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American Morning
Are We Less Safe?; Iraq, Terrorism & Politics; Don't Ask, Don't Tell Policy Continues in the Military; Record Number of Black Candidates Seek Higher Office
Aired September 27, 2006 - 07:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ELAINE QUIJANO, CNN CORRESPONDENT: Parts of that classified NIE was not made for political reasons. But what is clear is that he made the decision in the midst of a heated partisan fight.
(BEGIN VIDEOTAPE)
QUIJANO, (voice over): President Bush launched a full-throated political defense, attacking what he called the politically motivated leaking of a classified intelligence estimate dealing partly with Iraq.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We'll stop all of the speculation, all of the politics about somebody saying something about Iraq, John Negroponte, the DNI, is going to declassify the document as quickly as -- declassify the key judgments.
QUIJANO: The president suggested his critics do not understand the war against terrorists.
BUSH: Well, they don't see what I see. They're out there. They're mean. And they need to be brought to justice.
QUIJANO: President Bush noted the NIE was completed in April and leaked just weeks before congressional midterm elections. The president came prepared with talking points on the subject.
BUSH: We weren't in Iraq when they first attacked the World Trade Center in 1993.
QUIJANO: But he insisted he was not declassifying it for political purposes.
BUSH: Because I want you to read the document so you don't speculate about what it says.
QUIJANO: Democrats say it's perfectly clear what the documents say. The Iraq war has made the U.S. safe.
REP. NANCY PELOSI, (D) MINORITY LEADER: It's long overdue for this administration, the Bush administration, to speak truth to the American people on what's happening in Iraq.
QUIJANO: Afghan President Hamid Karzai, a critical U.S. ally in the war on terror, stood shoulder to shoulder with President Bush. PRES. HAMID KARZAI, AFGHANISTAN: Terrorism was hurting us way before Iraq or September 11th. And how do we fight them? How do we get rid of them? Other than going after them? Should we wait for them to come and kill us again?
(END VIDEOTAPE)
QUIJANO: And today another high-level meeting. President Karzai will sit down once again with President Bush, along with Pakistan's president, Pervez Musharraf. Mr. Bush hopes to ease tension between the two key U.S. allies. Tensions that have emerged over the recent resurgence of Taliban activity along their border.
Miles.
MILES O'BRIEN, CNN ANCHOR: Elaine Quijano at the White House, thanks very much.
That declassified portion of the report has more detail on the effects of the war in Iraq, on the war on terror. Here are some details we'll share with you. The report says the number of Muslims identifying themselves as Jihadists is increasing, that the Iraq conflict is shaping a new generation of terrorist leaders.
But the report suggests if the terrorists fail in Iraq, that will, in fact, hurt their movement. The report says the war in Iraq is only one reason for the growth of extremism, however. It also cites the slow pace of reform in many Muslim nations and pervasive anti-U.S. sentiment around the world.
The report does highlight some positive signs as well. It points to moderate Muslim leaders stepping up, denouncing the violence and says that the extremist movement could fracture if Osama bin Laden or other high-ranking al Qaeda leaders are caught.
Soledad.
SOLEDAD O'BRIEN, CNN CORRESPONDENT: With only six weeks till the midterm elections, it's not just about security. CNN's senior national correspondent John Roberts is live in Washington, D.C., with the politics behind the release of the intel report.
Hey, John, good morning to you.
JOHN ROBERTS, CNN CORRESPONDENT: Good morning to you, Soledad.
Well, this report, which seemed to undercut two of the central argument that President Bush has been making which helped him win elections in 2004 and helped Republicans maintain control of Congress in the 2002 elections, and that is, a, that America is winning the war on terror and that, number two, President Bush is actually making America safer. Because if this report is to be taken on its face, in fact what's happening right now is not making America safer. It's putting America more at risk. And this idea that the Jihadist movement is creating terrors at a greater rate than they can be defeated by the American actions in the war on terror, then, in fact, President Bush is not winning the war on terror.
How would that translate into the November elections? The Republicans are running as the party of security. Don't forget that President Bush, after the Labor Day weekend and for a couple of weeks after that, was refocusing attention on the need to defeat terrorism. So if he's got a national intelligence estimate out there that is contradicting, or at least in some conflict with what he's saying, that could spell problems for Republicans in November.
Soledad.
S. O'BRIEN: It is not all bad news, though, for Republicans even come November, right?
ROBERTS: Well, no, because this NIE really is like a piece of modeling clay or molding clay that you can take and shape into whatever argument that you want. Now the way that the Republicans could use this is they could say, look at what this NIE does, is it buttresses the president's claim that Iraq is the central front in the war on terror, that we cannot afford to let up in Iraq. We've got to win this fight because the NIE does say that if Jihadists were to leave Iraq, feeling like they were defeated there, they might be dispirited and that would have an effect on the overall global movement.
The president can also claim politics to say they're trying to do a hit job on me here with just five weeks left until the election. But for the White House to say it wasn't political to release this NIE is somewhat disingenuous as well because if it wasn't politics, the president would say, look, I don't care what people do with this information. We've got the information. We're using it the way we need to.
But it does raise the overall question. This is something to watch Democrats press in on in the next few weeks here, as this NIE continues to gain some momentum, is it will leave the open question, where would the war on terror be had the president not chosen to go to Iraq?
Soledad.
S. O'BRIEN: Yes, that's sort of the $64,000 question.
John Roberts for us this morning in Washington, D.C. Thanks, John.
Don't forget to get your daily dose of the latest political news by just clicking on CNN's new Political Ticker. You can find it at cnn.com/ticker.
Miles.
M. O'BRIEN: Hillary Clinton joining the fight. Firing a shot in the battle over which administration did more to stop al Qaeda. Senator Clinton defended her husband's efforts to go after al Qaeda during his presidency, questioning the current administration's response to an intelligence report warning of a possible attack a month before 9/11.
(BEGIN VIDEO CLIP)
SEN. HILLARY CLINTON, (D) NEW YORK: I'm certain that if my husband and his national security team had been shown a classified report entitled "Bin Laden Determined to Attack Inside the United States," he would have taken it more seriously than history suggests it was taken by our current president and his national security team.
(END VIDEO CLIP)
M. O'BRIEN: At the White House tonight, President Bush hosting a working dinner with the president's of Pakistan and Afghanistan. The president aiming for a verbal truce between the two men, each accusing the other of not doing enough to fight al Qaeda and the Taliban. Pakistani President Pervez Musharraf told CNN's Wolf Blitzer Afghanistan's president, Hamid Karzai, is ignoring what is happening in Afghanistan.
(BEGIN VIDEO CLIP)
PRES. PERVEZ MUSHARRAF, PAKISTAN: He is not oblivious. He knows everything, but he's purposely denying, turning a blind eye like an ostrich. He doesn't want to tell the world what are the facts for his own personal reasons.
(END VIDEO CLIP)
M. O'BRIEN: "The Situation Room" with Wolf Blitzer can be seen right here on CNN every day, 4:00 and 7:00 Eastern Time.
Happening this morning.
A huge bill to fund the fighting in Iraq and Afghanistan making its way through Congress. The House yesterday approving $70 billion in new military spending, part of a record $448 billion Pentagon budget. The Senate expected to follow suit later this week.
Today in Washington, both houses of Congress are expect to do vote on a detainee bill supported by the White House. It would let the Bush administration put the country's most dangerous terror suspects on trial this fall.
In Gaza, Palestinian hospital sources saying a 13-year-old girl is dead, three others wounded after an Israeli air strike. Israeli officials say the building hit was being used as a cover to smuggle weapons.
S. O'BRIEN: A closed-door hearing for former White House aide Lewis "Scooter" Libby in Washington, D.C., today. Libby's accused of lying to investigators about his knowledge of the former CIA operative Valerie Plame. At issue today is whether certain classified information should be disclosed in the case.
In Utah today, polygamist leader Warren Jeffs appears in court to set the timetable for his criminal trial. Jeffs is charged with two counts of rape as an accomplice. Authorities say he forced girls to marry older men.
Supermodel Naomi Campbell is back in a New York City courtroom today. She's on trial for assault for hitting her maid with her cell phone allegedly after she couldn't find a pair of jeans. If she is convicted, Naomi Campbell could go to prison for seven years.
That enormous, three-week-old wildfire is still threatening homes in Ventura Country in California. It's about 70 miles north of Los Angeles. Residents have been urged to leave their homes. Many, though, have refused. One man said the roar of the fire sounds like a jet engine. It's called the Day fire and it's one of the biggest in the state's history and it is only 43 percent contained.
Let's get right to Chad with a look at the forecast.
Chad, that's a fire that started on Labor Day.
(WEATHER REPORT)
M. O'BRIEN: Still to come, the military is stretched then, needs more than a few good men and women. But there's still one rule that won't bend.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: I said I did drug in the past. They could give me a waiver for that. But homosexuality, they said, is the one thing there's just nothing he could do about it. It's was unwaiverable.
(END VIDEO CLIP)
M. O'BRIEN: We'll take you to the front lines in the fight against don't ask, don't tell.
Also, the battle of the bulge. Can New York City really ban french fries and glazed doughnuts? Say it ain't so.
And police in one city are puzzled after their plan to set a trap for car thieves backfires. We'll explain ahead on AMERICAN MORNING.
(COMMERCIAL BREAK)
S. O'BRIEN: With America's military stretched so thin, the Pentagon is lowering the bar for recruits. But its don't ask, don't tell policy on homosexuality is still in place. Some gays are trying to change that. CNN's Jason Carroll's got more on this story.
This is a fascinating case, I think.
JASON CARROLL, CNN CORRESPONDENT: It absolutely is.
You know, Soledad, thousands of gays have been discharged from the armed services under the Pentagon's policy and they say that's hurting military readiness. So many of them are trying to reenlist, knowing they'll be turned away, but hoping it will help gain attention for their cause.
(BEGIN VIDEOTAPE)
CARROLL, (voice over): It's clear there's a need for more soldiers to serve in the armed forces. Troops now serving in Iraq are having to stay longer than expected. In its effort to recruit 80,000 soldiers this year, the army is easing its entry requirements.
RHONDA DAVIS, DISCHARGED NAVAL OFFICER: This is actually one of the highest awards you can get in the Air Force.
CARROLL: Rhonda Davis, a former officer with 10 years of decorated service in the Air Force and Navy, hope to help fill the depleted ranks by serving her country again.
DAVIS: When I showed him my discharge papers and it says homosexual admission on it, he says, that's the one thing that we can't give a waiver for.
CARROLL: Davis was discharged this past summer after admitting to being gay. It happened after attending a rally in support of gay marriage while in uniform. Under the military's don't ask, don't tell policy, admitted homosexuals cannot serve.
DAVIS: It makes me angry because I think, you know, in 10 years, I never even came in late.
CARROLL: Davis thought she might be granted a reprieve after seeing army waivers that are being granted, such as the army's high school diploma requirement, the age cap lifted from 35 to 42, and a waiver may also be allowed for admitted drug use or misdemeanor convictions.
DAVIS: If I said I did drugs in the past, they could give me a waiver for that. But homosexuality they said is the one thing there's just nothing he could do about it. It was unwaiverable.
CARROLL: But some military analysts say, don't ask, don't tell, should remain in place, because to lift it could compromise discipline and safety within the ranks.
ELAINE DONNELLY, CENTER FOR MILITARY READINESS: If we open the military to advancing the homosexual agenda, it would be contrary to the interests of the volunteer force. It would actually hurt recruiting. With the war going on, this would be the worse time to introduce this element of social engineering.
CARROLL: The Department of Defense told CNN its policy on the matter is clear. Davis worries don't ask, don't tell is hurting the armed forces, especially now. Since the policy was adopted in 1993, the Defense Department says close to 11,000 men and women have been dismissed.
DAVIS: Not to mention the fact that there's thousands of people out there who would like to serve in the military, who don't, and they're perfectly qualified otherwise, and they can't serve in the military because they're openly gay.
CARROLL: Davis says, while she would like to serve her country, for now she'll have to do it another way, by speaking out and fighting for a different kind of freedom.
(END VIDEOTAPE)
CARROLL: And last year the Military Readiness Act was introduced into Congress. It's a bipartisan bill aimed at repealing don't ask, don't tell. But again, there are many critics out there who say repealing that policy at this time just is not good for the military.
S. O'BRIEN: So what can Rhonda Davis do? Anything? I mean, is it -- can she sue for discrimination? Is she just stuck?
CARROLL: She could sue. But at this time she's not choosing to do that. Maybe perhaps she's looking at a case that just recently happened last year, an Air Force nurse did sue. That case didn't really go anywhere. It's on appeal at this time. So other than what she's doing right now, what else can you do with a policy that's still in place?
S. O'BRIEN: Does she say she has regrets about -- I mean she came out very openly.
CARROLL: No regrets. No regrets whatsoever.
S. O'BRIEN: Ten years in the Navy down the tubes essentially.
CARROLL: Ten years in the Navy down the tubes. And she said it was the best 10 years of her life. She has no regrets about coming out. She just hopes there will be a time when others can come out and continue to serve as well.
S. O'BRIEN: Jason Carroll, a great story, thank you.
CARROLL: Thanks.
S. O'BRIEN: Miles.
M. O'BRIEN: Happening in America this morning.
An army medic accused of going AWOL to avoid a second tour of duty in Iraq surfaces in Los Angeles.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: If you want to say good-bye to your family, let me know when you're ready and then we'll have a little talk to you. OK? How's that?
SPEC. FIRST CLASS AGUSTIN AGUAYO: Yes. Great. Thanks.
(END VIDEO CLIP)
M. O'BRIEN: Specialist First Class Agustin Aguayo says he's ready to take responsibility for his actions. He now faces court- martial.
And a solemn ceremony, long past due, at Arlington National Cemetery, Private Francis Lupo laid to rest 88 years after he was killed in action in France in World War I. Lupo's niece was there to accept the flag that draped his coffin. The Pentagon says Lupo is the longest missing U.S. soldier ever recovered and identified. His bones turned up in a construction site 55 miles northeast of Paris.
California Governor Arnold Schwarzenegger signing a bill today that would put a cap on greenhouse emission in that state. Schwarzenegger says this is just the first step in his state's battle against global warming. Schwarzenegger also wants California to place more focus on renewable fuels and hydrogen-powered cars.
New York City would like to ban trans fats in its restaurants and doughnut shops too. The artery clogging fats show up in foods like doughnuts and french fries. The city wants to give restaurants six months to switch to oils, margarine or shortening with less than a half a gram of trans fats per serving. If at all passed, the restaurants that don't cooperate would face fines.
Police in Dallas scratching their heads this morning. A thief takes off with a so-called bait car. The cars use special equipment to track and trap and convict car thieves, but police can't find this bait car.
S. O'BRIEN: Oops.
M. O'BRIEN: Oops. The program is suspended for now while they fish for the bait.
S. O'BRIEN: There's no car. Of course it's suspended.
M. O'BRIEN: Yes. Yes.
Sometimes a good deal isn't really a good deal, as an Idaho couple found out. The home they bought cheap turned out to be full of snakes. Snakes in a house. Sounds like a movie, although probably its been done, hasn't it. The man says he first made the discovery when he reached for a light cord. The light cord was a snake. Oh, my God!
S. O'BRIEN: Oh, my God!
M. O'BRIEN: Come on. There's - oh, gosh. The couple sent a video of the snakes to a TV program that offers home makeovers. I'm a little skeptical of this.
S. O'BRIEN: You are?
M. O'BRIEN: Just slightly. I'm just going to live that out there. I'll let you decide on that.
S. O'BRIEN: Really? Why?
M. O'BRIEN: Well, they're trying to get on TV with it. But anyway . . .
S. O'BRIEN: Oh. Well, it would work. You need the makeover.
M. O'BRIEN: Put them on, right?
S. O'BRIEN: Yes, come on.
M. O'BRIEN: All right. Now this is not your average pet. In Chicago, a man meets goose. A man keeps goose. The two are best friends. Harley the goose likes to chase the motorcycle and so he takes the goose out for a fly or a walk or whatever you call it. Up to 43 miles an hour and the goose just keeps on -- the Harley follows the Harley.
Some Chicago chefs are kind of a flop at stacking flap jacks. Flop jacks, I guess you could say. The chefs from the Cooking and Hospitality Institute of Chicago, attempting to get into the Guiness Book of World Records for the world's tallest stack of pancakes but the stack didn't add up, didn't stand up and they don't qualify.
S. O'BRIEN: They had like another 11 inches to go or something like that. They were way short.
M. O'BRIEN: Yes, kind of a syrupy tale anyway.
S. O'BRIEN: We haven't had puns from Miles in a long time.
M. O'BRIEN: I quit coffee and the puns went away.
S. O'BRIEN: Good.
M. O'BRIEN: I tried Ginseng this morning. Maybe they're back.
S. O'BRIEN: Off the Ginseng.
Anyway, coming up this morning, what secret is the Mona Lisa hiding behind her famous smile? Some scientists may have found the answer to that question. We'll share that just ahead.
And just about everybody thought that Andrew Fastow would get 10 years in prison for his role in Enron's collapse. Looks like he caught a break. Andy's "Minding Your Business" coming up next on AMERICAN MORNING.
(COMMERCIAL BREAK)
S. O'BRIEN: A look at medical news now. At least five states facing a serious shortage in family doctors. That's according to a report by the American Academy of Family Physicians. The group says there will be nationwide shortages with Nevada, Arizona, Florida, Texas, and Idaho, the very worst off. The report blames a growing and aging population, as well as fewer medical school graduates who specialize in family medicine.
And it's going to cost you a lot more when you finally do find a doctor. According to a national survey, in the past six years, the cost of family medical coverage has skyrocketed, up 87 percent. That's compared to consumer prices which are up 18 percent in the same period. Worker's pay has risen 20 percent. You can kind of see the disconnect there.
M. O'BRIEN: We can.
Another case of lost data, personal data, could affect over 2 million credit card customers. Listen up on this one. Chase is sending letters to current and former Circuit City credit card customers that their account information was mistakenly thrown away as trash. I mean, when are these people going to learn about this stuff? Chase has not found any miss use of the information. Get a shredder, folks.
All right. We've gone from HP now to Andy's other favorite story, which is the CEO police blotter complex.
ANDY SERWER, CNN CORRESPONDENT: What, a corporate road report?
M. O'BRIEN: Corporate road report.
S. O'BRIEN: We need a graphic for that.
M. O'BRIEN: The corporate road's gallery.
S. O'BRIEN: The corporate road report with Andy Serwer.
M. O'BRIEN: And Andy, Andy Fastow, we thought 10 years.
S. O'BRIEN: What happened?
M. O'BRIEN: What happened there?
SERWER: He got a break. Former Enron CFO, chief financial officer, Andy Fastow, got a break from a judge yesterday in Houston. He had agreed to serve -- this is him arriving yesterday. He had agreed to serve 10 years when he pled in 2004. But Judge Ken Hoyt gave him six years. The judge saying prosecution is necessary, persecution was not. Saying that he had been ridiculed, pointing out that his wife had served one year in the joint. And also, and more importantly, that he had cooperated with prosecutors in their investigations of Ken Lay and Jeff Skilling.
S. O'BRIEN: But why would the fact that his wife had spent a year in prison, why would that be a mitigating factor? I mean that, you know, yes, she spent a year in prison because . . .
SERWER: She committed her own crime, right? So that shouldn't have any bearing. Somehow it did.
The other thing, Soledad, he expressed remorse. He said he was ashamed. He apologized. There were a lot of tears yesterday in the courtroom. And there were the speakers, too, let's not forget.
M. O'BRIEN: How was that? SERWER: That was a dud. There were four speakers and three of them representing investors in Enron defended Fastow in saying that he should get a lighter sentence, again, because he cooperated with the government trying to get the bigger fish.
S. O'BRIEN: How did they pick these speakers?
SERWER: That's unclear. And it's unclear also, whether there were people who were denied a chance to speak. But I don't think they were. I mean at a certain point, are you going to take a day off of work to trudge down to court and, you know, complain about . . .
S. O'BRIEN: Actually, yes, if your life was destroyed by somebody, absolutely, I would sit in court. And no matter what you're talking about, a case about financial wrongdoing or something . . .
SERWER: All right. Let the record show you don't want to mess with Soledad.
M. O'BRIEN: But they're busy trying to earn back their nest egg that they lost, for gosh sakes.
SERWER: Yes, well that is also true. I mean you don't have time to take.
Now let's talk about Bernie Ebbers because he began his 25-year sentence yesterday in federal prison, Oakdale, Louisiana. Apparently Ebbers drove . . .
M. O'BRIEN: No mint on the pillow.
SERWER: No mint. Apparently not. He drove over from Mississippi in his Mercedes.
M. O'BRIEN: And, what, just parked it on. There's going to be a parking ticket on that thing when he gets out.
SERWER: No, I think what you do is you give the Mercedes to the warden, right?
M. O'BRIEN: There you go.
SERWER: I mean, making good here.
And you know who else is in this facility is former Louisiana Governor Edwin Edwards doing a 10 year sentence there for extorting river boat casinos.
M. O'BRIEN: A little gin rummy.
SERWER: So maybe they'll have something to talk about.
M. O'BRIEN: All right.
SERWER: Rouges.
M. O'BRIEN: What's next?
S. O'BRIEN: Tune in tomorrow.
SERWER: You don't get to say this very often, the butler did it. We have a story where, indeed, the butler did a little inside trading. We'll tell you about that coming up.
S. O'BRIEN: Interesting.
M. O'BRIEN: All right. Thank you, Andy.
SERWER: Yes.
S. O'BRIEN: Wow, this is a stellar business report today, Andy, on all fronts.
M. O'BRIEN: Keep it coming.
S. O'BRIEN: Coming up this morning, the fallout from the president's decision to declassify parts of a controversial intelligence report. Who are the political winners and losers. We'll take a look this morning.
And there is a new report that says it is official, the housing bubble is bursting. We'll take a look why it's bad news for homeowners ahead on AMERICAN MORNING.
(COMMERCIAL BREAK)
M. O'BRIEN: Good morning, Washington, D.C., beautiful morning there.
Happening this morning, neighbors who don't see eye to eye will meet and have dinner at the White House tonight. Presidents Pervez Musharraf, Afghanistan's Hamid Karzai, each says the other isn't doing enough to fight the Taliban and al Qaeda. The president will preside.
E. coli-contaminated spinach discovered in Pennsylvania may help nail down the source of this problem. Investigators have matched the new bags to the strain of E. coli that has been making a lot of people sick.
And an update now on Barbaro, the Kentucky Derby winner that broke his leg at the Preakness. His doctors say he's looking good. He's still in a cast, still in intensive care. As you can see there, out for a walk, a little bit of grass. It will be six months to a year before he can walk more freely. We're glad to see him up and well though.
Welcome back. I'm Miles O'Brien.
S. O'BRIEN: And I'm Soledad O'Brien.
Part of that controversial classified intelligence report on global terrorism has now been made public by the White House. Democrats say they're not satisfied, though. CNN congressional correspondent Andrea Koppel is live on Capitol Hill. Hey Andrea, good morning.
ANDREA KOPPEL, CNN CONGRESSIONAL CORRESPONDENT: Hey, good morning to you, Soledad.
Well, Democrats may be insisting that the war was a big blunder, but ever since that story broke last weekend, Democrats -- privately, at least -- have also been looking at that report, that leaked intelligence report as a big gift delivered just six weeks before midterm elections.
(BEGIN VIDEOTAPE)
KOPPEL (voice-over): An act of civil disobedience as dozens of antiwar protesters refuse to leave a Senate office building, while on the House floor...
UNIDENTIFIED FEMALE: I offer a privileged motion calling for a secret session...
KOPPEL: The top Democrat tried, yet failed, to force the House into a highly unusual secret session to discuss a classified intelligence report on terrorism and Iraq. Both events staged examples of the highly charged political current surging from one end of the Capitol to the other on the same day Iraq's president paid a visit.
In press conference after press conference, Democrats worked to keep the focus on what they call the Bush administration's failed policy in Iraq, using a recently leaked intelligence report called an NIE to bolster their case.
UNIDENTIFIED MALE: We want to make certain that what we're doing in Iraq and around the world contains and destroys the threat of terrorism. This national intelligence estimate suggests just the opposite, that our strategy in Iraq is adding to the problem and not diminishing the problem.
KOPPEL: Even after the president said he would declassify key findings, Democrats say it still wasn't enough.
SEN. HARRY REID, (D) MINORITY LEADER: We call for all of it, we Democrats. You can't release it piece meal. It's another attempt by this administration to hide the truth from the American people.
KOPPEL: By refusing to declassify the entire report, Senator Hillary Clinton said, "Republicans are trying to shift the focus away from the unpopular war in Iraq."
SEN. HILLARY RODHAM CLINTON, (D) NEW YORK: They may not have a plan to complete successfully the mission in Iraq, but they do have a plan to win elections here at home. The stakes are too high to let them take such a low road.
(END VIDEOTAPE) KOPPEL: And considering where we are in the political calendar, it's unlikely that Democrats will stop their criticism any time soon with just three days left before they adjourn to hit the campaign trail hard, Democrats are likely to continue to focus their criticism on what they view as President Bush and his party's Achilles heel -- Soledad.
S. O'BRIEN: Andrea Koppel for us on Capitol Hill. Thanks, Andrea -- Miles.
M. O'BRIEN: Clearly, both parties spinning that national intelligence estimate and it does expose Achilles heels on both sides. Let's cut through the spin for a moment.
"Time" magazine White House correspondent Mike Allen joining us now from Washington.
Each party taking something away from this report. Does it surprise you?
MIKE ALLEN, "TIME" MAGAZINE: Well, no, Miles. And good morning. You're right. As you can see in that great report by Andrea, Democrats have cheshire cat grins on their face as they say top of the morning to each other today. But I'm not sure they're going to win this argument in the short run at least.
Miles, I did something we don't often get the chance to do. I was at an event last night when this document came out. So I actually read it cold before I had heard the administration's spin or read the Democrat reaction or looked at my competitors' reports. Miles, when you look at this four-page document, which your viewers can easily get on the Web, most of it is like one of the president's speeches. Most of this document makes the points that he makes, that freedom is the antidote to terror, that the U.S. must win in Iraq and that there are people that want to kill us.
But Miles, there are also three sentences in here which are surely the sentences your viewers have in their morning papers and have been seeing on TV, which make it clear that there are significant voices within the nation's intelligence community that believe Iraq is part of the problem, not part of the solution, that more terrorists are being created, not fewer. And that's a big problem for the administration.
So the White House is able to look themselves in the mirror and say yes, most of this is what we've been saying in our speeches. Yesterday they put out a very cleverly headed document. It said, "And now, the rest of the story". A little hat tip to Paul Harvey there, pointing out all the things in the intelligence estimate to bolster the president's point. But he now has to go out and say why he can argue that the United States is winning the war on terror when there's this bleak assessment that says that terrorists are becoming more diffuse, they're going to be harder to get. They're going to be using suicide attacks, improvised explosive devices in urban areas, including in Europe, against soft targets, which are things like schools and grocery stores. M. O'BRIEN: Let's share with our viewers some numbers, a recent CNN poll that we commissioned, Opinion Research, September 22 through 24 is the timeframe. And here's the question. Which party would better handle terrorism versus Iraq? Republicans do well when the question is terrorism, 47 to 41. And then it's just a mirrored image when it comes to the issue of Iraq. So the question is, are voters going to be thinking about terrorism or Iraq or would the two somehow become intertwined. That is the key political calculus that's going on right now, right?
ALLEN: Miles I think it's very astute. This is a great test of one of the Bush administration precepts and I'll give them credit, they've been right about this before and I've doubted it again and again. As you know, they contend that any time you and I are talking about terrorism, talking about national security that that benefits the president, benefits Republicans. Even when people are talking about why Osama bin Laden hasn't been caught. They say that that very topic rings bells that help the president.
Now the question is whether that's changing. Yesterday you saw Congresswoman Jane Harmon of California, the top Democrat on the intelligence committee, saying that what this document shows is the opposite of what the president's been saying, but because we're fighting them there, we may have to fight them here. And if people start to believe that Iraq has made America less safe, that's going to be a big problem for the president.
But Miles, this is why I said to you at the beginning, I'm not sure Democrats are going to win this argument in the short run because the president's able to be out there, talking about this. He's portrayed it yesterday as a political tool. You saw the president -- we've seen a lot of the president sort of alpha male body language. He looked plenty hot yesterday as he would say when he talked about how this was leaked for political purposes coming down the stretch.
But when you hear the president and his people talking about his job one now is to put in place the tools for his successors to fight and win a multigenerational war on terrorism. And that's not what anyone wanted to do when they left in January '09. But now that's their big goal and it's hard for them to articulate and defend. Because Miles, I think you can agree that if Harry Truman had said we're winning the cold war, he would have been right, but there wouldn't have been a lot of people who believed him at the time. And there wouldn't have been a lot of evidence to back it up at that moment.
M. O'BRIEN: Good point. All right, Mike Allen, White House correspondent, "Time" magazine. Thanks very much.
ALLEN: Have a beautiful day, Miles.
M. O'BRIEN: All right, you too. Soledad?
S. O'BRIEN: After years of going up, up, up, housing prices are now heading down, down, down in some places. Has the bubble finally burst? Gerri Willis is the host of CNN's "OPEN HOUSE", talked to one couple who's got that sinking feeling.
(BEGIN VIDEOTAPE)
GERRI WILLIS, CNN CORRESPONDENT (voice-over): Kate and Hans Koning have been trying to sell their eastern Connecticut house for nearly a year. So far there are no takers, even though they cut their price not once, but twice.
KATE KONING, HOMEOWNER: I started at $875,000, and at the time I thought that was really a reasonable price for the house, given the size.
WILLIS: The Konings are not alone. Sellers across the country are struggling with a weakening housing market. Just how weak became apparent Monday when the National Association of Realtors released its monthly housing report showing that median prices for homes fell for the first time in 11 years. Although the tumble was small, just two percent, it represents a turning point for a market that has been on fire for the past decade.
DAVID LEREAH, NATIONAL ASSN. OF REALTORS: The housing markets just went through a very big boom. We need a correction. Prices got too high and now we need prices to come down to bring people back into the buying marketplace.
WILLIS: Back into the buying market so prices can go up again. But some say a rebound won't be that easy this time. Economist Robert Shiller correctly predicted the dot com bust of the late 90's. Now he says its housing's turn.
ROBERT SHILLER, AUTHOR, "IRRATIONAL EXUBERANCE": If the U.S. housing market really starts to decline, it will harm confidence and it will cause a possibility of downward momentum in the U.S.
WILLIS: And that means pain for some homeowners.
SHILLER: The people who bought in at the top and sell out at the bottom can get really hurt. And so there will be bankruptcies, foreclosures, and people out of jobs, but we'll recover from it. And this is not nuclear war.
WILLIS: Even Lereah who had previously been optimistic says prices are headed down for a while. Most at risk are places with big backlogs of homes and already high prices like southern Florida, southern California, Nevada and Washington, D.C. Some say recovery will be months in the future. Others say it could be years. For the Konings, it can't come soon enough.
KONING: I don't know how long this is going to go and how, you know -- I mean, I may have to just decide not to go anywhere.
WILLIS: Gerri Willis, CNN, New York.
(END VIDEOTAPE)
S. O'BRIEN: You can catch Gerri on "OPEN HOUSE" on Saturdays at 9:30 a.m. Eastern Time right here on CNN.
M. O'BRIEN: So what was Mona Lisa smiling about? Well perhaps it was a new bundle of joy. Scientists in Canada using 3D imaging technology have uncovered secrets about the 500-year-old masterpiece. They've learned DaVinci modified it. Originally Mona Lisa wore a bonnet, later that was painted over. And she also wore a transparent veil, a garment reserved for expecting or nursing mothers in the 16th century in Italy. Here's your clue. So perhaps that's what it was.
And some classic works of the Norwegian painter Edouard (INAUDIBLE) are on display. The painting, the scream and Madonna are being viewed by the public for the first time since police recovered them in August. You remember that famous heist. Authorities say the 1893 paintings were slightly damaged by the thieves who stole them from the Oslo Museum more than two years ago. I assume they'll be able to fix that though, let's hope.
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S. O'BRIEN: Coming up, who's the baby daddy? The father of Anna Nicole Smith's new baby girl, we know the answer. We've got the revelation for you just ahead.
Plus, the lawyer who's running for office in Massachusetts. If he wins, he'll be that state's first-ever African-American governor. He's already helping to make history though just by running. Those stories ahead. Stay with us.
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S. O'BRIEN: Following some tight primary races for you this morning. More African-Americans are running for high office this year than ever before. And with less than six weeks to go before election day, there are six black candidates who are running in highly visible races for senator or governor. More now from Dan Lothian.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: Yes, we can.
DAN LOTHIAN, CNN CORRESPONDENT (voice-over): After a decisive victory in his state's recent Democratic primary, Deval Patrick was back on the campaign trail one step closer to becoming the first African-American governor of Massachusetts.
DEVAL PATRICK, DEMOCRATIC CANDIDATE FOR GOV.: That historical milestone or the potential of it is certainly not lost on me.
LOTHIAN: Neither is the fact that he's making history just by running.
DAVID BOSITIS, JOINT CTR. FOR POLITICAL & ECONOMIC STUDIES: But is a record year for black gubernatorial candidates and if you combine black gubernatorial and senate candidates, it's a record year for the combination of the both. LOTHIAN: Patrick, a lawyer, former Coca-Cola executive and Clinton appointee of the Justice Department, is joined in the races for governor by former Pittsburgh Steelers' hall-of-famer Republican Lynn Swann in Pennsylvania. And in Ohio, Republican Ken Blackwell, a current secretary of state. Running for senate, Democrat Harold Ford, Jr., a U.S. representative from Tennessee. Republican Michael Steele, the current lieutenant governor of Maryland. And Democrat Eric Fleming in Mississippi, a state legislator.
(on camera): African-Americans have been visible in Congress for some time and as mayors in cities across the country, but this quest for higher office and the fact that the candidates are running serious campaigns is what's attracting so much attention.
(voice-over): After all, there's only one African-American U.S. Senator, Barack Obama of Illinois. And Doug Wilder, now the mayor of Richmond, became the nation's first and only black governor when he won in Virginia in 1989.
MAYOR L. DOUGLAS WILDER, RICHMOND, VIRGINIA: It's a distinction I would like to lose. I never thought it would be this long before we would have somebody as a governor that looked a little like me and I would like to think that that time is here.
LOTHIAN: It took time say political experts for blacks in lower offices to move up, to gain clout, an Ivy League education or wealth and to broaden their appeal.
BOSITIS: Not just a black-oriented agenda or a civil rights agenda or an anti-poverty agenda, but a broader agenda that speaks to a larger constituency.
LOTHIAN: But Wilder says they can't ignore black voters or the trail blazers.
WILDER: You can't forget the years of fighting for the opportunity to be able to register to vote.
DEVAL: Those struggles have opened all kinds of doors for me.
LOTHIAN: From the current field of black candidates, Patrick, according to political analysts, has the best shot at winning. In campaigns highlighted by race, the candidates say voters should make up their minds based only on the issues.
Dan Lothian, CNN, Boston.
(END VIDEOTAPE)
M. O'BRIEN: Up next on the program, Andy "Minding your Business." Andy what do you have?
ANDY SERWER, "FORTUNE" COLUMNIST: Miles, the Feds say the butler did it. The butler says he didn't. It's an insider trading case of the rich and famous. We'll get to that coming up next on AMERICAN MORNING. (COMMERCIAL BREAK)
S. O'BRIEN: Anna Nicole Smith's long time friend and attorney Howard K. Stern says he's much more than that. He's also the father of her daughter, Danilyn Hope, was born earlier this month in the Bahamas. Stern made the revelation on Tuesday on CNN's "LARRY KING LIVE".
(BEGIN VIDEO CLIP)
HOWARD K. STERN, ANNA NICOLE SMITH'S ATTY.: Anna and I have been in a relationship, and we love each other, and it's been going on for a very long time. And because of my relationship as her lawyer, we felt that it was best to keep everything hidden, and we've actually done a pretty good job of that.
(END OF VIDEO CLIP)
S. O'BRIEN: Yes, they had. Stern says the baby's been a ray of hope as the couple is dealing with the death of Anna Nicole's son Daniel. He died three days after the birth of his little sister. Investigators in the Bahamas still don't know what caused the 20-year- old's death. And this reminder, you can catch Larry every night on CNN at 9:00 p.m. Eastern Time. Miles?
M. O'BRIEN: And Andy is here with an insider trading scheme that has shades of Agatha Christie in there. The butler maybe did it, or allegedly, we should say. Andy Serwer, how are you?
SERWER: Miles, not only that, but Elvis, the king is involved in this too. So we have a lot of good stuff going on here. This case involves media mogul Robert Sillerman. You remember him, his company CKX owns the rights to Elvis Presley as well as "American Idol" and Mohamed Ali. And it actually entails his butler.
Here's the background. Back in 2004, Sillerman was looking to buy a small company called Sports Enterprises and he was also looking to fold into that company the rights to Elvis Presley. At that point, the butler, a gentleman named Graham Lefford, allegedly, according to the Securities and Exchange Commission, looked at the faxes that were going back and forth between the New York City offices and Sillerman's house out in the Hamptons and noticed that this deal was going down and bought himself some stock, 5,000 shares of this company at 12 cents a share, that was in August. Then in December, he sold those shares for between $9 and $10.50 and made himself a cool $48,525 on 600 bucks.
Now, Lefford denies the charge by the Securities and Exchange Commission which means, the SEC says the butler did it. We have to be clear about that at this point. Hard to say exactly how he would suggest that he wasn't guilty, but I'll leave that up to him and his lawyer.
S. O'BRIEN: Well if he's not, he should move immediately into a career as an investment adviser and not a butler because he's obviously brilliant. SERWER: Absolutely. But he was there faxing these documents and that's what the SEC says. It doesn't look so good for him.
M. O'BRIEN: So he had a fair amount of access.
SERWER: And he signed a confidentiality agreement apparently too, so it doesn't look so good for him.
S. O'BRIEN: Interesting.
M. O'BRIEN: All right, what else do you have?
SERWER: We're going to be talking, coming up next about Madden football and the curse of Madden Football. Players who are on the box, on the cover of the game, end up having bad things happen to them afterwards.
S. O'BRIEN: Really?
SERWER: Well sort of like the "Sports Illustrated" cover curse. Not so bad, but their careers don't do so well, some say.
M. O'BRIEN: The butler did it in that case, maybe.
SERWER: Maybe.
M. O'BRIEN: All right thank you.
S. O'BRIEN: We'll take a look at the day's top stories coming up next, including the controversial intelligence report on the war on terror. What exactly is in the declassified portion? We've got all the details just ahead on AMERICAN MORNING.
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