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At Least Two U.N. Observers Killed in Israeli Air Strikes; Kofi Annan Suggests Attack Was Deliberate by Israel

Aired July 25, 2006 - 19:00   ET

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


WOLF BLITZER, CNN ANCHOR: Lou, thanks very much. And to our viewers, you're in THE SITUATION ROOM where new pictures and information are arriving all the time. Standing by CNN reporters across the United States and around the world to bring you tonight's top stories.
And it's happening right now. There's breaking news right here in the crisis in the Middle East. A deliberate target or caught in the crossfire? The United Nations says at least two of its observers were killed by Israeli air strikes and the U.N. Secretary General Kofi Annan is now suggesting this was no mistake, repeat no mistake by Israel. He says it was apparently a deliberate targeting.

It's 2:00 a.m. Wednesday along the Israeli-Lebanese border where the attacks and the casualties keep coming tonight. Also this hour, Hezbollah's leader is speaking accusing Israel of plotting with the United States to create a new Middle East. We'll have the latest on the militant group's claims and the reported killing of one of its senior commanders.

And the young and the sick living in fear near the front lines. We will show you how the Middle East conflict is changing the battlefield and the toll that it's affecting on so many people in this part of the world.

I'm Wolf Blitzer reporting live from Jerusalem and you're in THE SITUATION ROOM.

Tonight breaking news here in the Middle East, stunning, a stunning new claim about a killing that occurred in south Lebanon. The United Nations Secretary General Kofi Annan is now asking Israel to investigate what he calls an apparently deliberate targeting. That's a direct quote, an apparently deliberate targeting of a United Nations observer post in southern Lebanon.

The U.N. says that at least two of its observers on a peace mission near the border were killed when an Israeli aircraft struck their position. This is a serious allegation being leveled tonight by the United Nations secretary general. We're going to be getting official Israeli government response, the first government response coming into THE SITUATION ROOM.

Meanwhile, also tonight, the Hezbollah leader, Hassan Nasrallah, is accusing Israel of plotting with the United States to create a new Middle East. He delivered a statement on Lebanese television. Listen to this. (BEGIN VIDEO CLIP)

HASSAN NASRALLAH, HEZBOLLAH LEADER (through translator): After Condoleezza rice talked about a new Middle East, meaning a new Middle East, American-Israeli Middle East, does anybody imagine that this plan, huge was born in a moment or a day or two after the kidnapping of two soldiers by the Islamic resistance? No.

(END VIDEO CLIP)

BLITZER: He's also saying that Hezbollah is about to start launching rockets further into Israel, further south than Haifa along the Mediterranean. We're watching this story. Meanwhile, Hezbollah and Israel are exchanging new rocket and artillery fire.

Tonight, Israel says it killed a senior Hezbollah commander in ground fighting in southern Lebanon. Lebanon says right now 392 of its people have been killed in this two-week conflict. Israel puts its death toll at 41.

We have reports across the region tonight including from our senior international correspondent Nic Robertson in Beirut, our chief international correspondent Christiane Amanpour, she's here in Jerusalem, our senior national correspondent John Roberts. He's along the border between Israel and Lebanon.

But let's go to Nic Robertson first. Nic, a very, very serious allegation being leveled by Kofi Annan tonight against Israel that Israel deliberately -- apparently deliberately in his words targeting United Nations observers in south Lebanon. Let me read briefly from his statement that was just released at the U.N.

I am shocked and deeply distressed by the apparently deliberate targeting by Israeli defense forces of a United Nations observer post in southern Lebanon that has killed two U.N. observers, military observers with two more feared dead. This coordinated artillery and aerial attack on a long established and clearly marked U.N. post at Khiyam occurred despite personal assurances given to me by Prime Minister Ehud Olmert that U.N. positions would be spared Israeli fire. Furthermore, General Alain Pelligrini, the U.N. force commander in south Lebanon, had been in repeated contact with Israeli officers throughout the day on Tuesday, stressing the need to protect that particular U.N. position from attack.

He goes on to call for the government of Israel to conduct what he says should be a full investigation into this very disturbing incident and demand that any further attack on U.S. -- U.N. positions and personnel must stop. I don't remember a recent time when the United Nations secretary general has leveled such a serious charge against the government of Israel. But update our viewers, Nic, in Beirut, what the reaction is there.

NIC ROBERTSON, CNN SR. INT'L CORRESPONDENT: Well the very latest, Wolf, that we have from security sources here is that in that U.N. observer post bunker that was clearly marked was a French observer, a Canadian observer, a Finnish observer, and a Chinese observer. It is not clear which among those are the two confirmed dead and which of the two are missing.

But from the sources we're speaking to, the devastation of that sight, the fact that all men were co-located in the bunker leads them to believe despite the fact there's an ongoing rescue effort underway that the other two who are still missing may in fact be dead as well. Certainly it has brought a level of concern here in Lebanon, certainly, far greater concern for the U.N. and for the other observers. This is a 51-member observer mission.

There are -- made up of 22 different nations. Seventy percent of those nations are European nations. This has to be also causing concern in European capitals. Among the dead or injured at least in to this French, Canadian, Finnish and Chinese. It has wide-ranging implications around the world, Wolf.

BLITZER: Nic, at the same time that we're hearing the United Nations secretary general level such a serious accusation against Israel, we're also getting a new videotape coming in from the leader of Hezbollah, Hassan Nasrallah, boasting that he's about to take this war to a new level. What is he saying?

ROBERTSON: Wolf, this was an half an hour speech. It's interesting that it was put on air at about 1:00 in the morning here local time, between 1:00 and 1:30. It was carried on Hezbollah's affiliated station Al-Manar, but also Lebanese broadcasting company carried it. Other stations carried it. This was a very, very clear warning of upping and escalating the conflict.

He said that the war has entered a new phase. And that would mean going beyond Haifa. He has indicated before -- Hassan Nasrallah indicated in a speech about a week ago that they were capable of striking beyond Haifa. Everyone here takes that to mean Tel Aviv. He also said that a timing -- at a moment of timing of Hezbollah's choosing, they would go beyond Haifa.

It has been part of Hezbollah strategy so far to imply that they have weaponry to capable of striking beyond Haifa. They haven't yet demonstrated that is necessarily capable. He also had a very clear response to Secretary of State Condoleezza Rice's visit here yesterday. He said Hezbollah would not be accepting any cease-fire that meant humiliating terms for them, and certainly he was implying the terms as discussed yesterday -- Wolf.

BLITZER: Nic, stand by, you're going to be coming back in THE SITUATION ROOM this hour. I want to bring in our chief international correspondent Christiane Amanpour. She's just back from the front lines. She's here in Jerusalem with me tonight.

Christiane, Reuters is now quoting Israeli officials as saying they do not target United Nations observer positions in Lebanon. They say they will investigate this incident, but this is a very serious charge leveled by Kofi Annan.

CHRISTIANE AMANPOUR, CNN CHIEF INT'L CORRESPONDENT: Well it is and it stands to reason that the Israelis would respond as they did that they don't deliberately target those kinds of facilities. However, apparently according to UNIFIL, you know they had 14 apparently close calls of that incident throughout this afternoon.

And the secretary general said that his top man there was in constant contact, so there must have been a terrible fear about what was going on. And do you know, last night we reported that at this location, which is very close to Matula (ph) where we were and where our other colleagues are, there was a huge increase in artillery and aerial bombardment.

And now today Matula (ph) is being declared a closed military area. So clearly they're targeting what they consider strategic targets around there. And it appears now that these four UNIFIL observers have been killed. But I think that what's happening is that for the first week or 10 days, there wasn't a huge amount of international outrage or uproar about what was going on because people thought that they were targeting infrastructure. But now, you are getting this situation coming up. You are getting all these cars and mini buses of people trying to flee under, you know instructions from the Israelis, fleeing and there's cars being you know hit.

There's increasing concern and worry about the level of misfiring, misidentifying the enemy, and civilian casualties. And the military who we spoke to there, you know, they know that they're under this pressure and they get these questions constantly and they say that they do their best to try to avoid civilian casualties, but as I say, sometimes they say they make mistakes and they misidentify.

BLITZER: And at the same time, the other breaking news we're following is this latest video coming in from Hassan Nasrallah the leader of Hezbollah. Let's play a little excerpt of what he told the Lebanese people on Al Manar the Hezbollah television network.

(BEGIN VIDEO CLIP)

NASRALLAH (through translator): We have entered the stage of Haifa and I declare that we are going into the stage of after Haifa. Therefore there's another stage with the confrontation and a struggle imposed by the enemy on us as a choice that we have no other choice. Therefore, there is no limitation to our striking to Haifa. No matter what the reaction of the enemy against us, we will go back. We will go to another stage of beyond Haifa and if that situation have developed we will go into beyond and beyond Haifa.

(END VIDEO CLIP)

BLITZER: A serious accusation from Hassan Nasrallah, the leader of Hezbollah. Israeli officials for days, I'm sure they have told you, they have said to me both on camera, off camera, they take him at his word. When he says they have surprises, they suspect he does have rockets or missiles that can go further south than Haifa and reach perhaps Tel Aviv. This is something the Israelis have to take very seriously.

AMANPOUR: Yes and what we're being told by the senior generals on the front as they took a couple of the towns right inside the Lebanese border, we talked to General Alain Freeman (ph) who is the number two up there, who says that they believe they're making some progress. Their assessment is that they're pushing Hezbollah back north and therefore making Hezbollah's rocket fire less accurate and they said, less able to penetrate as deep into Israel, so they believe they're making that kind of progress. But when you have a threat like that from Hassan Nasrallah, you can't ignore it.

BLITZER: Christiane, stand by because you're going to be coming back. There's lots going on. I want to go up north, the northern Israeli border with Lebanon. John Roberts is on the scene for us. Once again tonight artillery shells still going up, mortar fire. John, update our viewers. What's happening today?

JOHN ROBERTS, CNN SR. NAT'L CORRESPONDENT: Wolf, still a lot of outgoing fire from this position going into southern Lebanon. We visited this artillery battle several times over the past few days. And I have to tell you that this is one of the most intense nights of firing that we have experienced.

They are laying down fire deeper and deeper into Lebanon, trying to keep the head of the Hezbollah fighters down, also try to soften up some of those Hezbollah positions so that the Israeli defense forces can continue forward.

(SOUNDS)

ROBERTS: We have not heard yet from the Israeli defense force what their next move might be. But they did claim a significant success on the ground today.

(BEGIN VIDEOTAPE)

ROBERTS (voice-over): Bone tired and covered in dirt, soldiers return from the front lines, waving a captured Hezbollah flag. And after two days of what he described house-to-house fighting, their young commander made this pronouncement.

UNIDENTIFIED MALE: (INAUDIBLE) going quite good in the last few hours, actually we took total control in the city of Bint Jbeil.

ROBERTS: But taking what the Israeli army claims was Hezbollah's southern stronghold doesn't eliminate the danger.

(SOUNDS)

ROBERTS: More Katyusha rockets fell near the Israeli city of Kiryat Shmona. The missiles ignited brush fires that burned across the hillsides. Crop dusters modified to carry fire (INAUDIBLE) swept in low to put them out. And in at staging area along the border, one soldier narrowly escaped death when Hezbollah got off a lucky shot with a mortar that turned out to be a dud.

We wanted to talk with soldiers about the battle. Army rules though prevent them from speaking to us without authorization. It was clear from their faces and posture that the fighting was difficult. But rested and refueled, they are eager to get back to the battlefield.

UNIDENTIFIED MALE: No talking, just making coffee.

UNIDENTIFIED MALE: (INAUDIBLE) exactly.

(SOUNDS)

ROBERTS: Completing the operation will not be easy. Hezbollah is dug in deep says General Hirsch, well trained and well financed. He has never seen any terror organization so well prepared.

UNIDENTIFIED MALE: It will take time.

ROBERTS (on camera): A week, two weeks?

UNIDENTIFIED MALE: I don't know, sir. It will take time. Because we intend to dismantle Hezbollah infrastructure because you can see that there is nowhere peaceful life in almost all Israel.

(END VIDEOTAPE)

ROBERTS: Israel's defense minister today said that it was his intention that the Israeli defense forces hold ground in Lebanon until an international stabilization force can be brought in. I asked General Gal Hirsch if that meant a temporary occupation of southern Lebanon by the Israeli defense forces. He said look, we don't want to go back in and occupy the country.

But Wolf, it would seem pretty clear that if they get themselves a buffer zone in southern Lebanon and then they have to wait for an international stabilization force to come in, a force that hasn't even been agreed to yet, that the Israel forces will be in southern Lebanon whether or not you call it an occupation for some time -- Wolf.

BLITZER: And as we hear those artillery shells going off right behind with you, I'll ask you this question, John. The Israeli military says that they have now killed what they're calling a senior Hezbollah military commander not very far from where are you in this battle over Bint Jbeil. What do you know about this?

ROBERTS: Yes, we've heard that they have -- at least the claims are that they have killed a commander, a Hezbollah commander by the name of Abu Jaffr. They say that it occurred in the fighting around Maroun Al-Ras, which you might remember was that hilltop village that looked down on the Israeli towns of Avivim and Jerone (ph).

(SOUNDS)

ROBERTS: It was a Hezbollah stronghold according to the Israeli military. A lot of fire came into those two Israeli towns from there. They said that he was the commander of Hezbollah's central sector along the border with Lebanon, though, some people I talked to, Wolf, don't know who (INAUDIBLE) is.

(SOUNDS)

BLITZER: That -- those explosions, those artillery firing are going to continue, presumably, John, throughout the night. We're going to be coming back to you. John Roberts on the Israeli border with Lebanon.

All of a sudden, diplomacy becoming considerably more difficult now with this accusation being leveled by the United Nations Secretary General Kofi Annan that Israel apparently deliberately killed four United Nations observers in south Lebanon. The Israeli government now denying it.

A spokesman for the Israeli Foreign Ministry, Mark Gregga (ph), saying Israel does not target United Nations observers. All of this comes as the secretary of state, Condoleezza Rice, is trying to come up with a new international peacekeeping force in Lebanon.

Our chief national correspondent John King is traveling with the secretary. He's joining us tonight from Rome with more on Secretary Rice's day, which started earlier this morning here in Jerusalem -- John.

JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: And Wolf, not only Kofi Anna's anger adding to the diplomatic challenge, that new defiant statement from the leader of Hezbollah also complicated the efforts here of Secretary Rice's here in Rome.

As you noted, more than 1,200 countries gathered for this urgent summit here. The formal meetings begin tomorrow, but we know tonight Secretary Rice already reaching out to many of the other diplomats who will be at the table here in Rome. Among the meetings tonight with the man I just mentioned, the United Nations Secretary General Kofi Annan. A bit of fly-by-the night diplomacy here in Rome, very different for Secretary Rice, very different from how she began her day back in Jerusalem.

(BEGIN VIDEOTAPE)

KING (voice-over): It was all carefully scripted. A friendly handshake and an Israeli embrace of Washington's new ideas to end the fighting.

(SOUNDS)

KING: But there are many obstacles to a cease-fire deal, but Prime Minister Ehud Olmert made clear nothing will change just because the diplomats are finally talking.

UNIDENTIFIED MALE: Israel is determined to carry on the fight against Hezbollah. We reach out for them, we stop them and we will not hesitate to take the most severe measures.

KING: Secretary Rice in turn emphasized Washington won't demand Israel stand down unless there is first an agreement that puts Hezbollah out of the terror business and requires the Lebanese army to take control of the south.

CONDOLEEZZA RICE, SECRETARY OF STATE: And enduring cease-fire and enduring cessation of violence, which would indeed make the security situation better than it was before.

UNIDENTIFIED GROUP: (INAUDIBLE)

KING: Anti-American sentiment on the Arab street, this is during a Rice stop in the Palestinian territories complicates the deal making at Wednesday's emergency Lebanon summit in Rome. As she arrived for those talks, one obstacle looms especially large. Hezbollah's refusal to disarm makes it harder to win commitments for a new international peacekeeping force.

UNIDENTIFIED MALE: Right now it's simply not realistic to expect this Lebanese government, any Lebanese government to go after Hezbollah's weapons and that if an international force came in and tried to do, it would become the target of attacks by Hezbollah and perhaps by others.

KING: The United States envisions an initial force with roughly 10,000 troops that would be endorsed by the United Nations, but not under direct U.N. command with the authority to engage Hezbollah militias and to police the Syrian border and other Hezbollah re-supply routes.

The concept of such a force has brought international support, but securing commitments is another matter. The United States and Britain, for example, say they can't pitch in because of Iraq and other obligations.

(END VIDEOTAPE)

KING: Let me give you just a bit of a flavor of the uncertain diplomacy here. Secretary Rice and many of her colleagues do have a rough agreement that the first force to go in should be about 10,000 troops. Then perhaps a larger force of 20 to 30,000 troops after that, but tonight there is no disagreement on what countries would contribute. There is still disagreement over what country would take the lead in that force and Wolf, one thing Secretary General Annan has put on the table, he would like just a cessation of hostilities for 60 to 90 days and during that period of time try to work out all of these other difficult issues. From the position of the United States, that is a non-starter. The White House believes if you have a 60-day cessation of hostilities and don't deal with the difficult questions about deploring the Lebanese army, disarming Hezbollah, all of this will soon collapse, but it is clear still a number of significant differences and major problems to be resolved as they try to pull off this emergency summit here in Rome, Wolf.

BLITZER: John King hop scotching the world together with the Secretary of State Condoleezza Rice from Washington to Jerusalem, now in Rome. John thanks very much. We'll stand by for your coverage tomorrow. Much more going on in the crisis in the Middle East. Let's bring in Jack Cafferty in New York with the "Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: You know, Wolf, I'm sitting here 20 minutes watching this coverage and it occurs to me there isn't a television operation on this planet can touch CNN when it comes to covering this kind of story. This is great stuff.

Anyway, I've got some poll numbers here that could ruin your dinner. The latest "USA Today" Gallup poll suggests this incursion into southern Lebanon by Israel might not have been such a great idea. Seventy-six percent of the people polled are either very or somewhat concerned that the U.S. military will be drawn into the conflict. Seventy-five percent say it will increase the likelihood of terror attacks against the U.S. Seventy-nine percent say it will lead to a broader war including Syria and/or Iran. Seventy-nine percent see an even broader war in the Middle East involving all or most Arab countries in the region. Sixty-one percent say it will lead to World War III and sixty-four percent say it could result in a nuclear attack somewhere in the Middle East.

Told you it would ruin your dinner. And even if none of that stuff happens, 68 percent of the people surveyed in this poll say the Arabs and the Israelis will probably never be able to work things out between them.

So here's the question. Can Israel and its Arab neighbors ever live in peace? E-mail your thoughts on that to CaffertyFile@CNN.com or go to CNN.com/CaffertyFile -- Wolf.

BLITZER: Jack, let me second what you just said. I don't think any news organization in the world has the kind of reach that we have here, our news gathering capabilities around the world unparallel to put it mildly. Jack we'll get back to you. Thanks very much.

Coming up right after a short break, we'll get official Israeli governmental reaction to this very serious charge being leveled by the United Nations Secretary General Kofi Annan that Israel apparently deliberately sought to kill these four United Nations military observers in south Lebanon. The Israeli ambassador to the United States, Daniel Ayalon, he is standing by to join us live here in THE SITUATION ROOM. We'll be right back.

(COMMERCIAL BREAK)

BLITZER: I'm Wolf Blitzer. We're reporting live from Jerusalem tonight on the crisis in the Middle East and there's breaking news. An extremely serious charge being leveled against Israel tonight by the United Nations Secretary General Kofi Annan. Kofi Annan saying that Israel in his words apparently deliberately targeted a United Nations observer post in south Lebanon resulting in the deaths of four United Nations military observers.

I'll specifically what he said. He said I am shocked and deeply distressed by the apparently deliberate targeting by Israeli defense forces of a U.N. observer post in southern Lebanon that has killed two U.N. military observers with two more feared dead.

Let's get official Israeli governmental reaction. The Israeli ambassador to the United States, Daniel Ayalon is joining us now live from Washington. Mr. Ambassador, serious allegation being leveled against the Israeli military. What's your reaction?

DANIEL AYALON, ISRAELI AMBASSADOR TO THE UNITED STATES: Well I deplore it very much. I don't know how anyone half a world away can jump into conclusions as we have not and we are checking it. I have just talked to our chief of staff. We do not have yet confirmation what caused this death. It could be IDF. It could be Hezbollah. We will check those things and any loss of lives is regrettable. Whether it's on the Lebanese side, whether it's on the Israeli side. I think this kind of rhetoric is deplorable. It's outrageous and I hope he will apologize for that.

BLITZER: His reaction -- his statement accusing Israel of doing this apparently deliberately, he says in part that it was the result of extensive personal assurances he received from the prime minister of Israel Ehud Olmert that Israel would avoid fire at this well-known United Nations observer position. I assume that's why he's saying Israel apparently deliberately did it.

AYALON: Well first of all, we are still in the midst of the investigation, so we cannot confirm yet who and what caused their death. But even if it is our forces and I'm not sure this is the case yet, of course we will take all the right measurements and certainly it's not deliberate. It's a war. We are talking about a Hezbollah terror organization, which has capabilities of a state terror organization. First time in history that we see a terror organization with strategic capabilities and unfortunately also very, very deplorable tactics where they position themselves specifically next to civilians, inside civilian territories and areas and also apparently next to Hezbollah or next to UNIFIL positions as well.

BLITZER: Are you suggesting, Mr. Ambassador, that Hezbollah might have been responsible for the deaths of these four United Nations military observers?

AYALON: Obviously, Wolf, there was an exchange of fire between Israeli forces and Hezbollah terrorists. it's obvious that UNIFIL got caught in the middle. What caused this we do not yet any confirmation at this point. In a few hours, we will be able to know. We are checking it, but for anyone to jump into conclusions, I think this is not a good way to conduct international diplomacy.

BLITZER: So when you said at the beginning of this interview that it was deplorable, I think you were referring to the reaction from Kofi Annan, that his statement accusing Israel of apparently doing this deliberately that was deplorable. Is that -- did I understand you correctly?

AYALON: Absolutely. I think this is shocking. If anybody, especially of that stature, somebody who has been in Israel, who knows our morale, who knows the conduct of the military, who knows the situation whereby we have waited. We have fulfilled two of the last letter, U.N. resolution cleared out of Lebanon, suffered all these provocations and attacks. Our civilians -- more than a million living in bunkers and the whole situation and for him to level this accusation that it was deliberate, this is just outrageous and shocking. And I hope he will apologize for that.

BLITZER: We'll get in touch with his office and see what his reaction to your very strong comments is. Mr. Ambassador, at the same time tonight within the past hour or so, Hassan Nasrallah, the leader of Hezbollah making a claim that Hezbollah is now going to take this war to a new level. He says that they're going to start launching rockets further south, further south than Haifa. Apparently they have that capability. Israeli officials have said that over these past two weeks. What do you know about Hezbollah's military capability and launching rockets further south than Haifa, perhaps towards Tel Aviv?

AYALON: Yes, they still have some residual capabilities in long- range missiles. They have been receiving all these long range from Iran. They are capable of reaching 120 miles, which is well beyond even Tel Aviv range.

We took a lot of this long range, but they still have some residual capabilities. They still are able to do it. But this just strengthened our reserve to make sure that Hezbollah is dismantled. I mean, we will stop -- the whole world cannot afford stopping short of disarming Hezbollah to the last rifle to the last missile that they have.

If we want to have a peaceful Middle East, if we want to take Lebanon and give it back to the Lebanese -- if we want to have any sort of peaceful dialogue and potential for peaceful area, we have to dismantle Hezbollah.

It's a terror organization of the most dangerous magnitude and it is just simply -- this is another point. It is just simply implementing United Nations Security Council 1559. If we are not, if the international community is not able to implement its own resolution, it makes a mockery of the entire U.N. It undermines the credibility of all of us and if we cannot work this out, how can we tackle the bigger problems, nuclearization of Iran, North Korea and other hot spots in the world?

BLITZER: One final question, Mr. Ambassador. Is Israel your military, trying to kill Hassan Nasrallah and other top leaders of Hezbollah right now?

AYALON: I would say that Hassan Nasrallah and all the leaders of this terror organizations are legitimate targets as they're the ones who are targeting civilians. They are the ones by the way who have killed 241 American marines back in '83.

They killed French soldiers and they will not hesitate to set aflame and fire all over the world. We see that they use the most dangerous capabilities. And God forbid, if Iran can become nuclear and Hezbollah still exists, I have no doubt that they will not hesitate to use also weapons of mass destruction. This is why we're so determined to stop them and to stop them soon.

BLITZER: I'll take that answer as a yes, the Israeli ambassador to the United States, Daniel Ayalon. Thanks very much for coming in on this night full of breaking news.

And to our viewers, you're in THE SITUATION ROOM, where new pictures and information are arriving all the time. And happening right now, more on the breaking news we're following out of the Middle East crisis. Israel, as you just heard, is flatly denying a very powerful charge by the United Nations secretary general and calling it deplorable. Kofi Annan suggesting Israeli forces apparently deliberately targeted a United Nations post in southern Lebanon. The U.N. says at least two of its observers were killed. Just a short while ago, as you just saw live here in THE SITUATION ROOM, Israel's ambassador to the United States said Israel regrets the deaths, but he said Israel does not target U.N. personnel and raised the possibility that Hezbollah itself may have been responsible.

Also tonight, new defiance by the Hezbollah leader, Hassan Nasrallah. He's accusing Israel of plotting with the United States to create a quote, "new Middle East." And he says his guerrilla group will not accept any humiliating condition for a cease fire.

Plus, the warfare between Hezbollah and Israel enters its third week and Israel is now claiming a new victory. It says its troops killed a senior Hezbollah commander in the ground fighting that's been going on in southern Lebanon. I'm Wolf Blitzer in Jerusalem and you're in THE SITUATION ROOM.

We want to get more on all this breaking news that's unfolding tonight. We have reporters standing by. Christiane Amanpour is here in Jerusalem. John Roberts is along the border, Israel's border between Israel and Lebanon.

Let's start with John with more on these developments. John, you're not very far away from where this incident occurred in south Lebanon, Khiyam, where United Nations military personnel were killed. You've heard the exchanges, you've heard the latest accusations between the U.N. secretary general, the Israeli government response. We just heard from Israel's ambassador in Washington. Give us some perspective from your vantage point right along the border.

ROBERTS: Well Wolf, what -- anytime there was a war, anytime there was a military engagement, anytime the shells, the bombs, the missiles, the rockets are flying on either side of a conflict, there's bound to be what the military so dispassionately terms collateral damage.

We don't have eyes on the ground in Lebanon. The Israeli Defense Forces refuse to take us across the border even though they claim to have full control of Maroun al-Ras, that hilltop village just on the other side of the Lebanese border. And now they claim to have full control of Bint Jbeil, which is that town about three miles inside the border.

They still are keeping us over here so we can't put eyes on the ground, we can't collect any facts on the other side of the border to try to find out what really went on. But it's not surprising Wolf, given the intensity of the bombardment that we have just been seeing in the past hours with the number of shelling going off every minute. I think we can sometimes count 10 shells going out every minute, that somebody might get caught in the crossfire. As to whether or not that outpost in Khiyam was deliberately targeted, it's impossible for us to tell. We can only take people at their word right now and then try to get some investigation going later on. BLITZER: The Israelis say they will investigate. We hear those pounding sounds coming from behind you. John Roberts, thanks very much.

Let's go north to Beirut where after a day or two of a lull in Israeli air strikes in the Lebanese capital, they resumed with intensity today. Nic Robertson once again joining us from Beirut. Nic?

ROBERTSON: Well Wolf, we've also been hearing today from Lebanese defense sources who believe they have a very good idea of what Israel or how Israel intends to advance into Lebanon. But indeed, Beirut had been quiet for the last almost two days until late this afternoon.

(BEGIN VIDEOTAPE)

ROBERTSON (voice-over): For 24 hours, it had almost been normal in Beirut, 24 hours without bombing. That ended with a massive Israeli air strike. Huge clouds of smoke rose from Hezbollah's heartland in the southern suburbs of the capital.

At the same time, details reach Beirut that the grinding Israeli advance northwards into Lebanon. The mountain village of Maroun al- Ras taken. Bint Jbail, three miles, five kilometers over the border, a town straddling a strategic crossroads, taken. But what's next? Lebanese military sources suspect Israel intends to advance much farther, another 20 miles north across the Litani River into the town of Nabatiya, before moving west to the coast and the port city of Tyre.

UNIDENTIFIED MALE: Hezbollah rocket, Hezbollah rocket.

ROBERTSON: Where Hezbollah still fires rockets at Israel. It's a military operation that at this rate could take weeks. In the path of that potential advance, this house in Nabatiya, where Lebanese officials report seven civilians were killed where it was hit in an Israeli air strike.

And in nearby Tyre, the injured and displaced continue to flood in from the nearby villages and towns, desperately in need of relief supplies. In Beirut, those supplies began arriving. U.S. helicopters bringing enough emergency medical kits enough to supply 20,000 people for three months, the leading edge of a $30 million aid program for south Lebanon.

UNIDENTIFIED MALE: There's a humanitarian crisis here. We want to address that. The U.N. has appealed to people -- to nations -- people for support. We want to support that appeal.

ROBERTSON: The U.S. aid is being handed over to the international Red Cross to distribute as they see fit. Initially it's going into storage. Mindful in the last few days that Lebanese Red Cross had vehicles struck with Israeli strikes.

(END VIDEOTAPE) ROBERTSON: Well the latest update we've had from the Red Cross is that they will keep those medical supplies in the warehouse until they will get security guarantees from the Israeli government that will allow them to drive the supplies, the aid south through the mountains with some degree of safety. Wolf?

BLITZER: Nic Robertson on the scene for us in Beirut. Nic, thank you very much. Nic, an incredibly courageous working for CNN. We'll take another quick break. When we come back, another courageous journalist, Christiane Amanpour. he's here in Jerusalem with me after spending the last two weeks on the border with Lebanon. We're going to get Christiane's reaction to the breaking news we are following. A serious charge from the United Nations Secretary-General Kofi Annan that Israel apparently deliberately killed four United Nations military observers in south Lebanon, a charge Israel is denying, calling that accusation by Kofi Annan deplorable.

Much more on our special coverage on the crisis in the Middle East right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Welcome back. We're following breaking news here in the Middle East. The crisis in the Middle East just got a whole lot more complicated with the United Nations Secretary-General Kofi Annan accusing the Israeli military, in his words, of "apparently deliberately targeting United Nations military observer positions in south Lebanon," killing four U.N. troops, within the past few hours.

That's a charge that has been forcefully rejected by the Israeli ambassador to the United States, Daniel Ayalon. You saw him live here in THE SITUATION ROOM, deploring the statement made by Kofi Annan.

Let's bring in Christiane Amanpour. She's back here in Jerusalem with me. Just came back from the border. You were close to Khiyam, this location where the United Nations observer force was based that was targeted. In the original statement put out by UNIFIL, they claimed what?

AMANPOUR: That it was aerial bombs that hit a patrol base. And they also said that UNIFIL had reported 14 incidents of close firing to that base throughout this afternoon. And we certainly remember that last night when we were at the border there -- and it's just across from Matula (ph), where the CNN position is.

We reported last night a massive increase in the amount of air power and of artillery power. So, you know, this is happening in an area where there was a huge amount of activity.

And I think, you know, when you read the secretary-general's very strong statement, number one, there's -- four people are dead, so this is deplorable for U.N. observers. When he says, "apparently deliberately targeting," he then goes on to say the General Alam Pelligrini (ph), who is his force commander there, had been in repeated contact with Israeli officers through the day on Tuesday, stressing the need to be careful about that position. And, I mean, you know, these things when we talk to the military up there, the Israeli military, they tell us over and over again that they're doing their best to avoid civilian or other untouchable targets and they say that in war, there is misidentification of targets and misidentifying the enemy and mistakes. I mean, they're open about it.

And, you know, I was talking to former Israeli minister Yossi Sarid, who, as you know, was one of the founders of the Peace Camp. He was a former minister. And he says -- and like many hear in Israel say -- that they, obviously, support the strong response to the killing of their two soldiers. But he said to us the United States should be aware that it should really try to help Israel by restraining it because Israel, in his words, doesn't know when to stop. So this is an issue that is concerning people here.

BLITZER: You meant the kidnapping of those two Israeli soldiers.

AMANPOUR: What did I say?

BLITZER: The killing of those.

AMANPOUR: The kidnapping.

BLITZER: The kidnapping, Yossi Sarid being a very doveish politician here in Israel.

AMANPOUR: And the killing of the others.

BLITZER: You know, Kofi Annan is the top diplomat of the United Nations, the secretary-general. Normally, diplomats when they have these kinds of incidents, they respond with diplomacy. They are -- diplomatically, it has to be investigated. For him to make this serious accusation, as smart as he is, knowing the ramifications of what he was saying, you have to presume he has got other information beyond what's in the statement.

AMANPOUR: And he's called for an investigation and you know he has called for a cease-fire in all these past days since this has exploded.

BLITZER: But he's come up with a conclusion before the investigation.

AMANPOUR: He says apparently.

BLITZER: Yes, well, that's serious ...

AMANPOUR: He's calling for an investigation.

BLITZER: But that's a pretty serious accusation. It's a ...

AMANPOUR: Four of his people are dead.

BLITZER: It's a huge story and especially complicates this notion of trying to create a new -- a new -- international peacekeeping presence right now given the clear and present dangers that exist. Christiane, thank you very much. Christiane Amanpour here in Jerusalem doing outstanding work for CNN.

We're going to continue to stay on top of this breaking news. The accusation by Kofi Annan, the latest statements by the Hezbollah chief, Hassan Nasrallah.

Also, amidst all of this, there is a huge controversy exploding back in Washington related to this crisis in the Middle East, involving Iraq's new prime minister on his first visit to the U.S. capital. Much more on that right after this.

(COMMERCIAL BREAK)

BLITZER: Welcome back. We're following all the late-breaking news that's unfolding here in the Middle East. Much more on the news coming up.

We're also following another important story coming out of Haifa, the continued rocket attacks on Israel's third largest city. CNN's senior medical correspondent Sanjay Gupta is in Haifa and once again, it came under attack earlier today.

DR. SANJAY GUPTA, CNN SENIOR MEDICAL CORRESPONDENT: Hey, Wolf, we went to Rambam Medical Center, one of the largest trauma centers anywhere in Israel, maybe the world in fact, to get an idea of what it was like for a hospital to run while in the target zone. As it turns out, while we were there, we got a chance to see how that works firsthand.

(BEGIN VIDEOTAPE)

GUPTA (voice-over): In Haifa, this is how day 14 began. By early afternoon, 16 Hezbollah rockets fired from Lebanon across the bay towards Israel. Many land harmlessly in the water. A few make contact. We were downstairs in the hospital when we heard the thud of a rocket hitting.

(on camera): We've been here for a couple of hours now. You heard five different sirens go off. Then we heard a loud thud on this last one. There is smoke rising. Look how close this is to the hospital. Look how close this is to the entire medical center. This is what it's like every day for these doctors, these patients.

From that particular air strike, I saw at least 15 people brought in. A few of them seriously wounded. Many just terrorized. The rocket's target seemed to be random. This one landed in a middle of a turnabout on a busy road. This one in a busy marketplace.

This is the actual blast site. This is where the missile actually hit. To give you an idea, it's about eight feet by eight feet in diameter around here, square footage wide. But the impact is obviously felt much further on. I want to give you an idea. Take a look at this building made out of concrete. All the damage there actually from ball bearings. These rockets are filled with thousands and thousands of ball bearings. They smash out windows. They make dents in the concrete and obviously can injure people as well. The blast site is here, but the impact is felt just about everywhere. In Haifa, two weeks into this war, it seems every building has become a temporary bomb shelter.

We're definitely starting to get a sense that people are more frightened. Just about 10 or 15 meters away, there was actually a strike just about a half an hour ago. Sirens go off again, people are scared. You can see it right here, sirens are going off. There's a question of whether or not there will be another air strike right around this area in the next few minutes.

After the sirens go off, there's only usually about a minute before the rockets hit. By late afternoon, rockets have ceased. Israeli Defense Forces report the Katyusha launch site near Tyre, Lebanon that fired so many of those rockets was taken out. For now, good news for Israelis.

But launch sites are very mobile and another one may soon take its place. From the perspective of many of those citizens, a cease- fire is nowhere in sight.

(END VIDEOTAPE)

GUPTA: And Wolf, since filing that report, things have quieted down. We heard a lot of those sirens all morning long, then reports that the rocket launcher was actually taken out. But as you know, they're so mobile, it's hard to tell whether or not rockets will start firing into Haifa again. We will certainly keep you posted on that. Back to you, Wolf.

BLITZER: Sanjay, thank you very much -- Sanjay Gupta in Haifa for us tonight.

Meanwhile, back in Washington, there's a huge controversial erupting involving this crisis in the Middle East. It also involves the new prime minister Nuri al-Maliki on his first visit to the United States since assuming that post. Our White House correspondent Ed Henry is joining us now live with the latest. Ed?

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Wolf, President Bush acknowledged today that the violence in Baghdad is terrible, sparking another shift in strategy.

(BEGIN VIDEOTAPE)

HENRY (voice-over): President Bush knows his legacy will rise or fall based on Iraq. So he eagerly proclaimed it a remarkable, historic moment to stand in the White House with the leader chosen by Iraqis in a free and fair election.

BUSH: You have a strong partner in the United States of America.

HENRY: But that pageantry was quickly overshadowed by the word from the president and Iraqi President Nuri al-Maliki. More American troops are headed to Baghdad to deal with escalating violence. BUSH: The prime minister advised me that to support this plan, he and General Casey have agreed to deploy additional American troops and Iraqi security personnel in Baghdad in the coming weeks. These will come from other areas of the country.

HENRY: Just one month ago, General George Casey, the U.S. commander in Iraq, was considering pulling two combat brigades, up to 10,000 U.S. troops this fall. With the possibility of even deeper U.S. troop cuts on the horizon in 2007 if and only if conditions on the ground improved.

But now any hope of bringing home large numbers of U.S. troops before the midterm election seems bleak based on the stark assessment by the White House itself.

STEPHEN HADLEY, NATIONAL SECURITY ADVISER: Death squads and armed gangs are going around murdering people, kidnapping people, sometimes in broad daylight. There has to be a consequence for that. People need to be held to account.

HENRY: That effort may be hampered by the fact that al-Maliki has refused to condemn the actions of another terrorist group, Hezbollah and has only blamed Israel for the crisis in Lebanon. Asked to clarify his position, al-Maliki dodged by trying to shift the focus to the humanitarian crisis.

NURI AL-MALIKI, PRIME MINISTER, LEBANON (through translator): Here actually we're talking about the suffering of a people. And we are not in the process of reviewing one issue or another or any government position.

HENRY: Democrats are eagerly exploiting the fact that al- Maliki's position is completely at odds with President Bush.

SEN. HARRY REID (D-NV), MINORITY LEADER: I want the prime minister to denounce what Hezbollah has done and what they're doing. That's what I want.

(END VIDEOTAPE)

HENRY: Some Democrats want al-Maliki's invite to address a joint meeting of Congress on Wednesday to be revoked, but Republicans are expected to go ahead with the speech. Wolf?

BLITZER: Thanks very much, Ed Henry at the White House. Up next, Jack Cafferty and his question this hour about peace between Israelis and Arabs. Can it ever be achieved? Much more on our coverage, right after this.

(COMMERCIAL BREAK)

BLITZER: Let's go right to Jack in New York. Jack?

CAFFERTY: Thanks, Wolf. A new "USA Today"/Gallup poll shows 68 percent of Americans say that Arabs and Israelis will probably never work things out between them. We want to know what you think, whether there can ever be peace between those two groups.

Elie writes in Pittsburgh: "Easier said than done. I'm a Lebanese Christian living in the states. I was in Beirut when this madness began, had to flee via Syria and Jordan under the bombs. As long as there's no complete and final resolution of the Palestinian issue, based on the interest parties and not only on Israel's interests, there will never be peace."

Simon in Texas: "As long as fundamentalists believe Israel should be destroyed, war is unavoidable."

Bill in Columbus, Ohio: "Certainly. Unfortunately history tells us this can only happen when one side is defeated. Not destroyed, but soundly defeated militarily."

Betty in California: "Not as long as the U.S. arms and finances Israel. One major columnist said not only is Israel making a mistake, Israel is a mistake. I'm inclined at this point to think he's right. How did we think we could drop European Jews into the Arab world and think it would work? It has not worked, it is not working, and we're on the wrong side of history in this."

Pete in Spring Lake, New Jersey: "Seems unlikely the Arab/Israel relationship will ever lead to a permanent peace. We should finish our business, Iraq, and set up shop on the Lebanon/Israeli border. Perhaps then, with the U.S. appearance, a short-term peace could be achieved."

And Rick in Columbus, Ohio: "Not likely without some serious changes in attitudes in the Arab governments. Since its creation, Israel has been the bane of every Arab country's existence. Then again, I'd be pretty upset too if someone else came into my sandbox and told me that a certain corner now belonged to the kids my parents always told me to hate. Maybe once the teaching of hatred stops, attitudes will change."

More of these online at CNN.com/CaffertyFile. Wolf?

BLITZER: Jack, thanks very much. That's it for tonight from Jerusalem. Much more of our coverage though coming up on "PAULA ZAHN NOW." Paula?

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