Return to Transcripts main page

American Morning

Slowing Home Sales; Warnings About Increasing Sectarian Violence in Iraq; Iran Offers Talks

Aired August 24, 2006 - 08:59   ET

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

SOLEDAD O'BRIEN, CNN ANCHOR: Real estate is no longer on a roll. We're awaiting new sales figures this morning.
That pop you're hearing? Oh, that could be the housing bubble collapsing.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Operation Together Forward, the Battle for Baghdad, commanders say it's working, but for how long?

I'll have that story coming up.

PETER VILES, CNN CORRESPONDENT: I'm Peter Viles in Los Angeles.

New information in the JonBenet Ramsey murder case indicates authorities knew five years ago that John Mark Karr was fascinated with the Ramsey murder.

DR. SANJAY GUPTA, CNN SR. MEDICAL CORRESPONDENT: Using stem cells without hurting unborn babies, is that possible? And could it cool one of the country's biggest controversies?

That's ahead.

TONY HARRIS, CNN ANCHOR: Well, everyone loves time off, a little R&R away from the office. So why are we taking fewer and fewer vacations?

O'BRIEN: And joyriding every inch of the New York City subway system. These two guys set a goal and set a new record. Why did they do it?

We'll take a look ahead on this AMERICAN MORNING.

Welcome back, everybody.

I'm Soledad O'Brien.

HARRIS: And good morning, everyone.

I'm Tony Harris, in for Miles O'Brien.

O'BRIEN: Let's talk about the slowing home sales. It could mean some good news if you're trying to buy a home. Bad news, clearly, if you're trying to sell the home. You're feeling the pinch if you're a seller. We're awaiting those new numbers from the government. Expect them in about an hour or so. And it's possible that those numbers could point to an even more perilous housing bubble.

Jennifer Westhoven joins us to talk about that.

Good morning. You're nodding yes. That can't be good.

JENNIFER WESTHOVEN, CNN CORRESPONDENT: Good morning.

No -- yes, I wish. You know, yesterday -- the reason we're focusing so much on this number is because yesterday's number was so ugly. And it's so important, because so many Americans have been seeing their house prices go up, they've been getting them appraised, and they're counting on this money for when it comes time for retirement.

HARRIS: That's right.

WESTHOVEN: And now it's starting to look like this is actually a time when maybe we're starting to look at prices that are either weak or flat or maybe even declining. So this is what we saw yesterday.

Existing home sales down by about four percent. That's the slowest rate in two years. And here's the worst sign that we saw in that report. There's a record number of homes for sale right now.

And when you have that many homes on the market, it puts pressure on those prices to go down. Just about anyone -- if you know somebody who is trying to sell a home -- can probably attest to this, it's taking longer. The negotiating isn't going quite as well. So that means that today we're going to be looking closely to this new home sales number.

Now, as we heard on the program before, this can be a very volatile number. It's not always the greatest gauge. And also, only one out of seven homes in the United States is a new home.

So today's number is going to be smaller in terms of importance than yesterday. But still, you know, maybe it could give us a little hope here or maybe it's going to make things look even rockier.

There are a lot of predictions now. A lot more economists who had been saying we're having a soft landing. A lot more people are saying it's going to be a hard landing. You know that line from "All About Eve, "Fasten your seat belt."

(LAUGHTER)

HARRIS: That's right. It will be a bumpy ride.

WESTHOVEN: Yes, so lot's of concern.

HARRIS: OK. Jennifer, appreciate it. Thank you.

Well, a new CNN poll asked Americans whether the war in Iraq has made the U.S. safer from terrorist attacks. Thirty-seven percent of those polled said, yes, it has made us safer, while 55 percent said the war has made us left safe. Forty-three percent believe the U.S. is safer from terrorism now than it was before 9/11, 32 percent say it's about as safe, and 25 percent say the U.S. is less safe. And when asked if police in their community are prepared for a terrorist attack, only 27 percent said yes, while 70 percent said no.

The poll was conducted by the Opinion Research Corporation for CNN.

The U.S. ambassador to Iraq is warning the world about the increasing sectarian violence in Baghdad. Zalmay Khalilzad writes in "The Wall Street Journal" -- quoting here -- "It is vital that Iraqis control sectarian violence and come together against the terrorists and outside powers that are fomenting the violence. The Battle of Baghdad will determine the future of Iraq, which will itself go a long way to determining the future of the world's most vital region."

CNN's Barbara Starr joins us live from the Pentagon now with more on the Baghdad story.

Barbara, good morning.

STARR: Good morning to you, Tony.

Well, the ambassador is quite an experienced hand at these matters, so his words are getting a lot of attention around the world. He even went on in that article to say there is "an urgent crisis in securing Baghdad."

It is Baghdad that is Iraq's face to the world, of course. Though many other areas of the country may be relatively peaceful, Baghdad, by no measure, is.

What the ambassador noted is that in the month of July there were 2,100 -- 2,100 civilian deaths in Baghdad in the capital. Seventy- seven percent of those, he says, were attributable to the sectarian violence. So that is the crucial task at hand, getting that sectarian violence under control.

What are they doing about it? Well, for the last several weeks now about 12,000 total Iraqi and U.S. security forces moving through the capital, cordoning off neighborhoods, searches hundreds of homes, looking for bomb-making material, looking for people who may be associated with these death squads that are causing so much of the violence, murder and mayhem.

What the top commanders are saying is there are now results that operation in Baghdad is working. But very critically, no one is predicting yet any long-term success on this because, of course, they have been down this road for three and a half years or so.

They move into an area, they get a handle on the violence, and when the troops move out, the bad guys, the insurgents, the sectarian death squads, whatever you call them, they move back in. No one is sure what will happen in the weeks ahead. HARRIS: And Barbara, we have seen that pattern over and over again with Iraq. And just another note, the ambassador is pointing the finger at Iran as being a real destabilizing force in Iraq.

STARR: Absolutely, Tony. The ambassador, top U.S. military commanders increasingly are saying that they have clear evidence that Iran is supporting and is behind these death squads. They go so far as to say that Iranian trainers are operating inside Iraq, training the extremists in their bomb making and in their terrorist tactics. It is a matter of great concern.

They continue to say, as well, that they find IEDs and bomb- making material inside Iraq that has Iranian markings on it. So there is a lot of concern that a lot of this trouble is coming across the border from Iran.

HARRIS: CNN's Barbara Starr at the Pentagon for us.

Barbara, thank you.

O'BRIEN: The Reverend Jesse Jackson is heading to the Middle East tomorrow in the hopes of freeing those two FOX News journalists. The Palestinian news agency Ramattan released a video yesterday showing Olaf Wiig and Steve Centanni. The two in the video say they are in fairly good condition.

Wiig's wife is pleading for his release.

(BEGIN VIDEO CLIP)

ANITA MCNAUGHT, WIFE OF KIDNAPPED JOURNALIST: Olaf and Steve have always worked for the interest of the Palestinian people. They came here to support you by telling your story.

I do not question that you who are holding them have suffered greatly, as everyone in Gaza, in the Palestinian territories is suffering. But these two men are not responsible for the injustices that you speak of. And they should not be punished for them.

(END VIDEO CLIP)

O'BRIEN: The militant group demanded the U.S. release Muslim prisoners in exchange for the two men. It gave a 72-hour-long deadline.

Turning to Iran now, the Bush administration is considering what to do next now that Iran has given an incomplete answer to the Security Council demands. The State Department yesterday said Iran has fallen short of the conditions set by the U.N. Security Council.

CNN's Aneesh Raman is the only U.S. television network correspondent in Tehran.

Aneesh, good morning.

ANEESH RAMAN, CNN CORRESPONDENT: Good morning, Soledad. Iran has said no to suspending its nuclear program. No indication on the ground it will do so by the U.N.'s mandated deadline at the end of the month. But what it has said yes to is a new round of serious negotiations.

Now, why do the Iranians want to do that? And they say they're willing to put everything, including suspension, on the table.

Iran is aware that when that U.N. deadline comes and passes, it does not immediately trigger action. The U.N. Security Council has to debate what, if anything, to do, what kind of sanctions, if any, to impose on Iran.

Iran's call for new talks is resonating with its allies, Russia and China, who have veto power on the Security Council. And so Iran's lengthy response we saw earlier in the week has set the stage for divisions we could see at the U.N. Security Council and perhaps a delay in any sanctions coming against Iran as it show no sign of stopping its nuclear program -- Soledad.

O'BRIEN: So then, is all the defiance basically over the nuclear program?

RAMAN: It is. It's routed in a large part to the fact that Iranian officials publicly, at least, say they are pursuing a civilian nuclear program and that it is their right to do so. They have drummed up a lot of domestic support because of that around nationalist pride. So it will be very difficult for Iranian officials to now turn around to the people here and say we're going to suspend this program that we told you to go protest, march and claim is our right.

Another issue is that, as long as Iran is showing defiance, it is getting support not just in Iran, but among the larger Muslim world, among people who are disenfranchised with the West, in Pakistan, Malaysia, Indonesia, Iran, Iraq. And Iran's president is emerging as the defining voice for these people. And so this is all part of it, Iran seeing itself as a rising power in the region -- Soledad.

O'BRIEN: Aneesh Raman is in Tehran for us this morning.

Thanks, Aneesh -- Tony.

HARRIS: And Soledad, this just in to CNN. It's something we have been talking about a bit this morning. But we're just getting word that women may buy now the morning-after pill without a prescription over the counter, but only with proof that they are 18 or older.

That decision coming from federal health officials this morning. And it brings to an end, at least for now, kind of a contentious three-year battle to ease access to the emergency contraceptive. And I understand that CNN has just confirmed this.

The compromise decision is thought of as a victory, a partial victory for women's advocacy and medical group who have been saying that eliminating sales restriction cost cut in half the nation's three million annual unplanned pregnancies. So, once again, CNN has confirmed that the health officials in Washington, federal officials have now determined that women may be able to buy the morning-after pill without a prescription, but only if they can provide proof that they are 18 years of age or older.

We'll continue to follow developments on this story throughout the day.

John Mark Karr, the suspect in the JonBenet Ramsey murder, remains in a Los Angeles jail awaiting his transfer to Boulder, Colorado, but now he has two lawyers representing him.

Live now to Peter Viles in Los Angeles.

Peter, good morning.

VILES: Tony, good morning.

The sun just now coming up in Los Angeles on John Karr's fifth day in the Los Angeles County Jail. A little bit longer of a stay than we had led -- been led to expect. And there still is no official word from authorities here in Los Angeles or Colorado on when John Karr will be taken to Boulder.

The D.A. in Boulder, of course, is not talking at all, but John Karr's lawyers here in Los Angeles are talking. Jamie Harmon says she has been retained to represent John Karr in this. And she made a point yesterday when she made the rounds with the media to remember, folks, he has not been formally charged with any crime.

This is Jamie Harmon.

(BEGIN VIDEO CLIP)

JAMIE HARMON, KARR'S ATTORNEY: We don't even know if this case is going to get to court. You all are aware that the charges have not yet been formally filed against Mr. Karr. And the D.A. has 10 days to come and pick him up from yesterday morning at 10:15, 11:00, whenever it was that we finished up with court, and 10 days to come and get him and 72 hours from that point to charge him.

(END VIDEO CLIP)

VILES: That, as we understand it right now, from John Karr's attorney. We should also mention that yesterday the Karr family in Atlanta said that they had engaged a Hollywood producer, a guy named Larry Garrison to represent the family's interest. He also immediately made the media rounds speaking on behalf of the family, saying they believe John Karr is innocent.

It's not entirely clear what this producer's role will be going forward, but one of the things the family has been quoted as saying is that they want a high-profile defense attorney. So, from the family in Atlanta, maybe some sort of different version of events that this woman here in California, Jamie Harmon, may not be the lawyer for long -- Tony.

HARRIS: Hey, Peter, what are the police in Sonoma saying about Karr's fascination with the case, with the JonBenet Ramsey, case?

VILES: Sure. This is a question we've been asking for almost a week now because we had known he had been arrested up there in Sonoma County some years ago, five years ago, on child pornography charges. We wanted more details about this investigation, did not get anything until yesterday, when they put out a long statement, the sheriff's department -- sorry for that -- the sheriff's department up in Sonoma County, in which they said, yes, they did identify during that investigation that John Karr had a fascination with the JonBenet Ramsey murder and also the Polly Klaas murder, and that occasionally when he spoke about it he put himself in the mindset of the murder.

All of that said, the authorities up there said that there was no strong evidence to tie him to the case. He never made a confession, and he didn't say anything that indicated he had special private information about the case. So they took this information five years ago, they say, and turned it over to the FBI and to authorities in Boulder.

So Boulder authorities have known this guy's name for five years, at least according to the sheriff up in Sonoma County.

HARRIS: That's very interesting. OK.

CNN's Peter Viles for us in Los Angeles.

Peter, thank you.

O'BRIEN: We've been covering this for several days now. The weather out West has been just terrible. And now the governor of Washington is declaring a statewide wildfire emergency because of the fires that are raging across his state.

Nearly 3,000 firefighters are battling the biggest fire. It recently doubled in size. It's now about 120,000 acres. And forecasters continue to predict that thunderstorms and high winds and low humidity in many areas will continue. And, of course, that makes the potential for more fires.

Just a really big threat.

Meanwhile, there's a wildfire burning dangerously close to a Utah community. It's about an hour north of Salt Lake City.

Four homes have been evacuated while the firefighters work to try to put out that fire. Fire officials say it's 250 acres in size and it's about 65 percent contained.

And for the second time this week, strong storms blew right through Tucson, Arizona, toppling trees, leaving thousands of people without power. Some of those downed power lines fell on top of some cars and trapped drivers and passengers in some cases for up to three hours. Some people risked their lives, actually, when they climbed out of their car windows to try to get away from the live wires.

That brings us right to the forecast. Chad's got that.

Hey, Chad.

CHAD MYERS, CNN METEOROLOGIST: You never think about that, how dangerous downed lines are if the power is still going through those lines.

Good morning, Soledad.

(WEATHER REPORT)

O'BRIEN: All right, Chad. Thanks.

MYERS: You're welcome.

O'BRIEN: Still to come this morning, two young men wrongly accused of being terrorists. They talk to CNN about the lasting damage that's been done to their lives.

HARRIS: And later, the growing trend toward dropping the SATs for college admission. We'll look at some of the best schools that don't require them.

That's ahead on AMERICAN MORNING.

(COMMERCIAL BREAK)

HARRIS: Arrested on terrorism charges, but then freed. Charges dropped, but the stigma remains. That's the dilemma facing a pair of college students in Ohio. Everyone read about their arrest, but now it seems few people know they have been cleared.

CNN's Jonathan Freed has their story.

(BEGIN VIDEOTAPE)

JONATHAN FREED, CNN CORRESPONDENT (voice over): When Osama Abulhassan and Ali Houssaiky search for their names on the Internet, they find themselves but can't bear to look at what they see.

ALI HOUSSAIKY, CLEARED OF TERRORISM CHARGES: Fifty-eight thousand results, and everyone on the first page is terror related.

FREED: And on the second page and the third page. The terrorism references just keep going.

OSAMA ABULHASSAN, CLEARED OF TERRORISM CHARGES: We want to clear our names. We want everybody to know we were innocent.

FREED: Osama and Ali are Lebanese-Americans from Dearborn, Michigan. They were arrested in Ohio early this month after a traffic stop. Police found more than $10,000 in cash in their car and a dozen prepaid cell phones, the type authorities have been told to watch out for because they are hard to trace and can be used by terrorists, even as detonators for bombs.

HOUSSAIKY: The money was inside here, you know. And the 12 phones were just laying down, you know, back here.

FREED: So, the two 20-year-olds who say they bought and resold about 600 phones in the last two months to make money for college found themselves behind bars and charged with money laundering in support of terrorism and soliciting or providing for an act of terrorism. They believe they were targeted because they are Arabs.

Police in Marietta, Ohio, insist they profile people based on behavior, not racial background. Osama and Ali say trying to explain it all to their parents was surreal.

ABULHASSAN: To have to cal them and to have to talk to them from behind the glass with handcuffs, we will say it's probably one of the most devastating things we ever went through.

HOUSSAIKY: Because I never -- I never, ever, ever in my life seen my dad cry. And he was just telling me, "Keep your head up, don't worry about it." He's like, "You are going to get out, don't worry."

FREED: County prosecutors dropped the terrorism charges after a few days, saying they didn't have enough evidence to make them stick. But the two men are still facing falsification charges, accused of changing their story about why they were buying the phones.

They initially told police it was for a family business. They say they never intended to mislead, they were just flustered by being arrested.

(on camera): What do you say to the person who says, "I hear what they are saying, but come on, they had $10,000 in cash and a bunch of cell phones in the car. There must have been something going on"?

HOUSSAIKY: Is it illegal to carry cash? It's not illegal to carry money? Is it illegal to buy phones? It's not illegal to buy phones. So what's the problem?

FREED (voice over): Ali gets wistful when remembering how his picture used to appear in the local paper because of athletic awards. He's determined to stay in college and become a high school teacher. The experience has prompted Osama to want to study law.

But the two friends worry they may never escape the stigma of terrorism.

Jonathan Freed, CNN, Dearborn, Michigan.

(END VIDEOTAPE)

HARRIS: Well, it's a similar story for three Texas men of Arab descent arrested in Michigan earlier this month. They, too, were buying hundreds of cell phones. Terrorism charges have been dropped, but they still face other charges that could put them in jail for up to 25 years each.

O'BRIEN: This news just in to CNN. And it is sad news if you're a fan of Pluto.

As of this moment, Pluto is officially no longer a planet. There are no longer nine planets. This is a historic moment, I think.

HARRIS: Well, yes.

O'BRIEN: There are now eight planets and this one what they call a dwarf planet, a smaller planet, not a classical planet.

HARRIS: So that's what it is now.

O'BRIEN: That's the decision.

HARRIS: It's reduced to being a dwarf planet.

O'BRIEN: Twenty-five hundred astronomers were meeting...

HARRIS: It takes that many?

O'BRIEN: ... from 75 -- yes, apparently -- 75 countries or, so and they have come to the decision finally that Pluto is not a planet.

HARRIS: We could have...

O'BRIEN: It does not qualify anymore. They have been trying to work out a definition for the planet for many years now, and they finally have come up with this.

So, sorry, Pluto. You're out of luck.

Think of all the textbooks that have to be changed because of this one decision.

HARRIS: Yes, but 2,500, huh?

O'BRIEN: Think of all the science models in science classrooms everywhere that have to be changed because of this decision.

HARRIS: I'm crestfallen.

O'BRIEN: Anyway, moving on, coming up this morning huge news about the so-called morning-after birth control pill. The FDA is approving some nonprescription sales now. Dr. Sanjay Gupta is going to talk with us about that just ahead.

Stay with us.

(COMMERCIAL BREAK)

O'BRIEN: What did you do on your summer vacation? For many Americans, believe it or not, the answer is nothing, because they've had no summer vacation at all. A new national poll finds that nearly half of those surveyed can't find the time for any free time. AMERICAN MORNING'S Alina Cho has our report.

(BEGIN VIDEOTAPE)

ALINA CHO, CNN CORRESPONDENT (voice over): John Pepe is always working. He's on this the job by 6:00 a.m. A trader on the New York Stock Exchange by day, a spin class teacher by night. He's also a divorced father of two.

That leaves little time for himself or for a vacation. He only takes two weeks a year, even though he's allowed to take more.

(on camera): Some people might say, you get five weeks, you only take two, you're out of your mind.

JOHN PEPE, SALES TRADER, GYM OWNER: Yes, you could say that, in a good way, though. But a lot has to do with, you know, the cost of traveling today. I mean, a vacation for four is not what it used to be. The cost of gas.

CHO (voice over): In the dog days of August, when many could be relaxing at the beach, 43 percent of Americans, according to a new Gallup poll, have no summer vacation plans.

PEPE: Friends, family, they say I'm completely out of my mind and how long can you keep up this torrid pace and so forth.

CHO: It's gotten so bad, accounting firm PricewaterhouseCoopers completely shuts down for about two weeks a year. All 29,000 employees have to take a vacation.

The response, overwhelmingly positive.

KYM WARD GAFFNEY, PRICEWATERHOUSECOOPERS: Hey, you're looking at your Blackberry, no messages are coming through. You check your voice-mail, kind of anticipating some calls, no calls. You took this breath and you said, "Wow, OK, people are really serious about this."

CHO: A win-win.

BARBARA KRAFT, PRICEWATERHOUSECOOPERS: Folks came back and said, "It's the first time I had guilt-free time away from the firm."

CHO: And the firm says workers come back relaxed and refreshed and better able to handle stress.

But don't tell that to John Pepe. He says any stress he brings home he works off at the gym, which he owns. Another reason he says he can't get away.

PEPE: Would I love the extra time? Absolutely. But right now...

CHO: It's not an option.

Alina Cho, CNN, New York. (END VIDEOTAPE)

HARRIS: Wow.

More and more colleges -- still to come -- are dropping the SAT as a requirement for admission.

Coming up, we'll look at some of the best schools that don't require that dreaded test.

Stay with us. More AMERICAN MORNING when we come right back.

(COMMERCIAL BREAK)

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com