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American Morning

Castro Communication; Cuba At A Crossroads?; Crisis In The Middle East; East's Extreme Heat; Inside Israeli Warship; Minding Your Business

Aired August 02, 2006 - 07:00   ET

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

SOLEDAD O'BRIEN, CNN ANCHOR: We've got Rick Sanchez in for Miles. Rick this morning is reporting from Little Havana in Miami. Hey, Rick, good morning.
RICK SANCHEZ, CNN ANCHOR: I am indeed, Soledad. And certainly there have been a lot of people taking to the streets, you might dancing in the streets, on -- in some instances last night. And many of them coming back now to what is called La Calle Ocho, Southwest Eight Street in the heart of Miami, the heart of exile Miami, as well.

Many of these exiles have been wondering now exactly what's going to happen with Fidel Castro. What will happen with his health. Are they being told the truth? Is it much worse than what Cuban officials are letting on?

Well, this we know, the Cuban leaders condition still extremely closely guarded. In fact, they're calling it a state secret, which is the reason they're really not divulging a whole lot of information at this point. They're saying that he is in stable condition and that he is in good spirits.

Other than that, they're not saying a whole lot. No one has seen Fidel Castro. No one's seen Raul Castro either. What does this say about the Cuban leader's situation?

To Morgan Neill now. He's in our Havana bureau following things for us there in Havana, joining us now live.

Morgan, what have you gleaned?

MORGAN NEILL, CNN CORRESPONDENT: Well, Rick, what does this tell us that they're guarding closely the details of his condition? Well, it tells us very little because this is very much par for the course. This is something we've seen over decades.

There have always been theories about various illnesses that President Fidel Castro may be suffering from and these theories tend to gain weight because there's little traction, there are little facts to base them on. That is again what's happening here. Tuesday afternoon we heard this statement reportedly from the leader himself saying he was in stable condition and good spirits, although admitting his condition is serious.

Now people on the streets here, while they were certainly shocked to hear the initial announcement Monday that he was handing off power to his 75-year-old brother, Raul, now say they still have to go to work in the morning. They still have to fend for their families, et cetera. So there's no real sense of panic on the streets.

Rick.

SANCHEZ: There is no question and I think few would doubt that Fidel Castro has unbelievable Machiavellian skills. Is there any sense from people there in Cuba that the Cuban government is somewhat orchestrating this? That's not to say that there's not anything wrong with him or, in fact, that he may be in worse condition, but that they're just playing this out to make sure it's favorable for Fidel in the end?

NEILL: Well, it's interesting that you talk about this idea of orchestration. While it's certainly not the place to speculate that somehow that's related to the medical condition, what we have seen over the past several months is gradually Raul Castro, his brother and the temporary leader of Cuba right now, has been appearing more in state run newspapers. We saw one long article talking about his history, a bit about his personal life. These are things that we did not see for decades. So there is a sense that more and more Raul has been taking a more prominent position.

Rick.

SANCHEZ: Morgan Neill, following things there for us in Havana. We will be checking back with you.

Meanwhile, as for people here in parts of south Florida, hundreds of thousands of them who are expecting that something will soon be happening in Cuba. They say they're not exactly sure what it's going to be. But when you think about it, they've been expecting this now for almost a half a century and they gather from time to time. Perhaps never quite like this with this kind of heightened expectation. But they certainly have gathered in the past. And when they do so, they do so here on Southwest Eight Street in a place called Versailles.

(BEGIN VIDEOTAPE)

SANCHEZ, (voice over): To feel the pulse of Cuban Miami, to understand why so many Cuban Americans are so strident in their support of democracy, their hatred of communism, their extreme dislike of Fidel Castro, one has to come here. Felipe Valls founded his restaurant 34 years ago.

FILIPE VALLS, RESTAURANT OWNER: It was one of the few places where I found something Cuban. Something truly authentic to our culture.

SANCHEZ: It's Versailles. Where among the guava-filled postolitos (ph) and chicken croquets, politics is the nightly staple served up with Cuban coffee, as strong and pure as the passion displayed by these men and women who refer to themselves not as Cubans, nor Americans, but as exiles, hoping to return home.

UNIDENTIFIED MALE: It would be a dream for me, for my parents, to be able to go back there.

UNIDENTIFIED FEMALE: If it's not on the first plane, I'll go on the second one.

SANCHEZ: But you'll go back?

UNIDENTIFIED FEMALE: Definitely.

SANCHEZ: Is that important for all of you? Raise your hands. Yes. Yes. Yes. You'll go back.

It is their eternal hope to get back to a free Cuba. That's why news of Castro handing power to his brother Raul brings them here. And here, at Versailles, as they have for decades, they break down the latest news, debate it, analyze it and argue it.

Why Raul Castro?

UNIDENTIFIED FEMALE: I don't know why Raul because he is not competent. He doesn't have the charisma. He doesn't have the personality. He doesn't have half the know how. And I think he's going to fall.

SANCHEZ: Not all Cuban-Americans in Miami are so strident, so political. In fact, polls show many want to normalize relations with Castro's Cuba, something that decades ago wouldn't have been considered heresy. But Cuban-Americans who want to normalize relations are less vocal, seemingly less powerful and much less inclined to drink the coffee, unlike regulars here like Jose Levin (ph).

JOSE LEVIN (ph): The big city in the world. (INAUDIBLE). The big city. All (INAUDIBLE), you know, parade day (ph). Women. Everything in Havana. You know (INAUDIBLE).

(END VIDEOTAPE)

SANCHEZ: I want to show you something now because before there was Starbucks, before there was Barney's, before there were any of these coffee shops that we've all become accustomed to, there was this. I think you're looking at it now. This is Calskito (ph) as it's called. It's traditional in parts of Latin America for people to gather in the morning and not only have their coffee but have their politics, as well. They're already gathering here, as well, at Versailles where soon they'll be joined by perhaps thousands to discuss the same thing. Fuel themselves with that same coffee and talk about what today's news will bring for them and whether it will bring the eventual downfall of Fidel Castro and his communist regime. Something so many here have been waiting decades for.

That will be the situation here. We'll continue to follow it. Soledad, I throw things back over to you.

O'BRIEN: All right, Rick, thanks. So many people watching it there and watching it all around the globe, in fact. Let's turn now to the crises is the Middle East. Police in northern Israel say they're seeing more rockets fall there than they have in days. Meanwhile, Israeli troops and war planes are striking for the first time in the Bekaa Valley. Fighting is said to be fierce outside the city of Baalbek, near the Syrian border, which is northeast of Beirut. Israel says troops have killed 10 Hezbollah fighters, captured five others. Let's get right to Matthew Chance. He's in northern Israel for us this morning.

Matthew, good morning. What's Israel saying about this latest offensive?

MATTHEW CHANCE, CNN CORRESPONDENT: Well, the latest offensive is really very much focused on the south of Lebanon, alongside the broad strip of territory alongside the Israeli border. That's want the Israeli military say they want to capture as soon as possible and are working hard to do that and battling Hezbollah militants along the way.

But there was this other operation you're referring to as well, which was a special forces operation right in the northeast of Lebanon around the Ancient city of Baalbek where it turns out, according to the Israeli chief of staff who I've just walked out of a briefing with, that a special forces unit was deployed there against what was described as a remote Hezbollah logistics base and a center where it was believed Hezbollah leaders were located, although it's not clear from his comments whether any of the leaders were actually present when special forces arrived. They did raid a hospital in Baalbek, which they thought they could -- the raid to in order to gather intelligence. There was fierce fighting inside the hospital it seems. At least 10 Hezbollah guerrillas were killed according to the Israeli military. Another five were taken prisoner by the Israelis and have been brought back to Israel.

They got some intelligence from there. They say they brought these five prisoners back to Israel. None of the Israeli soldiers that were involved in the operation received any injuries. And so, from that point of view, from the Israeli's point of view, they're casting it as a success.

Soledad.

O'BRIEN: On the ground, Matthew, both from military officials and also just people there, do they feel that any hopes of a cease- fire are further and further away?

CHANCE: Well, that's a goods question. And one of the things that the Israeli chief of staff said a few hours ago is that a unilateral cease-fire was absolutely out of the question, in his words. And so, at the moment, they really are focusing on the military campaign, particularly in south Lebanon, to secure as much of that territory as they can.

The extent of the operation, the Israeli military chief is not commenting on. He's saying it's a political decision. We have had comments, though, from the Israeli Prime Minister Ehud Olmert about what is being anticipated now. Let's take a listen to what he has to say.

(BEGIN VIDEO CLIP)

EHUD OLMERT, ISRAELI PRIME MINISTER: Israel will stop fighting when the international force will be present in the south part of Lebanon. We can't stop before it because if there will not be presence of a very effective robust and military international force. Hezbollah will be there and we will have achieve nothing.

(END VIDEO CLIP)

CHANCE: We're going back to the chief of staff's comments as well, as saying that they have inflicted heavy casualties and a heavy price on Hezbollah. Saying that more than 300 of their fighters have been killed over the past several weeks.

Soledad.

O'BRIEN: Matthew Chance for us this morning. Matthew, thanks.

Reporting from the other side of the border, Michael Ware. He's right outside the hospital in Lebanon's Becca Valley. He filed this report earlier.

(BEGIN VIDEOTAPE)

MICHAEL WARE, CNN CORRESPONDENT: This is the northeastern city of Baalbek, close to the Syrian border, where less than 12 hours ago airborne Israeli troops assaulted this hospital behind me, the Daro Hecmet (ph). Locals here say that the Israeli troops either landed on the roof of the hospital or dropped troops onto the hospital, as as many as 10 helicopters swirled in the air. They say that there was then a firefight.

There's clearly signs here of fire going into the hospital. There's pop (ph) marks from bullets and fire coming out of the hospital by the gouges the bullets have left on surrounding buildings.

The story is still unclear. How the locals on the ground here say that one person was killed here at the hospital and at least three people were taken prisoner by the Israeli troops and whisked away. They say that 500 meters north of this position on the road another eight civilians, they call them, were killed on the roadway in their cars and walking beside the road.

This is Michael Ware for CNN in Baalbek, Lebanon.

(END VIDEOTAPE)

O'BRIEN: No relief on the east coast today. The mercury rising to record highs. A heat warning now in effect here in New York. People are being urged at the same time to conserve electricity. Let's get right to CNN's Allan Chernoff.

Oh, you drew the short straw today, hanging out at Times Square. How hot is it there now? ALLAN CHERNOFF, CNN CORRESPONDENT: Good morning, Soledad.

Actually right now on street level it's not all that bad. But for people commuting into the city via the subway, well those subway platforms right now, they are absolutely steaming. And the forecast today is actually worse than it was yesterday. The forecast high is for 104 degrees. That kind of temperature can really have serious health effects on the elderly.

(BEGIN VIDEOTAPE)

CHERNOFF, (voice over): In the stifling heat, nurses went door- to-door to check on elderly patients like 99-year-old Jerry Jerado (ph).

HUDA SCHEIDELMAN, NURSE: You should drink more water than juice.

CHERNOFF: The heat wave baked the east coast from New York to Washington, pushing temperatures into the high 90s. And in Philadelphia, it hit triple digits. Humidity added to the misery index.

IRIS ILLAS, NEW YORK RESIDENT: It feels like about 110, 118 degrees. That's how I feel.

CHERNOFF: With oppressive heat forecast through Thursday, New York's Mayor Bloomberg declared a heat emergency and urged caution.

MAYOR MICHAEL BLOOMBERG, NEW YORK: This is dangerous what's going on out there. So stay out of the sun.

CHERNOFF: For those without air conditioning, officials publicized more than 380 cooling centers. They're community centers offering cool air and comfortable seating to those in need.

"BLUE": WATER SALESMAN: Ice cold water, $1. Get your water here.

CHERNOFF: What's a health risk for someone is a business opportunity for others.

BLUE: It's a beautiful thing. I'm not going to be greedy. You know, I'm needy. I got to feed a wife and three sons.

CHERNOFF: Making a living in the heat, though, is brutal for those working construction.

JOHN PALAZZOLA, CONSTRUCTION WORKER: Been doing this 24 years. It's time to go. It's too hot. Way too hot.

CHERNOFF: The best way to cope was to be prepared, like George Cortez.

GEORGE CORTEZ, NEW YORK RESIDENT: I have a wash cloth that's moist and I have it in a plastic bag. And I have juice, distilled water, carrots and celery. Celery keeps you cool. CHERNOFF: Utility companies facing record power demand urged conservation. As part of the effort overnight, landmarks, such as the Empire State Building and the Chrysler Building, kept their lights off.

(END VIDEOTAPE)

CHERNOFF: But the lights in Times Square remained on and that was part of the record usage that Con Ed had for power. More than 13,000 megawatts used at 5:00 yesterday afternoon. That's enough power for 13 million homes. By the way, Con Ed says right now, at the moment, 1,200 customers in New York City are without electricity.

Soledad.

O'BRIEN: Oh, that's so awful. Allan Chernoff for us with an update. We're going to check in with Allan throughout the morning. Thanks, Allan.

Let's get right to the forecast. Chad's got that at the CNN Center.

Celery. A lot of celery to keep cool today. That's the secret thing.

CHAD MYERS, CNN METEOROLOGIST: I didn't know that.

O'BRIEN: See, you learn something every morning here on AMERICAN MORNING.

(WEATHER REPORT)

O'BRIEN: A Manchester, New Hampshire, woman is trying to help the elderly cope with the heat. Her name is Sandra Patient (ph) and she has donated dozens of fans to a senior center. She did that yesterday. She's also arranged for dozens more to be distributed throughout the city. She says she wanted to help and that basically somebody had to get the ball rolling and it was going to be her. Good for her.

Still to come this morning, a CNN exclusive. We'll go on board one of the Israeli navy warships off the coast of Lebanon and get an exclusive behind-the-scenes look at the blockade in action.

Then a CNN "Security Watch." How U.S. border agents failed a major security test. We'll tell you what they did and, more importantly, didn't do.

Then later, amid rampant speculation about Fidel Castro's health, we'll talk to a Cuban exile group that's helped rescue thousands of Cuban refugees. But they're not celebrating just yet. We'll tell you why just ahead on AMERICAN MORNING.

(COMMERCIAL BREAK)

O'BRIEN: It's something you'll see only on CNN. John Vause is the first television network correspondent given a look at the Israeli ship that is now off the coast of Beirut. The ship is called Lahave (ph). It is blocking the port there. And he takes us on a tour of that ship.

(BEGIN VIDEOTAPE)

JOHN VAUSE, CNN CORRESPONDENT: This is the INS Lahave (ph), the flagship of the Israeli navy. It's a corbit (ph) class missile ship, slightly smaller than a friger (ph). But still it is heavily armed. Right here there are torpedoes. Part of the armorments (ph) include harpoon missiles and what they call a Barak (ph) anti-missile defense system.

This is the flagship of the Israeli navy and right now it's serving as the command post essentially for the Israeli naval blockade off the coast of Lebanon. A lot of the technology aboard this ship we can't show you because of the Israeli censorship rules during wartime. But some of the technology is in a room just down here.

They call it the CIC, the command and control center. Effectively the nerve center of Israel's blockade off the coast of Lebanon. A lot of the technology in this room we're not allowed to show you because of the Israeli censorship rules. It's high tech.

But effectively what happens in here is that the Israeli navy can see a radius of around 180 nautical miles. Virtually up and down the coast of Lebanon, able to see everything vessel which comes and goes. And the purpose of the Naval blockade, Israel says, is to stop weapons, in particular missiles, from Iran and Syria reaching Hezbollah and also to prevent the two kidnapped Israeli soldiers from being smuggled out of Lebanon.

John Vause, CNN, on board the INS Lahave.

(END VIDEOTAPE)

O'BRIEN: Amid all the rising gas prices, you might be shocked to hear which vehicle topped last month's bestsellers list. Andy Serwer's "Minding Your Business" just ahead.

And Mel Gibson apologizes again for last weekend's behavior. He directly addresses those antisemitic remarks. We'll tell you what he's saying now. That's up next on AMERICAN MORNING.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

JON STEWART, "THE DAILY SHOW WITH JON STEWART," COMEDY CENTRAL: Everybody in Hollywood's still buzzing about Mel Gibson's drunken, some say antisemitic DUI stuff. Mr. Gibson announced today that he will be entering rehab, the Betty Ford Center, for his alcoholism. And I believe the Henry Ford Center for antisemitism.

(END VIDEO CLIP) O'BRIEN: Oh, he's so funny. Yes, Jon Stewart. Yes, he told that joke last night. They must have thought it was very funny. Went over very well with the crowd.

It's been a really long hangover for Mel Gibson. He's apologized again for the comments that he made during an arrest last week on suspicion of driving under the influence. And unlike the apology the first time around, this time he talks directly about those some would say antisemitic remarks. Here's what he said.

"There is no excuse, nor should there be any tolerance, for anyone who thinks or expresses any kind of anti-semitic remark. I'm in the process of understanding where those vicious words came from during that drunken display, and I am asking the Jewish community, whom I have personally offended, to help me on my journey through recovery. I know there will be many in that community who will want nothing to do with me, and that would be understandable. But I pray that that door is not forever closed."

ANDY SERWER, CNN CORRESPONDENT: That's quite the apology. I mean it goes on and on and on. He's practically lying down on the floor and saying, you know . . .

O'BRIEN: Yes. And it's all over the blogs with people sort of mocking it as well. We're going to, of course, talk a little more about the fallout from apology version 2.0, as like to call it, this morning.

SERWER: Right. Right. Very good.

O'BRIEN: Let's talk business news, though. Cars.

SERWER: Yes, cars.

O'BRIEN: What's the big news here?

SERWER: Well, this is the same story we've been talking about for months and months, Soledad. U.S. automakers sales by them crashing. Japanese automakers accelerating. These are the numbers for the month of July. And you can see not good at all for Ford, GM and DaimlerChrysler. But, guess what, Toyota and Honda up. Bad news for big cars. F-series pickup from Ford down 45 percent. Chevy Silverado down 30 percent.

And the big headline, Soledad, you asked for, is for the first time ever, Toyota outsold Ford for a whole month. So the first time, the month of July, Ford was beaten by Toyota, outsold by 17,000 vehicles. And, you know, this whole thing of the Japanese beating up on the U.S., it's not like it was back in the 1970s so much where it was about quality.

It's about fuel efficiency and product mix. Well, that was an issue back then, as well. But this time, you know, consumers are starting to really look at smaller cars and hybrids and Toyota and Honda have them and the U.S. manufacturers don't as much. Another story I want to tell you about this morning coming out of Detroit comes from Ford. The automaker that has these problems we've been talking about is reviewing its operations. It hired a new strategic adviser. It looks like they're going to be selling off Jaguar. Now Ford bought Jaguar in 1989 for $2.6 billion. And basically this line -- they stabilized it and they got rid of the quality problems. But it's been red ink ever sense.

O'BRIEN: So they've lost money on it.

SERWER: They have lost money. And its dragged down the premiere auto group at Ford, which includes Volvo, the Aston Martin and Landrover. And so don't be surprised if it's sold. The question is, who's going to buy it, right?

O'BRIEN: Right. Right. Right. Because they're all struggling.

SERWER: Yes, exactly.

O'BRIEN: But someone will buy it. I think somebody will buy it.

SERWER: I think someone will buy it. It's got such a great name, of course.

O'BRIEN: Right. Andy, thank you.

SERWER: Thanks, Soledad.

O'BRIEN: Still to come this morning, a CNN "Security Watch." Alarming failures at our nation's borders. We'll tell you how undercover investigators faked out the border agents and also what's being done about it.

And check out the flooding in El Paso, Texas. Look at that. It's going to get worse potentially. We'll take a look at that forecast just ahead. Stay with us.

(COMMERCIAL BREAK)

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