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Crisis In The Middle East; Closer To Peace?; Lieberman's Last Stand?; Iraq Rape-Murder?

Aired August 08, 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: Let's move now to northern Israel. Fierce battles there at the border as Israel continues to try to target Hezbollah rocket-launching strikes. CNN's Matthew Chance is in northern Israel for us this morning.
Hey, Matthew, good morning again.

MATTHEW CHANCE, CNN CORRESPONDENT: Good morning to you, Soledad.

I just want to pick up on what Anthony was saying there because he said he'd met a key Israeli demand. And Israel has indeed welcomed in principle, this proposal to deploy 15,000 troops to the Israeli border with Lebanon to take over from where the Hezbollah positions have been. But it says that it wants to make sure that this Lebanese force is robust enough to actually curtail the activities of Hezbollah and to prevent them, if there is any cease-fire agreed at the diplomatic level, from using that time to re-arm and to reposition to come back and fight against Israel another day.

So Israel is looking for some guarantees and some actual mechanisms by which the Lebanese army would propose to do this, possibly with the backing of a multinational force. If the diplomatic pressure doesn't work, if the diplomatic agreement doesn't work, Israel says it has a military option very firmly on the table. It's preparing thousands of troops potentially to join the 10,000 to 12,000 Israeli soldiers already inside southern Lebanon. It could expand its military operations significantly in southern Lebanon over the coming days, again, if there is no diplomatic agreement at the U.N.

That would be a major escalation, obviously. That would see Israeli soldiers already in fierce fights, close quarters, with Hezbollah guerrillas. Actually stepping up their activity in southern Lebanon, possibly pushing as far north as the Litani River, some 20 miles in places north of the Israeli border. So that's something that is of deep concern to people watching this conflict at the moment.

Soledad.

O'BRIEN: Matthew Chance in northern Israel for us. Matthew, thanks.

The United Nations Security Council is trying to reach a compromise on a cease-fire resolution. Today, representatives from the Arab league will ask for some changes. CNN's Richard Roth live at U.N. headquarters in New York.

Hey, Richard, good morning.

RICHARD ROTH, CNN CORRESPONDENT: Good morning, Soledad.

The ambassadors from the U.S. and France combed over that Security Council resolution seeking ways to address concerns of Lebanon and, at the same time, getting this resolution passed.

(BEGIN VIDEOTAPE)

ROTH, (voice over): The rush to a resolution inside the U.N. Security Council bogged down again. Lebanon and Arab neighbors reject language that would permit Israel to temporarily keep thousands of troops in Lebanese territory while ordering an immediate halt to Hezbollah attacks.

YAHYA MAHMASSANI, ARAB LEAGUE AMBASSADOR TO U.N.: The way it is done now in the present draft, it has -- it is (INAUDIBLE) and we don't accept it.

ROTH: And some Security Council nations are listening to their case.

VITALY CHURKIN, RUSSIAN AMBASSADOR TO U.N.: We're troubled by the fact that the Lebanese government apparently is not satisfied with the draft resolution and we're trying to see if something can be done.

ROTH: The French co-authors, with the United States of the resolution, were willing to see what could be done.

JEAN-MARC DE LA SABLIERE, FRENCH AMBASSADOR TO U.N.: I'm going to work today to improve the text and we have to take into account the concerns of all.

ROTH: Lebanon's amendment to the resolution proposes a simultaneous withdrawal by Israel, along with deployment of Lebanese government troops in the south. But the Security Council is not likely to make dramatic adjustments to the resolution. It will hold off on a vote until a special Arab lead delegation address the Security Council.

JOHN BOLTON, U.S. AMBASSADOR TO THE U.N.: Let me just say it's not as though we drafted this resolution in a closet somewhere and suddenly sprang the text on any member government. We, the United States, and France, were in close touch with both the government of Lebanon and Israel throughout this entire negotiation process.

(END VIDEOTAPE)

ROTH: And the Security Council also has in its hands this morning a report by Kofi Annan on the air strike by Israel on the Lebanese town of Qana. He says it warrants further investigation. It may be a violation of international law. But the Security Council, Soledad, gave the secretary-general's team only six days in which to investigate so far. He says more querying is need.

Back to you. O'BRIEN: Richard Roth at the U.N. for us this morning. Richard, thanks.

Tony.

TONY HARRIS, CNN ANCHOR: It is primary day in four states. U.S. Senate and House challenges are set for Michigan, Missouri, Connecticut and Colorado. In Georgia, there are several run-offs today, including a tough battle for Congresswoman Cynthia McKinney. Today's marquee match-up, though, is surely the Connecticut Senate race. Polls opened there more than an hour ago. Democrat Joe Lieberman is facing a tough battle against challenger Ned Lamont. Some are calling it a referendum on the Iraq War. Senior political correspondent Candy Crowley is live in Hartford, Connecticut, for us this morning.

Candy, good morning.

CANDY CROWLEY, CNN CORRESPONDENT: Good morning, Tony.

Several months ago this looked like another of those sleepy little primaries where an incumbent would easily get his party's nomination. But that was before we knew that a wealthy candidate who was willing to support his own candidacy and, of course, an very unpopular war. Both of those things combined to give Joe Lieberman the race of his life.

(BEGIN VIDEOTAPE)

CROWLEY, (voice over): It may be that the first political casualty of the war will be a Democrat.

SEN. JOE LIEBERMAN, (D) CONNECTICUT: This is all about the Iraq War. All about the anger at the war and all about the anger, almost hatred, among a lot of Democrats towards George Bush.

CROWLEY: Supportive of the war, opposed to leaving before the job's done, Joe Lieberman is watching his career flash before him.

NED LAMONT, (D) CONNECTICUT CANDIDATE FOR SENATOR: I think too often Senator Lieberman goes out of his way to undermine the Democratic message.

CROWLEY: Ned Lamont is a political newbie, but his anti-war campaign has caught lightning in a bottle, thunder provided by the fiercely liberal side of the blogosphere.

UNIDENTIFIED MALE: But I've been following your progress on the web and, you know, reading certain sites and stuff.

LAMONT: It started as an asterisk and now we've got a pretty competitive race now.

UNIDENTIFIED MALE: I know.

CROWLEY: The latest poll has Lamont winning by six points, narrower than the lead he had last week.

LIEBERMAN: I'm looking forward to being called Connecticut's comeback kid!

CROWLEY: It is the political event of the summer. The first race testing the depth and breadth of anti-war sentiment, watched by politicians running in '06 and '08. A Lamont victory would likely also be read as the first scalp for liberal Democrats trying to push the party center to the left. Because as much as this race has been about Iraq, it has been about the definition of the Democrat.

DAVID LIGHTMAN, HARTFORD COURANT: People are saying, gee, has he been too close to President Bush on other issues? Has he been too eager to cooperate with Republicans on a host of issues? They want to know how good a Democrat has Joe Lieberman been.

CROWLEY: This picture has been worth more than 1,000 words and who knows how many votes.

LIEBERMAN: The two big lies of Ned Lamont, Joe Lieberman is a cheerleader for George Bush. Ridiculous. I've opposed most of what this president has asked to us do through Congress. Secondly, that somehow I'm not a real Democrat. Outrageous.

CROWLEY: But it has been effective. Lieberman and colleagues traveled the state he has represented for 18 years, listing his Democratic bonafides, no time for nuance.

SEN. CHRIS DODD, (D) CONNECTICUT: This is a very good Democrat, too, I'll tell you.

UNIDENTIFIED MALE: Don't throw out the baby with the bath water.

(END VIDEOTAPE)

CROWLEY: Up until the very last minute, Joe Lieberman was calling himself the comeback kid. He believes that he will win this race. But just in case, is already making plans to run as an independent this fall.

Tony.

HARRIS: OK. Candy Crowley for us. Candy, thank you. And, Candy, of course, is part of the best political team in the business.

Another closely watched race is taking place in Georgia. Congresswoman Cynthia McKinney is facing Hank Johnson in today's democratic party runoff. She drew less than 50 percent of the vote in last month's primary. McKinney made headlines during a scuffle with a Capitol Hill police officer.

Tom DeLay's name will appear on the November ballot in Texas unless he withdrawals from the race. A federal appeals court had blocked the state's GOP effort to replace him. And yesterday Supreme Court Justice Antonin Scalia rejected a request to block a ruling. Democrats sued to keep the former House majority leader on the ballot. DeLay faces money laundering and conspiracy charges.

O'BRIEN: This year's Atlantic hurricane season may not be as bad as it was first feared. In just a few hours, government forecasters are going to update their outlook. Last week, forecaster William Gray, who's very respected in his field, dropped his prediction for the number of hurricanes from nine to seven. And he said it's unlikely we're going to see a storm like Hurricane Katrina this year, which is terrific news.

End of July's supposed to be hot and dry. Things went as planned this year. Last month turned out to be the second hottest July on record. I believe it. The hottest temperature recorded for July is 77.5 degrees back in 1936. This year we hit 77.2, way above the average of just 74 degrees. More than 2,300 daily temperature records were broken from coast to coast and no relief at night. Some 3,200 nighttime records were set as well. I believe that because it would be hot and soupy when we woke up.

(WEATHER REPORT)

O'BRIEN: Still to come this morning, it happened again. An identity theft alert for more U.S. veterans. We'll give you details just ahead.

HARRIS: Also, disturbing testimony in the case of a former U.S. soldier accused of rape and murder. A fellow soldier makes a chilling admission in court.

O'BRIEN: And more problems spill over from that Alaskan oil field shut down. We'll tell you what it means for gas prices. All that and more on AMERICAN MORNING.

(COMMERCIAL BREAK)

HARRIS: And happening this morning.

Oil giant BP faces growing criticism over its pipeline problem in Alaska. The shutdown could hit the west coast especially hard and Alaska stands to lose millions of dollars in royalties and taxes for each day the pipeline is down.

It happened again in Pennsylvania. Thousands of patients treated at two veteran hospitals may be at risk for identity theft. The Department of Veterans Affairs says a subcontractor lost a computer containing their personal data, including Social Security numbers.

O'BRIEN: In Iraq, police on high alert after a strong of roadside bombings. At least two of the bombs were targeted to Iraqi police patrols. Nineteen people have been killed.

A U.S. military hearing is still underway to try to determine if a group of U.S. soldiers will be tried in that grisly rape and murder case in Iraq and chilling new details are coming out even as we speak. Let's get right to CNN's Harris Whitbeck. He's live in Baghdad for us.

Hey, Harris, good morning.

HARRIS WHITBECK, CNN CORRESPONDENT: Good morning, Soledad.

The defense in the Article 32 hearing has questioned -- the tactics used by criminal investigators in getting statements from the suspected soldiers. They questioned whether the suspects had attorneys present there or their desire to have attorneys there was fulfilled. There was also talk today of combat stress and how difficult it is to operate military checkpoints in a war zone. Nevertheless, the testimony that is being heard there is painting a dark picture of what happened that night in March in a house in Mahmoudiya.

(BEGIN VIDEOTAPE)

WHITBECK, (voice over): Testimony on the second day of the military's Article 32 hearing provided chilling details about what happened before the ghastly alleged rape and eventual killing of a 14- year-old Iraqi girl. Three other family members were also killed. Investigators testified that Specialist James Barker admitted he and three other defendants were drinking and playing cards that day at a military checkpoint near the victim's house. Another defendant, Sergeant Paul Cortez, told military investigators that's when the idea to commit the alleged crimes was first broached.

While they were playing cards and drinking Iraqi whiskey, the idea came to go out to a Iraqi house, rape a woman and murder her family. Private First Class Justin Watt, a member of the same unit but not involved in the incident, testified that he heard Private Steven Green say "I want to kill and hurt a lot of Iraqis." Green was discharged in May and also faces rape and murder charges in federal court.

Investigators also testified that defendant Barker explained how the soldiers wore black ski masks and walked to the house and encountered the father and his daughter outside. One soldier grabbed the girl, another the father. They took them into the house.

The girl, according to Barker, was held down and raped by at least two soldiers, including Green, who first took the girl's parents and younger sister to another room where he allegedly shot them. Investigators testified Barker quoted Green as saying, "they're all dead. I just killed them."

Green has pleaded not guilty in federal court. The four soldiers under investigation have not entered pleas because they haven't been officially charged. That decision could come in the next few weeks.

(END VIDEOTAPE)

WHITBECK: U.S. officials have sought to assure their Iraqi counterparts that the soldiers will be punished if charged and convicted. The Iraqi governments that called for an independent investigation.

Soledad. O'BRIEN: Harris Whitbeck for us this morning in Baghdad. Harris, thanks.

Tony.

HARRIS: And, Soledad, we are just getting word of a fresh round of Israeli attacks near Tyre. That is, of course, in southern Lebanon. Smoke has been seen rising over the horizon as Israel warns civilians to stay off the streets. CNN's Karl Penhaul is there for us live.

Karl, good morning.

KARL PENHAUL, CNN CORRESPONDENT: Tony, the city of Tyre today very much a city under siege. It is now completely isolated from the rest of Lebanon. The approach roads and bridges into this city have been bombed. There are no humanitarian aid convoys that can come in and evacuees certainly cannot get out at this stage.

Israeli war planes have been dropping leaflets, warning anybody who is spotted in a vehicle south of the Litani River that those vehicles will be considered as terrorist suspect. That they will be considered a suspicious of moving around Hezbollah munitions and rockets and, consequently, they will be destroyed. So certainly a warning in no uncertain terms from Israel.

All this comes on the back of a 48-hour bombardment by Israeli war planes and artillery that is still going on. Until just a few moments ago, there were two Israeli war planes, warships rather, Tony, just off the coast here, sending in a ferocious bombardment right up to the outskirts in the south of Tyre. We've now seen, though, just in the last few moments, those warships withdraw. It seems that momentarily that section of the bombardment is over. But as I say, this has now been going on almost constantly for the last 48 hours.

Tony.

HARRIS: OK. CNN's Karl Penhaul for us in Tyre, Lebanon. Karl, thank you.

O'BRIEN: Still to come this morning, much more on the escalating conflict in the Middle East. We'll take you right to the front lines in Lebanon for an incredibly close-up look at Israeli troops at war with Hezbollah.

Plus, more bad news about that Alaskan oil field now shut down for repairs. We'll tell what you it means for gas prices. It's not good news, as you can imagine. That's ahead on AMERICAN MORNING. We're back in a moment.

(COMMERCIAL BREAK)

HARRIS: The Federal Reserve is set to meet today to discuss interest rates. The big question, is another increase on the way and the latest on the BP oil pipeline shut down in Alaska. Andy is here "Minding Your Business." Andy, good morning.

ANDY SERWER, CNN CORRESPONDENT: Good morning to you, Tony.

Fallout from the BP shutdown and more details. First of all, we are learning that this is in connection, the shutdown, to a spill in March. An investigation from that spill, and an analysis of the pipeline itself, that 22-mile transit line, now it turns out will be shut for months. At risk here of having their supply curtailed would be west coast states, particularly California, Washington, and Hawaii. But there is enough supply in the system to ameliorate any serious disruptions, experts say. However, the state of Alaska is going to be losing $6.4 million in royalties every day because of the shutdown.

As far as the price of oil and gas goes, the price of oil climbed to $76 a barrel and change. Overnight, though, it has stabilized, so it doesn't look like it's going to be climbing much more unless more bad details emerge from this mini crisis, I guess you could call it. The price of gasoline now at $3.03 nationally for a gallon of unleaded. Still, below by a few pennies the record we set last fall in the wake of Hurricane Katrina. In the next hour, we'll talk more about the investigation and the situation with that pipeline and what's going on up there with BP.

Now, Tony mentioned the Federal Reserve. In fact, they are meeting today. There will be an announcement at 2:15 Eastern concerning interest rates. The Fed has raised rates 17 times since June of 2004. The Fed funds rate now stands at 5.25 percent.

And this is the first time in a long time, you guys, where there really will be some drama because the Fed has raised rates to keep the economy from overheating. But now many observers will tell you the economy has begun to slow down, so the need for raising rates is over. There is a real great question, though, as to whether or not Ben Bernanke and company share in that view.

So there's really going to be, for the first time in many, many months, a lot of people watching this afternoon to see the announcement, what happens. And, you know, if they decide not to cut rates, I think the stock market will take off. If they do raise rates, I should say, the stock market will take a dive.

HARRIS: What do you think? What do you think?

SERWER: I think that they will raise one more time.

HARRIS: You do?

O'BRIEN: Really?

SERWER: That's my prediction. Yes. Because they don't like to change back and forth.

O'BRIEN: Contrarian.

SERWER: I know. I could very well be wrong here. But we shall see in a few hours.

O'BRIEN: I guess we'll know later today.

SERWER: Yes. And you will be reminding me tomorrow if I'm wrong.

HARRIS: That's right.

SERWER: If I'm right, I'll remind but.

O'BRIEN: That's what I do best.

HARRIS: All right, Andy, thank you.

SERWER: You're welcome.

O'BRIEN: Still to come this morning, a closer look at life on the front lines in southern Lebanon. We're going to take you right on to the battlefield with an elite Israeli unit.

Then later this morning, the war in Iraq. How big a toll is combat stress taking on U.S. troops there? Those stories ahead on AMERICAN MORNING. We're back in a moment.

(COMMERCIAL BREAK)

O'BRIEN: Happening this morning.

Senator Joe Lieberman is fighting for his life politically. He trails anti-war challenger Ned Lamont going into today's Democrat primary in Connecticut.

After months of cutback, several airlines say they're planning to add more domestic flights. That's according to "USA Today." And for travelers it could mean good news. It could mean cheaper fares.

In Baghdad, a string of roadside bombings killed at least 19 people. At least 75 others wounded. Two of the bombs targeted Iraqi police patrols.

Welcome back, everybody. I'm Soledad O'Brien.

HARRIS: And good morning, everyone. I'm Tony Harris in for Miles O'Brien.

O'BRIEN: Israel is now responding to a Lebanese cease-fire plan. The plan would send 15,000 Lebanese soldiers to the border. Israeli Prime Minister Ehud Olmert calling it "interesting." CNN's John Vause live for us in Jerusalem.

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