is the scene now in Pittsburgh at this hour. And there could be more trouble brewing across the region. There's some rough weather out West, too. This is Donner Summit in Northern California.

Well, a story of survival in the Montana wilderness. Fifty-teen- year-old Ken Kukus was elk hunting last weekend when his truck slid into a snowbank. He spent four nights in the mountains near White Sulphur Springs, before he was rescued on Wednesday.

Kukus already battles multiple sclerosis, and he wears braces on his legs. He had surgery yesterday. Both legs had frozen -- been frozen, rather, or got -- became frozen, rather, from the knees down. But he says that he may go hunting again next year.

Now, four families are grieving because, in the last week, each has lost a child in hunting accidents. A 14-year-old boy in Wisconsin was killed on Thanksgiving Day. His 12-year-old cousin accidentally shot him in the back. Another 14-year-old boy was killed Sunday in North Dakota while hunting deer with his father.

Also on Sunday, in Florida, a 10-year-old boy accidentally shot and killed a 13-year-old while they were hunting with a group of adults. And Monday, in Ohio, a 15-year-old boy accidentally shot his 12-year-old brother. They were hunting deer.

Perhaps stories like these are why fewer children are taking up that sport, even though many hunters never get hurt.

Jonathan Freed reports.

(BEGIN VIDEOTAPE)

JONATHAN FREED, CNN CORRESPONDENT (voice-over): Before dawn on the plains of Montana, it's cold, and so is Danielle Faechner. She's a bit sleepy, too.

UNIDENTIFIED MALE: Go right down the fence line. There's two deer standing down there.

FREED: But it doesn't matter, because Danielle is being driven by the excitement of a rite of passage. She recently turned 12 and can now hunt legally in the state, along with her father, Steve, and her 13-year-old sister, Serena.

UNIDENTIFIED MALE: See the deer. You see the white spot?

FREED: They are stalking deer.

(on camera): What did it feel like the first time that you held a gun?

D. FAECHNER: It was kind of scary, but then you get used to it.

FREED: Scary "Oh, my God, I have a science test that I didn't study for"?

D. FAECHNER: Different kind of scary, like knowing that that could kill something.

FREED (voice-over): The Faechner girls are serious about hunting. It provides food, lets them spend time with their family and connect to its history.

UNIDENTIFIED MALE: Now, let's take this box.

FREED: The girls use their great-grandfather's guns.

UNIDENTIFIED MALE: Do you see it?

FREED: This time, it's big sister Serena who ends up making a kill...

UNIDENTIFIED MALE: You got him.

FREED: ... and gets to pose for the trophy photo.

UNIDENTIFIED MALE: Look right over here.

FREED (on camera): There are a lot of people who, you know, their -- their biggest thing that they are waiting for is to get their driver's license. That's next, I'm guessing, for the two of you.

SERENA FAECHNER, 13-YEAR-OLD HUNTER: I want that, too, yes. It would be nice.

(LAUGHTER)

FREED: But if you had to choose between the two?

S. FAECHNER: I would choose hunting.

D. FAECHNER: You can't eat a car. You can eat a deer.

(LAUGHTER)

FREED (voice-over): The guy with the video camera is Kevin Hoyt. He's a friend of the family and a crusader for the cause of hunting.

KEVIN HOYT, THE FUTURE OF HUNTING: We're fighting a losing battle. We're in the 11th hour. And we have got to do something now, if we're even going to have a prayer of trying to save and preserve this wonderful sport.

FREED: Hoyt says hunting is in crisis because not enough families are like the Faechners, passing the sport down to their kids.

During the 1980s, about 17 million people called themselves hunters. But the hunting industry says the number of hunters in America is now dropping and that hunting could virtually vanish from America by mid-century if something isn't done to save it.

(on camera): What would be missing from society if hunting, as it's been...

HOYT: Stopped?

FREED: Stopped.

HOYT: Discipline, patience, respect. There's a number of things that come from hunting. When you spend time with a kid in the woods, it's the perfect time to talk to your kids about sex or drugs or all the other important issues out there. And it's -- it's an opportunity for your kids to talk back.

FREED (voice-over): Hoyt also insists, the demise of hunting would damage the environment, because most conservation money comes from hunters through the sale of licenses.

HOYT: We're the ones that are saving and protecting and restoring habitat. We're the ones transplanting endangered species and reintroducing species to -- to make sure they are here for our future.

FREED: So, he's on a cross-country mission to inspire young hunters and their parents. His tour includes classrooms.

HOYT: Why would we possibly hunt?

How about in the back?

UNIDENTIFIED MALE: The hide for clothing or something?

HOYT: The hide, sure.

FREED: In schools receptive to his message.

Kevin Hoyt may travel solo, but he's not alone in his concern. Anxious that tradition could fade away and worried about losing the economic benefits of this $20-billion-a-year sport, politically active pro-hunting groups are also seeing children as the solution to keeping hunting off the endangered species list.

RICK STORY, SENIOR VICE PRESIDENT, UNITED STATES SPORTSMEN'S ALLIANCE: About half the hunting population, roughly 45 percent, are between the ages of 35 and 54. That's older than we would like it to be.

FREED: Rick Story is with the United States Sportsmen's alliance, a group that has joined with other pro-hunting organizations to fund youth recruitment drives and to push for the loosening of state laws limiting children's participation in hunting. Story says the biggest obstacle to recruitment is the 20 states that are keeping kids out of camouflage by setting minimum-age requirements, many at 12 years old.

Story calls it arbitrary. STORY: For some children, you know, it may be 7 or 8. You know, for other children, it might be 9 or 10. But shouldn't it be a parent, and not the government, that makes that determination?

UNIDENTIFIED MALE: Want to get a big one?

JONATHAN WEICHMAN, 9-YEAR-OLD HUNTER: Yes.

FREED: Jonathan Weichman is only 9, and he's out hunting for the first time during a youth hunting weekend put on by the state of Ohio.

UNIDENTIFIED MALE: Go ahead there, buddy.

FREED: He's revved up and ready to go.

WEICHMAN: I like sitting here waiting to see a deer come up, and then taking the shot, and just -- it just makes me happy to see it go down.

FREED: Studies show, the younger hunters start, the more likely they are to stick with the sport.

UNIDENTIFIED MALE: When do you take your safety off?

WEICHMAN: I'm getting ready to shoot.

UNIDENTIFIED MALE: Mmm-hmm.

FREED: Supporters insist it's safe.

HOYT: Ping-Pong has more injuries than hunting does.

FREED (on camera): Yes, but if an accident happens in hunting, it tends to be larger than a Ping-Pong accident, no?

HOYT: That is very true, but, because of guys like myself, the thousands of volunteer hunter education instructors spread all across the country, hunting incidents are at an all-time low right now.

PRESCOTT: Children and young adolescents lack the emotional maturity to be able make that split-second decision of when to fire a gun. These are all pretty much hunting accidents that have taken place.

FREED (voice-over): Heidi Prescott of the Humane Society of the United States argues that, if we have age limits for driver's licenses, we should have them for a sport involving firearms, and it should be at least 15 or 16 years old.

(on camera): Their argument is that younger hunters are statistically the safer hunters because of the supervision.

PRESCOTT: Even one hunting accident is one accident too many. And, already this year, there's been hunting accidents where youth were involved. So, it's -- it's not a safe sport. FREED (voice-over): Despite predictions by anti-hunting groups that the sport is doomed, no matter what's done to try to save it, the hunting industry is determined to encourage the next generation.

Nine-year-old Jonathan didn't bag a deer on his first day out, but he did spot a doe. He fired, but the animal escaped.

UNIDENTIFIED MALE: Good job, Peter.

FREED: Five other kids in town were successful shots, like 11- year-old Tina (ph).

UNIDENTIFIED MALE: You shot it with what?

UNIDENTIFIED FEMALE: A .20-gauge.

UNIDENTIFIED MALE: Twenty-gauge shotgun?

FREED: Who named her 200-pound buck Bob.

UNIDENTIFIED FEMALE: It doesn't matter if it's big or not. It -- it just matters that you had fun and you got your first deer.

FREED: Back, in Montana, the Faechners are dining out...

UNIDENTIFIED MALE: Chow time.

FREED: ... on their children's shooting success. They have put venison on the table. And it's food this family does not take for granted.

(on camera): Is this something that you want to pass down to your kids?

D. FAECHNER: Definitely.

S. FAECHNER: Yes, definitely.

FREED: Really? You know that already?

S. FAECHNER: Yes.

FREED (voice-over): Jonathan Freed, CNN, Havre, Montana.

(END VIDEOTAPE)

PHILLIPS: Well, we've got entertainment news straight ahead. A special delivery for Jen and Ben and a run-in law with the law for Jen and Vince. If you don't know those people are, it's OK, we'll explain. We've got the scoop, straight ahead.

(COMMERCIAL BREAK)

PHILLIPS: Must see TV, it's not. Chances are you've never heard of it, but Recovery TV is spreading the word about this year's devastating hurricanes and the federal government's response. And whether you think it warrants cheers or jeers, you're paying the bills.

Here's CNN's Tom Foreman.

(BEGIN VIDEOTAPE)

TOM FOREMAN, CNN CORRESPONDENT (voice-over): Far from the cleanup, the debris and the angry public meetings.

UNIDENTIFIED FEMALE: I need some answers.

FOREMAN: Seventy miles from Washington in the Maryland countryside, it's show time for FEMA.

UNIDENTIFIED MALE: In times of crisis, the best help is often just a source of reliable information.

FOREMAN: This is the "Recovery Channel," produced by the Federal Emergency Management Agency, and airing around the clock via satellite and the Internet.

DIANNA GEE, RECOVERY CHANNEL ANCHOR: It could be the best day and the worst day. The day you finally get to go back to your storm- damaged home.

FOREMAN: FEMA conceived the channel years ago to spread important information after disasters. Following Katrina, it was on in shelters, a plain display about rebuilding, financial aid, help and more. But now, with FEMA accusing the mainstream media of failing to provide enough of that info, the "Recovery Channel" has undergone a makeover.

UNIDENTIFIED MALE: Stay with us. Together, we can build a bright future.

FOREMAN: And at the Annenberg School of Communication, Professor Joe Turow says it's turned into propaganda.

JOE TUROW, ANNENBERG SCHOOL OF COMMUNICATION: Most of the information was really not the specific kind of factual information one might think, but rather feature and fluff pieces that seemed designed to aggrandize FEMA, and actually the Bush administration, too.

UNIDENTIFIED MALE: I just want to thank FEMA for all they've done for us.

FOREMAN: Certainly, the channel conveys no public frustration with FEMA. When the channel was airing this,

JAMILAH FRASER, RECOVERY CHANNEL ANCHOR: The massive effort to clean up Louisiana is still topping our coverage. And to speed up this process, our commander in chief steps in with some additional assistance.

FOREMAN: CNN was airing this: UNIDENTIFIED MALE: What's wrong with you, Uncle Sam? You drunk? Huh? What you doing with our tax money? Come on, you need to go to rehab, brother.

FOREMAN: Consider this "Focus On Education" report.

FRASER: But one New Orleans school refused to let the doors of education close on them. They just rolled in the wheels of knowledge.

FOREMAN: This segment, this week was about FEMA bringing trailers to a school where a tree destroyed several classrooms.

UNIDENTIFIED MALE: And all of us without FEMA would not be able to be standing here today.

FOREMAN: But this school is not in New Orleans. It's two hours north and there was no information about more than 100 devastated schools actually in the city, where by the way, almost 8,000 school employees have just been told they've officially lost their jobs.

FRASER: Good information for good decisions.

FOREMAN: Another concern. The FEMA logo appears often, but much of the language on the channel suggests it is independent of the very government agency that is running it.

FRASER: Today our lead story is FEMA's top priority: Housing. A two-week extension for those evacuees in hotels. That's what FEMA is saying today.

FOREMAN: Critics on Capitol Hill have repeatedly suggested the administration is misusing public funds for domestic propaganda. Senator Frank Lautenberg is one of them and he watched the channel at our request.

SEN. FRANK LAUTENBERG (D), NEW JERSEY: The way this is being done, it's a fakery. And it shouldn't -- it should be identified as a government product.

FOREMAN: When we contacted FEMA, a spokesperson defended the channel, but after reviewing the questions CNN raised, sent this statement: The agency, it says, is taking immediate measures to ensure that all programming is unmistakably labeled as an official FEMA resource. And it's eliminating any editorial content.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

PHILLIPS: In the aftermath of Katrina, most of New Orleans residents are living elsewhere and their mayor is following them. Ray Nagin is holding his third town hall meeting with displaced residents now living elsewhere. Tomorrow he's going to host a gathering here in Atlanta, Georgia, and he's going to urge folks to help -- or to return home rather, to help rebuild their city. CNN's live coverage begins at noon Eastern, 9:00 Pacific. Well, still ahead, the queen of talk sits down with the king of late night. You've got a front row seat when LIVE FROM comes back.

(COMMERCIAL BREAK)

PHILLIPS: Straight to the news room. Tony Harris talking about those hostages overseas.

HARRIS: That's right, Kyra.

PHILLIPS: You've got video?

HARRIS: Yes, we do have some new video. The Arab news channel Al-Jazeera has just aired a new video a short time ago of four western hostages, including American Tom Fox. Now, in that video -- here it is right here -- the two Canadians are seen eating and then, there we go, another shot of Tom Fox and the Briton, Norman Kember. And they're seen talking here but we can't hear what it is they're saying.

Now, Al-Jazeera is reporting two hostages are calling on their countries to end their presence in Iraq. Understand, of course, that those statements are attributed to two men who are being held against their will.

Another note here. According to Al-Jazeera, the group that is holding the hostages, the Swords of Justice Brigade, has issued a statement. And in the statement it says that the hostages will be killed unless their demands are met by December 8th. That is next Thursday.

The demands, freeing all prisoners from Iraqi government- controlled jails and freeing prisoners from what the group calls occupiers' jails. And the American hostages are calling again for the U.S. and British governments to end all military presence in Iraq once again under duress. These are obviously men who are being held against their will.

The latest video and the latest statement with a date to have these demands met, that date is December 8th. And this is in a statement from the Swords of Justice Brigade. If the demands aren't met, the hostages will be killed. Kyra, that's the latest information, the latest video. Back to you.

PHILLIPS: All right. We'll stay on top of it. Tony Harris, thanks so much. We're going to take a quick break. More LIVE FROM right after this.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

DAVID LETTERMAN, "THE LATE SHOW": These people at CBS are promotional geniuses.

UNIDENTIFIED MALE: Tonight on Dave, it's the television event of the decade as Dave welcomes Oprah Winfrey. Don't miss this memorable late show. Right after the CBS news special report, "Hell: Frozen Over" only on CBS.

(END VIDEO CLIP)

PHILLIPS: All right. That didn't have to happen to get Dave and Oprah back together. But if you've been following the so-called feud you might think that it was a bad thing. CNN's Brooke Anderson explains.

(BEGIN VIDEOTAPE)

LETTERMAN: Ladies and gentlemen, please welcome Oprah Winfrey!

BROOKE ANDERSON, CNN ENTERTAINMENT CORRESPONDENT (voice-over): Their reunion was a love fest, but David Letterman and Oprah Winfrey haven't always gotten along so well.

STEPHEN BATTAGLIO, SENIOR CORRESPONDENT "TV GUIDE": David Letterman has asked Oprah to be a guest on his show many times over the years, and she has refused.

ANDERSON: In a 2003 interview with "Time" magazine, Winfrey cited her two previous appearances on Letterman's show as to why she was reluctant to make another one, saying -- quote: "Both times I was sort of like the butt of his jokes. I felt completely uncomfortable sitting in that chair, and I vowed I would not ever put myself in that position again."

Oprah's last appearance on "Late Night" was in 1989. Since that time, Letterman has frequently joked about Oprah not being his biggest fan.

LETTERMAN: We found out through reliable sources that Oprah hated me.

UNIDENTIFIED MALE: Oh.

ANDERSON: Hate? No way, according to Oprah.

OPRAH WINFREY, TALK SHOW HOST: For there is no feud. There's only peace.

LETTERMAN: Peace and love?

WINFREY: Peace and love.

LETTERMAN: And admiration?

WINFREY: And admiration.

LETTERMAN: And ...

ANDERSON: But Letterman himself acknowledged he may have made a few too many jokes at her expense over the years.

LETTERMAN: I have made jokes, and I've begged and I've pleaded and I've made a fool of myself and generally have been a nuisance. So, of course, she wasn't eager to come back.

ANDERSON: Oprah even seemed surprised by Letterman's newfound graciousness.

WINFREY: Thank you for being so nice to me.

LETTERMAN: Absolutely.

ANDERSON: On the show, they talked Tom Cruise.

LETTERMAN: And you're sitting there, and Tom Cruise was hopping up and down on your furniture.

ANDERSON: They got serious about AIDS in Africa.

WINFREY: And there's millions of children who are going to be suffering.

ANDERSON: And they chatted about "The Color Purple" musical, which Oprah is producing, and its opening night on Broadway.

Letterman ventured outside the Ed Sullivan Theater when he escorted Oprah to the Broadway Theater, where "The Color Purple" was playing less than a block away.

A big night for Oprah, and a seemingly happy ending to a friendly feud.

Brooke Anderson, CNN, Los Angeles.

(END VIDEOTAPE)

PHILLIPS: Well, Winfrey even bought Letterman a present, something to remember his infamous routine at the Academy Awards ten years ago, a signed picture of Oprah and Uma.

Well, the stork drops in on a Tinseltown twosome, bringing a little bundle of Benifer. Actually, Ben Affleck and Jennifer Garner have new aliases today, mom and dad. And their new daughter is reportedly named Violet. She was born yesterday and everybody is said to be doing just fine.

Meanwhile, it's bouncing blue lights to report for Vince Vaughn and Jennifer Aniston. Are they officially known as Vaughniston now? Well, whatever. The dynamic dating duo were pulled over by police in Scottsdale, Arizona.

Vaughn, who was driving, was asked to take a breathalyzer test after the officer reportedly caught a whiff of something alcoholic. But the results were below the legal limit. No ticket, but it was suggested that he not continue to drive, so the pair got into a car of a friend who was following them.

Coming up on LIVE FROM, breaking news on breaking wind? A British scientist says he's got a secret weapon to make bossy less gassy. It could make the whole world a better place. Hold your breath. We'll be right back.

(COMMERCIAL BREAK)

PHILLIPS: And they're off that applies both to runners of the race and most of the runners clothes. This underwear race is an annual event.

Some of those guys should not be coming before the camera.

At an Israeli Red Sea Resort, it comes before some more serious athletic competition, though, a triathlon. And it shows, according to one participant, that these runners really are good sports.

Well, when it comes to attracting attention it's hard to top a 220-foot condom. Aids activists covered up Argentina's most visible landmark with a giant condom yesterday in Buenos Aires to raise awareness during World Aids Day.

One onlooker says the shiny pink display showed a lack of respect, but an organizer said it seemed like a good way to have the biggest impact.

Time now to check in with CNN's Wolf Blitzer he's standing by in Washington to tell us what's coming up at the top of the hour in "The Situation Room."

Hi, Wolf.

WOLF BLITZER, CNN ANCHOR: Hi, Kyra. Thanks very much.

Lots of news, including Hillary Rodham Clinton's challenger. Find out why the woman who wants to take her out of the Senate almost dropped out of the race herself.

Plus, a CNN exclusive. The first television interview with the director of National Intelligence. Our David Ensor asked John Negroponte the tough questions. It's a rare interview. You'll see it here in "The Situation Room."

Also, medical controversy. The doctors who performed the world's first face transplant answer their critics. The ethics of transplanting one person's face to another.

And a little bit later, a nursing home shortage--nursing shortage, that is, in America. Will someone be there when you get sick? A reality TV show that's trying to solve the nation's crisis.

All that. Lots more coming up right here, Kyra, in "The Situation Room."

PHILLIPS: And I see Ali Velshi right over your right shoulder there. He's getting ready too. Yes, he's making little hand gestures behind you there, Wolf. Is he behaving himself?

BLITZER: He's a very nice guy. Very smart guy, too.

PHILLIPS: Yes, he is.

Not as smart as you.

BLITZER: No, no, he's very smart.

PHILLIPS: We can't top you, Wolf.

BLITZER: He knows his stuff.

PHILLIPS: All right. Ali, we'll see you in a minute. Wolf, you too. Thanks guys.

Well, a globe trotting feline makes it back to Wisconsin, but how will they keep her done on the farm now that she's seen gay Paris?

Actually, Emily never got to Paris at all, but she get her kitty passport stamped in Belgium and France after accidentally stowing away on a cargo container that was shipped overseas.

We told you about this yesterday. And now, thanks to her vet tags and a business class flight on Continental Airlines, well, she's back home with her peeps in Milwaukee.

Just wait until she starts demanding foie gras instead of kitty kibble.

And now for something completely different. Some scientists believe that part of the reason our environment is such a stinking mess is thanks to gassy cattle. We're not pulling your leg or your finger on this one.

But bovine flatulence and burping are thought to be such significant contributors to methane pollution in global warming that some of Britain's brightest minds have been pondering how to squelch the belches or at least stop them from scorching our precious atmosphere.

Biochemist John Wallace is now shouting eureka. And he says adding a natural acid to cattle feed cuts the methane by up to 70 percent. How would you like to be a lab assistant on that experiment?

All right LIVE FROM is just about to call it a week. And so is Wall Street. I don't know how I go from that story to...

ALI VELSHI, CNN CORRESPONDENT: This is why people say business news is boring because I come after the world's biggest condom and cows farting.

PHILLIPS: Sorry, Ali. We couldn't think of a better way to get to you.

VELSHI: The Dow maybe might hit 11,000, maybe.

PHILLIPS: Well, that's gassy.

VELSHI: Woo-hoo. Yes, exactly. We'll get to the numbers in a moment. It looks like it's not going to happen today. That's usually a good indicator of the economy. The Dow has been very strong.

But, the New York Stock Exchange, and you don't really want to get into why, but, you know, you have to have a seat. You have to own a seat on the New York Stock Exchange in order to trade on it.

Well, a seat just sold for $4 million. That's a record. Now I don't know about you, Kyra, because you're highfalutin down there. But this is like a $68 special, maybe? I don't know.

PHILLIPS: OK. It doesn't get. Look, I'm sitting in the type of seat. All right?

VELSHI: Are you really?

PHILLIPS: Yes and actually, you know, this seat it keeps like kind of dropping on me, and I have to keep trying, you know, to get it to come up, and then the back part, you know, keeps--yes.

VELSHI: For four million bucks I bet you get a nice seat.

PHILLIPS: Exactly.

If we were Wolf Blitzer--oh, wait he doesn't sit down. That's right.

VELSHI: Well, what could happen, Kyra...

PHILLIPS: Yes.

VELSHI: ...is we could get new seats for both of us if, let's say, things changed at the company we worked for.

PHILLIPS: Now, well what needs to change exactly?

VELSHI: Well, it depends on who you ask.

Billionaire Karl Icon, sort of a titan, he's done these corporate takeovers before. As you know, he's been buying big chunks of Time Warner, which is the parent company of this network.

And he and a group of investors own about three percent of the company. It doesn't sound like much, but this is a huge, huge company. And they are, you know, doing all sorts of things.

They are trying to get CNN, which is part of this organization-- they are trying to get Time Warner to split up into four companies. One of which would be CNN and HBO and those channels.

One of which would be the cable systems, Time Warner Cable. One of which would be, what else do we have here? AOL.

PHILLIPS: Yes. It's hard to keep track of everything now.

VELSHI: Yes, there is a third group. Oh, the magazine publishing. The publishing...

PHILLIPS: "Time," yes. "Time" magazine?

VELSHI: But, you know, if they get their way, we'll have a whole different situation.

PHILLIPS: Is somebody talking to you in your ear? I hear people talking.

VELSHI: What saying stop talking about the company?

PHILLIPS: Yes, are you getting distracted? Did they just tell you to stop talking about CNN?

VELSHI: This thing is broken. I can only sort of read your lips.

But anyway, the reason this is interesting is because Karl Icon has done these corporate takeover type of things in the past. And, you know, from the perspective of a business journalist or someone who follows it it's the makings of a bigger battle than people might have thought it was going to be six months ago.

We'll see how it goes.

PHILLIPS: Well, speaking of well big battle of big numbers, 11,000?

VELSHI: Yes. And, I mean, as you know, these numbers, whether it's 10,000 or 11,000, are insignificant as the number. But it's a sense of a milestone again on the Dow now.

It's, of course, hit that, hasn't closed above 11,000 for some time. We're at 10,878. And, of course, as you can see, the Dow is down today. But there is some speculation that, of course, if it had opened up it would have been a good strong day, and we might have topped 11,000.

It will happen. Don't know when exactly. And there's really nothing that anyone should be doing about that. It's just a sense of things being OK, as you saw the president was talking about the economy this morning.

PHILLIPS: Well, I know we're going to hit the closing bell.

That's right we follow everything the president says from Iraq to the economy.

There it is, Ali Velshi. I hope you have a great weekend. I'll see you Monday, all right?

VELSHI: And you. I shall see you Monday, Kyra. Thank you.

(MARKET REPORT)

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