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American Morning

Rockets Hit Haifa; Crisis in the Middle East; Iraq Strategy Meeting

Aired July 25, 2006 - 06:00   ET

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


SOLEDAD O'BRIEN, CNN ANCHOR: A whole new Middle East, that is a call from Secretary of State Condoleezza Rice as she meets with top Mideast leaders at this hour.
Another series of Hezbollah rockets attacking Haifa this morning and there are reports of injuries. We've got a live report just ahead on this AMERICAN MORNING.

Good morning. Welcome, everybody. You're watching a special split edition of AMERICAN MORNING. I'm Soledad O'Brien in New York today.

Hey, -- Miles.

MILES O'BRIEN, CNN ANCHOR: Hello, Soledad.

I'm Miles O'Brien.

Good morning to you from Jerusalem where it's just about 1:00 in the afternoon and we're watching two fronts in this war, a diplomatic front here in Jerusalem as the secretary of state meeting right now with high-ranking officials in the Israeli government, the defense minister right now, having already met with the prime minister. She will, in just a couple of hours, make her way across the hills behind me into the West Bank, Ramallah, and talk to the Palestinians. More on that in just a moment.

But in many respects, Condoleezza Rice's call for a new Middle East has been met with more of the same, more rocket firings to report this morning. And this day in the Middle East, in Israel, in northern Israel, specifically Haifa, no less than 16 rockets counted so far. There are injuries to report on the ground. Once again those sirens wailing and once again the people of Haifa living in fear.

Let's get right to Fionnuala Sweeney live from Haifa -- Fionnuala.

FIONNUALA SWEENEY, CNN CORRESPONDENT: Hi, Miles.

Well, yes, the air raid sirens have been going off intermittently all morning, and the last one set off a barrage of rocket attacks. As you reported, 16 people injured. One, we believe, had a direct hit on a building, but we were able to see three rockets land. Although we heard only seven thuds, we know that there were more rocket attacks.

It's very clear now that Haifa is unable to withstand this kind of attack apart from people staying within their homes. And I was out in a shopping mall earlier this morning and it really wasn't open. A lot of the shops were closed. And the couple of shops that were open, people were glued to the radio stations and listening whenever the sirens went off, and they've been going off quite a lot.

There's also, as you know, Miles, from being here, a lot of concern about what this is doing to the economy, not just at Haifa, but particularly northern Israel, as many, many people now, particularly in the north where there are no air raid sirens because it takes so little time for those rockets to come across from Lebanon, there people are in bunkers and shelters and not going to work. And so basically one-third of the country not able to function at all -- Miles.

M. O'BRIEN: It really has shut down that part of Israel. There are even calls right now for forcing businesses to compensate people who can't even return to work. But at this stage really no end in sight, -- Fionnuala.

SWEENEY: No, there isn't any end in sight. I mean I've been here several days now, and at the beginning of my particular rendezvous here, it did seem that business was carrying on as usual. There had been rocket attacks earlier in the week.

But then there had been a lull of a couple of days and I suppose that lulled people into a false sense of security. And one was surprised to come here after being somewhere like Nahariya, which is even closer to the border, about 20 minutes from here, and that was absolutely like a ghost town.

The problem for Israelis living in northern Israel is that these rockets take about two minutes to come from southern Lebanon into Haifa, which is about 20 minutes from the border. But if you're living very close to the border, the rockets take even less time. The air raid sirens here begin to wail about 30 seconds or so before a rocket lands. But that is not necessarily enough warning for people to get out of their cars, out of the streets and into buildings.

So you can imagine what it's like for people living in Nahariya, people living in Kirach Mouna (ph), all along the border where the air raid sirens don't even begin to wail because the time it takes for those rockets to travel from southern Lebanon being so fast is only about 30 seconds. So they -- there many, many people are living in bunkers -- Miles.

M. O'BRIEN: Fionnuala Sweeney in Haifa where the blitz on Haifa and the rest of northern Israel within the range of those Katyusha rockets and other missiles continues.

All this comes as the Israeli offensive into southern Lebanon continues. Focus continues along Bint Jbeil, that small town about two-and-a-half miles into Lebanon, north of the border of Israel, where the Israeli defense forces say they have basically encircled a Hezbollah stronghold, a headquarters, if you will, in the south of Lebanon. In heavy fighting yesterday, two Israeli soldiers were killed, about 20 others were wounded, some of them wounded by friendly fire.

Meanwhile, those air strikes continue. The hope is to take out those rocket launching locations. And one of the places the Israeli air force is focusing on is Tyre.

If you go from Haifa to Tyre on the map you can see exactly why this would be a perfect straight shot for a rocket, about 15, 20 miles to the border of Lebanon -- from Haifa to the border and then just about the same amount of distance north there to Haifa, a suspected location where a source of a lot of these rockets. The Israeli air force has conducted a series of air strikes there.

CNN's Ben Wedeman is on the ground taking great precautions himself to tell us what the latest is -- Ben.

BEN WEDEMAN, CNN CORRESPONDENT: Yes, Miles, we've watched as dozens of Israeli bombs and rockets have landed in this area behind me. You can still see the smoke where one of them has hit.

And not only have we seen incoming fire, but we've seen outgoing fire as well. About an hour and a half ago, six Katyushas went off in one of those groves behind us, obviously heading toward the south. So it does appear, at least today, that the level of activity, the bombardment and the firing out is higher than it has been in the last few days.

Meanwhile, Miles, we've been listening to Israeli radio, being broadcast in Arabic, telling the inhabitants of southern Lebanon that this has become a war zone, that they should get out for their own good. And also warning, for instance, that any four-wheel drive vehicles on the road, they will consider a target -- Miles.

M. O'BRIEN: That's a stern warning and that's a big concern. Let's remind viewers why they would single out these four-wheel drive vehicles. These -- many of these rockets are small and easily transportable, aren't they?

WEDEMAN: Yes. Basically the Israelis have been targeting any sort of truck or large vehicle in the area. In fact, when we were driving down here yesterday, passing through the town of Sidon, which is about an hour north of here, there were about a dozen trucks stopped by the road.

Basically people are afraid to move these trucks around. And of course that is causing problems by itself, because many of these trucks aren't used to transport Katyusha rockets, they are used to transport food and other essential materials. So this situation, Miles, is becoming complicated in many ways.

M. O'BRIEN: And it compounds a difficult humanitarian situation.

Ben Wedeman in Tyre, Lebanon, which has been the focus of a series of Israeli air strikes.

And while all this continues with really no apparent prospects for a cease-fire anywhere in sight, the U.S. Secretary of State Condoleezza Rice continues her shuttle diplomacy.

She got a very cool reception in Beirut, Lebanon yesterday as she met with leaders there, with the prime minister and the speaker of Parliament. They insisting on an immediate cease-fire before anything can happen. In essence say, to use a U.S. colloquialism, the cart before the horse, could be talking about some sort of negotiated settlement without a cease-fire.

Meanwhile, now that she is here in Jerusalem speaking with the prime minister, currently with the defense minister just a few blocks away from where I stand, the focus is on exactly how to proceed further. And of course in the case of Israel, she will meet with agreement on this whole notion of a cease-fire. The Israelis insisting a cease-fire is premature.

Condoleezza Rice walking a tight rope through this shuttle diplomacy, insisting she doesn't want any band-aid solutions. Let's listen to her.

(BEGIN VIDEO CLIP)

CONDOLEEZZA RICE, SECRETARY OF STATE: The people of this region, Israelis, Lebanese and the Palestinians, have lived too long in fear and in terror and in violence. A durable solution will be one that strengthens the forces of peace and the forces of democracy in this region.

And I think there has been no stronger believer in that course than President Bush. And it is why he has asked me to come at this difficult time, because as we deal with the current circumstances, we need always to be cognizant of and looking to what kind of Middle East we are trying to build.

(END VIDEO CLIP)

M. O'BRIEN: But while the secretary of state, while the Israelis focus on some sort of long-term solution, there are short-term needs in southern Lebanon. You just heard Ben Wedeman talking about the humanitarian issues there and the fact that in many respects U.S. air strikes -- U.S. -- Israeli air strikes are focusing on trucks which are carrying humanitarian supplies in which it were intended to be rocket launching vehicles.

Listen to Prime Minister Ehud Olmert when he discusses the subject of perhaps punishing Lebanon as a whole.

(BEGIN VIDEO CLIP)

EHUD OLMERT, ISRAELI PRIME MINISTER: We are not fighting the Lebanese government and we are not fighting the Lebanese people. The Lebanese government, I hope, will make effort to distance themselves from Hezbollah and from the terrorist organizations. And once doing it, they will find in us partners for all kinds of accommodations that will make life for the Lebanese easier and better and certainly will help facilitate an arrangement that will end the war.

(END VIDEO CLIP)

M. O'BRIEN: So far 386 Lebanese are reported dead, 1,100 wounded. Difficult to tell who among them is Hezbollah or a civilian. Eight hundred thousand people now displaced, most of them internally, as a result of this conflict now in its 14th day -- Soledad.

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

In fact, Lebanon's prime minister says it's somewhere between 750,000, 800,000 people who have fled the violence and now are in desperate need of immediate assistance. The U.S. is responding, pledging $30 million in aid. The first supplies will arrive today.

CNN's senior Pentagon correspondent Jamie McIntyre has details.

(BEGIN VIDEOTAPE)

JAMIE MCINTYRE, SENIOR PENTAGON CORRESPONDENT (on camera): As of this morning, the Pentagon says it no longer needs U.S. war ships off the coast of Lebanon to assist in the evacuation of Americans from Beirut. Future evacuations will be done by charter vessels, such as the Orient Queen, the luxury liner that took about a thousand Americans out of Beirut yesterday.

Instead, the U.S. military's focus now is on assisting the State Department in getting humanitarian aid into Lebanon. The first shipment of medical supplies is due there today.

The U.S. military will fly most of the aid into Cyprus where it will be transferred to ships and taken into the port of Beirut. There it will be turned over to non-governmental organizations that will distribute the aid in Lebanon.

The Pentagon says U.S. troops will not be flying into dangerous parts of Lebanon and will not be distributing aid on the ground. Some aid will be flown in by helicopter to the U.S. Embassy which is still up and operating because it hasn't been evacuated.

Jamie McIntyre, CNN, the Pentagon.

(END VIDEOTAPE)

S. O'BRIEN: Still ahead this morning, we're going to check back in with Miles on what's happening in Jerusalem, the latest on diplomatic efforts to end the violence in the Middle East. Then we'll go inside a bomb shelter in Israel, take a look at what life is like for Israelis and Arabs who are trapped by the violence that surrounds them.

And Carrie Lee has got business headlines this morning.

Good morning.

CARRIE LEE, CNN CORRESPONDENT: Good Tuesday morning to you.

Strong profit reports and a pair of mergers sent stocks soaring yesterday. Will the gains hold into today's session? We'll have that story and more coming up on AMERICAN MORNING.

(COMMERCIAL BREAK)

S. O'BRIEN: Let's get a look at the latest developments in the crisis in the Middle East.

Secretary of State Condoleezza Rice meeting with Palestinian President Mahmoud Abbas. It's going to happen in just a couple of minutes. Earlier, she held talks with the Israeli Prime Minster Ehud Olmert.

Early this morning, Hezbollah fired at least 16 rockets toward the Israeli port of Haifa. Dozens of people reported wounded. And Israel is launching more strikes on the Lebanese coastal city of Tyre. Lebanese security forces say another Israeli air strike in southern Lebanon hit a house and killed seven people.

Let's turn to Iraq now where sectarian violence seems to be non- stop. The country's prime minister is meeting with President Bush at the White House today.

CNN's Ed Henry has more for us.

(BEGIN VIDEOTAPE)

ED HENRY, CNN WHITE HOUSE CORRESPONDENT (on camera): On a normal day, President Bush's meeting with the Iraqi Prime Minister Nuri al- Maliki would dominate the headlines, but Maliki's first visit to Washington today is likely to be overshadowed by the ongoing crisis elsewhere in the Mideast. Nevertheless, this is an extremely important time for the president because much of his legacy lies in the hands of Maliki and whether he can deliver on more progress in Iraq.

During his secret trip to Baghdad, the president heaped praise on Maliki, saying he has the character to ensure that Iraq can both govern and defend itself. But since then the violence in Iraq has only gotten worse with the U.N. report showing an average of 100 Iraqis a day are being killed and White House spokesman Tony Snow acknowledging this week Maliki's security plan is not working.

Coming up with a new plan will be at the top of the president's agenda today, especially with Iraq still looming as a major issue in the mid-term elections and more than 130,000 U.S. troops still there.

Ed Henry, CNN, the White House.

(END VIDEOTAPE)

S. O'BRIEN: Happening in America this morning, a dramatic ship rescue off the coast of Alaska to tell you about. Twenty-three members of a crew were saved from a cargo ship which had taken on water and was listed on its side. The rescue took place in bad weather and choppy seas. Nobody, fortunately, was seriously hurt.

The FBI has now joined the investigation into those suspected sniper shootings in Indiana. One person has been killed, another injured on Sunday in a string of shootings along two interstates about 100 miles apart. Police say they are investigating tips that additional shootings could occur.

Jury deliberations resume in Houston today in the second Andrea Yates murder trial. Yates began to cry as crime scene photos of her children and the children's pajamas were shown yesterday. Yates is accused of drowning her children back in 2001. She was convicted of murder in 2002, but then that was overturned.

Police in Boston finding a mysterious murder case now, a woman who was visiting her brother's grave on the fourth anniversary of his murder was gunned down. Happened in almost the exact same spot where he was killed and nearly at the same time and on the same day four years later. So far police say they have no leads in the case.

A massive wildfire in the San Diego area is threatening hundreds of homes this morning. Flames have already charred 7,000 acres in the Cleveland National Forest. Authorities believe the fire may have been caused by illegal immigrants who abandoned a campfire.

And the searing heat in California now being blamed for at least 29 deaths, most of those happening in the Central Valley where temperatures have climbed into the triple digits. The heat wave is also pushing the state's energy supply to the very brink. So far though no threat of rolling blackouts.

Sixteen minutes past the hour, let's get a check of the forecast and Chad Myers who is at the CNN Center.

Any break in the forecast for these folks?

CHAD MYERS, CNN METEOROLOGIST: A little bit, yes. I mean 10 degrees and that will help. That will help significantly.

(WEATHER REPORT)

S. O'BRIEN: All right, Chad, thank you.

MYERS: You're welcome.

S. O'BRIEN: Still to come this morning, is Amazon.com developing a movie download business? Carrie Lee takes a look at the rumors. She's got business news coming up next.

And this morning we take you inside a bomb shelter that houses both Arabs and Jews. It's hot, it's crowded and tensions are running very high. That story is up next on this special split edition of AMERICAN MORNING. We're back in a moment.

(COMMERCIAL BREAK)

M. O'BRIEN: Welcome back from Jerusalem.

The Secretary of State Condoleezza Rice still meeting with the Israeli defense minister on her way, in a little bit, to the West Bank, to Ramallah, to meet with the Palestinian Authority President Mahmoud Abbas. We're watching that diplomatic front.

And we're also watching the rockets still flying. We have reports this morning of no less than 16 rockets in 3 separate locations in downtown Haifa striking -- causing upwards of 10 injuries. And it follows a day of at least 100 rockets flying into northern Israel in one way, shape, form or another with several injuries as a result.

The closer you get to the border, the less warning there is. In places like Haifa, the sirens wail and there's time for people to get to shelter. But move to the north, to a place like Nahariya, just tucked in underneath the Lebanese border, and there's very little time to get to shelter. And so what is happening is people are spending most of their time beneath ground in shelters. Arab-Israelis, Israelis together, and as time goes on, the tension builds.

We get more on this story from CNN's John Vause.

(BEGIN VIDEOTAPE)

JOHN VAUSE, CNN CORRESPONDENT (voice-over): You can hear the panic in her voice. There are more Katyushas this woman yells as she calls everyone inside the bomb shelter. Safe below ground, they wait, wait for the explosions above, wait for the all-clear which never seems to come because the Hezbollah rockets never seem to stop.

Once inside, Dalia (ph), a mother of three, tells me she's terrified. So, too, is everyone else.

This is the debris from an earlier missile strike, she says, which landed just outside the bunker. We're stuck underground and this is not healthy, she says. We support the prime minister and the Israeli military, but we want to be evacuated. The Lebanese were evacuated. We want to be as well.

The days are long and tense, the nights are worse, they say. The electricity cuts in and out. This is the biggest bomb shelter in Nahariya, a northern Israeli town which has been hit by dozens of Katyusha rockets. Here Israeli Jews and Arabs seek cover together. Tempers are frayed. Heated arguments follow.

The Israeli-Arab woman on the right accuses the Jewish woman of celebrating when Arabs are killed. The Jewish woman yells back how can you say that when we give you shelter? Here the Jews support the Israeli offensive, the Arabs want a cease-fire.

We don't want Israel striking Lebanon or Lebanon hitting Israel, says Fika Suad (ph) an Israeli-Arab. I'm scared she tells me. It's not easy in this bunker.

(on camera): This bunker is about 20 feet underground. It's incredibly hot and the air is thick and stale. It seems difficult to breathe. And the people here have been living like this for almost two weeks now.

(voice-over): It's hardest on the children. They're bored. Some are too young to understand.

UNIDENTIFIED MALE: They don't go to the schools. They don't go to play. Of course the children are not used to it and sometimes they cry when they heard the bomb.

VAUSE: Here they cook meals, watch television for the latest news and wait, wait for either a cease-fire or more rockets.

John Vause, CNN, Nahariya, northern Israel.

(END VIDEOTAPE)

M. O'BRIEN: So far in 14 days, 39 Israelis have died, 17 of them civilians, as a result of these rocket and missile firings from Hezbollah positions north of the border -- Soledad.

S. O'BRIEN: All right, Miles, thanks. We're going to get back to you in just a little bit.

First, some business news. The buyout of a private hospital operator HCA makes for a healthy financial market. A little good news.

Carrie Lee is "Minding Your Business."

Good morning.

LEE: Certainly helped things yesterday, Soledad. The Dow adding over 180 points at the finish, the Nasdaq gaining 2 percent. Remember recently the Nasdaq was at a 14-month low. So green arrows across the board. Some strong profit reports in the pharma sector helping as well.

This morning it is looking like a slightly bullish start on Wall Street. A couple of the econ reports on home sales, existing home sales, as well as consumer confidence are two things that will shape the session.

A couple of stocks we're keeping an eye on. Amazon.com did well yesterday. The company reportedly is set to get into the movie downloading business starting next month. This according to a report in "Advertising Age." Sources have also told Reuters the company is talking in advanced levels with several major Hollywood studios.

Amazon isn't commenting on this report, but the company has picked up its research and development spending recently. And some analysts on Wall Street think that that is for these new digital projects. So that's the latest on Amazon.

And also Netflix out with third quarter profits after the bell last night. Company stock though fell about 20 percent. Profits tripled but they had to spend more to keep the customers they have and acquire new customers.

And, Soledad, maybe some jitteriness about this Amazon prospect as well, because if Amazon gets into the download game, that would be very bad news for Netflix indeed.

S. O'BRIEN: Yes, it certainly could change those numbers in a down way, -- Carrie Lee.

LEE: Yes, so some concern there maybe.

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

LEE: Sure.

S. O'BRIEN: The morning's top stories straight ahead, including Secretary of State Condoleezza Rice meeting with Israel's prime minister. The latest on the diplomatic efforts for peace just ahead.

And a new round of rocket attacks to tell you about in Haifa. Our reporters are there live.

You're watching a special edition of AMERICAN MORNING. We're back in just a moment.

(COMMERCIAL BREAK)

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