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American Morning

Israel and Hezbollah Still Firing Away; Gas Prices Rising; G8 Faces Crises

Aired July 14, 2006 - 08:59   ET

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

MILES O'BRIEN, CNN ANCHOR: No slowdown in the Middle East this morning. Both Israel and Hezbollah still firing away.
President Bush now in Russia, working the phones, checking in with Middle East leaders over the crisis.

SOLEDAD O'BRIEN, CNN ANCHOR: Over at the Pentagon, evacuation plans are in the works to get Americans out of Lebanon, if it comes to that.

And the crisis is sending oil prices to record levels. And probably even higher to come.

M. O'BRIEN: And a collision course out West. We're right at the spot where fire could meet fire on this AMERICAN MORNING.

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

S. O'BRIEN: And I'm Soledad O'Brien.

We continue to talk about this crisis in the Middle East this morning. More back-and-forth attacks between Israel and Hezbollah to report. The Israeli military using warships and planes to again disable Beirut's airport.

Our correspondents are covering all the angles for us this morning.

Alessio Vinci is in Beirut. Paula Newton is live for us in Jerusalem. Barbara Starr is at the Pentagon. Andy Serwer right here in New York with us to talk about oil prices.

Alessio, let's begin with you this morning.

Good morning.

ALESSIO VINCI, CNN CORRESPONDENT: Good morning to you, Soledad.

Well, it appears that the airport here in Beirut appears to be a favorite target. This morning the Lebanese army had managed to patch up one of the runways, allowing five Middle Eastern airliners, the national carrier here of planes, to take off and leave the country. But shortly afterwards, that runway was bombed one more time by the Israeli forces, as well as, we understand, the parking lot very close to the terminal. That would be the first time, of course, that not the runway or the fuel depot of that airport would be hit. So, according to the information that we're getting here today, is that three locations of that airport have been bombed, the runways a second time, the parking lot next to the terminal, as well as the fuel depot.

All the while, of course, the military operation continues also in southern Lebanon with Israeli air forces striking targets, including bridges, a road, as well as a fuel depot next to a power plant. Here, of course, the desire of Israel to put a noose around the entire country by basically isolating it from land, sea, and -- and the air.

At the same time, intense diplomatic activities here. The Lebanese prime minister spoke on the phone with U.S. President George W. Bush, as well as Condoleezza Rice. Mr. Bush -- President Bush offering him support in his demand for a comprehensive cease-fire. Condoleezza Rice also promising that she would exercise utmost pressure in order to try to achieve that kind -- that kind of pressure.

Also, the prime minister meeting with the five permanent members, the ambassadors of the five permanent members of the U.N. ahead of an important meeting later on today New York.

Soledad, back to you.

S. O'BRIEN: All right. Alessio Vinci with an update for us.

Now let's move south from Beirut right to Jerusalem. CNN's Paula Newton is live for us there this morning.

Paula, good morning.

PAULA NEWTON, CNN CORRESPONDENT: Good morning, Soledad.

And a busy one it has been here. According to Israeli defense forces, 50 to 60 rockets today alone have hit in northern Israel. And that has sent a lot of cities and towns there, Soledad, into a state of panic. We can report that there are about two dozen people injured, most of them lightly.

But what has really taken over there is this jittery sense they need to get out of the line of fire. While many of them have been spending time in bomb shelters, some are thinking, look, it's just better to head south and head for families and relatives, and so they really get out of the line of fire from those rockets.

As if right on cue, Prime Minister Ehud Olmert called a security meeting. That is due to get under way right about now. We do expect some information from him out of the meeting, and to try to give some indication to Israelis in the north about what to do and how long they need to evacuate their homes -- Soledad.

S. O'BRIEN: Paula Newton for us this morning. Paula is in Jerusalem. Thank you -- Miles.

M. O'BRIEN: CNN's Barbara Starr at the Pentagon now with word of a possible plan to get Americans out of Lebanon -- Barbara.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: The military now waiting hour by hour to see what requests they get from the U.S. ambassador in Lebanon, but the military is doing major contingency planning, getting ready to go if that request comes. Military sources are telling us that there are two options on the table right now.

One would be to see if there are any usable airfields in Lebanon that they can move in an aircraft and get a small number, perhaps, begin with a small number of Americans, embassy workers and other American civilians, that want to get out of the way. Whether another agreement can be brokered to use Beirut International Airport's runways one more time remains to be seen, but military sources saying they are now looking at all the available airfields, seeing if there is anything they can use and if there's any sense of security for them if they go in.

There is another much greater option sort of lurking in the background, if you will. The USS Iwo Jima, a Marine Corps amphibious warship, and a number of other ships are in the northern Red Sea. They are conducting an exercise with Jordan right now. They could be turned around, they could be sent back into the Mediterranean, stand offshore Lebanon if there is a major request to expand any operation, and evacuate perhaps hundreds, if not thousands, of American citizens in Lebanon.

Sources are telling us they don't think they are there yet. They don't think that's the request they are going to get from the ambassador. But to be very clear, Miles, at this hour the U.S. military is doing contingency planning for any eventuality -- Miles.

M. O'BRIEN: Barbara, if that flotilla in the Red Sea started steaming to the Med, how long would it take them?

STARR: Well, they would go with what they call in the military all due speed. Certainly, a number of hours, if not more than that.

They would want to get into position, but also, there's a very serious matter here of the security situation as it exists. It wouldn't be that difficult, of course, to send in helicopters with Marines into Beirut, secure some area, and move Americans to a secure area, and then fly them out. But getting security is a key issue.

You can broker an agreement with the government of Lebanon, but what about Hezbollah, what about Israel? Who is actually going to guarantee safe passage?

Nobody wants the Americans to get into the middle of a shooting war. So all of this becomes very dicey, Miles, any way you look at it.

M. O'BRIEN: Dicey indeed. Barbara Starr at the Pentagon.

Thank you very much.

There is no oil in Lebanon or Israel, but whenever bombs fall in the Middle East gas prices rise almost instantly in Peoria.

Andy Serwer has been watching that for us this morning.

Good morning, Andy.

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

And, of course, in the middle of all this is the price of a barrel of oil, which is now streaking to record highs, hovering around $78. Latest read right around $77.50.

This obviously is directly affected by what is going on in the Middle East. There are also some problems in Nigeria this morning, as well. Some violence there.

But basically, as you're suggesting, it's more of a psychological problem than an actual problem with production. And, of course, the concern would be that if this crisis widens, say, to Iran, that that could directly affect the price of oil.

Analysts say don't be surprised if you see the price go to $80 a barrel at some point very, very soon. Of course, that would be another threshold.

And back here in the United States what does that mean? We're paying $3 for a gallon of gasoline on average. It is probably the case that that would not be dropping significantly anytime soon. In fact, you shouldn't be surprised to see prices unfortunately rise as we head into the summer because of this crisis.

M. O'BRIEN: So far, though, we've been a bit surprised by the fact that people really haven't slowed down on their consumption here in this country at the $3 mark. What is the price point, do you think?

SERWER: It's hard to say. And obviously, we haven't reached that yet. But if you adjust for inflation, the price of gasoline, how it's risen over the past 20 years or so, it's not that expensive.

So, while it seems to be a lot of money relative to the way prices for other goods and services have climbed over the past several decades, gasoline is not that expensive. Hard to imagine, but it really is true. People seem to have enough money in their pockets to fill up the tanks still.

M. O'BRIEN: Yes. Still cheaper than a latte.

SERWER: Yes, I guess that's probably right.

M. O'BRIEN: All right. Andy Serwer, thank you very much -- Soledad.

SERWER: Thanks, Miles.

S. O'BRIEN: Certainly gallon for gallon it is.

SERWER: Yes, indeed.

M. O'BRIEN: Absolutely.

S. O'BRIEN: Thanks, guys.

Oil prices in the Middle East, Iran, North Korea's nuclear ambitions all food for thought when the members of the globe's largest industrial nations gather for the G8 summit. President Bush arrived in St. Petersburg earlier today. That's where these G8 meetings will start tomorrow.

Just a short while ago he laid a wreath at the base of a World War II monument. The president is meeting today with Russian President Vladimir Putin.

CNN Senior International Correspondent Matthew Chance is in St. Petersburg this morning.

Hey, Matthew. Good morning.

MATTHEW CHANCE, CNN SR. INTERNATIONAL CORRESPONDENT: Good morning to you as well, Soledad.

Well, that's right, President Bush is, of course, now in St. Petersburg, preparing to attend the G8 summit of leading industrialized nations. That's expected to get under way tomorrow.

In the meantime, though, a number of important items on President Bush's agenda.

I want to say first, though, that energy security, of course, was the issue or is the issue that is expected to be at the top of the agenda of the G8 discussions. But, of course, what is happening around the world, particularly in the Middle East, it looks like some of the emphasis may be going on to talk about how to resolve the crisis in the Middle East.

A number of things on President Bush's agenda today already. As you mentioned, he has been laying the wreath on the war memorial, paying tribute to the Soviet soldiers who died defending what was then Leningrad from Nazi forces during the Second World War.

He's also been meeting with NGOs, with community leaders, with human right activists to get a picture from them about the kind of concerns that they have about democracy in Russia, because that's one of the things that President Bush is going to be discussing with Vladimir Putin, the Russian president, tonight when he has a private one-on-one meeting with him at his country house outside of St. Petersburg. Democracy is an issue. It has been an issue of tension between the United States and Russia over the recent -- over the recent months. Washington accusing the Kremlin under Vladimir Putin of backsliding on democracy -- Soledad.

S. O'BRIEN: Matthew Chance in St. Petersburg for us this morning.

Matthew, thanks -- Miles.

M. O'BRIEN: In southern California this morning, firefighters are still hard at it, but they cannot probably stave off the inevitable, the collision of two huge wildfires. Searing heat, low humidity and heavy winds are fanning and fueling the flames there.

Joining us now, Kyung Lah, who is right in the crosshairs of those two fires in Morongo Valley, California -- Kyung.

KYUNG LAH, CNN CORRESPONDENT: Well, Miles, this is the area where those two fires will merge and potentially, if firefighters say the winds are right, will grow into this one large 60,000 wildfire in the southern California area.

What you're seeing behind me is the area of the evacuation. Those houses down there at the base of these -- these foothills here, a lot of those residents, some hundred, 300 of them, have been told to get out of their houses. Now, just slightly above -- hard to see through all that smoke -- what you're looking at there, that little glow, that is backfire, intentionally set fires so firefighters can try to burn off that brush and try to save those homes.

This is very active fires. So far, 47,800 acres scorched in the Sawtooth fire.

Governor Schwarzenegger has declared a state of emergency which frees up state dollars. This is going to be a very expensive fire for the state. Some $6 million is the tab so far.

Overnight, firefighters say that they did not lose any homes. So far, they have lost a total of 42 homes in this fire. But if those two fires do collide, firefighters say that this could be a very large, dangerous fire. Residents say as they are watching all of this happen it's almost too much to bear.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: We're just loading up for a hasty retreat. We're not packing everything. We're putting stuff that we need in the cars and we're going to wait it out see if we can't get through this.

UNIDENTIFIED FEMALE: Yes.

UNIDENTIFIED MALE: It's come right over the ridge right now. So it's looking pretty close. It's looking like it could happen.

(END VIDEO CLIP) LAH: The sun has just started to come up. What happens -- what we have seen over the last few days is we're going to start seeing that high heat in this area. And then right around noon or 1:00 Pacific Time, the winds really start to pick up. And firefighters say they fully expect to see in the hills behind me 100-foot-tall flames -- Miles.

M. O'BRIEN: Wow. That's pretty scary.

Kyung Lah, who is there in Morongo Valley, thank you very much.

Chad Myers is off. Rob Marciano is at CNN Center, and he's got the outlook for firefighters there.

Good morning, Rob.

ROB MARCIANO, CNN METEOROLOGIST: Good morning, Miles.

(WEATHER REPORT)

MARCIANO: That's the latest are from here, guys. Back out to you.

M. O'BRIEN: Thank you very much, Rob.

Coming up on the program, the Middle East on the brink of war. Is Israel justified or has it gone too far? We'll talk with Senator John McCain.

S. O'BRIEN: Also this morning, outed CIA operative Valerie Plame sues the vice president. She says he ruined her career.

We'll take you to Washington, D.C.., to see if she has a case.

M. O'BRIEN: Plus, a soldier's promise to an Iraqi boy who befriended U.S. troops after risking his life to turn in his own father. It's a remarkable story.

Stay with us and you'll hear about it.

(COMMERCIAL BREAK)

M. O'BRIEN: What began with the kidnapping of a single Israeli corporal has now escalated into fighting that verges on full-scale war. Is there any way to put the genie back into the bottle and bring Israel, Hamas and Hezbollah back from the brink? And what, if anything, should the U.S. be doing right now?

Arizona Senator John McCain joining us from Capitol Hill with some thoughts on all this.

Senator, good to have you with us.

SEN. JOHN MCCAIN (R), ARIZONA: Thank you.

M. O'BRIEN: You of all people as a former POW can empathize with the plight of these captured soldiers. But there is a question of proportionality here. And while the president has said Israel can defend itself, a measured response is what a lot of people are seeking here.

Have they stepped over a line here in their response?

MCCAIN: I don't think so. I think that the fact that they are being attacked constantly by Hezbollah from southern Lebanon, from Gaza, they have already experienced attacks from both sides, I think the thing that complicates it rather dramatically is that a lot of this direction to these organizations, both Hamas and Hezbollah, come from -- from Damascus and from Tehran.

The Iranians have nurtured Hezbollah and helped them put all these rockets in place in Lebanon. It's also clear that the Lebanese government does not control Lebanon, which is a very sad sort of situation, and Hamas being the "elected Palestinian Authority" which is dedicated to the extinction of the state of Israel.

So, no, I don't think that the Israelis are overreacting. In fact, I believe that if the United States were faced with the same sort of scenario we would be reacting vigorously as well.

M. O'BRIEN: You know, in the context of all of this there's a lot of concern, speculation, whatever you want to describe it, that Israel might branch out and perhaps attack Syria, or even beyond. I want to share with you a statement from the Iranian president, Mahmoud Ahmadinejad, who said this: "If the Zionist regime commits another stupid move and attacks Syria, this will be considered like attacking the whole Islamic world and this regime will receive a very fierce response."

What do you make of that? I mean, he's a volatile character who says all kinds of interesting things. But nevertheless, what do you make of that?

MCCAIN: Well, I'd be very frightened if it weren't for the fact this same president has gone to the United Nations and announced his country's dedication to the extinction of the state of Israel. So it's not a matter, at least in his words, of whether, it's a matter of when.

Look, the Iranians are causing great difficulties in southern Iraq. The Iranians control and have helped Hezbollah move thousands of rockets into Lebanon whereby they can be launched into Israel. The Iranians continue their acquisition of nuclear weapons, and they want to dominate that part of the world. And that's -- and this is part of that overall scheme.

This is a very serious situation. I agree with calls for restraint on the part of Israel, but I think that a vigorous response on the part of Israel is very appropriate.

M. O'BRIEN: So what happens if Israel does launch an attack on Syria or Iran? Play that out. MCCAIN: I think -- I think it depends on under what circumstances and why. We know that the -- they are trying to transport the two captured Israeli soldiers to Iran as we speak, or to Syria.

Again, if they continue to rain rockets down on the state of Israel, then you may see tragically an expansion of this conflict. So I guess the other question is, what if the Syrians and Iranians don't stop? And then what is the appropriate response?

Look, this is a serious situation, but it has not been fomented by the state of Israel. And to somehow put some equivalence on this that the Israelis should then join in some kind of equivalence when they are not the ones that provoked this -- in fact, the evacuation of Gaza was a step in the right direction in the view of most people.

M. O'BRIEN: Senator, a lot of people would suggest that this is a problem that is festering and has been allowed to fester...

MCCAIN: Yes.

MCCAIN: ... for lack of U.S. attention. Other crises, Iraq and North Korea, you name it, have occupied this administration.

Would you call on the president to become more personally engaged in the Middle East?

MCCAIN: I think that the president should be personally engaged. I think he has been personally engaged.

I think he recognized that President Clinton offered the Palestinians just about anything that they wanted at Camp David and they still turned it down. Hamas is a terrorist organization that has come to power in the Palestinian Authority. But at the same time, I'm not exactly sure whether the United States' active intervention would achieve anything at this particular time.

M. O'BRIEN: Really? Why not?

MCCAIN: Well, the events are going to have to sort themselves out to a certain degree. The United States can try to encourage discussion and dialogue, but it's hard to have a dialogue with organizations that are dedicated to your extinction.

You know, you usually start out with the right to exist as being part of the negotiating process. And I -- and I really believe that we have to understand that to deal with the Lebanese government would not be very fruitful because they are not in control. To deal with Hamas, who are dedicated to their extinction, is very difficult. And Syria and Iran are the primary provokers of this situation, and they are the ones that bear responsibility.

We're going to have to examine all of our options, but I do not believe that to place Israel on an equivalent basis with these terrorist organizations is the appropriate way to begin.

M. O'BRIEN: Senator John McCain, thanks for being with us this morning.

MCCAIN: Thank you.

M. O'BRIEN: Back with more in a moment.

(COMMERCIAL BREAK)

M. O'BRIEN: And now the story of an American soldier, an Iraqi boy, big risks and big promises.

Army 1st Sergeant Daniel Hendrex made it his mission to repay a debt and get a boy that he nicknamed "Stevo" out of harm's way, and he succeeded. His new book is entitled "A Soldier's Promise."

(BEGIN VIDEOTAPE)

M. O'BRIEN: Sergeant Hendrex joins us now. Good to have you with us.

SGT. DANIEL HENDREX, AUTHOR, "A SOLDIER'S PROMISE": Thank you for having me.

M. O'BRIEN: You met this boy 14 years old in the midst of the Iraq war. When you first met him was there something different about him?

HENDREX: You know, there really was. I mean, you've seen the front of the cover. He's 13 going on 14 years old, but he looks about 10 years old. So when he showed up at the border checkpoint and asked to be arrested, it really confused us.

So he came in, we got a story. And then that's when we found out ultimately that his father was involved in the insurgency, and he helped basically corral about a 40-man insurgency, as well as understand the hierarchy in the little town right along the Syrian border.

M. O'BRIEN: For him to be in a family whose father is aiding the insurgency, to go to you, is an incredibly courageous act.

Why do you -- what do you think motivated him?

HENDREX: His primary motivation was the safety of his family. He had five siblings, as well as his mother. He was incredibly close to his mother, and he felt his father was really not only forcing him into the insurgency, but bringing danger right to their doorstep. So I think that's what finally led him to us.

M. O'BRIEN: The closer he got to you, though, the more dangerous it became for him, didn't it?

HENDREX: It really did. Once did he this, it didn't work out like he expected, and he really did put him and his family's life on the line. And that's why we personally got involved with this. It took a long effort, almost six months to finally get him over here on special public benefit parole. M. O'BRIEN: What sorts of resistance did you encounter along the way?

HENDREX: You know, I don't think it was resistant. It was just -- it was something very unique.

At that point, the very beginning of the war, it had not happened. And so, you know, his father, even though he was a terrorist and still in jail, his mother was not ever confirmed that she was killed. So, under those circumstances, it was really hard to take him out of an Arabic country and bring him to the states.

M. O'BRIEN: But you do believe she was killed, and subsequently, he has no parents there.

HENDREX: Correct. Exactly. So we know she was shot. We've just never been able to verify, but we do believe she was killed.

M. O'BRIEN: Was her death in any way a reprisal for his actions do you think?

HENDREX: That's exactly what it was for.

M. O'BRIEN: How is he doing now, to have to endure all that at that young age and loss, and perhaps guilt associated with that loss? How is he doing?

HENDREX: You know, you couldn't -- he's doing incredible. Like I said, the turmoil that he went through and what he is today, he is -- he is a teenager like every other teenager.

M. O'BRIEN: The book is "A Soldier's Promise." The author is Army 1st Sergeant Daniel Hendrex, who found time during his tours to pen this book.

Good job. It's a good job. It's very inspiring.

Thanks for your time.

HENDREX: Thank you, sir. Nice to meet you.

(END VIDEOTAPE)

M. O'BRIEN: A quality guy, for sure. We can all be proud of people like that serving on our behalf.

A little postscript for you. Stevo is now living with a family somewhere in the U.S., location not disclosed out of fear for his security. He hasn't been officially adopt by the new family just yet.

Now, Sergeant Hendrex recently took Stevo to summer camp, and they exchange e-mails and, you know, IMs and so forth. And they are in constant contact.

It's quite a story.

S. O'BRIEN: It certainly is.

M. O'BRIEN: It's nice to meet him -- Soledad.

S. O'BRIEN: Coming up this morning, we've got the very latest on the escalating crisis in the Middle East. We're going to take a look at Iran's role in the conflict.

Plus, an incredible new look at that building explosion in New York City that happened on Monday. Take a look at some of these pictures.

That's just ahead.

Stay with us.

(COMMERCIAL BREAK)

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