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Secretary Rice in Asia; Continuing Violence in Iraq

Aired October 18, 2006 - 09:00   ET

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

TONY HARRIS, CNN ANCHOR: And you are in the CNN newsroom.
Good morning, everybody.

I'm Tony Harris.

HEIDI COLLINS, CNN ANCHOR: And I'm Heidi Collins.

For the next three hours, watch events unfold live on this Wednesday, the 18th of October.

Here's what's on the run-down.

The top American diplomat pressing Asian allies on North Korean sanctions. Condoleezza Rice looking for aggressive enforcement.

HARRIS: Bloody October -- the military announces another 10 American troops have been killed in Iraq.

COLLINS: And a Kentucky couple -- police say they are on the run-with an infant. A surveillance camera may have spotted them near St. Louis. We follow the trail in THE NEWSROOM.

HARRIS: The North Korea threat -- here is what we know.

This hour, Secretary of State Condoleezza Rice is in Japan, the first stop of her Asian travel. She is traveling to shore up support for the United Nations sanctions against North Korea and its defiant nuclear test.

Her visit comes with new concerns. Activity suggests North Korea could be preparing for a second nuclear test.

Tomorrow, Rice travels to South Korea. Then it is on to China and Russia.

CNN's Zain Verjee is the only television correspondent traveling with Secretary Rice on her trip to Asia.

Zane joins us now by telephone from Tokyo -- Zane, good morning.

ZAIN VERJEE, CNN CORRESPONDENT: Tony, good morning to you.

One of Secretary Rice's goals is to get regional powers to implement the U.N. Security Council resolution that essentially slapped sanctions against North Korea. Since North Korea's nuclear test, Japan has been feeling increasingly threatened. Secretary Rice had a message to Japan today. She said don't worry, the U.S. stands with Japan and the security alliance is strong.

(BEGIN VIDEO CLIP)

CONDOLEEZZA RICE, SECRETARY OF STATE: We also talked about the importance of our defense alliance at this critical time. And I reaffirmed to Foreign Minister Aso and will, in fact, reaffirm again to Prime Minister Abe, the firm commitment of the United States to the defense of Japan.

(END VIDEO CLIP)

VERJEE: And the reason that that's important, Tony, is that Japan has a pacifist constitution. And that basically means that it can't use armed -- can't used armed force and it's not really ready for battle. So Japan relies on the U.S. security umbrella to defend it from any threats.

HARRIS: Zane, just a couple of quick questions.

Talk about China for us, because it seems to me that this all comes down, the success of these sanctions comes down to China's willingness to work with the international community. It comes down to enforcement.

What is Secretary of State Rice hoping to get in terms of guarantees from China?

VERJEE: Well, China is very critical, as you say. Many say that China is the key. And South Korea, as well, visiting here, too, especially on this trip, for Secretary Rice.

China and South Korea are very angry that North Korea tested a nuclear device. But the thing is, is that they don't want to push the regime in North Korea so hard to inflict even more economic difficulties on them so that the regime essentially collapses, because that would trigger millions of refugees to pour into China, to pour into South Korea. It would destabilize the region, it would be potentially dangerous and it would be a huge economic burden at a time where both China and South Korea really want to focus on growth.

HARRIS: And, Zane, the view from South Korea, the Secretary of State heads there tomorrow, what is South Korea's take on what is happening in the international community?

VERJEE: Well, South Korea, like China, you know, is concerned about security in the region, but it doesn't want to push North Korea so hard and back it into a corner that the dog bites back.

One of the things that Secretary Rice is really focusing on this trip is to prevent North Korea from obtaining or transferring nuclear materials. That's something outlined in the U.N. Security Council resolution. And she wants South Korea, like the others, to inflict a strong inspections regime, essentially stopping North Korean cargo ships or any ships containing suspicious material coming in and out of North Korea. And she wants South Korea, China, Japan to monitor that and to share intelligence, and, also, to interdict those ships. HARRIS: Wow!

VERJEE: That's going to be difficult because South Korea has indicated a reluctance in doing that, fearful that it may trigger military skirmishes and lead to a bigger problem.

HARRIS: CNN's Zain Verjee, traveling with the Secretary of State.

Zane, we appreciate it.

Thank you.

And we will talk about all of these issues with former ambassador to China, Jim Sasser, at the bottom of the hour -- Heidi.

COLLINS: Over the last few years, no luck on the diplomatic front in trying to convince North Korea to back away from its nuclear plans. Talks stalled last November, as you may remember. The negotiations were aimed at getting the North to abandon its nuclear program in exchange for aid and security guarantees.

The six nation talks have been on again/off again since 2003. The host, China, North Korea's closest ally and biggest supplier of food and energy. Other countries, involved, though -- the U.S. Russia -- which shares a border with North Korea -- Japan and South Korea, a country that's had an uneasy truce with the North for more than half a century.

North Korea walked out on the talks nearly one year ago in protest over U.S. sanctions on its alleged illicit financial activities.

And to Iraq now, where 10 more U.S. troops are dead. They were killed in bombings and in battle.

CNN's Arwa Damon joining us now live from Baghdad -- Arwa, why all of this recent violence?

ARWA DAMON, CNN INTERNATIONAL CORRESPONDENT: Well, Heidi, it could be for a number of reasons. And Tuesday was an incredibly deadly day for U.S. troops here.

First of all, we are still in the holy month of Ramadan, nearing its end. Over the last three years, we have regularly seen a significant up tick in violence, up tick in attacks against U.S. forces during this time period. But, also, the country as a whole, especially the areas in which these casualties happened -- Baghdad, Diyala Province and Al Anbar Province -- are progressively getting more violent. The insurgency is launching more and more attacks. The IEDs, roadside bombs that they are using, still crude, but are becoming more sophisticated and effective.

We are also seeing an increase in small arms fire attacks. They, too, those deadly snipers that are out there on the streets, especially in the capital, Baghdad, are also becoming more effective. In a sense, the insurgency is morphing itself. And as U.S. forces take measures to secure themselves, the insurgency is also developing new measures to attack them -- Heidi.

COLLINS: Arwa, we're also getting some reports about sort of a house cleaning, if you will, of some of the Iraqi special police.

Tell us what that's about.

DAMON: That's right. Now, this announcement came from the Iraqi Ministry of Interior.

If we just step back a few months, though, the new minister of interior took position, Jawad Bolani, and said that he was going to clean up the Ministry. It has been plagued with accusations of being infiltrated by death squads and militias.

What we have seen happen is now he announced that two brigades, the headquarters of two brigades of the Iraqi National Police have been dissolved, their commanders removed from posts, given other jobs within the Ministry.

In all, 3,000 Iraqi police commandoes and Ministry of Interior employees have been fired for a range of reasons, going from money laundering, from bribery, from negligence, from human rights violations and from not being able to perform their duty.

We are seeing this massive shake up within the Ministry of Interior. It is trying to establish itself as being a viable force. It's trying to establish its police as being a viable police force, something that is very challenging right now in Iraq. We are seeing constant insurgent attacks where they are wearing Iraqi police uniforms and it is right now more crucial than ever for the Ministry to establish its credibility -- Heidi.

COLLINS: Boy, hopefully this latest move will make a difference.

Arwa Damon live from Baghdad.

Arwa, thank you.

HARRIS: More finger pointing at Pakistan from Afghanistan's leader. President Hamid Karzai tells the Associated Press Mullah Omar, the Taliban's supreme leader, is hiding in Quetta, Pakistan. He also blames Pakistan for surging Taliban violence in Afghanistan and calls on the Pakistani leaders to do more to crack down on militants.

From Pakistan's government, a blunt rejection of Karzai's claims.

A blunt assessment on Afghanistan. It comes from the former commander of British forces in Afghanistan. Brigadier Ed Butler says international troops may have to stay in Afghanistan for the next 20 years. In the short-term, he warns the Taliban may regroup over the winter and come back even stronger next year. Butler says British forces are having to make up for time lost to the Iraq War instead of concentrating on Afghanistan.

Butler has just returned home to Britain after giving up his command in Afghanistan.

COLLINS: We want to get over to Chad Myers now.

Boy, people are getting hammered with a whole heck of a lot of water on the coast.

CHAD MYERS, CNN METEOROLOGIST: Absolutely.

(WEATHER REPORT)

HARRIS: Still ahead, Mark Foley says he'll reveal his alleged abuser.

Why now and what comes next?

COLLINS: Also, a tip to tell you about. A top Democrat now on the ethics hot seat over his generosity and a million dollar land deal.

HARRIS: And wanted for a kidnapping and a killing -- the search is on for a Kentucky mother and her baby. An update in THE NEWSROOM.

(COMMERCIAL BREAK)

COLLINS: The scandal over explicit e-mails then the claim he was abused by a priest. Now, ex-Congressman Mark Foley says he will reveal the identity of his alleged abuser. His attorney says it will prove Foley is not just making excuses for his behavior toward pages.

Details now from national correspondent Susan Candiotti.

(BEGIN VIDEO TAPE)

SUSAN CANDIOTTI, CNN CORRESPONDENT (voice-over): Whether he can prove it is one thing, but Mark Foley's attorney wants skeptics to know his client's allegations are not trumped up.

GERRY RICHMAN, MARK FOLEY'S ATTORNEY: It's going to be very clearly in the coming days that it is a fact as opposed to any possible allegations that it's a fantasy or something made up for political purposes.

CANDIOTTI: It was about two weeks ago that Foley first made his bombshell allegation.

DAVID ROTH, MARK FOLEY'S ATTORNEY: Mark has asked that you be told that between the ages of 13 and 15, he was molested by a clergyman.

CANDIOTTI: But who is the alleged molester and where is he now?

The archdiocese wants to know. It says Foley's claims have put a cloud of suspicion over all its Press Secretary Tony Snow.

MARY ROSS ACOSTA, ARCHDIOCESE OF MIAMI: Common sense must come in here that we need to know who it is prior to us being able to provide the counseling for that person.

CANDIOTTI: Foley's lawyer says he'll turn over the name at the right time in a "sensitive way."

RICHMAN: Mark Foley is intending to work with the Archdiocese of Miami and greater West Palm Beach for the purpose of revealing the name of the particular priest who is involved so that the archdiocese can then deal appropriately with the issue.

CANDIOTTI: Foley grew up in South Florida. As a youngster, he served as an altar boy. He attended Catholic grade school and high school, but later transferred to a public high.

Foley's lawyer says he's talked with the Palm Beach State Attorney's office, but no criminal charges will be filed. The allegations are too old. The alleged abuse happened more than 35 years ago, well past the statute of limitations.

(END VIDEO TAPE)

COLLINS: Susan Candiotti joining us now live from Miami -- Susan, I wonder, if the priest's name is released, will that come from Foley's attorney or directly from the archdiocese?

CANDIOTTI: Well, that's the question, isn't it, Heidi?

At this point, some -- a new development. This from Mr. Foley's civil lawyer. This morning, he told me that they have no intention of filing a civil lawsuit, as we previously thought. It was certainly under consideration. That would mean that the name would have to be released through the Archdiocese of Miami, most likely. And the Archdiocese says under its rules, it must release the name.

But we don't know how soon that would happen.

COLLINS: All right, so we'll be watching for that. I didn't realize they were required to release that name.

All right, Susan Candiotti live from Miami.

Thank you.

HARRIS: Republicans not the only ones with ethics issues. The top Senate Democrat is juggling a couple of ethics issues himself.

CNN Congressional correspondent Dana Bash has that.

(BEGIN VIDEO TAPE)

DANA BASH, CNN CORRESPONDENT (voice-over): Democratic leader Harry Reid lives in this Ritz-Carlton in Washington. At Christmastime, the senator gave doormen and other employees $3,300 in tips over three years, a generous gesture. But the money came from Reid's campaign coffers, a possible violation of election law.

SHEILA KRUMHOLZ, CENTER FOR RESPONSIVE POLITICS: You do not use campaign donations for personal use. And tipping your doorman or, you know, the condo association just doesn't pass the smell test.

BASH: Reid said his lawyers had assured him it was OK because of the extra work that comes with having a Senate leader in the building. But to be safe, he says he's "reimbursing the campaign from my own pocket."

Damage control for the Senate's top Democrat, under fire for potential ethics violations three weeks before an election in which Democrats are slamming Republicans for a so-called culture of corruption.

The Nevada Democrat is also battling questions about a Las Vegas land deal that earned him $700,000 in 2004.

SEN. HARRY REID (D-NV), MINORITY LEADER: I bought a piece of land, sold it six years later. Everything was reported. It was all transparent.

BASH: Reid did report to Congress he owned the land and paid taxes on it. But he did not disclose that three years before selling it, he transferred ownership to a limited liability corruption.

Aides say the senator wanted to develop the land and made that transfer for legal protection.

Reid now says he'll amend four years of ethics reports to be more transparent about the deal.

KRUMHOLZ: I would expect that a person who's been in Congress as long as Harry Reid has been would know better to -- to provide as complete a picture as possible.

BASH: For a GOP under siege by scandal from Mark Foley to new revelations about Congressman Curt Weldon, Reid's troubles give Republicans ammunition to return fire on the campaign trail.

Like on this Tennessee radio show.

DAN RONAYNE, NATIONAL REPUBLICAN SENATORIAL COMMITTEE: Harry Reid said this whole campaign is going to be about ethics. I think the voters can barely look at that and say there's some hypocrisy there.

BASH (on camera): When voters are asked which party is more ethical, they say Democrats, but by a pretty slim margin. And one pollster says new reports of scandal in either party probably won't sway voters much because other issues are shaping the election.

ANDREW KOHUT, PEW RESEARCH CENTER: Iraq, the economy, health care and a sense that the country is not on the right course are the major reasons. And President Bush himself and discontent with his administration are the reason the Republicans are in big trouble.

BASH (voice-over): A growing number of voters, he says, are sour on Republicans. But they're not doing handstands over Democrats, either. Dana Bash, CNN, Capitol Hill.

(END VIDEO TAPE)

HARRIS: And we are minding your business.

Andy Serwer is here with a bit of a preview for us -- Andy, good morning.

ANDY SERWER, "FORTUNE" MAGAZINE: Hi, you guys.

Deceased but exonerated -- a big court victory for the late Ken Lay. We'll tell you how that went down coming up in THE NEWSROOM.

(COMMERCIAL BREAK)

HARRIS: A judge's ruling clears the conviction against Enron founder Ken Lay.

Andy Serwer is Minding Your Business this morning -- Andy, good morning to you.

SERWER: Good morning to you, Tony.

You know, the wheels of justice turn and sometimes they turn in strange ways.

HARRIS: Strange ways.

SERWER: That's the only way to put this.

Judge Sim Lake, who presided over the Enron trial, has vacated the convictions against Enron's Ken Lay, the late Ken Lay, of course. He was convicted of 10 counts of conspiracy and fraud back in May.

In July, you may remember, he passed away in Aspen, Colorado.

How could this be?

Well, Lay's lawyers pointed to a ruling from 2004 that found that the defendant's death pending appeal extinguished the entire case because...

HARRIS: Oh.

SERWER: ... the defendant hasn't had the opportunity to challenge the conviction, the government shouldn't be able to punish a dead defendant or his estate.

So, the state, his family, I guess, can say that he was never convicted of any wrongdoing.

HARRIS: Wow!

SERWER: That's where it stands.

HARRIS: And we know that he was.

OK, so, but Andy, here's the question -- what does the ruling do for the government in its efforts to get money from Ken Lay's estate?

SERWER: Oh, yes, now that's an interesting question. You know, the government said that Lay has about $44 million of ill-gotten gains, or his estate does, of course, from Enron. And in this criminal proceeding, the government was going to go after that money.

Now, it can no longer do so. It may choose to do so in a civil proceeding, but in that case it has to sort of get in line with other civil litigants.

HARRIS: Oh.

SERWER: So this muddies the picture very much so and I'm sure the government prosecutors are wringing their hands and pulling their hair out over this.

HARRIS: Oh, man.

Hey, Andy, you've been telling us about United Health, the CEO there, repricing his stock options.

OK, what's the total? What's the damage?

SERWER: Yes, we don't want to belabor this one, Tony, because we've been talking about this William McGuire character for days, weeks and months.

HARRIS: Yes.

SERWER: But this is the guy who, at one point, had $1.6 billion of stock options and the investigation found that these were priced on the lowest days of quarters during the year and during the year. Mathematically impossible unless they were not arbitrarily done, that they were picked on purpose for being low days.

So, McGuire says all right, we'll scrap that and I will pick the least favorable days for these options to be exercised.

HARRIS: Right.

SERWER: It turns out he loses some money, but not that much. His trove is reduced by $159 million, which, to anyone but someone like this, is a huge amount of money. But you're still talking about this guy ending up with well over a billion dollars.

HARRIS: That's the bottom line. That is the bottom line.

SERWER: That is it.

HARRIS: Hey, Andy, you're back later in the hour.

What are we talking about? SERWER: We're going to be talking about some news coming up regarding Google and the stock market and how people on Wall Street get paid.

HARRIS: Beautiful.

Andy, see you then.

SERWER: See you then.

HARRIS: Well, a blunt assessment. Jimmy Carter on President Bush's North Korea policies. That is coming up in THE NEWSROOM.

COLLINS: And China one of the next stops for Secretary Rice. A political minefield seen through the eyes of a former U.S. diplomat. He's coming up in THE NEWSROOM.

HARRIS: Ten more Americans killed in Iraq. Live to Baghdad.

That is straight ahead.

You're watching CNN, the most trusted name in news.

(COMMERCIAL BREAK)

COLLINS: We quickly want to update a story in Kentucky. There's an amber alert there and a very interesting and somewhat frightening story going on.

Fredericka Whitfield is at the newsroom desk for more on that -- Fred, what do we know coming out of Kentucky this morning?

FREDRICKA WHITFIELD, CNN CORRESPONDENT: Well, Heidi, a possible lead to the suspects involved in the bludgeoning death of a Kentucky social worker and then the consequent abduction of that 9-month-old baby.

Take a look at this video. It is video shot at a gas station showing -- and it's across state lines in Smithboro, Illinois. And that's about 200 miles south of Chicago.

It shows a man getting out of the passenger's side -- right there -- the man getting out of the passenger's side, using a credit card to pay for fuel. It's believed to be 23-year-old Christopher Luttrell. Luttrell is the boyfriend of 33-year-old Renee Terrell, both believed to be involved in the beating death of a Kentucky social worker, 67- year-old Boni Frederick, who was taking care of Renee, Terrell's 9- month-old baby right there in the picture.

The social worker Frederick's body was found on Monday. It's believed the couple still has the baby, but their whereabouts are unknown -- Heidi.

COLLINS: All right, Fredericka, we'll continue to watch that one, certainly.

Thank you.

HARRIS: Hey, Heidi, what do you say?

The big board, the Dow opening today.

Let's get a quick market check.

This is Chris Rendazo (ph), a New York Stock Exchange employee just returned from active duty in Iraq. We love him.

COLLINS: That's got to be his kids, don't you think?

HARRIS: Yes, and his kids. We love him. We thank him so much for his service. Look at the kids having a ball, right?

I mean this is terrific for them, ringing the bell, opening the market today.

This is a big reporting week for corporations. We'll watch that and get a check of all of the day's business news with Andy Serwer just a little later in this hour.

COLLINS: The North Korea threat. Here is what we know. This hour, Secretary of State Condoleezza Rice in Japan. It's the first stop of her Asian tour. She's trying to shore up support for the United Nations sanctions against North Korea and its defiant nuclear test. Her visit comes amid new concerns North Korea could be preparing for a second nuclear test.

Tomorrow rice travels to South Korea, then it's on to China and Russia. And tough words for President Bush's policy from a former president Jimmy Carter says an agreement he brokered years ago is now, quote, "in the waste basket." The 1994 deal, the agreed framework, freezing the North's nuclear program. It followed contacts between carter and North Korea's leader at the time, Kim Il-Sung.

(BEGIN VIDEO CLIP)

JIMMY CARTER, FMR. U.S. PRES.: Beginning in 1981, he began to send me messages that somehow or another he wanted to have conversations with someone that represented the United States. And I felt then as a negotiator that the stupidest thing our government can do, if it has a real problem with someone, is to refuse to talk to them and to let them simmer, and threaten them and build up animosity and fear in that country. And it's particularly applicable to an enclosed society that's already paranoid to be further isolated and excused from direct talks with the people whom they fear.

(MARKET REPORT)

HARRIS: Let's take a closer look at China's critical role in this crisis with North Korea through the eyes of a veteran diplomat, Jim Sasser, served as U.S. ambassador to China during the Clinton administration. He joins us from our Washington bureau.

Ambassador, good to see you again. JIM SASSER, FMR. U.S. AMB. TO CHINA: Good to hear from you, Tony.

HARRIS: Hey, let me ask you about the sanctions here. It seems it comes down to enforcement, enforcement, enforcement. I want you to take us into the room here. Secretary of State Rice and her counterparts, they're talking about enforcement. What is she asking for, as specifically as possible, and what is she getting back from China?

SASSER: Well, she wants to have china increase their -- the strength of their inspections, and she's going to get back from China, I think, cooperation.

Her counterpart there, Foreign Minister Li Jaoching (ph), I know quite well, and I think the Chinese are angry at the North Koreans, they are embarrassed by the North Koreans; they are frustrated by the North Koreans. And already the Chinese, according to news reports yesterday, are increasing and inspecting truck cargo going into North Korea and increasing their fortifications along the North Korean- Chinese border, which is about 900 miles long. So I think we're going to get cooperation from the Chinese on this.

HARRIS: So ambassador, embarrassed you say. Would you go as far as to say humiliated?

SASSER: I would say that the Chinese feel that they have lost some face here.

HARRIS: But let me -- are they embarrassed enough to, for example, provide, say, 50 percent of North Korea's oil instead of 70 percent, or 40 percent of North Korea's food aid instead of 60 percent?

SASSER: Tony, that could happen. But we're not going to know about it. The Chinese are not going to advertise that. I think they are going to find ways to put what they think is a modicum of pressure. But they're in a delicate situation. They do not want this regime to collapse in North Korea, because if it does, there will be hundreds of thousands, maybe millions, of starving North Koreans streaming across the border into northern China.

HARRIS: Jim, can we trust China? And let me play this. You were on the big "PAULA ZAHN NOW" show last night, and Frank Gaffney was there, the founder and president for the Center for Security Policy. And last night, he said this about China, and let me have you respond.

(BEGIN VIDEO CLIP)

FRANK GAFFNEY, PRES., CTR. FOR SECURITY POLICY: At a time when they're reportedly firing lasers at our satellites, they're building up strategic energy, and economic, and military, and alliance and geographic capabilities that are almost certainly going to conflict with our interests over time, we've got to understand that china is going its own way. (END VIDEO CLIP)

HARRIS: Jim, what do you think? Friend, foe?

SASSER: I think you can count on China to act in its own self interest just like every country does. And China's self interest in this present situation is trying to contain this nuclear problem on the Korean peninsula.

HARRIS: Got you. Let me sort of pick up on that. Do you think that when the administration says all options are on the table, the administration also means the nuclear option is on the table?

SASSER: What the administration is trying to do, Tony, is reassure Japan, South Korea, other countries in the region that they can rely on the U.S. nuclear umbrella to protect them and they don't need to start out with their own individual nuclear weapons program. This is an effort, I think, to contain this so we don't get into a nuclear arms race in Asia.

HARRIS: So how, for example, does Iran respond to that language from the president? How does -- I think we got an indication of how you North Korea responds.

SASSER: Well, Iran is a different kettle of fish. I think Iran has their own ideas about how they are going to operate. And I, frankly, am not in a position to answer that question.

HARRIS: Yes. OK, Jim. It was great to talk to you. Appreciate your insights on putting us in the room as to what we might get, secretary Rice might get from her counterparts in China. That's great.

SASSER: My pleasure. Thank you.

HARRIS: Appreciate it.

(MARKET REPORT)

(WEATHER REPORT)

HARRIS: Still to come, bombings and shootings leave 10 more U.S. troops dead in a single day. Live to Baghdad, straight ahead in the NEWSROOM.

COLLINS: Border build-up. Mexican drug cartels outgunning the Border Patrol, opening the way for a bigger security threat.

See that story coming up in the NEWSROOM.

(COMMERCIAL BREAK)

HARRIS: A disgraced Congressman's claims. The man at the center of the congressional page scandal says he'll reveal the name of a priest who he says abused him. Mark Foley says he's identifying the priest so the church can deal appropriately with the issue. The spokeswoman for the Miami archdiocese was a guest on CNN's "AMERICAN MORNING" last hour.

(BEGIN VIDEO CLIP)

MARY ROSS AGOSTA, CATHOLIC ARCHDIOCESE OF MIAMI: I would think that victims of sexual abuse are being unfairly targeted. Well, because if this clergyman is a Roman Catholic Priest, and is still alive and is in active ministry, are we putting other teenagers, other children at risk, because we don't know who it is? And secondly, I don't understand how Representative Foley's attorneys feel that Mr. Foley can, you know, continue to heal himself with this still hanging out there. This is not closure. And to dangle this information from press conference to press conference is truly unfair.

(END VIDEO CLIP)

HARRIS: Well, the archdiocese says it is ready to offer counseling once the alleged abuser is identified.

COLLINS: Nine soldiers, one Marine. The latest Americans killed in Iraq this deadly October. The military announced today four of the soldiers were killed in a roadside bombing west of Baghdad yesterday. Less than three hours after that attack, another soldier died when his patrol was hit with small arms fire in northern Baghdad. Later, a sixth soldier died in a roadside bombing also north of the capital. Meanwhile, in Diala province, three Task Force Lightning soldiers died as a result of enemy action during military operations there. And in Anbar province, a Marine died from wounds due to enemy action. That makes 66 U.S. troops killed this month, putting October on track to become one of the deadliest months for American forces since the beginning of the war.

HARRIS: The border patrol outgunned. Mexican drug dealers are getting a hand from gangs across the border.

CNN's Casey Wian has that story.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT (voice-over): A gun battle on the streets of Nuevo Laredo, Mexico. These scenes took place just across the Rio Grande from the United States. Mexican government troops battling the Zetas, soldiers for drug cartels. Themselves former Mexican troops or police.

This violence is increasingly spreading across the border to the United States, according to a new report from the House Homeland Security Subcommittee on Investigations.

REP. MIKE MCCAUL (R), HOMELAND SECURITY COMMITTEE: We found that the drug cartels are more violent than ever and more powerful than ever, and they are the root causes for the violence on our border. They represent the head of the snake, the head that must be eradicated. WIAN: The report documents how Mexican drug cartels are actually increasing their grips on smuggling roots in Texas, even as the Border Patrol and National Guard deploy more resources to the area. Among its conclusions, Mexican drug traffickers are increasingly coordinating operations with U.S. gangs such as MS13.

Members of the terrorist group Hezbollah have already entered the United States across the southwest border. And Hugo Chavez's regime in Venezuela is emerging as a potential hub of terrorism in the western hemisphere. It says Venezuela is providing documents that could be used by terrorists to obtain a U.S. visa.

And it states the obvious: border patrol resources are inadequate.

GOV. RICK PERRY (R), TEXAS: It's not merely idle chatter to say that border security is critical to homeland security. To think that international terrorists have not already exploited our border is naive.

WIAN: The congressional investigation was launched in February after LOU DOBBS TONIGHT reported on a battle between U.S. law enforcement officers and Mexican drug smugglers in military uniforms who had crossed into the United States. We also reported the Homeland security Department documented 200 Mexican military incursions since 1996.

(on camera): Among the reports proposed solutions, more Border Patrol agents, more border fencing and increased cooperation with the government of Mexico to control the drug cartels.

Casey Wian, CNN, Los Angeles.

(END VIDEOTAPE)

HARRIS: And for a look at all sides of the news, watch "LOU DOBBS TONIGHT," 6:00 Eastern on CNN.

COLLINS: OK, so one of my most favorite stories of the day has to do with this painting. It's a Picasso. But it's no longer on the market after a multimillion-dollar oops. The unartful mishap. You won't believe who it happened to, in the NEWSROOM.

(COMMERCIAL BREAK)

(BUSINESS HEADLINES)

HARRIS: How about this story? A billionaire -- is this your favorite story of the day? OK. A billionaire, Steve Wynn may want to rethink his office decor. Wynn was apparently showing visitors around his office at the namesake Wynn Casino. He gestured with his arms and punctured his prized Picasso. Wynn's elbow put a silver dollar sized hole in the 74-year-old masterpiece. What's the name of this?

COLLINS: That's big. "La Reve."

HARRIS: "La Reve."

COLLINS: "The Dream."

HARRIS: And the mishap is absolutely costing him. Seems Wynn had just closed a deal to sell the painting for $139 million, but now he's elbowed his way out of that deal, at least for now.

COLLINS: Yes, he stood to make $90.4 million on that as a profit.

HARRIS: Really?

COLLINS: Yes, he bought it for, obviously, a lot.

HARRIS: And you can rehab it, but it's never the same.

COLLINS: No. It's never the same.

HARRIS: It's never the same.

COLLINS: Meanwhile, become to some serious news in Asia. On a mission. Condoleezza Rice rallies a unified front against North Korea. The latest on this developing story in the NEWSROOM.

HARRIS: But first, fighting on two fronts. An Arizona state lawmaker runs for re-election while battling insurgents in Iraq. His story coming up in the NEWSROOM.

(COMMERCIAL BREAK)

HARRIS: Well, he is running for re-election while trying to run insurgents out of Iraq. CNN's Chris Lawrence on Arizona's soldier candidate.

(BEGIN VIDEOTAPE)

CHRIS LAWRENCE, CNN CORRESPONDENT (voice-over): Can an Army Reservist battle insurgents in Tikrit while fighting Democrats in Tucson? This Arizona state legislator is aiming to prove it's possible.

We caught up with Jonathan Paton when he was training for deployment. Now he's serving in Iraq as a military intelligence officer.

JONATHAN PATON (R), ARIZONA STATE LEGISLATOR: The hardest thing about all of this, is want be -- I'm always the guy that I wanted to make sure that stuff gets done on time, the mailing we're sending out gets done on time. I can't do that when I'm over there. I have to put my trust in other people to do it for me.

LAWRENCE: Paton is depending on his supporters to run a campaign without its candidate.

PATON: I might miss a few debates. I have a spokesman, who is the state senator in our district. He's going to have to go out there and be me.

LAWRENCE (on camera): In any other race, his military service may be a huge advantage. But his opponent is Democrat Clarence Boykins (ph), a Vietnam vet.

(voice over): Sometimes communication is touch-and-go in Iraq. So to know if he's still got a job, Paton may have to check the Internet after Election Day.

PATON: Believe me, that day I will be, you know, whatever self- discipline I have, I'm going to be on edge that particular day. I want to know how I did.

LAWRENCE: Paton is running for re-election on his immigration record. He introduced a bill that empowers state and local officials to go after smugglers. But he's not around for the last four weeks of the campaign. Even if he's re-elected, Paton could miss up to two months of his second term.

PATON: You know what, if I don't win because I'm doing something that I thought was the morally right thing for me to do, then that's OK.

LAWRENCE: Paton can miss up to three months before the county names a temporary replacement. By the time he gets back, the battle at home will be over while war still rages in Iraq.

Chris Lawrence, CNN, Tucson.

(END VIDEOTAPE)

HARRIS: And so you say you want to hear more about the upcoming elections. Lou Dobbs is demanding answers. Tonight in a live one- hour special from Kansas City, Lou's war on the middle class. Tonight at 7:00 Eastern on CNN.

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