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American Morning

Heated Battle in Lebanese Town of Bint Jbeil; Blair and Bush Meeting; U.S. Troops Staying in Iraq Longer Than Expected

Aired July 28, 2006 - 06:29   ET

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

SOLEDAD O'BRIEN, CNN ANCHOR: Happening this morning, a fresh round of Israeli strikes in southern Lebanon. Lebanese officials say the strikes killed at least three people, wounded nine others.
In just a few hours, President Bush and British Prime Minister Tony Blair will hold a meeting at the White House. They're expected to discuss the Mideast crisis. Blair says he wants a U.N. resolution on the crisis in place by next week.

And in California, that deadly heat wave has now killed more than 100 people. For almost two weeks, temperatures have soared into the triple digits across the state.

Good morning. Welcome. You're watching a special edition of AMERICAN MORNING.

I'm Soledad O'Brien in New York.

Good morning, Miles.

MILES O'BRIEN, CNN ANCHOR: Good morning, Soledad.

Live from a hilltop kibbutz just about three miles south of the active and heated battle in the Lebanese town of Bint Jbeil.

I'm going to ask Dave Albright (ph) just to zoom over my shoulder here and zoom in on what we're seeing here. Everything you see in green in the foreground here is still in Israel. You see some smoke just on the other side there. That's in Lebanon. Everything kind of in brown is in southern Lebanon.

And just over that hill, you can see way off in the distance, there's a single structure with a red roof. That is the outskirts of Bint Jbeil. And as we've been watching here, we're just seeing a steady bombardment, pounding by the artillery of the Israeli Defense Forces. This follows a night where we're told the Israeli air force targeted no less than 110 suspected Hezbollah locations all throughout southern Lebanon.

In the meantime, we have seen the evidence of the Katyusha missiles and other missiles being fired back in this direction. This little settlement here with all the red roofs here, a Katyusha or suspected Katyusha fell down on it just a short time ago. So we're really getting a good view of the battle.

Just to the far right of our view here is Maroun al-Ras. So this is really the area that the Israeli Defense Forces, the Israeli air force has been focusing on.

Continuing fierce fighting. And we're told on the ground in those cities right now, said to be Hezbollah strongholds. Bint Jbeil said to be virtually the capital of Hezbollah in southern Lebanon. Fierce fighting, close infighting in the narrow streets of a city that is about 20,000 people.

So we're watching that all unfold here from this vantage point. Day 17, Soledad. No letup in sight.

S. O'BRIEN: All right, Miles. Thanks. We'll check back in with you in just a little bit.

The Middle East crisis is going to dominate the president's day. British Prime Minister Tony Blair arrives at the White House. That happens later this morning.

CNN's Robin Oakley live in London right now.

Robin, good morning to you.

What does the prime minister hope to get out of this trip with the president?

ROBIN OAKLEY, CNN CORRESPONDENT: Well, good morning, Soledad.

Certainly Tony Blair is hoping to step up the pace of diplomatic activity, working towards a cease-fire. Officials traveling with Tony Blair have said the prime minister is not going to be going in demanding a cease-fire. There's no U-turn in those terms. But he does feel that the time is now right for getting together the detailed background that will make a cease-fire sustainable, if it can be achieved.

And certainly Tony Blair's officials are saying that he would like to see a U.N. resolution as early as next week. And they're also really explaining that they believe they could now be pushing at an open door on this question, that the U.S., too, is probably ready to see a U.N. resolution in the belief that the Israeli forces will, by then, have inflicted sufficient damage on Hezbollah -- Soledad.

S. O'BRIEN: Robin, let me ask you a question about how the prime minister's viewed back at home regarding this Mideast crisis.

OAKLEY: Big, big problems for Tony Blair in those terms, Soledad. Two-thirds of the British public and opinion polls now say that Britain is too close to United States policy. A lot of other European leaders feel Tony Blair is out of step.

They've been pressing much more urgently for a cease-fire than he has done, really ever since Tony Blair's closeness to President George Bush over Iraq. He has been much criticized as being the president's poodle. And that was underlined, really, with that so-called, "Yo, Blair" conversation at the G-8 summit when the microphones were left switched on accidentally. Tony Blair appeared to be offering to go to the Middle East and do what he could do to help with the peace process, and the offer obviously spurned by George Bush, who said, let's leave it to Condoleezza Rice -- Soledad.

S. O'BRIEN: Robin Oakley for us in London this morning. Robin, thanks.

And CNN is going to have live coverage of President Bush's news conference with Tony Blair at 12:30 Eastern Time.

At least 3,500 American soldiers will be staying in Iraq longer than expected. It's part of the Pentagon's new plan to stop the escalating violence in Baghdad.

CNN Senior Pentagon Correspondent Jamie McIntyre explains.

(BEGIN VIDEOTAPE)

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: The request had to be approved personally by Defense Secretary Donald Rumsfeld because the U.S. military was essentially breaking a promise to the troops that they would only be on the ground for one year in Iraq. But the top commander in Iraq, General George Casey, decided he needed the capabilities of this stryker brigade, armed with high-tech-wheeled vehicles, to increase security in Baghdad. Because of that, he asked them to stay for up to four more months, although exactly how long they stay remains to be seen.

In return, the troops will get some bonus pay between $800 and $1,000 a month extra in their paycheck, but they will be pulling some dangerous duty in one of the deadliest parts of Iraq.

Jamie McIntyre, CNN, the Pentagon.

(END VIDEOTAPE)

S. O'BRIEN: Happening "In America" today, unwelcome news for New Orleans. Confirmation from Army Corps of Engineers data that new floodgates on three major drainage canals will not protect the city from heavy flooding during a tropical storm or a hurricane.

In Washington, the U.S. House could vote today on increasing the minimum wage. Democrats want to raise it from $5.15 an hour to $7.25 an hour. That would happen over two years.

New York City, the son of philanthropist Brooke Aster denies abusing his ill 104-year-old mother. Anthony Marshall (ph) is accused by his own son of penny-pinching on her health care. Marshall (ph) says his family spends more than $2.5 million to care for his mother at her Park Avenue home.

In San Francisco, Barry Bonds' personal trainer appeared in a federal courthouse where a grand jury is investigating the baseball star for perjury and tax evasion. But it is not known whether the trainer, Greg Anderson (ph), testified or not. He appeared before a judge who could have put him in jail if he refused to cooperate.

Let's get right to the forecast, 36 minutes past the hour. Chad's got it.

Hey, Chad. Good morning again.

CHAD MYERS, CNN METEOROLOGIST: Good morning, Soledad.

(WEATHER REPORT)

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

MYERS: You bet.

S. O'BRIEN: Still to come this morning, thousands of Israelis take up residence in an unlikely place as they flee the fighting and the destruction at home. We'll show you.

And Miles takes us on a tour with the Israeli border patrol. The latest from the front lines of the conflict as our special edition of AMERICAN MORNING continues.

Stay with us.

(COMMERCIAL BREAK)

S. O'BRIEN: Thousands of Israelis trying to escape the Hezbollah rocket barrage are now living in a tent city in southern Israel. What's more, it's being funded by a controversial businessman.

More from CNN's Paula Hancocks this morning.

(BEGIN VIDEOTAPE)

PAULA HANCOCKS, CNN CORRESPONDENT (voice over): It's approaching 100 degrees Fahrenheit on the Mediterranean coast. The only way to cool off is to take a dip.

This beach is filled with what appeared to be vacationers, but instead, they're people from northern Israel who fled south to escape the constant Hezbollah rocket attacks.

Victor Sharon and his family left home with just one bag after a rocket hit the house next door, shattering their windows. He says they were lucky they were in the bomb shelter at the time.

VICTOR SHARON, CARMIEL RESIDENT: Every day we've been getting hit by the Katyusha rockets. Every day, every single day. And, you know, the girls, they had never gone through this before. They've never been through the situation before. It's the first time that they've ever heard any bombs go off. And, you know, they were scared.

HANCOCKS: There are 6,000 people in this tent city. Hundreds more are on the waiting list. There's little privacy, but there is food and entertainment, and most importantly, no rockets. You could call it a luxury refugee camp at a cost of half a million dollars a day. Controversial Israeli-Russian billionaire Arkady Gaydamak foots the bill to promote what he calls Jewish solidarity. The makeshift city was built in 48 hours. It has its own police force, synagogue and medical facilities.

DAVID NITZANI, ORGANIZER, TENT CITY: The state of mind when they came here was already extremely stressed to begin with. So the whole idea is just to help them relax and keep them busy as much as we can and avoid -- this way to avoid, you know, all kind of stress-related outcome.

HANCOCKS (on camera): Living in this tent city is like living in a different world for many of these residents of northern Israel. But the one reminder that they're not on holiday, and they are actually at war is the sound of fighter jets every now and then. And also, in the evening they can hear the helicopters coming back from military operations in Gaza, which is just about 15 miles down the coast.

(voice over): While the sand and the sea would seem a desirable distraction, everyone we spoke to said they just want to go home.

Paula Hancocks, CNN, Nitzanim, Israel.

(END VIDEOTAPE)

S. O'BRIEN: Still to come on our special edition of AMERICAN MORNING, Israel unleashing a new round of attacks in Lebanon. Our reporters are standing by with the very latest.

And then we return to Miles in the Middle East as he suits up and rides along with the Israeli border patrol.

A short break. We're back in a moment.

(COMMERCIAL BREAK)

S. O'BRIEN: The latest now from the Middle East this morning.

A fresh round of Israeli strikes in southern Lebanon. Lebanese officials say the strikes killed three people, wounded nine others.

Israeli tanks and troops are pulling out of northern Gaza. The withdrawal follows a two-day sweep for militants that's killed 29 Palestinians.

President Bush is going to meet this morning with British Prime Minister Tony Blair at the White House. The two are expected to discuss the Mideast crisis. Blair says he wants a U.N. resolution on the crisis in place by next week.

Miles is on the border this morning between Israel and Lebanon. We can't disclose the exact location, but he'll update us on what's happening there.

Hey, Miles. Good morning. Obviously, we're having -- are you back, Miles? Let's see if we can hear you.

M. O'BRIEN: Yes. Can you hear us? Can you hear me?

S. O'BRIEN: I can now. Go ahead.

M. O'BRIEN: Can you hear me now?

S. O'BRIEN: Yes. You're back.

M. O'BRIEN: All right. Sorry about that, Soledad.

We're 2,600 feet above sea level, mountain top location at a kibbutz. Can't tell you where it is. That's the Israeli censorship rules. We are, after all, watching live right before us the battle of Bint Jbeil.

You can see a series of explosions in the brown area. That's Lebanon. Up and over that hill is the center of Bint Jbeil, but that's the approach to it.

A constant stream of artillery. We heard it all last night in Kiryat Shmona where we overnighted. And it is clearly a very tense border.

We spent a little time earlier today with some members of the Israeli border patrol.

(BEGIN VIDEOTAPE)

M. O'BRIEN (voice over): We suited up with body armor when we met the border patrol in Metula. There is no place farther north in Israel.

UNIDENTIFIED MALE: So you see here this is what was called the good fence, the border between Israel and Lebanon. Off to your right over there, you have the town of Metula. And up here in front of you, you see the Lebanese town of Karakile (ph).

M. O'BRIEN: The two Humvee convoy is led by Micah Avni (ph), a reservist who grew up in Connecticut. He runs a commercial finance business here now, but got the call, and like so many others, dropped everything two weeks ago.

UNIDENTIFIED MALE: Most of us would like to be at home with our families and doing our jobs and not out here playing soldier, which unfortunately we've been forced to do. And we find ourselves in a situation where we were attacked by the Hezbollah. It came out over the blue in the past couple of weeks with rockets falling over Israel. We had no choice but to call (ph) the army and to deal with this.

M. O'BRIEN: Of course it was the kidnapping of two border guards along this frontier that triggered the war. The soldiers look warily at the other side. UNIDENTIFIED MALE: There are definitely Hezbollah loyalists in some of those buildings. I mean, we've had shooting going back and forth with those buildings over the past few weeks. And prior to when the situation heated up, we would see the Hezbollah. They had flags flying. So there's no question that there are Hezbollah there.

M. O'BRIEN (on camera): This is a place they used to call the good gate.

What town is that?

That's Varcala (ph) in Lebanon.

The distance between the two is what?

Three hundred meters, no more.

This used to be a very busy thoroughfare before Israeli troops pulled out of southern Lebanon in the year 2000.

Check this out over here. This was like a waypoint where people would get checked out by customs and immigration, make sure they had the right visas and so forth.

It turns out there was a lot of commerce back and forth. And a lot of people who lived in Lebanon would come into Israel to the town of Metula to work.

(voice over): It is eerie on the Israeli side of the border. Aside from us, no one is here. And look at these new homes. Big investments in a tough neighborhood.

UNIDENTIFIED MALE: We've had a lot of sniping and shooting by the Hezbollah from that building.

M. O'BRIEN (on camera): And is it just an incomplete building or...

UNIDENTIFIED MALE: I think it's just an incomplete building. And, you know, that's often a good kind of base for sniping because you can go up and do what you want. And so, as you can see, it's a little bit blown up because we had to retaliate fire there. Part of the walls are knocked out from our tank fire.

M. O'BRIEN: Right.

This is the border road which goes between -- that's Lebanon over there. I'm standing in Israel. That road goes all the way to the Mediterranean in that direction and all the way to Syria in that direction.

This road, these fences were here all before the Israelis invaded in 1982. And it remains and is fortified and is protected since they pulled out in 2000. And today, it's not a very safe place to be, quite frankly. Driving along this road, you're inviting sniper fire, and who knows what else. (voice over): And so they patrol, trying their best to stay vigilant. Long hours of tedium with the strong undercurrent of fear.

UNIDENTIFIED MALE: I think from an Israeli perspective, having missiles shot into Israeli cities completely unacceptable. It's not something that we can allow, it's not something that any democratic country would allow. And I think that the Hezbollah is a radical fundamentalist party who is not willing to talk. They're not willing to negotiate. They don't think in those terms.

(END VIDEOTAPE)

M. O'BRIEN: Back now live. As you look at that white smoke, that is the -- sort of the northern part of Bint Jbeil.

Bint Jbeil, the majority of it over that horizon, steady artillery. It's been going on ever since we've been in this area almost constant.

Just an absolute rhythm of constant pounding. That, along with the air attacks we told you about last night.

Going back to Micah Avni (ph), the border patrol reservist, yesterday, Soledad, when we spoke to him, he was critical of the Israeli prime minister, Ehud Olmert, and said that he felt that Mr. Olmert and his cabinet were being too timid in the way they were handling this war. Had some criticism for him.

Today, wouldn't say anything of that kind. His superiors told him not to -- Soledad.

S. O'BRIEN: Yes, I'm not surprised. When I saw that yesterday, I thought, huh...

M. O'BRIEN: Yes.

S. O'BRIEN: ... I wonder who's going to rope that in, and pronto. Interesting.

All right, Miles, thanks. We'll check back in with you in a little bit.

Andy Serwer is "Minding Your Business" coming up next.

Hey, Andy. Good morning.

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

The voice-mail stock fraud perps are busted.

Plus, US Air has some amazing news, Soledad. A profit. How about that?

S. O'BRIEN: Some good news. All right. We'll look at what's behind that.

Thanks, Andy.

Also ahead this morning, British Prime Minister Tony Blair. We've been telling you about this, this morning. He's expected to push for a Middle East cease-fire when he meets with President Bush today. We're live from the White House just ahead with the latest on that.

You're watching AMERICAN MORNING. We're back in a moment.

(COMMERCIAL BREAK)

S. O'BRIEN: More on the Middle East crisis in just a moment. First, though, some business news.

A phone scam. We've told you about this in the past. It's an incredible scam.

Andy Serwer's got an update on what's happening there.

How does it work?

SERWER: Well, I thought it was ingenious, Soledad.

S. O'BRIEN: It really is brilliant.

SERWER: It was great. And I'll tell you, first of all, federal authorities have charged three Florida residents with securities fraud in connection with the so-called voice-mail stock scheme. This goes back to 2004. You may remember this.

You'd get a message on your voice-mail that was a wrong number. In other words, someone would call you up. And this is how it actually worked.

It said, "Debbie, this is Jenny. Oh, my god, I met this really hot stock exchange guy, and he told me about the stock Megatrons (ph), and it's only $2, but it's going to go to $6. And are you going to the pool later? I'll tell you all about it. It's really cool. OK. Bye."

And that's what you'd get on your voice-mail. So you were like listening in...

S. O'BRIEN: You were, like, "Wow, someone left the wrong message."

SERWER: Right.

S. O'BRIEN: The wrong number called, but I could...

(CROSSTALK)

SERWER: Well, it's illegal because what these people were doing is what's called pumping and dumping. They would take a position in the stock or they would have friends who would take a position in this little stock, and this would be driving the stock price up, manipulating a stock price.

S. O'BRIEN: Did it work?

SERWER: It worked. Apparently, it made these six stocks go up $179 million. This is a great story.

S. O'BRIEN: Wow.

SERWER: There was a duffel bag of cash exchanged at a Gulfport, Mississippi, casino; 9,500 calls made, 43 States, 1,700 complaints. No word from the lawyers of these three alleged perps, but it sounds like they're in a world of trouble.

But it was ingenious. I think this goes in the hall of fame of stock frauds, don't you think?

S. O'BRIEN: I think it's pretty smart.

SERWER: Some more stuff to tell you about this morning, Soledad.

US Air -- get this -- reports a profit. A big profit for the second quarter. Back from the dead.

This is the new US Air. You may remember it came out of bankruptcy and merged with America West. And the stock's done really well over the past -- well, it's almost been a year. Nearly doubling -- more than doubling, going from about $20 to $47.

The company reported a $305 million profit. Says it's going to be profitable in the third quarter. Says it's going to be profitable for the whole year.

And I'll tell you, Soledad, while we weren't looking, the airlines are coming back. Even though fuel prices are high, traffic is up.

S. O'BRIEN: Is that's what's...

SERWER: OK. The business has cut back a little bit, so there's not as many planes. Business is up and ticket prices are up. So this could be the first. Other airlines may start reporting profits as well.

S. O'BRIEN: Oh, that could be nice.

SERWER: Yes, indeed.

S. O'BRIEN: More good news, even though we're sort of paying for it.

SERWER: Right.

S. O'BRIEN: You know what? They need the help, though.

SERWER: That's right. We need a healthy airline business in this country, obviously. S. O'BRIEN: Right.

Andy, thank you.

SERWER: Thanks.

S. O'BRIEN: And I like your valley girl accent. That's good.

SERWER: Oh, my god.

S. O'BRIEN: Oh, my god, Debbie.

SERWER: Debbie.

S. O'BRIEN: Thank you.

Let's check the forecast now. Chad's got that at the CNN Center.

Hey, Chad.

MYERS: Hi, Soledad.

(WEATHER REPORT)

MYERS: The next hour of AMERICAN MORNING starts right now.

S. O'BRIEN: Thank you, Chad.

Israel is stepping up attacks this morning. More airstrikes pounding southern Lebanon. An Israeli offensive in northern Gaza comes to an end, though. Troops pulling out after two days of fighting.

And British Prime Minister Tony Blair is on his way to Washington. He's seeking an end to the Middle East crisis.

Plus, an American victory is now in question. Tour de France winner Floyd Landis is now defending himself after a troubling drug test.

Good morning. Welcome, everybody. You are watching a special edition of AMERICAN MORNING.

I'm Soledad O'Brien. I'm in New York this morning.

Hey, Miles. Good morning.

M. O'BRIEN: Good morning, Soledad.

Live from a hilltop overlooking the southern part of Lebanon, and what we're seeing unfold before us here, as we stand in this kibbutz 2,600 feet above sea level, is the battle of Bint Jbeil and Maroun al- Ras as Israeli forces continue pounding these suspected Hezbollah strongholds.

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