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American Morning

Immigration Battle; Progress in Iraq; Office Politics

Aired May 26, 2006 - 06:30   ET

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

MILES O'BRIEN, CNN ANCHOR: Happening this morning, hundreds of thousands attend a papal mass in Poland. Pope Benedict in the same Warsaw square where John Paul II inspired Poland's solidarity movement a generation ago.
House Speaker Dennis Hastert may sue ABC News for libel. That word coming from his lawyer. ABC reported Wednesday Hastert was "in the mix" -- that's a quote -- in the Jack Abramoff corruption probe. ABC sticking by its story.

And the full Senate expected to confirm General Michael Hayden as the new CIA director today. He'll be the first military officer to run the CIA in 25 years.

Good morning to you. I'm Miles O'Brien.

SOLEDAD O'BRIEN, CNN ANCHOR: And I'm Soledad O'Brien. Welcome, everybody.

It was kind of a roller-coaster ride in the Senate, but in the end a major immigration reform bill has passed. It includes a guest worker program and a path to citizenship for illegal immigrants. Now the hard part, a compromise with the House.

CNN National Correspondent Bob Franken in Washington this morning.

Hey, Bob. Good morning to you.

Compromise possible, do you think?

BOB FRANKEN, CNN NATIONAL CORRESPONDENT: Possible, yes. Looking likely, no. But oftentimes, you have an advantage when you deal with lowered expectations, and the expectations are quite low given the differences between the bills.

One of them, the Senate version, has a path to citizenship. On the other side, you have a House bill that includes, among other things, the provision that would make illegal immigration a felony.

So you've really got a huge gap to cross. But as I said, the possibility exists that people might get in there and get conciliatory and come up with something that's not been anticipated.

We certainly know that the president has put his prestige on the line, the prestige and the power of the White House. And even though things are not going well, that's quite a bit of power that's going to be brought to bear for that legislation -- Soledad.

S. O'BRIEN: The Mexican president, Vicente Fox, has said that he was pleased with the way the Senate went. What's been the reaction to his reaction?

FRANKEN: The reaction has, in fact, been pretty much that he's not a player here. Those people who have talked about the Mexican president being here have said that his positive words are really along the lines of, so, what is he supposed to say?

S. O'BRIEN: That's odd. An interesting question.

(BEGIN VIDEO CLIP)

PRESIDENT VICENTE FOX, MEXICO: The United States Senate has taken a historic step by voting in favor of a comprehensive immigration reform. It is a moment that millions of families have been hoping for.

(END VIDEO CLIP)

FRANKEN: And the point that many people make is that the president of Mexico doesn't have a vote in this Congress. Soledad, there are going to be a lot more votes ahead, a lot more hard, hard bargaining ahead.

S. O'BRIEN: Yes, tough and hard, those are the words we've heard both sides of the aisle on this one.

Bob Franken for us this morning.

Bob, thank you -- Miles.

M. O'BRIEN: President Bush and British Prime Minister Tony Blair admit making mistakes in Iraq, but they haven't changed their minds about going to war. And they're not giving a timetable for pulling out troops.

CNN's Ryan Chilcote live now from Baghdad with reaction from there -- Ryan.

RYAN CHILCOTE, CNN CORRESPONDENT: Well, we heard a lot about the political progress in the two leaders' speech yesterday. Both of them talking about the very important political milestones that have been reached here.

I think it's really too early, however, to talk about how effective this new government has been. Something that both of the leaders talked about. Remember, this government has only been in power for six days now. And it's really not a complete government.

You heard President Bush there yesterday concede that this government still doesn't have a defense minister, someone to run the military. It doesn't have anyone to run the police yet, it does not have an interior minister yet. So, a lot of Iraqis will make the judgment about how effective this government is and how far the political progress has come in Iraq based on the government's ability to provide security. And it's tough to imagine how they can do that, of course, without those two important leaders in those positions to carry on the fight against the insurgency and sectarian violence -- Miles.

M. O'BRIEN: Ryan, why the holdup in naming those key ministers?

CHILCOTE: Well, there's been a lot of division, really, sectarian division, on who should get the job. As far as the interior minister -- ministry is concerned, there was a Shiite that was in charge of that post earlier on. The Sunnis felt that that minister was actually running death squads within his ministry that were basically hunting down Sunnis and killing them based on their sect.

So they have felt quite strongly that Sunnis should run that ministry. The Shiites don't want to give it up.

The same problems come when it comes to the defense ministry. These are important, very contentious ministries. And look, it took them six months to form the government to begin with. Those ministries are really where the rubber hits the road in terms of their meaning -- Miles.

M. O'BRIEN: The linchpin in all of this as far as getting U.S. and British troops out are Iraqi security forces being prepared to take care of their own country. It seems like that's a long way off.

CHILCOTE: Yes. You heard Prime Minister Maliki this week say that he thought Iraqi security forces could be in complete control of their own security within 18 months. I think if you talk to Iraqi and U.S. military commanders here on the ground, you will find that the issue is exactly how complete that control will be.

There are -- while there's been a lot of progress in terms of building up the numbers of troops in Iraq's security forces, there's still a lot of issues when it comes to the Iraqi security force's ability to support themselves here. There is really no one region in this country where Iraq's security forces can operate independent of U.S. forces at this point.

And one of the things that the prime minister didn't say when he said that he thought that Iraqi forces could be in control at 18 months is he didn't say anything about when U.S. troops might be able to come home. That may mean that he believes that they need to be here in a support role even 18 months from now -- Miles.

M. O'BRIEN: Ryan Chilcote in Baghdad.

Thank you very much -- Soledad.

S. O'BRIEN: Happening "In America" this morning, it could be a threat to airport security. Fourteen hundred TSA employees' items have been lost or been stolen. Their official badges, their uniforms, that's over the past three years, and that's according to information obtained by San Antonio TV station WOAI.

Airports in L.A. and Chicago report the most missing items. The Transportation Security Administration response is that the items themselves don't constitute a security problem.

A follow-up now to a story we told you about last week. Two Dallas-area high school students under arrest in that case of the tainted muffin. Eighteen people at Lake Highland High School were sickened by the muffins, apparently laced with the active ingredient in marijuana. The teens each face five felony counts of assault.

Progress is being made at the Louisiana Superdome, still more than a year away from being completely repaired, though. The dome was badly damaged both inside and out during Hurricane Katrina. Officials say it will be fixed enough to host the Saints' return to New Orleans on September 25th.

Federal aid is now available to victims of this month's flooding in Massachusetts and New Hampshire. The government designated parts of both states disaster areas. Massachusetts state officials say as many as 14,000 homes have been damaged. Those family members are eligible for up to $27,000 in federal aid -- Miles.

M. O'BRIEN: Here's some pictures you've never seen before. This is an underwater volcano erupting.

Never been captured on tape or film before in the history of the universe. Wow! Certainly on this planet, anyhow.

Check that out. A robot camera just about 10 feet from the volcano as it erupted, 1,800 feet down in the Pacific, 60 miles north of Guam. It's the clearest picture ever taken of seismic activity under the sea, and it really showed -- this is how islands are made.

You can see as the molten rock comes out, it almost immediately kind of -- kind of congeals, or whatever. Very interesting.

Time for a check of the forecast now.

I'm just kind of mesmerized here...

REYNOLDS WOLF, CNN METEOROLOGIST: Yes, I'm with you. I mean...

M. O'BRIEN: ... watching that. It's really cool.

WOLF: Miles, we're looking at future beachfront property here.

M. O'BRIEN: That's right.

WOLF: I mean, sure, it's a few million years down the road, but...

M. O'BRIEN: Get it, yes. But if you buy now, you get a deal, right? Just buy and hold.

WOLF: Great for ancestors. You buy in advance and then you put up the condominiums later on. Good times.

(WEATHER REPORT)

S. O'BRIEN: All right. Reynolds, thanks.

Still to come this morning, we're on the ground in Afghanistan with a report on how life there is now starting to look a lot like Iraq.

M. O'BRIEN: Although that's not what we're seeing there.

And then, how the immigration bill could impact one of the most recognized symbols of freedom and democracy. I'll let you guess what we're talking about.

S. O'BRIEN: And what the president's doing to calm a growing frustration over material that was seized from a congressman's office.

First, though, a look at what else is making news on this Friday morning.

(COMMERCIAL BREAK)

M. O'BRIEN: In Afghanistan, the violence is rising and there's growing concern the Taliban are becoming entrenched in that society once again. And, of course, U.S. troops are right in the middle of it all.

Just one of the stories our correspondents all around the world are watching this morning for you.

(BEGIN VIDEOTAPE)

BARBARA STARR, CNN PENTAGON CORRESPONDENT: I'm Barbara Starr in Kabul, Afghanistan, where the marketplace is very busy. It seems like most of the city is out here today.

But in the southern part of Afghanistan, violence is again on the rise. The Taliban are reorganizing, and the U.S. military says it's getting to be as dangerous as it is in Iraq.

(END VIDEOTAPE)

(BEGIN VIDEOTAPE)

BEN WEDEMAN, CNN INTERNATIONAL CORRESPONDENT: Hamas has pulled its militiamen off the streets of Gaza in what appears to be an attempt to ease the tensions between the group and the Palestinian Authority President Mahmoud Abbas. Now it's just Palestinian security in the streets, but yesterday there was a clash between these security forces and Hamas that left one man dead.

Meanwhile, Palestinian leaders are meeting to resolve their differences. Reports are that Hamas is willing to compromise. Certainly, its decision to pull its men off the streets indicates that the confrontation between Hamas and Mahmoud Abbas has been averted, at least for now.

(END VIDEOTAPE)

(BEGIN VIDEOTAPE)

DAN RIVERS, CNN CORRESPONDENT: Well, a special day here in Thailand, as the king, Bhumibol Adulyadej, is given an award by U.N. Secretary-General Kofi Annan to mark a lifetime of work to improve the lives of millions of his citizens. The king is famed for numerous projects here to improve sustainable development, to promote education and health throughout Thailand. And this is the first time an individual has ever received this U.N. development award.

And this all comes just two weeks before a huge celebration in Bangkok to mark the 60th anniversary of the king's succession to the throne.

(END VIDEOTAPE)

M. O'BRIEN: For more on these or any other if our top stories, we invite you to head to our Web site. CNN.com is the place -- Soledad.

S. O'BRIEN: Still to come on AMERICAN MORNING, they say that going to war with Iraq was the right thing to do, but President Bush and Prime Minister Tony Blair admit mistakes were made along the way. Will this contrition help their poll numbers? We're live at the White House with that.

Then, why House Speaker Dennis Hastert is going after ABC News, threatening to sue, in fact. That story's ahead.

Stay with us. You're watching AMERICAN MORNING.

(COMMERCIAL BREAK)

M. O'BRIEN: Happening this morning, British Prime Minister Tony Blair making the rounds in Washington. He's set to speak at Georgetown University. Last night, he and President Bush acknowledged the war in Iraq wasn't going as smoothly as they'd hoped.

The congressional battle over immigration reform begins. House conservatives are denouncing that Senate bill passed yesterday. They say it gives amnesty to undocumented immigrants.

Meanwhile, the Senate bill would also reopen the Statue of Liberty's crown. The crown has been off limits to the public since the 9/11 attacks -- Soledad.

S. O'BRIEN: President Bush is now calling for a cooling off period in a battle between House leaders and the Justice Department. The president stepped into the middle of the dispute by sealing records taken from Congressman William Jefferson's Capitol Hill office. Jefferson is under investigation for bribery.

CNN's Dana Bash has more from Capitol Hill. (BEGIN VIDEOTAPE)

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Discussions will continue later today over how to handle the material the FBI seized from a lawmaker's office over the weekend. That, after the president agreed to seal all of that material for the next 45 days.

He did that in order to try to calm the growing confrontation between his administration and Republicans here on Capitol Hill led by the House speaker, Dennis Hastert, who say the Justice Department crossed a constitutional line in searching a member of Congress's office. And for the House speaker, it has become personal.

He accused the Justice Department of trying to retaliate against him by, in his words, leaking a false story to ABC News that he himself was under criminal investigation. And the House speaker is also going after that network. He says that they should retract the story, something that they refuse to do. He also is accusing them of libel and defamation, and he's threatening to sue.

Dana Bash, CNN, Capitol Hill.

(END VIDEOTAPE)

S. O'BRIEN: Andy Sewer is "Minding Your Business" up next.

Good morning.

ANDY SERWER, EDITOR-AT-LARGE, "FORTUNE": Good morning, Soledad.

Business news, we are looking at a game console war, perhaps.

And get this, the U.S. Treasury is going to get rid of a tax to help pay for the war, the Spanish-American War. For real.

Coming up next on AMERICAN MORNING.

(COMMERCIAL BREAK)

S. O'BRIEN: Welcome back, everybody.

Some good news for gamers. Prices may be coming down?

SERWER: Yes. We are looking at a price war here, Soledad, perhaps in the game console business. The question is, are people loyal to the games that they love so much that they are willing to fork up more for, say, the PlayStation rather than the Nintendo Wii regardless of the price? But let's get to the story here.

The Nintendo Wii -- that's W-I-I -- and this is the one where you can move your arms like a sword.

S. O'BRIEN: Right. We did a story on it the other day.

SERWER: Yes. We've been talking about that.

S. O'BRIEN: There we go.

SERWER: There you go.

M. O'BRIEN: Daniel Sieberg, our gamer, in-house gamer.

SERWER: Yes. This is supposed to be coming out in October. And news comes out in Japan that it's going to cost 250 bucks. That will compare with the PS3, which is not out yet, famously, which will go for around $500 to $600.

The Xbox 360, no relation to Anderson Cooper, goes for $300 to $400. And -- I always like that they were both 360. It's kind of neat.

M. O'BRIEN: Yes.

SERWER: And so, again, it will be interesting to see if they can get more juice selling it for less. And there are different games. We talked about that. The Nintendo games tend to be for younger people, but with this new sword action...

M. O'BRIEN: A little Mario and all that stuff. But the question is, will there be software unlike that Anderson Cooper...

(CROSSTALK)

SERWER: Now here's an interesting one. The U.S. Treasury is going to be offering refunds on a luxury tax for long distance phone use. And this tax dates back to 1898, implemented during the Spanish- American War, when there was no federal income tax and long distance service was considered a luxury.

It's a 3 percent tax that you pay on long distance usage, and the refund would apply to phone calls that you made on your bill, 2003, 2004, 2005. The Treasury will be issuing instructions on how to get the refund soon. And you would apply for it in your 2006...

S. O'BRIEN: Why just 2003...

SERWER: That is very unclear.

S. O'BRIEN: I mean, 1898 and only now?

SERWER: Right. I paid all the way going back.

(CROSSTALK)

S. O'BRIEN: Yes.

SERWER: Well, listen, it's so much money. It's $5.9 billion in 2005 alone. I guess it's a compromise. They can't afford to give all the money back. But some of it, and it's a nice thing. And you do it next year on your '06 return in '07.

M. O'BRIEN: It makes me wonder what other kind of taxes are lurking out there, you know? SERWER: Doesn't it? Yes.

S. O'BRIEN: And how convenient to forget about the Spanish- American War tax.

SERWER: Right. The Civil War saber tax, or something. I mean, right?

S. O'BRIEN: One would have thought we paid that one off already.

SERWER: Yes.

M. O'BRIEN: Remember the Maine, is what I always say.

SERWER: Indeed.

M. O'BRIEN: Remember the Maine.

SERWER: And we are, still.

M. O'BRIEN: Thank you. All right.

S. O'BRIEN: And paying for it maybe.

M. O'BRIEN: All right.

A look now at some of the other stories we're working on this morning.

President Bush and British Prime Minister Tony Blair acknowledged mistakes in the Iraq war.

House conservatives denounce the Senate's recently passed immigration bill. They say it gives amnesty to undocumented immigrants.

The Senate today it expected to confirm General Michael Hayden as the new CIA director.

New rumblings this morning that Treasury Secretary John Snow is set to resign.

And it's getaway day for millions of Americans, including Andy Serwer. We'll tell you how some drivers are beating high gas prices this holiday weekend.

Let's get a check of the forecast. Reynolds Wolf in the weather center.

Good morning, Reynolds.

WOLF: OK. Good morning.

(WEATHER REPORT)

KATHLEEN KOCH, CNN CORRESPONDENT: I'm Kathleen Koch at the White House. What does President Bush regret about the war in Iraq? I'll tell you coming up.

FRANKEN: I'm Bob Franken in Washington. The fight over immigration in the Senate is over. The brawl is about to begin.

M. O'BRIEN: Airport insecurity. More than a thousand Transportation Security Administration uniforms and badges go missing like baggage. So who will be screening the screeners?

ALLAN CHERNOFF, CNN SR. CORRESPONDENT: I'm Allan Chernoff, along the New Jersey Turnpike. How are high gasoline prices affecting vacation plans this Memorial Day? We'll have the story of one family coming straight ahead.

S. O'BRIEN: And pedal to the metal, Texas style. The Lone Star state raises the speed limit to 80 on more than 500 miles of highway.

Those stories are all ahead as we begin the second hour of AMERICAN MORNING.

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