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American Morning

Tornado In Tennessee; Deadlock In Iraq; Enron Trial; Taxpayer Privacy; Big-Baby Car Seats

Aired April 03, 2006 - 07:30   ET

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

MILES O'BRIEN, CNN ANCHOR: East in toward Atlanta right now. Chad Myers is watching all this for us.
Chad.

CHAD MYERS, CNN METEOROLOGIST: And good morning, guys.

Yes, the weather now rolling through the city of Atlanta with a severe thunderstorm warning on it but with no twist, no rotation to that storm on Doppler radar. Doppler radar actually can see, so to speak, see the direction that the raindrops are moving. And if one raindrop's moving this way and one raindrop's moving this way, somewhere in between the raindrops are circulating and that's not happening over Atlanta right now. Although there still are tornado watches out, there may be a little bit better chance of some rotation into parts of Alabama still, to the south and west of Atlanta.

Here's what happened last night. I want you to focus on a couple of storms that roll over Newbern. There is one there brining hale. And this is the one right there that I believe brought that tornado down to the ground, right on the ground, making so much destruction and causing so many fatalities in that little town there.

Miles.

MILES O'BRIEN: Let's get right to that location. Dyer County, Tennessee, the hardest hit spot. Jeff Holt is the sheriff. He's with us now.

Sheriff, you've had a rough night there, to say the least. How are things going this morning?

SHERIFF JEFFREY HOLT, DYER COUNTY, TENNESSEE: We're still in the process right now of searching the area. We're waiting for daylight so we can get into the hardest hit areas and make an absolute thorough search of it.

MILES O'BRIEN: It's difficult, I know, until you have first light, but give us your best assessment at this point of what you know about the damage and casualties.

HOLT: Right now we're looking at 12 fatalities that we probably have here in the county. There is a possibility that number may go higher as daylight comes and we're able to search further out in the areas. Destruction is almost absolute total destruction along some of the path of this. There's just nothing left of houses but foundation. MILES O'BRIEN: Sounds like it's still pretty windy there, too. You still kind of have the aftermath of that. Do you have a sense of how many tornadoes might have touched down there? Have you been able to figure that out yet?

HOLT: From this point, all we know is one. We won't know that. Hopefully we're going to get up and fly the area today along the path and we'll see whether we've got just one path or more than one path.

MILES O'BRIEN: I assume you have some power outages this morning as well.

HOLT: Yes, sir. Yes, sir. We've got major power outages along the affected area running from west to east across the county, across the north side.

MILES O'BRIEN: This is kind of a nightmare scenario. The end of a weekend, in the middle of the night, people asleep. Was there adequate warning? Would it have helped if folks had more weather radios, for example?

HOLT: You know, this hit about 7:40 last night. So, you know, the warnings were out. They were being tracked all the way across Arkansas and Missouri as it was coming in. So, you know, we had plenty of warnings. I think that just the amount of destruction that there is what caused our fatality count to get so high.

MILES O'BRIEN: Yes, so a little -- I guess a little early for people to be asleep necessarily. They were paying attention but maybe not responding as quickly as they should.

You know, I guess this is a reminder that these warnings are not to be taken lightly.

HOLT: Yes, sir. You can never take them, not in this area, because we've had several over the last few years, F-3 and F-4 range. So, you know, that kind of destruction is not very survivable.

MILES O'BRIEN: All right. Well thank you very much. The Dyer County sheriff, Jeff Holt, with us this morning. He's got a busy day. At first light they'll get an assessment of the damage there. Thanks for your time.

Soledad.

SOLEDAD O'BRIEN, CNN ANCHOR: Lots of other stories making news this morning. Let's get right to Carol. She's got an update from the newsroom.

Hey, Carol.

CAROL COSTELLO, CNN CORRESPONDENT: Good morning.

Good morning to all of you.

Drawing the political lines on immigration. The Senate set to debate two proposals already on the floor. The first vote's expected later today.

In the meantime, thousands of protesters marched throughout the country this weekend. They say the new plans would criminalize immigrants. More rallies set for today.

In Virginia, Zacarias Moussaoui arriving at court for today's jury deliberations. The caravan of SUVs pulled up to the courthouse just moments ago. And we'll get those pictures for you when we can. Jurors now deciding whether Moussaoui is eligible for the death penalty for lying about plans for the September 11th attacks.

The bumps are back. Health officials in Iowa looking into the first epidemic of mumps in the state in almost 20 years. The outbreak first appeared on college campuses. It was thought to be contained, but now cases have been reported in one-third of the states. Some 245 cases now being treated.

More reports of the bird flu, this time in Egypt. Officials there say two young girls have been affected. Millions of suspected birds are now being rounded up. In the meantime, the United States is stockpiling a vaccine and it seems to be working, at least partially, and in high doses. Details appear in the "New England Journal of Medicine."

Airline quality taking a steep dive. That's according to a survey being released today. It shows customer satisfaction with the airlines is at its lowest in six years. Among the complains, oh, you know the drill, lost luggage, late flights and complicated security procedures.

That's a look at the headlines this morning. Back to you, Soledad.

SOLEDAD O'BRIEN: All right, Carol, thank you very much.

A surprise visit, and a stern message too, to Iraq from Secretary of State Condoleezza Rice. She's warning Iraqi leaders that they have to get moving on forming a government and put a stop to sectarian violence. CNN's Aneesh Raman live for us in Baghdad this morning.

Aneesh, good morning.

ANEESH RAMAN, CNN CORRESPONDENT: Soledad, good morning.

Secretary Rice, who was here alongside British Foreign Secretary Jack Straw, left a few hours ago. Both are now in route to London. It ended a day and a half surprised visit that, as you say, it carried with it a blunt message, form an Iraqi unity government and form it now.

Yesterday both secretaries met with all the various political entities here, the Sunnis, the Shia, as well as the Kurds, voicing that message. The Iraqis, of course, went to the polls on December 15th. That government yet to form. And Secretary Rice this morning in a press conference said that without the government the violence will continue. (BEGIN VIDEO CLIP)

CONDOLEEZZA RICE, SECRETARY OF STATE: It is only through a political process in which the Iraqi people have confidence, and political leadership in which they have confidence, that they can be certain to abandon for all time any resort to violence.

(END VIDEO CLIP)

RAMAN: Now that confidence among the Iraqi people is waning by the day. As I mentioned, it's been months since they went to the polls bravely to vote the government in. We have seen the parliament convene, but they met just for a half hour. And the critical issues of who will be in the top leadership positions still remains unresolved.

Soledad.

SOLEDAD O'BRIEN: So then, Aneesh, what exactly is the hold up? Is it sort of the violence that's the problem? Is it the sectarian disagreement that are so longstanding anyway? Is it the leadership or the lack of leadership? What is it?

RAMAN: It's hugely complex. It's a mix of all of that. But perhaps, most important to say, is that it's Ibrahim al-Jaafari. You'll recall he was the current -- the former Iraqi prime minister. The current nominee for that position by the Shia alliance. He has come under mounting criticism from the Sunni and Kurdish politicians who want hm to step aside, want someone else to lead the country for the next four years. He has show no signs that he's willing to do that. Secretary Rice called upon all Iraqi leaders, in her words, to look within themselves and find the right course for unity in Iraq. All but a very explicit statement saying that Jaafari should step aside.

Soledad.

SOLEDAD O'BRIEN: Aneesh Raman's in Baghdad for us this morning.

Aneesh, thanks.

Miles.

MILES O'BRIEN: The government's case is over and this among the Enron trial in Houston shift to the defense. Both Jeff Skilling and Ken Lay expected to testify in their own defense. CNN's Chris Huntington sets the scenes for us.

(BEGIN VIDEOTAPE)

CHRIS HUNTINGTON, CNN CORRESPONDENT, (voice over): Jeff Skilling and Ken Lay insist they did not commit any crimes at Enron. In the four and a half years since Enron collapsed, both of them have publicly disputed the allegations against them, and that record offers a preview of their likely defense strategy and what they might tell the jury. JEFF SKILLING, FORMER ENRON CEO: I have nothing to hide.

HUNTINGTON: In February 2002, Skilling contentiously testified before Congress.

UNIDENTIFIED MALE: This is serious stuff, sir.

HUNTINGTON: At those hearing, Skilling flatly denied that he cooked Enron's books or lied to anyone about his finances.

SKILLING: I did not believe the company was in financial peril and I have no knowledge of any -- and had no knowledge of any wrongdoing.

HUNTINGTON: Skilling also directly refuted one of the government's central charges in the criminal case against him. That he and former Chief Financial Officer Andrew Fastow had an illegal agreement to hide Enron's debt in off the book partnerships.

REP. BILLY TAUZIN, (R) LOUISIANA: Did you, in fact, have an agreement, a handshake deal, with Mr. Fastow, to make LDM (ph) whole (ph) for any losses what so ever?

SKILLING: Absolutely not. Mr. Chairman, there was no handshake deal between myself and Mr. Fastow period.

HUNTINGTON: Lay also appeared at the hearings but declined to testify, pleading the fifth. Since then, he has consistently said that while he was running Enron, he did not know about any wrongdoing.

KEN LAY, FORMER ENRON CHAIRMAN: I take responsibility for what happened at Enron, both good and bad. But I cannot take responsibility for criminal conduct that I was unaware of.

HUNTINGTON: He expanded on that theme just a month before his trial began.

LAY: Except for the illegal conduct of what I think were less than a handful of employees, I am convinced Enron would not have had to seek protection under the U.S. bankruptcy code in 2001 and would still be a great and growing company today.

HUNTINGTON: Law Professor John Coffee says blaming Fastow and his crew is a good defense tactic. But Coffee doubts the jury will believe Skilling and Lay if they testify they had no idea Enron was in trouble.

JOHN COFFEE, COLUMBIA UNIVERSITY LAW PROFESSOR: And I think that's like denying history. It's equivalent to denying that the holocaust happened and I think it will hurt them with the jury.

HUNTINGTON: And convincing that jury is just about the only chance Jeff Skilling and Ken Lay have to avoid prison.

Chris Huntington, CNN, New York.

(END VIDEOTAPE)

MILES O'BRIEN: That will be testimony that people will be lining up to see.

SOLEDAD O'BRIEN: Oh, yes.

MILES O'BRIEN: We will talk with Mimi Schwartz (ph) from "Texas Monthly." She'll be in the courtroom. She has been. She's been covering the trial. She wrote a good book on this whole story and that will be coming up in our 9:00 Eastern hour.

SOLEDAD O'BRIEN: Speaking of business news, what's ahead this morning, Andy?

ANDY SERWER, CNN CORRESPONDENT: Soledad, just how prevalent is identity theft anyway?

Plus, keeping in touch with loved ones back home goes high tech. This one will surprise you. Stay tuned to AMERICAN MORNING coming up next.

(COMMERCIAL BREAK)

SERWER: I'm going to celebrate.

SOLEDAD O'BRIEN: Jennie Garth is 34. Is that what you're celebrating, "90210" star? She's 34.

SERWER: No, I'm not -- well, that's OK too. I'm celebrating Eddy Murphy's birthday.

SOLEDAD O'BRIEN: Really?

SERWER: Yes, I think that's fun.

SOLEDAD O'BRIEN: Any reason?

SERWER: No, I just -- I like Eddy Murphy and, you know . . .

SOLEDAD O'BRIEN: He's 45.

MILES O'BRIEN: Why not?

SERWER: That's sort of near my age, kind of.

SOLEDAD O'BRIEN: Really?

SERWER: Close. A little younger, quite frankly, thank you.

SOLEDAD O'BRIEN: I mean, why, he's so much old, Andy, that's what I would have . . .

SERWER: Oh, you were trying to help me out here.

SOLEDAD O'BRIEN: Let's talk about video conferencing. It's making business news today. SERWER: Yes, a couple of things to get to, Soledad.

First, I want to get you this. It just crossed the tape. GM has sold a 51 percent stake in GMAC, its financing arm, for $14 billion. A widely anticipated deal to a New York investment company, Cerberus. They're the ones leading that transaction. We'll have more on that later.

Also I want to tell you, first off, about identity theft before we get to video conferencing. How prevalent is identity theft? Well, maybe not as widespread as we thought. A new study out by the Justice Department says 3.6 million American households were victimized over the past six months. Much less than another study by the Federal Trade Commission which says 9.3 million.

Of course, this has a lot to do with how do you count, how do you count what constitutes identity theft? Is it actually some one, you know, picking something out of a trash can and trying to use a credit card number or someone actually taking money out of your bank account and using your credit card. The standards are different. That's what accounts for that difference there.

MILES O'BRIEN: And 3.6 million, that's a lot of people inconvenienced.

SERWER: It still is a lot.

MILES O'BRIEN: Yes. All right.

SERWER: Now I want to talk about video conferencing, Soledad. And, you know, if you have loved ones back home, if you just immigrated into this country, there's a couple ways to get in touch with them, obviously. Phone calls and webcams are a new way.

But what about video conferencing? This apparently is a business on the rise in cities like New York and Los Angeles. A story about one gentleman named Fernando Rojos (ph), who was a Colombian native, lived in this country for 25 years. And apparently he set up video conferencing out on Long Island. And here's what it costs, about $80 for an hour, maybe up to $120 an hour to talk to loved ones. They have to be -- obviously you have to coordinate it.

MILES O'BRIEN: $80 an hour.

SERWER: Yes, it's a lot of money.

MILES O'BRIEN: That's pretty steep.

SERWER: It's a lot of money but that's, you know, video conferencing is not a cheap technology.

SOLEDAD O'BRIEN: That was a . . .

MILES O'BRIEN: Oh, sure it is. That's on the Internet. There's no real cost.

SERWER: Well, that's what a web cam is but the quality is much lower.

MILES O'BRIEN: Oh this is one of the . . .

SOLEDAD O'BRIEN: Yes, this is a real video. I think that's not so -- $80, you bring the whole family in for an hour. That's a long time.

SERWER: People are seeing relatives they never -- you know, haven't seen because they were born before they left.

SOLEDAD O'BRIEN: An hour is a long time to spend with your relatives.

MILES O'BRIEN: You just get a little Einstein (ph) on their math, you know.

SERWER: Yes, it is. Birthday parties.

SOLEDAD O'BRIEN: Oh, (INAUDIBLE).

MILES O'BRIEN: Well, you know, it's just a thought.

SOLEDAD O'BRIEN: People back in the old country may not have a Mac, all right?

MILES O'BRIEN: All right. I got you.

SOLEDAD O'BRIEN: Could be. Could be.

SERWER: I think that's the case.

SOLEDAD O'BRIEN: Yes. All right. Andy.

SERWER: Thank you.

MILES O'BRIEN: I think it's great.

SERWER: Stand corrected there?

SOLEDAD O'BRIEN: I take it back.

SERWER: Apparently.

SOLEDAD O'BRIEN: It's now great.

MILES O'BRIEN: I''m picked on. That's OK. I'm used to that.

SOLEDAD O'BRIEN: Thank you, Andy.

SERWER: You're welcome.

MILES O'BRIEN: The information on your tax return should be private, right? Well, the IRS is considering new rules that could increase the number of people and companies with access to your personal information, even though you would have to OK it. The concept is controversial, to say the least. Here's Gary Nurenberg. (BEGIN VIDEOTAPE)

GARY NURENBERG, CNN CORRESPONDENT, (voice over): Two weeks till the April 15th filing deadline, Steve and Rhonda McNerney walk into a meeting with their tax preparer, numbers in hand.

STEVE MCNERNEY, TAXPAYER: That's information that is our information that is not for sale.

NURENBERG: They just learned about a proposed IRS rule change that would allow their tax preparer to sell that information to mass marketers.

STEVE MCNERNEY: I thought that information was confident information between the tax preparer and the client.

NURENBERG: Since the 1970s, the IRS has permitted tax preparers to provide clients information, with their consent, to affiliated business that provide financial services. The rule change would allow tax preparers, with consent, to provide client information to anyone. The McNerney's tax preparer, Joseph Jacques, says he won't do it.

JOSEPH JACQUES, ACCOUNTANT: My policy of my office is, is total secrecy of my clients information. I don't disclose anything.

NURENBERG: But other tax preparers do and the IRS says it suggested the rule change to make it very clear that clines know it and approve it in advance, even as the IRS removes limits on who can get the information.

MARK EVERSON, IRS COMMISSIONER: The problem we saw was, we don't think that the taxpayer is fully aware the fact that this is going on.

NURENBERG: The IRS proposal requires specific, written consent on a separate piece of paper that warns taxpayers in large print the privacy of their information can't be insured once the prepare releases it.

EVERSON: This, we believe, will result in less information actually being disclosed unknowingly.

NURENBERG: And because some nationwide firms outsource tax preparation to overseas sites, the rule change would require consent for that as well. One senator has introduced a bill that would restrict the disclosure of tax information.

SEN. BARACK OABAMA, (D) ILLINOIS: If you can find me somebody out there who thinks, you know, it's a great idea to get a bunch of junk mail or to expose ourselves to, you know, encroachment on our privacy, then maybe the IRS position makes sense.

NURENBERG: Privacy groups plan to tell an IRS hearing this week the new rule could lead to costly identity theft.

MARC ROTENBERG, ELECTRONIC PRIVACY INFO. CENTER: Something that is really, I think, placing America's privacy at risk somewhat needlessly.

NURENBERG: The McNerney's won't allow the sale of information on their tax forms. But if the proposed rule change becomes law, millions of other taxpayers could.

Gary Nurenberg, CNN, Washington.

(END VIDEOTAPE)

MILES O'BRIEN: It's good to know.

And with deadline day just two weeks away, we have some other helpful hints you'd like to know, probably. AMERICAN MORNING's tax guide is coming up. Tax experts will tell us about filing taxes online, deductions you might have missed. And best of all, what to do with that tax refund. Wednesday to Friday this week right here on AMERICAN MORNING.

Summer travel season, it's a couple of months away. A lot of people are thinking about the summer already, though, that's for sure. I know my kids are. They're already ready. Lots of folks are finding it harder than ever to use those frequent flyer miles. Coming up, tips to help you get the most out of your miles, avoid those blacked out seats.

SOLEDAD O'BRIEN: Also ahead this morning, most states have laws that kids three and younger have to ride in a car seat. What if your kid, though, is too big to fit into one? Dr. Sanjay Gupta has a look for us. Stay with us.

(COMMERCIAL BREAK)

SOLEDAD O'BRIEN: If you're a parent, you know that there are few things more important than making sure that your little kids are buckled up for safety. But a new report out today says that many children are just too heavy, too big for their car seat and that puts them at greater risk in the event of a crash. Yet, as Dr. Sanjay Gupta tells us, it's just not that easy to find the right car seat.

(BEGIN VIDEOTAPE)

SANJAY GUPTA, CNN CORRESPONDENT, (voice over): Riding in the car seat and watching the world go by is a feature of every kid's childhood. But finding a car seat to fit three-year-old Rafael was a surprisingly daunting task.

GERALDO TOBIAS, RAFAEL'S FATHER: Rafael's 47 pounds and 37 inches long. I see kids his age taller, but they're lighter. Much lighter than him.

GUPTA: Rafael's always been on the heavier side. At just two years old, he already weighed 41 pounds. And now his weight rivals the average for a kid twice his age, which poses a problem when it comes to finding the right fit. You see, he's outgrown two of his car seats so far. TOBIAS: The car seat is rated for infant to 100 pound kid up to 52 inches tall. It's too tight for him on the thigh and his legs are hanging and, as you can see, he's not comfortable in it anymore.

GUPTA: Rafael isn't alone. Most states have laws that children up to the age of three must be in a car seat, but there are about 283,000 children who are too big for the available types of car seats on the market. That's according to researchers at the Columbus Children's Research Institute. They looked at most of the child safety seats on the market and found that out of 92 types only six car seats would be safe for a boy Rafael's size. They're hard to find in stores and they come at a hefty price.

LARA TRIFILETTI, COLUMBUS CHILDREN'S RESEARCH INST.: The seats that would accommodate children at these higher weight rangers are the most expensive seats on the market. They start anywhere from $130, all the way up to $270. That's really one of the major problems is that these seats are too expensive for most families to afford.

GRACE GANADEN, RAFAEL'S MOTHER: Well, if I can afford it, I would get that one for the safety one.

GUPTA: Right now, Rafael has a booster set that uses the car's built in safety belt to strap him in. But experts say that's not safe enough. Look at these crash test videos that show how dangerous the wrong car seat can be, even in a low impact crash. And they stress the importance of the right one, especially when it comes to one, two, or three year old kids.

TRIFILETTI: They're developmentally not capable of withstanding the force of a crash and they may also slip out under the adult seatbelt. So a five-point harness just provides another level of security in keeping them in the seat.

GUPTA: The researchers conclusion, parents should look for the five-point harness, follow the manufacturer's guidelines and, of course, make sure the child is comfortable for the long haul. But for bigger kids like Rafael, that's a tall order.

Dr. Sanjay Gupta, CNN, Des Moines, Iowa.

(END VIDEOTAPE)

SOLEDAD O'BRIEN: A big, old boy but he's a little cutie.

MILES O'BRIEN: Big guy. Cutie for sure.

SOLEDAD O'BRIEN: That's a big problem. My kids are big.

MILES O'BRIEN: Well . . .

SOLEDAD O'BRIEN: Not as big as that, but they're big. They -- you know, it's hard to get them a car seat that really fits them.

MILES O'BRIEN: Got to make sure it's the right size for them to be safe. That's really important. SOLEDAD O'BRIEN: Yes.

MILES O'BRIEN: In a moment, we're going to look at the top stories, including Jill Carroll back home in the U.S.

Word this morning there may be more senior staff changes in the west wing of the White House.

Mayoral candidates in New Orleans reaching out to evacuees near and far.

Iran test fires a powerful torpedo.

And a story we've been following for you all morning, severe storms in the Midwest. Several states hit by tornadoes and strong winds. We're live from one of the worst hit areas.

Stay with us for more AMERICAN MORNING.

(COMMERCIAL BREAK)

SOLEDAD O'BRIEN: Good morning. Welcome, everybody. I'm Soledad O'Brien.

MILES O'BRIEN: And I'm Miles O'Brien.

Cleanup this morning after tornadoes and high winds cut a path of destruction through parts of the Midwest overnight. Now those strong winds are sweeping through the southeast as we speak. We have your severe weather forecast with Chad Myers just ahead.

SOLEDAD O'BRIEN: A tearful reunion for Jill Carroll. She's back home this morning. Now we're waiting to hear more about her ordeal.

MILES O'BRIEN: And there's a new sheriff in the west wing, and now two more administration heavy hitters could soon be shown the White House door.

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