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YOUR WORLD TODAY

Dozens Die in Subway Crash in Valencia, Spain; Militants Holding Israeli Soldier Give Israel Ultimatum; Crack Found in Space Shuttle Discovery's Insulation; Mexican Presidential Race Too Close to Call; Almost One Year Since London Terror Attacks

Aired July 3, 2006 - 12:00   ET

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


HALA GORANI, CNN INTERNATIONAL ANCHOR: Rescue crews race to the sight of a deadly underground train derailment in Spain.
JIM CLANCY, CNN INTERNATIONAL ANCHOR: With a Palestinian militant deadline looming, tensions rise for the fate of an abducted Israeli soldier.

GORANI: And two leading candidates may be claiming victory, but Mexico's presidential election is far from over.

It's 6:00 p.m. in Valencia Spain, 7:00 p.m. in Gaza.

I'm Hala Gorani.

CLANCY: I'm Jim Clancy.

Those are among the major stories we're following this hour on YOUR WORLD TODAY, broadcast live around the globe.

We begin our report in Spain, where disaster struck an underground commuter train.

GORANI: Thirty-four are dead, another dozen or more are seriously injured this hour. It happened at about 2:00 in the afternoon, when the train, filled with commuters, jumped the tracks.

CLANCY: Now, the accident prompted an immediate and massive response from authorities.

(BEGIN VIDEOTAPE)

CLANCY (voice over): Spanish police blocked off streets, rescue workers rushed the injured on stretchers to waiting ambulances, and scores of commuters were evacuated from the underground railway system. The train was just arriving at a station in Spain's eastern city of Valencia when two railcars veered off the tracks.

UNIDENTIFIED MALE: Most of the injured people, maybe 90 percent of the people, had been in the tunnel, inside the train. So it wasn't a merely in the station. There was some (INAUDIBLE).

CLANCY: Pope Benedict XVI is due in the city to mark the World Meeting of Families. It was unclear if any of the thousands of pilgrims who had already arrived to see the pontiff were among the victims. Initial reports indicated the toll of dead and injured would make this the worst train crash in Spain in recent years.

In March, 2004, terrorist bombs planted aboard commuter trains in Madrid killed 191 people. But police said there's no evidence linking Monday's crash to terrorism. An investigation, authorities say, will focus on excessive speed or the failure of one of the wheels on the train car as the most likely causes.

(END VIDEOTAPE)

CLANCY: Once again, at this hour, 34 people are known dead in that crash. We'll continue to monitor the latest out of Valencia and bring you any updates as soon as they come in -- Hala.

GORANI: We turn now to what could be critical hours ahead in the crisis over a kidnapped Israeli soldier. His Palestinian captors are giving Israel less than 24 hours to meet their demands or they will "regard this case as closed."

For Israel's response and also what's happening on the ground, let's bring in Paula Hancocks. She's in Gaza City.

We saw some incursions of ground forces into northern Gaza, but this isn't, Paula, it seems, the massive ground attack that had been threatened. Is it?

PAULA HANCOCKS, CNN CORRESPONDENT: That's right, Hala. Yes, we did see some Israeli troops and tanks moving into northern Gaza early on this morning Gaza time, but it wasn't this big incursion that Prime Minister Ehud Olmert had threatened a few days ago.

Now, we do have an ultimatum from the Palestinian militants, and they have given Israel less than 11 hours now to meet their demands.

(BEGIN VIDEOTAPE)

HANCOCKS (voice over): A sixth night of airstrikes on Gaza, and another political target. This time, the offices of Al Aqsa Martyrs Brigade.

Just hours later, the hostage-takers issued an ultimatum. Israel rejected it. Three militant groups holding the kidnapped Israeli soldier say it will be case closed if their demands are not met by 6:00 a.m. Gaza time on Tuesday.

The political wing of Hamas has also been asking for concessions.

UNIDENTIFIED MALE (through translator): The situation must be clear and precise, and at the very least, they need to release in the first stage the children and women prisoners in Israeli jals.

HANCOCKS: There have been further demands for 1,000 prisoners to be released. In public, at least Israel is sticking to its no- negotiation line.

UNIDENTIFIED MALE: Israel will not reward acts of terrorism. And terrorism will not be paid, and terrorists will pay for their terrible things. And therefore, we will not negotiate with terrorists.

HANCOCKS: Clashes between Israelis forces and Palestinian gunmen have stepped up. Three militants were killed near the airport in southern Gaza, two were found to be wearing suicide belts. A further two militants died in clashes in northern Gaza.

Some Israeli tanks rolled into northern Gaza early Monday, but this is not yet the extensive operation Olmert had threatened. But as the shelling continues, ordinary Gazans are just trying to live.

Business continues as normally as it can and as normally as it has in previous Israeli incursions. This taxi driver says, "For four or five years it's been the same. There's no difference. What Israel is trying to accomplish, it won't."

One of his passengers tells me the continuing airstrikes and sonic booms make children, women and the elderly terrified. It causes stress night and day, and no one can sleep.

(END VIDEOTAPE)

HANCOCKS: Now, on the humanitarian front, some emergency supplies have been allowed through. For six hours on Sunday, the Israelis opened the Karni crossing, the main crossing between Israel and Gaza, for goods to come in. And fuel was brought in as well, as there is little electricity here since the power plant was taken out by an airstrike. And hospitals and places like that need that fuel to keep the generators going -- Hala.

GORANI: Paula Hancocks in Gaza City.

We're covering this story from all angles. In a few minutes we will be speaking to Hamas representative Gazi Hamad. And after that, we will be speaking to Mark Regev, the Israeli government spokesperson -- Jim.

CLANCY: A little crack may cause a crisis. It's certainly raising a lot of questions. The U.S. space shuttle Discovery may not be leaving its launchpad Tuesday as scheduled.

Miles O'Brien is live at the Kennedy Space Center. He joins us now.

Miles, tell us, what is going on? What do the scientists say?

MILES O'BRIEN, CNN SPACE CORRESPONDENT: Well, here's what I can tell you now, Jim Clancy. Right in the middle of our discussion here is a huge discussion under way at the Kennedy Space Center and other outposts of NASA as the mission management team for the space shuttle tries to figure out what to do with a 10-centimeter-long crack which developed in that external foam, that insulating foam which envelopes the external fuel tank.

Over the weekend, they fully fueled up that tank twice, two attempts to fly to space, but bad weather got in the way. Look in the center of your screen here, and you can see a diagonal crack there just coming off of that bracket.

That bracket is on the external fuel tank and is part of a pipe which connects the liquid hydrogen to the liquid oxygen tanks which are inside. That crack is very shallow, but, nevertheless, was discovered after an inspection after those two events where they filled up the fuel tank with fuel and unfueled it.

The liquid hydrogen and liquid oxygen that's put in the tank is extremely cold. And it causes the tank to flex. Presumably, that is what causes the crack.

NASA says it will not fly with the crack as is. The question is, how will they repair it, how long it will take to repair it, and how will this affect the shuttle mission, which was slated to lift off about 26 hours from now?

Just to show you where this is on the orbiter, right in this region right here, and that's critical to know, because if there's a crack on this side, you don't care so much. In this case, because it is upstream of the orbiter, and in a place where if the piece fell off it would strike the orbiter and cause some damage, it has gotten NASA's attention.

My colleague, Daniel Sieberg, is at the Kennedy Space Center. He's been listening to NASA officials as they've been dribbling out little bits of information on this.

Daniel, what are you hearing?

DANIEL SIEBERG, CNN TECHNOLOGY CORRESPONDENT: Well, Miles, as you pointed out, flying with it as it is right now is not an option. They're considering everything that's on the table, whether it's a fix on the launchpad or possibly, we're hearing, also, swapping out an external fuel tank. Obviously, this would mean a significant delay.

Tomorrow's launch scheduled for 2:38 in the afternoon. At this point, hard to say if that's going to go ahead. But we're hearing that there's going to be at least a delay of some kind.

And, of course, what you're talking about is the falling foam, a piece like this, that we all remember happened in the case of Columbia. A piece of about a pound and a half of foam came off, struck the wing, and ended up causing Columbia to burn up upon reentry.

A piece of foam also came off when Discovery launched a year ago. It didn't cause any serious damage. But, of course, that's part of the concern with this crack.

In addition to the foam coming off, also ice forming in this crack, which is something else they have to worry about. Ice coming off being more serious than foam coming off.

So, they're looking at everything right now. We're hearing that the briefing has been moved. It was expected about afternoon. Now it's expected sometime after 12:30 Eastern Time here. So that's about 20 minutes or so, and that's if everything goes forward -- Miles.

O'BRIEN: OK. So we'll be watching that briefing.

Daniel Sieberg is at the Cape. We're watching it here, we're checking our sources, and we'll see, Jim, exactly how long it takes for this fix to occur. Everything from a very long procedure, which would be removing that fuel tank and swapping it out, to perhaps just a patch on the launchpad, which would be a much less significant delay.

We'll keep you posted.

CLANCY: All right. Thanks for that.

Miles O'Brien in New York. Daniel Sieberg there at the Kennedy Space Center.

Thank you both.

GORANI: Too close to call. Well, that's a phrase that's familiar to many U.S. voters. Mexico is now locked in the tightest presidential election race in its history. A center-right conservative and the leftist former mayor of Mexico City have both claimed victory.

The U.S. is closely watching as conservative Felipe Calderon clings to a less than one percent lead over his leftist rival, Andres Manuel Lopez Obrador.

CNN's Harris Whitbeck is in Mexico City.

(BEGIN VIDEOTAPE)

HARRIS WHITBECK, CNN CORRESPONDENT, (voice over): The president of Mexico's electoral institute couldn't have be clearer, the election was too close to call. And he asked the candidates to refrain from speeches that could lead to confusion.

LUIS CARLOS UGALDE, PRES, FEDERAL ELECTORAL INST. (through translator): The margin of difference between the first and second place is so narrow that it is not possible to say at this point in time who has won.

WHITBECK: The reaction from the two leading candidates was almost immediate. Both ignored the request by the country's highest ranking electoral authority.

FELIPE CALDERON, PAN PRESIDENTIAL CANDIDATE, (through translator): I am satisfied because today the voting tendencies that have been announced by the polls and according to the PAN's data, which coincide with those of the IFE, and the quick vote count carried out all indicate that we have won the presidential elections.

ANDRES MANUEL LOPEZ ORBADOR, PRD PRESIDENTIAL CANDIDATE (through translator): I want to inform the people of Mexico that according to our data we have won the presidency of the republic. WHITBECK: With sympathizers of both candidates celebrating their perceived victories, President Vicente Fox went on national television asking for patience.

VICENTE FOX, MEXICAN PRESIDENT (through translator): The people have spoken by voting and now we expect parties and candidates who participated in this process, will contribute to the climate of trust and peace that must prevail after a civic day like the one that we have just lived through.

WHITBECK: But supporters of Calderon and Lopez Orbador would have nothing of it.

It is now up to the electoral institute to sort everything out. It will wait until all votes are counted in all electoral districts before it declares what candidate will be able to celebrate victory.

Harris Whitbeck, CNN, Mexico City.

(END VIDEOTAPE)

CLANCY: A U.S. Army veteran of the fighting in Iraq has now been charged with murder and rape in connection with an attack on an Iraqi family back in March. Those charges filed in Charlotte in the U.S. state of North Carolina, where the soldier has been arrested.

His name is Steven Green (ph). He was earlier discharged from the Army.

The charges stem from a military investigation of the incident in the town of Mahmoudiya. The investigation involves five soldiers all together.

GORANI: All right. We're going to take a short break on YOUR WORLD TODAY.

When we return, the life of an Israeli soldier may hang in the balance in Gaza.

CLANCY: Right now, Palestinian militants are giving Israel less than 24 hours, until 6:00 a.m. its time to meet new demands. Coming up on our program, we're going to speak to a Hamas spokesman about that ultimatum and to Israel's -- and about Israel's vow it will not negotiate.

(COMMERCIAL BREAK)

CLANCY: Welcome back. This is YOUR WORLD TODAY, where we bring viewers across the globe the most important international stories of the day.

We're going to return now to one of our top stories, the crisis in the Middle East. Israel, of course, saying no way will it negotiate, hand over Palestinian prisoners in exchange for one of its captured soldiers. But a spokesman for the Hamas government said if Israel continues every day to kill and target and attack it won't get the soldier alive or dead.

Now, government spokesman Gazi Hamad joins us now live from Gaza.

Mr. Hamad, thank you for being with us.

Let me begin just by asking you this: Has the government warned the militants not to harm that captive soldier?

GAZI HAMAD, PALESTINIAN GOVERNMENT SPOKESMAN: Look, we are the government, we are not part of this negotiation. You know that. There are three military factions who take the responsibility of the capturing or kidnapping of this soldier. But we as a government, we are working with different parts, including the Egyptians, the president and Palestinian faction in order to find a solution and to find how can we find a compromise, a solution for this problem.

But really, I think that the military attacks daily in Gaza in targeting the buildings and the governmental institutions and buildings, this will increase the complication in this area. And this may destroy all the efforts which are made by the Egyptians and other parts in order to solve this problem peacefully.

CLANCY: Now -- so, in other words, you haven't told the militants, the government has warned or told the militants anything about this captive soldier?

HAMAD: No. From the first moment, we called this faction in order to keep this soldier alive and to deal him in very good way. And I think we are interested now to solve this problem peacefully without military escalation.

But we expect from the Israel side also to stop its aggression against our people, because I think that the statement which was issued today by the military faction, they want to send a very clear message to Israel that, if you continue their aggression and their attacks against our people, this will not lead to a solution.

CLANCY: All right.

HAMAD: And this will increase the tension. And merely a confrontation in this area. So let the diplomatic and the mediation to be -- or to succeed and to go on.

CLANCY: OK. Is anybody talking to Israel that you know of? You know the Egyptians are talking with them.

Who arranged for the doctor, Mr. Hamad, to go and see this soldier? I understood he was wounded. What's his condition now? Do you even know?

HAMAD: I don't know what are the situation. But as I heard from different sources, that people deal with him and take care for the soldier, because you know that our values and the principles prevent us to harm the soldier, just to respect him, to give him everything.

But, you know, we expect also from Israel to understand the tragedy of 10,000 Palestinians who are in an Israeli jail. Some of them, they spent 20 years. Some of them spent 15 years. And no one take care about them.

So I think now all the world, all the governments now, they have contacts with the president, with the Palestinian government, in order to (INAUDIBLE). But no one...

CLANCY: All right.

HAMAD: ... take care about our prisoners, who are -- some of them are women and sick people and young people. So we need also the world to open its eyes to understand the tragedy of the Palestinian prisoners.

CLANCY: All right. What do you think, Gazi Hamad, it's going to take to resolve this? Is it going to take a prisoner exchange? Israel has done it in the past.

HAMAD: Look, you know that the Palestinian government before this spent 12 years in peace talks and negotiation, and nothing coming out. And the numbers of the prisoners was increased by 200 persons. Now we have 10,000 Palestinians in Israeli jails.

So I think if Israel now says, OK, we can do it, we can give hope or signals that they want to release the prisoners from the Israeli jails, I think this will put end for this crisis. But if Israel insists to say no for everything, this will lead to frustration, and this merely to deadlock, or block it.

So we prefer to solve this problem peacefully, and I think Israel should listen also to the language of mine and language of wisdom.

CLANCY: All right. This could end very badly for everyone.

Gazi Hamad, a government spokesman, there telling us that the militants have been told to treat their captive with care.

Thank you.

We'll have more on this in just a matter of minutes, when we'll be hearing from a spokesman from the Israeli Foreign Ministry. Mark Regev will join us -- Hala.

GORANI: All right.

In the meantime, Jordan is insisting that the daughter of Saddam Hussein is a royal guest and it won't heed calls for her extradition. Raghad was granted asylum by King Abdullah in 2003. Now she and Saddam Hussein's wife have showed up on a most wanted list issued by Iraq's national security adviser, Mowaffaq al-Rubaie. He says the region could "end up in flames" unless its neighbors stop what he says is "harboring terrorists."

(BEGIN VIDEO CLIP)

MOWAFFAQ AL-RUBAIE, IRAQI NATIONAL SECURITY ADVISER: Certainly, some neighboring countries are turning a blind eye to the activities of these people. And I'm not going to name any country, but I know that these people are doing their work without being hampered or without being impeded in their activity. And they're funneling or transferring money inside -- to terrorists inside Iraq.

(END VIDEO CLIP)

GORANI: Well, some of the names on this most wanted list are new. Some appeared previously on the so-called deck of cards list the U.S. -- the U.S. used after the invasion in 2003.

CLANCY: All right.

For our viewers in the United States, a look at the U.S. headlines straight ahead.

GORANI: The rest of us are going to get a check of financial markets from New York and London.

CLANCY: And then a little bit later, on the phone and behind the wheel. A surprising new study may make you want to just hang up and drive.

(COMMERCIAL BREAK)

DARYN KAGAN, CNN ANCHOR: I'm Daryn Kagan at CNN Center in Atlanta. More of YOUR WORLD TODAY in just a few minutes.

First, though, let's check on stories making headlines here in the U.S.

Do you wait and fix it, or do you fly? It's a tough decision for NASA managers right now. And tomorrow's scheduled launch of Discovery lies in the balance. NASA crews have found a five-inch crack in foam insulation on the shuttle's external fuel tank.

Our Daniel Sieberg is following the story from Kennedy Space Center and joins us live now.

Daniel, hello.

SIEBERG: Daryn, that's right, we are expecting a press briefing in the next five or six minutes. NASA mission managers have been meeting for the past couple of hours or so to discuss what to do about this crack.

And what we're talking about here, we've got a model of the external fuel tank of shuttle Discovery. The crack is somewhere about here, sort of midway down the external fuel tank. It's about a five- inch crack, about a quarter inch wide. And this is actually where shuttle Discovery would be.

So that's the concern, the possibility that ice could form in this crack, that more foam could come off. They have to look at all the possible options, whether it's a repair on the launchpad, that would be more of a simple fix. They would have to at last get up to that point on the external fuel tank to make that fix.

They've got everything on the table from A to Z, even swapping out the external fuel tank, which would mean quite a significant delay. And they would certainly try to avoid that.

Tomorrow's launch scheduled for 2:38 in the afternoon. They've already scrubbed two because of weather delays. So we're just going to have to wait and see now what they decide to do.

KAGAN: All right. Daniel, thank you.

Our space correspondent, Miles O'Brien, joining us now from New York with some more perspective on how they're trying to make this decision -- Miles.

O'BRIEN: Well, you know, the one thing that seems pretty clear right now, Daryn, is they're not going to do nothing. This crack is quite evident.

Let's take a look at some pictures and give people a sense of exactly what we're talking about here.

As Daniel pointed out, this is -- this area here is all the intertank area. That big orange fuel tank actually has two tanks inside of it. Up on the top is liquid oxygen. Up on the bottom behind the shuttle here is liquid hydrogen.

There's some piping that connects the two regions in the so- called intertank area. And where the two meet, it becomes rocket fuel.

Let's go to the close-up now and give you a sense of what we're talking about here.

I'm going to highlight the area so you know exactly where it is. There you see it. And this -- to give you a perspective in scale, from here to here is about eight inches -- excuse me, make that five inches.

It's about an eighth of an inch deep. It's not much of a crack at all, you would think, except what happens if some kind of ice gets in there and it expands, and then a piece of foam calls off. And then, in theory, you have some sort of scenario where foam could be falling toward the orbiter, possibly causing some damage.

We're joined right now from the Kennedy Space Center by NASA's associate administrator for public affairs, press secretary, as well, Dean Acosta.

Dean, do we know yet, assuming they're going to do something, do we know if it can be done on the launchpad? Because that has a significant impact on how big a delay it would be.

DEAN ACOSTA, NASA PRESS SECRETARY: Yes, I think your reporter, Daniel, talked about that. Right now the mission management team is just wrapping up their first meeting, and I think they're talking about all the different scenarios, one of which is making that fix on the launchpad. Other fixes may take longer.

But again, it's -- as Dr. Griffin, the administrator of NASA, has discussed, we're going to let the data really drive us on this one. We're going to make sure that whatever the resolution is, is that it's the right one and not one that we're trying to -- you know, we want to make sure that that is the correct problem solution to this issue.

O'BRIEN: We are coming off of two days of fueling and unfueling of the space shuttle's external fuel tank. Two weather scrubs. Super-cold liquid hydrogen and liquid oxygen going inside and out. And as a result, these tanks are inevitably going to be flexing somewhat.

I guess the question becomes, on a day where you know the weather is not going to be enticing at all, or it's highly probable it would not be good for launch, it is a wise idea to be tanking up that external fuel tank and potentially creating these cracks?

ACOSTA: Well, I mean, you know, that -- that's the Monday morning quarterbacking scenario, because if we knew certainly this was going to cause that scenario, you wouldn't do that. But we didn't know that.

And we also, at the beginning of the day -- and been many opportunities, Miles, you certainly know, because you've covered the space program for so long, where the weather is horrible in the morning, and you're in Florida, and by afternoon, the clouds burn off. And that scenario could have played out yesterday.

It didn't, but it could have. And so that's why you tank, that's why you get the crew ready to load up. And you hope for that break during your -- during your window where you can launch.

Again, you know, this is a process.

We had our ice team that went out last night to inspect the tank. They discovered the crack, and now we're doing what NASA knows how to do best, is solving problems. And that's what we're doing right now.

O'BRIEN: All right. And there's nobody better at spotting problems than that ice team. They have always done an excellent job doing that.

ACOSTA: Yes.

O'BRIEN: Dean Acosta, who is the associate administrator for public affairs, press secretary for the space agency.

We'll be back with you later, I'm sure, as soon as we hear from that mission management team.

Thank you for your time.

And so that's where it stands right now, Daryn. Officially, until this meeting is wrapped up, there is a date for launch, tomorrow, 2:28 p.m. Eastern time. But we'll look for a potential change because of the possibility of trying to fix that crack one way or another, either the quick fix or a much longer fix.

We'll keep you posted -- Daryn.

KAGAN: Yes, and already a change in that news conference. We expected it 12:30. Now it's delayed at least until 1:00 p.m. We'll watch for that on "LIVE FROM."

And now, back more world news today.

(COMMERCIAL BREAK)

GORANI: Welcome back to YOUR WORLD TODAY. I'm Hala Gorani.

CLANCY: I'm Jim Clancy, and these are the stories that are making headlines around the world.

At least 34 people killed in a train derailment in Spain. It happened in the eastern city of Valencia. The "El Pais" newspaper quoting a government official who says this wrecks appears to have been an accident caused by a wheel breaking as the train was traveling too fast around a curve.

GORANI: Officials are calling Sunday's presidential elections in Mexico too close to call. One percentage point separates conservative Felipe Calderon from leftist Andres Manuel Lopez Obrador. The two bitter rivals have declared victory, though.

More on this story in a few minutes.

CLANCY: Palestinian militants holding an Israeli soldier issued an ultimatum. They want Israel to give into their demands to release women and younger prisoners or they say they'll consider the soldier's case closed. Israel says it won't give in to blackmail. It's promising to keep up its offensive in Gaza until the soldier is safely released. One of the latest airstrikes hit a building used by militants in Gaza City.

GORANI: Well, Israel has negotiated with militant groups in its past to win the release of captured Israelis, but those groups never headed the Palestinian government. Many Israelis say to negotiate now would reward the tactics of Hamas, setting a dangerous precedent.

Let's get some perspective on the crisis from Israeli Foreign Ministry spokesman Mark Regev. He's in Jerusalem.

Thanks for being with us. What do you make of this...

MARK REGEV, ISRAELI FOREIGN MINISTRY SPOKESMAN: A pleasure.

GORANI: ... 6:00 a.m. ultimatum by the militants who are holding the Israeli soldier? How do you interpret it?

REGEV: Well, obviously, no one can take this sort of ultimatum and accept it. This is blackmail. This is terrorists saying you do what we want or we kill the hostage. And I don't think any democracy can go down that road. I mean, ultimately, if you meet the demands of the terrorist, you're just going to encourage more such demands in the future. Every extremist with a gun will grab a hostage and come with even more outrageous demands.

GORANI: Well, Israel has negotiated, as we said there in introduction to you Mark Regev, in the past before to get some of its soldiers back in exchange for Palestinian prisoners. In fact, the mother of the Israeli soldier who was killed 12 years ago, Noxan Waxman (ph), even said why aren't the Israelis negotiating right now to release this man? Why not? What's the reason?

REGEV: Obviously, this country's a democracy and there's public debate. But I can tell you within government and within the national security structure, there is wall-to-wall consensus on this issue. I mean, giving into the hostage demands might be some sort of short-term fix, but in many ways, it's a mirage. Because you are going to encourage more hostage taking down the line. And it's very important to send a clear and precise message to the terrorists that if they take hostages, there's going to be nothing in it for them. And that, in fact, unless they release our hostage now, we will have to act to bring about his release.

GORANI: All right, let's talk about what you will do if this hostage is not released. Amir Peretz, the Israeli defense minister, said we will go after higher caliber targets. We saw an Israeli missile hit the office Palestinian Prime Minister Ismail Haniyeh. Will he be targeted physically? In other words, will he be assassinated?

REGEV: What we in Israel say is the following: if you act like a politician, we'll give you the respect that a politician deserves. But if you act like a terrorist; if you're involved in suicide bombings; if you're involved in rocketing Israeli community, barrage after barrage of rockets; if you're involved in kidnapping -- so if you act like a terrorist, we will treat you like a terrorist.

GORANI: But that's not really answering the question. Is Ismail Haniyeh a physical target?

REGEV: I don't think anyone on our side has yet drawn up lists, but what we say to Hamas is the following: if you have now gone back to full-scale activities against Israel, if you're involved in bombings, in kidnappings, in other acts of violence against Israel, you can't turn around and say, oh, why is Israel suddenly responding? We are responding because you are attacking.

GORANI: But Mark Regev, just -- so that is still not answering the question. Is Ismail Haniyeh a target for killing or not?

REGEV: I can say the following: the Hamas organization has taken credit for this hostage taking. The Hamas organization has said this was a good thing. And I think all of Hamas leadership has to be seen as culpable.

GORANI: OK, well, you're not answering the question there. Just one quick last one the strategy. What is -- some critics are saying why is this in Israel's best interest to go in heavy-handedly like this in Gaza, take out power stations, make life very difficult for civilians. How is this serving Israel's interests at this point in time?

REGEV: Hala, you have to remember, our servicemen was forcibly kidnapped on Sunday morning. We waited a full three days before responding. In other words, we gave diplomacy a chance. And even today - even today -- we hold out the hand for a diplomatic solution. If our serviceman is released unconditionally, that will allow us to deescalate.

That will allow us to redeploy our forces outside the Gaza Strip, which is something that ultimately we want to do. We didn't pull of Gaza last year just to return this year. We didn't want to do this. They forced us to take this action by continued acts of terrorism and aggression from Gaza into Israel.

GORANI: All right, Mark Regev, foreign ministry spokesperson, speaking to us live from Jerusalem. Thank you very much -- Jim.

CLANCY: Nearly one here has passed since the London terror bombings. The four blasts on July the 7th killed more than 50 people and wounded hundreds of others. Many are still coming to terms with the horror of that day.

And as Paula Newton tells us, one image has burned itself into a nation's consciousness.

(BEGIN VIDEOTAPE)

PAULA NEWTON, CNN CORRESPONDENT (voice-over): Could just one picture capture the events of that day in London? Express the terror of it? There are many that come close, images that are now infamous. But there is only one that has become so unforgettable. It has been dubbed, "The Mask."

PAUL DADGE, ASSISTED 7/7 VICTIM: I just grabbed her. I said we need to go, we need to go now. And we literally run from the store. And got to the road and just this line of photographs were there. What I remember vividly there in the middle of a major incident it was deadly silent. All you could hear was the sch-sch-sch, of the shutters going off.

JANE MINGAY, PHOTOGRAPHER: You just click and that's what we did. Suddenly I looked over and I saw this lady, with this sort of mask, and him holding her. And there was no one else like that. They just stood out. From the fact that he was cradling her, looking after -- also, mainly the fact that she had this mask.

NEWTON: The mask was meant to help soothe and heal this woman's burns, but it also made the victim faceless. And a year on, she's chosen to stay that way.

DADGE: She was actually on at train that was attacked by a bomb blast, whereas I wasn't. And I think that gets forgotten sometimes. That she wants her privacy. She's back at work and just carrying on a normal life, and obviously wants some kind of closure on the event. NEWTON: Paul Dadge may not have been on the train that was hit by a bomb but on that day, just like now, he was right in the thick of it.

Dadge is a trained firefighter. But for years he's worked as an IT specialist. That's still his day job, but now you can also call him the conscience of 7/7. He's out learning more about his local ambulance service in Staffordshire, north of London. They have the fastest response time in the country and Dadge wants to know why.

Dadge has been honored as a hero for his acts on 7/7, directing hundreds to safety, administering first aid, and getting a burn victim to safety.

MING: It was quite dramatic. Also the way he was holding her -- it was a vision. You know, all of a sudden. It was really the strongest thing that I saw that day.

NEWTON: The image may have made Dadge a celebrity, but he's not complaining. Instead he's using his notoriety to make a statement.

DADGE: For somebody who was actually there on the day to stand up and say I was there, and that's me in the picture. And to say you won't affect us here in London, or Madrid, or New York, or wherever, these blasts may be and we'll carry on as normally, is quite powerful thing to do.

NEWTON: With powerful portrait to match. One that, in Dadge's words, lives up to what he calls Brit grit.

Paula Newton, CNN, London.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

CLANCY: Welcome back, everyone.

GORANI: Seen live, YOUR WORLD TODAY, more than 200 countries across the globe. This is CNN international.

All right, well, there's another international news program, a big franchise across the globe: Big Brother. Contestants, though, there are thrown together in a house where cameras watch their every move. Not quite CNN.

CLANCY: Not quite. Nowhere is the program more controversial than in Australia. And that's where some politicians say it's time to take it off the air.

Michael Holmes explains.

(BEGIN VIDEOTAPE)

MICHAEL HOLMES, CNN CORRESPONDENT (voice-over): Two contestants of the Australian "Big Brother" leave the house, thrown out by TV executives after an allegation of sexual assault on a housemate.

It was just the latest furor swirling around the 10-network program. A late night, adults only, version was cancelled recently following complaints of too much nudity. On this occasion, one man was seen on the Internet broadcast of the show holding down a female housemate while another man rubbed himself on her.

CAMILLA HALLIWELL, "BIG BROTHER AUSTRALIA" CONTESTANT: I said to Big Brother, there was no malice intended. They were doing it in a playful way.

HOLMES: As a result, police say there will be no charges. But politicians are taking it very seriously.

STEVE FIELDING, FAMILY FIRST PARTY: How many more incidences like this are we going to put up with before the show is pulled?

HOLMES: The Australian prime minister, John Howard, who was accused by some opponents of playing "Big Brother," said the business community was always asking to be allowed to self-regulating.

JOHN HOWARD, AUSTRALIAN PRIME MINISTER: Here's a great opportunity for Channel 10 to do a big of self-regulation and get this (INAUDIBLE) program off the air.

HOLMES: The opposition leader agreed, but Channel 10 executives said the series was staying.

TIM CLUCAS, NETWORK TEN: These guys broke the house rules and were removed from the house. That's the way the show operates, and that's the way we guaranteed to the government that the show would operate.

HOLMES: "Big Brother" is an international franchise. Strangers locked in a house, viewers voting them out at a time. Local versions have at various times been seen in the U.S., Britain, South Africa and elsewhere. But few have been quite as controversial as the Australian edition.

Michael Holmes, CNN, Atlanta.

(END VIDEOTAPE)

CLANCY: Well now to something a little bit less controversial, Hala.

GORANI: Now, we've all done it. And if you haven't, you're probably the exception.

CLANCY: Now, we're talking about using your cell phone while driving. And despite a growing number of studies that increases your chances of crashing.

GORANI: Tom Foreman tells us now about one more study. This one drives home the point in a sobering way.

(BEGIN VIDEOTAPE)

TOM FOREMAN, CNN CORRESPONDENT (voice-over): In their study of 40 drivers taking 160 trips in a driving simulator, researchers at the University of Utah expected a few fender benders. What they did not expect was that legally drunk -- yes, drunk -- test subjects, would do better than drivers on cell phones.

FRANK DREWS, UNIVERSITY OF UTAH: I think that is a fair statement. I mean, what we found is a significant increase in accident rates when driving and conversing on a cell phone, and we didn't find this increase in our study when people were legally drunk.

FOREMAN: Professor Drews demonstrated what he found. We conducted half our interview by cell phone while he was in the simulator.

DREWS: Hello?

FOREMAN: And just like his subjects, he says he was hitting the brakes more slowly, having trouble following the flow of traffic...

(on camera): What's the speed limit where you are?

DREWS: It is actually -- a good question. I don't know.

FOREMAN (voice-over): And several times, he nearly crashed.

DREWS: There's a big -- oh my gosh. There's a big...

FOREMAN: Still, there are questions about this research. It was a small sample of drivers who were barely drunk, and most drunk driving accidents occur with people well above the legal limit for intoxication.

And a recent study from the National Highway Traffic Safety Administration indicates that while cell phone talking is dangerous, the crash risk is even higher for people who are reaching for things, distracted by sights along the road or overly tired. In addition, the cell phone industry says, look at the real world.

JOHN WALLS, CTIA - THE WIRELESS ASSOCIATION: What we see is over the last ten years, accidents going down, while cell phone usage has gone up almost 4,000 percent. So if it was a sinister of a behavior combination as many claim it is, we think we'd see a proportionate rise in accidents and that's just not happening.

FOREMAN: Nevertheless, the professor says with nearly one in ten drivers using a cell phone at any given moment, his research should give lawmakers something to talk about over this busy driving weekend.

Tom Foreman, CNN, Washington.

(END VIDEOTAPE)

GORANI: Do you do it sometimes? Talk on the phone while driving? CLANCY: Try not to.

GORANI: Try not to, all right.

Portugal now is by far the smallest remaining country with a team in the World Cup semifinals. .

CLANCY: Ahead on YOUR WORLD TODAY, could that nation's Napoleon complex mean a World Cup Waterloo for France? Oh, I hope not.

(COMMERCIAL BREAK)

CLANCY: The excitement building all over Europe as the World Cup semifinals get ready to kick off on Tuesday.

CLANCY: Don't know if it's building so much, it's just a roller coaster ride. CNN, of course, is going to have reporters in all the World Cup hot spots over the next several days. You've got Germany, Italy, France and Portugal, including the hometown of that country's newest national hero.

GORANI: Al Goodman has more from Portugal.

(BEGIN VIDEOTAPE)

AL GOODMAN, CNN CORRESPONDENT (voice-over): Heading for a festival in Portugal, a time-honored tradition. Carlos and his family know what it takes for their small country to make it all the way to the World Cup semifinals.

UNIDENTIFIED MALE (through translator): Being small doesn't matter. We're strong men. We're fighters. And we don't do anything halfway.

GOODMAN: Fancy footwork, and not just by Portugal's winning side. Especially in Montijo, hometown of Ricardo, who blocked England's penalty shots and became the toast of the local Casa de Brujas, or Witches' House, a neighborhood club where old friends meet to share typical Portuguese appetizers and talk politics and football.

They may sing about wine, but everyone is thinking about Portugal's first World Cup semifinal appearance in 40 years.

UNIDENTIFIED MALE: It's a long time, but, you understand, because you are one. Only we're a little count in Europe.

GOODMAN: Just 10 million people in Portugal, but room enough for the old and new. And a lot of friends of Ricardo's.

UNIDENTIFIED MALE (through translator): Ricardo was born here like me, and my son attended school with him.

GOODMAN: Ricardo's parents say they don't feel like the most famous family in town, but certainly the proudest.

UNIDENTIFIED FEMALE (through translator): Portugal needed something to give it joy, and the national team is providing that.

GOODMAN: World Cup victories have diverted attention from Portugal's economic problems and high unemployment.

(on camera): They didn't put on this parade just for Ricardo, but they might as well have after what he did to England.

(voice-over): And next little Portugal is hoping to spin more magic on an even bigger foe: France.

Al Goodman, CNN, Montijo, Portugal.

(END VIDEOTAPE)

CLANCY: All right. Well, the American comedian Henny Youngman used to have a something that went something like, take my wife, please.

GORANI: Right. But in Finland, Jim, that might be amended to say carry my wife, please. They just held their wife-carrying competition there. The annual event has been going on for 11 years, believe it or not.

CLANCY: Competitors come from as far away as Australia to try to race for the gold in the 253-meters -- 200 -- why would you have to carry her 253 meters?

GORANI: All right. It goes back to the legend of a Finnish robber from long ago who made off with lots of stolen goods from the villages he raided, and a few wives.

CLANCY: Finn wives.

GORANI: All right. I like the one that was being carried upside down. That's was interesting.

That's it for this hour.

CLANCY: That's right. "LIVE FROM" is up next for our viewers in the United States.

GORANI: For the rest of you, another half hour of YOUR WORLD TODAY is next. I'm Hala Gorani.

CLANCY: I'm Jim Clancy. And this is CNN.

(COMMERCIAL BREAK)

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com

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