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American Morning

Gates Hearing Today; Amazing Survival; California Wildfire

Aired December 05, 2006 - 08:00   ET

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

SOLEDAD O'BRIEN, CNN ANCHOR: Good morning. Welcome, everybody, Tuesday, December 5th.
I'm Soledad O'Brien.

MILES O'BRIEN, CNN ANCHOR: And I'm Miles O'Brien.

We're glad you're with us.

We begin in Washington and a wartime White House unhappy with the pace of progress in Iraq, looking to change the strategy and the personnel.

President Bush and his nominee for defense secretary, Robert Gates, meeting at the White House as we speak. Gates' confirmation hearings begin 9:30 Eastern Time. CNN will have live coverage, of course.

As for the strategy, the Baker-Hamilton panel delivers its final report to the President tomorrow. The group offering its advice on how to grapple with the war.

All this is set against violence and outright chaos in Iraq. Just today, three car bombs and a bus attack in Baghdad. At least 29 are dead.

We have two live reports for you. Andrea Koppel is on Capitol Hill. Barbara Starr at the Pentagon.

We begin with Andrea.

And Andrea, it's interesting. This is not his first confirmation hearing for Mr. Gates, but it was a different time and a different subject matter 15 years ago. Wasn't it?

ANDREA KOPPEL, CNN CONGRESSIONAL CORRESPONDENT: It certainly was. That was back in the days of the Iran Contra, and the questions swirling about what Robert Gates knew as the then-deputy CIA director. But today he's going to get a much warmer welcome here from the 24 senators who will be sitting in the seats behind me.

I think it's fair to say, Miles, that this is going to be a slam dunk. Nobody doubts but that Robert Gates will be confirmed, and the reason is, according to one congressional aide I spoke to, anybody but Rumsfeld. When you have people like Senator John Kerry, who's advocating withdrawing all U.S. troops by next summer, saying he endorses the Gates nomination, that gives you a window inside just how the nominating process is going to go today.

As you mentioned, a few moments ago President Bush met with his nominee just before he heads over here to Capitol Hill.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Good morning. I just had breakfast with my nominee to be the secretary of defense, Bob Gates.

Bob Gates will be a fine secretary of defense. I appreciate the fact that he's getting a hearing today in the United States Senate. And I hope for speedy confirmation so he can get sworn in and get to work.

Those who wear the uniform know they'll have a friend in Bob Gates in the Defense Department. He admires our military, he respects those who have volunteered to serve our country. He is -- he's going to do an excellent job for us.

Again, Bob, I thank you for agreeing to serve.

ROBERT GATES, DEFENSE SECRETARY NOMINEE: Thank you, Mr. President. Thank you very much.

BUSH: Good luck to you.

GATES: Thank you.

BUSH: Thank you all.

(END VIDEO CLIP)

KOPPEL: Now, Robert Gates has no background in the military. He is a career intelligence officer who first joined the CIA back in 1968. He then over the years went up the chain of command, right up to the very top, when he finally became the director of the CIA back in 1991.

For the last couple of years, he said he's had the best job in his entire career. He's been the president of Texas A&M University.

You can expect the questioning today, Miles, not to be about that, but rather focusing very much on getting inside Gates' head as to what his strategy is, how he is going to deal with resolving the crisis in Iraq, and whether, as Senator Carl Levin of Michigan put it, he'll be willing to speak truth to power -- Miles.

M. O'BRIEN: Andrea Koppel on Capitol Hill.

Thank you -- Soledad.

S. O'BRIEN: So with that word on the street that Gates' nomination is pretty much going to be a cakewalk, Democrats and Republicans at such odds over the next step in Iraq, the question is really why. CNN's Barbara Starr is at the Pentagon for us this morning.

Barbara, good morning. What are you hearing at the Pentagon?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, here everyone is going to be watching their TV, certainly, to watch the confirmation hearings. There is anticipation here with the military as well that there will be speedy confirmation.

I think what people will be looking for here amongst the uniformed military is any signs about Bob Gates' thinking about what to do next in Iraq. He is likely to get a lot of very pointed questions about that. He is very likely to say all options are on the table, everything is being studied. Of course, we are just one day before the Iraq Study Group, which he was a member of, is about to deliver its recommendations to the president.

In a questionnaire before his confirmation hearings that Gates submitted to the committee, he said that he would not want to see any precipitous withdrawal of U.S. troops from Iraq, that that could leave the country, if not the region, in some chaos. So he's not very likely to endorse the kind of set timetable that Senator Kerry is talking for -- about, but there is a growing understanding, Soledad, by the U.S. military that what they are talking about is accelerating the turnover of security to the new Iraqi government, putting more U.S. trainers out on the front line.

That may not mean more U.S. troops, but making some of those combat troops, trainers and advisers, pushing the Iraqis out there.

S. O'BRIEN: Barbara -- hey, Barbara, I'm going to stop you there because your audio just took a hit, so we've lost your audio. We're going to try to fix that and get back to the Pentagon as she continues to update us as we head into these hearings.

It's going to start in about an hour and a half. CNN's going to carry that hearing live as it happens -- Miles.

In Oregon this morning, celebration and concern. Three of four members of a family missing in some snow-covered mountains since Thanksgiving weekend are safe and sound. An intense search is under way around Grants Pass, Oregon, meanwhile, for James Kim. His wife and daughters are safe and sound and telling an amazing tale of survival.

(BEGIN VIDEOTAPE)

UNDERSHERIFF BRIAN ANDERSON, JOSEPHINE COUNTY, OREGON: She's in great shape. The kids are in great shape. So we're happy. I mean, that's -- that's a good find for everyone who was involved. And this is a good day for us.

M. O'BRIEN (voice over): It's a good news chapter, but not the end of the story for a San Francisco family lost in the snow in southwestern Oregon. A helicopter crew spotting Kati Kim and her two daughters nine days after their car got stuck in the snow on a mountain road. But Katie's husband James is still missing. He left his family two days earlier in a desperate search for help.

ANDERSON: It's my understanding he left the car at 7:45 Saturday morning, was going to walk out. And if he didn't find anything, return by 1:00. He did not return back to the car.

M. O'BRIEN: James Kim left wearing only tennis shoes, pants, a sweater and a jacket. The family went missing just after Thanksgiving, headed home to San Francisco after a holiday trip to the Pacific Northwest. They missed a turn, tried an alternate route, and ended up stuck on an impassable mountain road.

ANDERSON: They had minor provisions in the car. They ended up running -- they ran out of gas. They were running the car during the day and at night to keep warm. Then they started to burn their tires at night to stay warm. And so they did a good job.

M. O'BRIEN: Kati Kim nursed 4-year-old Penelope (ph) and 7- month-old Sabine (ph) to keep them nourished.

UNIDENTIFIED MALE: I'm elated that the children have been found and that we have our babies back. But I have an intense worry about James at this point.

M. O'BRIEN: Searchers followed James Kim's footprints in the snow until darkness. His family says he has some outdoor experience.

ANDERSON: There's always a good scenario. Nine days, you know, stuck in the snow in a car is a good scenario. We're going to continue to look until we find James. We're operating on the assumption that he's still alive and we're going to try to find him.

(END VIDEOTAPE)

M. O'BRIEN: He may seem familiar to you. James Kim is a senior editor at the popular tech Web site CNET.com. He co-hosts a weekly podcast.

Coming up at the bottom of the hour, about 25 minutes from now, we'll talk with Kati Kim's mother and father, Sandy and Dr. Phil Fleming (ph). We'll ask them how they're doing -- Soledad.

S. O'BRIEN: In southern California today, firefighters hoping to catch a break from those howling Santa Ana winds, trying to get control of that wind-whipped wildfire. Seventeen hundred firefighters now are working the fire that destroyed five homes, burned more than 13,000 acres in Ventura County.

Let's get right to AMERICAN MORNING'S Chris Lawrence with an update.

(BEGIN VIDEOTAPE)

CHRIS LAWRENCE, CNN CORRESPONDENT (voice over): The hot, dry Santa Ana winds gusted up to 70 miles per hour, whipping the flames into an inferno that engulfed five homes.

DORANN LA PERCH, LOST HER HOME: We've lost our personal belongings, my mom's and dad's wedding pictures.

LAWRENCE: But for every house lost, firefighters probably saved a dozen more.

UNIDENTIFIED MALE: It looked like we were about to be surrounded by the fire, which was quite -- quite frightening.

LAWRENCE: These pictures show what Michael Liacko's family saw, a wall of fire running up the side of two mountains.

MICHAEL LIACKO, DEFENDED HIS HOME: We were all out with hoses watering down the hillside here, just hoping we could get enough water on it to keep it damp.

LAWRENCE: The smoke was choking them.

LIACKO: Our eyes were watering and our throats were sore.

LAWRENCE: Their bags were packed and they were this close to leaving.

(on camera): Did you ever feel like, dad, what are we doing here? I mean, should we -- should we really go?

ASHLEY LIACKO, MICHAEL'S DAUGHTER: Yes, because my friend had to evacuate her house, so she came here. And then when it kept getting closer, I'm, like, "I want to go." I was just scared. I was in tears I was so scared.

LAWRENCE (voice over): Finally, her dad dialed 911.

M. LIACKO: The fire department responded within two minutes. And it was like the cavalry coming over the hill with the helicopters.

LAWRENCE: Swooping in with water, battered by those winds.

M. LIACKO: They were literally going sideways. And I don't know how they fly in that.

LAWRENCE: Michael says he'll never forget those gusts.

M. LIACKO: You can feel the wind now, how heavy it is. It's literally moving us. And those flames were just shooting across the hillside yesterday.

LAWRENCE: The wildfire scorched thousands of acres, but firefighters helped save hundreds of homes like Michael's, who says the reward of living here far outweighs the risk.

Chris Lawrence, CNN, Moorpark, California.

(END VIDEOTAPE)

S. O'BRIEN: Now, firefighters say the long dry spell and the extremely low humidity has helped fuel the fire. Humidity levels have been in single-digit numbers in southern California. Chad's going to have the forecast straight ahead for us, not only for California, of course, but for the rest of the country. That's just ahead -- Miles.

M. O'BRIEN: Happening this morning, continued violence in Iraq. New pictures coming in this morning.

At least 29 people killed in a bombing and a shooting in Baghdad. Fourteen of the dead Shiite religious workers. That's stoking fears the attack will touch off yet another round of sectarian violence.

Outgoing secretary-general of the United Nations, Kofi Annan, heads to the White House today. President Bush and the first lady honoring him with a formal dinner there. It could be a little awkward. Earlier this week, Annan told the BBC Iraqis were safer under Saddam Hussein's regime than they are now.

Another E. coli outbreak linked to Taco Bell. On New York's Long Island, eight Taco Bell restaurants closed. Fourteen people are sick, two had recently eaten at Taco Bell. New Jersey is still dealing with an E. coli outbreak there -- 25 people sick, at least one Taco Bell closed there -- Soledad.

S. O'BRIEN: Coming up this morning, the challenge ahead for defense secretary nominee Robert Gates. We're going to take a look at the big problems in Iraq and whether or not he can fix them.

Plus, millions of Americans were supposed to enjoy the benefits of a promising new cholesterol drug from Pfizer. Now the drug has been pulled. What happens next?

We'll take a look straight ahead.

(COMMERCIAL BREAK)

M. O'BRIEN: Top stories we're following for you.

New pictures of President Bush getting ready to send defense secretary nominee Robert Gates off to his confirmation hearing. There they are in the Oval Office.

And take a look at this. Live pictures of the Intrepid. The flattop still not budging.

The famed aircraft carrier about to ease its way out, it is hoped. It's been on the Hudson River for 20-some-odd years. Headed to Bayonne for a fresh coat of paint -- well, it's much more than that. A complete retrofitting.

But so far it appears it is still stuck in the mud. We're watching it. It's kind of like watching battleship gray paint dry. But we'll watch it, nonetheless.

As Pete on the floor here said, "Hope they untied it." Good thought.

S. O'BRIEN: We'll look into that for you, Pete.

M. O'BRIEN: If you're listening out there, untie it. Chad, let's go to you now.

CHAD MYERS, CNN METEOROLOGIST: An answer for everything, doesn't he?

M. O'BRIEN: Yes, he does. He's a smart guy, that Pete.

(WEATHER REPORT)

S. O'BRIEN: Just over an hour from now the Senate Armed Services Committee is going to take up the nomination of Robert Gates as secretary of defense. Now, Gates has already met with President Bush at the White House. We showed you these pictures when they happened just about 20 minutes ago. They had breakfast, then came out for a little photo op and a few words.

Gates, of course, would be taking over for the very embattled Donald Rumsfeld. What questions do Americans want answered as Gates takes his seat at the hearings? It happens in about an hour and 15 minutes.

Let's get right to Michael Gordon. He's the chief military correspondent for "The New York Times." He's also the co-author of "Cobra II: The Inside Story of the Invasion and Occupation of Iraq."

Nice to see you, Michael. Thanks for talking with us, as always.

Let's get right to it, if we can.

What will you be listening for as Bob Gates sits down in about an hour and 15 minutes to start talking to members of the Armed Services Committee? What do you want to hear?

MICHAEL GORDON, "NEW YORK TIMES": Well, I think there are really three main questions that I have in mind. And I'm not sure he can answer them all. But I think the lawmakers really want to know where the Pentagon is going to go on Iraq.

And, of course, Mr. Gates can't answer all of this definitively. The Baker-Hamilton group is yet to issue its recommendations. The president has to decide. But he can give some sort of indication about what -- how he might address the issue of U.S. force levels in Iraq, and at least tell how he might go about making the decision.

For example, a lot of weight is being put on the role of advisers to Iraqi units. Well, improving Iraqi units is going to take some time. So how will he decide if additional U.S. forces are needed? I think that's one key area that's going to be explored by the -- in the -- on the Hill today.

S. O'BRIEN: Fifteen years ago, of course, as you well know, there was much criticism about his role during the Iran Contra scandal. And there were some who said that, in fact, he tailored intelligence to meet the needs of what his superiors wanted.

Do you think that's going to play any role whatsoever? It seems like no when you listen to Carl Levin talking.

GORDON: I really don't think it's going to be a factor. I think that there's a very strong desire in the Congress to put the Rumsfeld era behind them and to move on. Gates is to be that person.

You know, in addition to Iraq, there are another couple key areas that I think are also going to come up. One, should we enlarge the size of the U.S. military because it's stretched very thin? And also, what about the climate within the Pentagon?

I mean, Mr. Rumsfeld has picked a group of military officers who I think have a reputation for being team players. There's a sense that perhaps more independent military figures are needed.

What is going to be the relationship between Mr. Gates and the generals? I mean, I think these are the sorts of things that are going to weigh on the mind of lawmakers, not what happened in Iran Contra a decade ago.

S. O'BRIEN: So we keep hearing the words, you know, "shoo-in," "cakewalk" for Mr. Gates as he goes into this hearing. Is that only because people are so ready to move beyond Secretary Rumsfeld, that they're going to kind of give him a -- why is he -- why is he such a shoo-in?

GORDON: Well, he's a known quantity in Washington. You know, he was the head of Central Intelligence. He was the deputy national security adviser. There may be some controversial elements of his career, but he's not an unknown figure.

And yes, he's a shoo-in because the country, the Congress and the administration itself wants to begin a new era at the Pentagon. And he's the person that's been picked to succeed Mr. Rumsfeld.

S. O'BRIEN: When it's the president and his advisers who are making the policy, how much do you think a new secretary defense, Gates, could play in really changing what's happening for the troops on the ground in Iraq?

GORDON: Well, the situation in Iraq is a very difficult one, and there's no quick fix or one solution that's going to change that situation dramatically in the short term. I think everybody needs to realize that. But he's been seized with the problem for some time.

He was on the Baker-Hamilton panel. He was a member of that panel. He's expressed some views which are different than the administration views on the need for some sort of direct dialogue with Iran. So he has shown some sort of independence in the past.

I think he provides an opening at defense for a new look at Iraq. But I don't think his becoming defense secretary is going to magically transform this situation. That's going to be a long and difficult process.

S. O'BRIEN: Michael Gordon is the chief military correspondent for "The New York Times." Thanks, as always, for talking with us.

GORDON: Thank you.

S. O'BRIEN: Miles.

M. O'BRIEN: Coming up, the latest on the desperate search for a father still missing and how his wife and daughters managed to survive being snowbound in Oregon.

Plus, Pfizer's future. The company with a big setback after the failure of a promising new cholesterol drug.

Ali Velshi will look into what it means for that drugmaker's future ahead on AMERICAN MORNING.

(COMMERCIAL BREAK)

S. O'BRIEN: So what's next for Pfizer? The drugmaker suffered a huge blow this week, giving up all clinical trials and development of what was supposed to be its blockbuster cholesterol drug.

Ali Velshi is "Minding Your Business" this morning.

Good morning, Ali.

ALI VELSHI, CNN CORRESPONDENT: Hey, good morning, Soledad.

Yes, it's a big problem for Pfizer. Fifteen years in development. Pfizer announced on the weekend that it was pulling this drug that could have been its next big blockbuster.

(BEGIN VIDEOTAPE)

VELSHI (voice over): It's not the easiestst name to pronounce, but Torcetrapib was poised to be one of the biggest drugs ever, and it wasn't just going to save lives, it was going to save Pfizer. Pfizer, you may know, makes the cholesterol wonder drug Lipitor.

JOHN SIMONS, "FORTUNE" MAGAZINE: Lipitor is the biggest-selling drug that there has ever been.

VELSHI: By a long shot. Thirteen billion dollars in sales for the drug this year alone.

So why does Pfizer need saving? Because its patent on Lipitor is going to run out. Soon it will have to compete with cheaper generics. Sales will inevitably plummet.

Lipitor prevents heart attacks by lowering bad cholesterol. Somebody would take Torcetrapib to raise their levels of so-called good cholesterol. It wasn't going to be as big as Lipitor, says "Fortune" writer John Simons, but it would have been pretty big.

SIMONS: It would have been a very big deal. It would have sold at least over $2 billion a year, probably -- probably as much as $6 billion to $8 billion.

VELSHI: Torcetrapib had been in the works for 15 years, but on Saturday Pfizer pulled the plug after clinical trials showed a higher death rate for patients taking the drug than those who weren't.

Torcetrapib was about two years from hitting pharmacies. It's unusual for a drug so far along to be canceled, and it's a big blow for Pfizer. The company spent $7.5 billion a year on research and employs 13,000 scientists, largely in pursuit of increasingly elusive blockbusters.

SIMON: It's kind of like hiring a bunch of art students who are very talented and saying -- putting them in a studio and saying, OK, create me a Mona Lisa.

VELSHI: Torcetrapib may not have been the Mona Lisa, but it had all the makings of a masterpiece. And it was going to buy Pfizer the time it needed to come up with the next big drug.

(END VIDEOTAPE)

VELSHI: Now, Soledad, Torcetrapib wasn't going to be out for another two years, but the drug companies say it cost them between $800 million and a billion dollars and 10 to 12 years to come up with new drugs.

It's not just a Pfizer problem. Take a look over here. Over the next few years, Norvasc, Effexor, Advair, Plavix and Zyprexa, different drugmakers, they're all coming off of patents -- Soledad.

S. O'BRIEN: That's a huge problem for the whole industry.

VELSHI: Yes.

S. O'BRIEN: All right, Ali. Thanks.

A look at our top stories straight ahead this morning.

A mother saves herself and her two young daughters in the Oregon wilderness, but her husband is still missing. We'll update you on the status for the search for him straight ahead.

And with so many families on the Gulf Coast in need, why are the insurance companies raking in so much money?

We'll take a look.

Stay with us. You're watching AMERICAN MORNING.

(COMMERCIAL BREAK)

M. O'BRIEN: Show of support. President Bush giving defense secretary nominee Robert Gates a boost of confidence this morning as he prepares for tough questions on Iraq at his confirmation hearing.

We're live. S. O'BRIEN: Incredible save. A mother and her two young daughters safe after spending more than a week snowbound. We're going to talk to some other family members about the rescue and now the continued search for the missing father.

M. O'BRIEN: And our holiday survival guide series. This morning, the skinny on big delays at airports, and the one flight you've really got to avoid. It's late 100 percent of the time, and Alina Cho proved it.

That's ahead on AMERICAN MORNING.

S. O'BRIEN: Poor Alina.

M. O'BRIEN: Poor Alina. That's a tough assignment.

Good morning to you, Tuesday, December 5th.

I'm Miles O'Brien.

S. O'BRIEN: And I'm Soledad O'Brien.

Thanks for being with us.

Happening this morning, President Bush and his secretary of defense nominee, Robert Gates, just finished their White House meeting. Confirmation hearings for Gates with the Senate Armed Services Committee -- Armed Forces Committee is what I'm trying to say -- will happen in just about an hour. And of course CNN is going to cover it live for you.

More E. coli cases to tell you about also. It's now on Long Island, shutting down eight Taco Bells there. Fourteen people sick. Two had recently eaten at Taco Bell.

The E. coli outbreak in New Jersey, which is the outbreak we told you about yesterday, 25 people now are reported sick. The suspected Taco Bells are going to stay closed until they're both inspected and decontaminated.

We're watching the Intrepid this morning, supposedly getting ready to ship out. Engineers say it's finally free of all that mud that had built up over decades in the Hudson River. I guess the hull was pretty much sucked into the mud. We're going to have a live report from the deck of the floating museum straight ahead.

M. O'BRIEN: I don't think it's budged yet.

S. O'BRIEN: Not yet.

M. O'BRIEN: In southwestern Oregon this morning relief and a redoubled effort to search for a man still missing in some snow covered mountains. A helicopter crew spotted Kati Kim and her two young daughters yesterday after they spent nine days trapped in their car on an impassible snowy road. But James Kim is still missing. He left his family two days ago in a desperate search for help. At first light this morning, searchers will once again, try to follow his footprints in the snow. Kati's parents join us now -- Phil and Sandy Fleming. They are in Albuquerque, New Mexico. Good morning to you both.

A lot of mixed emotions I imagine this morning. First of all, let's talk about the search for James. What's going to happen today and are you pretty optimistic they'll be able to track him down?

DR. PHIL FLEMING, KATI KIM'S FATHER: Redoubled efforts to try to find James and, yes, at this point we are very optimistic.

M. O'BRIEN: Tell us what the search is going to be like today, Dr. Fleming.

P. FLEMING: I don't have details of what's going on at the command center.

M. O'BRIEN: OK. Are they going to search by ground, by air, the general sense of how they're going to go after trying to find him?

P. FLEMING: Well, I can say this, I think reflective of the efforts, apparently they searched all through the night for him, so I expect it's air, ground, all possible ways, probably heat detection. I've heard something about that. I just don't know the full details, but I think it's a maximum effort. We've been so appreciative of the tremendous resources that have gone into this search on behalf of James and Kati and the children.

M. O'BRIEN; Sandy, James is wearing, according to one report, tennis shoes, a sweater and a jacket. But does, apparently, have experience as an outdoorsman. Does he have the right kind of experience to survive in these very cold, snowy conditions do you think?

SANDY FLEMING, KATI KIM's MOTHER: I really have to say I don't know. All I know is that they've camped, and that really is the extent of anything that I knew, but Kati did say that he set up their car and everything as if they were just camping out to help them survive.

M. O'BRIEN: Tell us a little bit more about that. I understand that they ran the car just at night to keep warm, just to use just the only the amount of gas they need. Then eventually burned the tires. Tell us how they survived.

S. FLEMING: Again, we don't have the details of that. Kati had some food -- normal food that she would have for the babies in the car, for the children. She usually carried water, blankets, layers of clothing for them. They had received a recent gift package that included some things that they used for survival also, just little things, but I'm assuming every little thing helped them.

M. O'BRIEN: And she nursed the girls as well? S. FLEMING: She did. She was nursing. She's been nursing Sabine. She's 7 months old. And she said, and momma, I nursed both babies, so I'm sure that helped the welfare of the children.

M. O'BRIEN: Phil, I know you've had an incredible emotional roller coaster these last nine days. What was it like getting that call?

P. FLEMING: Well, I just had to ask and re-ask because I had prepared -- I was prepared to receive bad news. I was prepared to look at this issue realistically in the odds for a bad outcome. When I received this news, I had to confirm it over and over. It was just unbelievable joy to have my three girls back.

That joy, however, is tempered in every -- over our concern about James, who has been heroic in this situation. I understand James didn't eat, used the resources for the children. Everything I've heard about his activities is very consistent with his character. And I am just obviously exceedingly concerned about the return of the baby's father.

M. O'BRIEN: We sure wish you well on that. Sandy and Phil Flemming from Albuquerque -- best to you, best of luck to you, best of luck to the searchers today as they look for James. Thank you for your time.

P. FLEMING: Thank you.

S. FLEMING: Thank you.

M. O'BRIEN: Soledad.

S. O'BRIEN: Gosh, our hearts go out to that family. That's got to be such a hard time for them. Such good news and such terrible news at the same time.

In fact, many people who lost everything in Hurricane Katrina got a second shock -- they had no insurance coverage. One family even got a bill. This, while the insurance industry has been reporting record profits. CNN's Sean Callebs is live for us this morning in Durbelville (ph) in Mississippi. Good morning Sean.

SEAN CALLEBS, CNN CORRESPONDENT: Good morning, Soledad. We chose this town near the Mississippi coast for a reason. The people here struggling to rebuild. Pretty good snapshot of what people all along the Gulf Coast are trying to do now right now.

Want to tell you about a bit about this house right here. Now, this gentleman had enough insurance to pay off his mortgage, but not enough to rebuild, so you're looking at an empty, gutted shell. That's where he stays. Doesn't know what he's going to do.

The woman that owns this house -- she's in pretty good shape. She had flood insurance, $250,000 worth. She was able to rebuild, raise her house about five feet, but got nothing for content. So, the rebuilding is going slowly and it's not nearly what she wants to do. If you look back through the trees, the house back in this area belongs to Donald and Sue Williams. A tough story -- two retirees who moved from Florida to be closer to their children. They had the same insurance carrier for 20 years. However, once the storm came through they found out they weren't covered. And what makes this difficult to swallow for so many people is that the insurance company is having a banner year.

(BEGIN VIDEOTAPE)

CALLEBS (voice-over): Donald and Sue Williams' golden years were washed away in an instant by Hurricane Katrina. They lost their Mississippi home, their savings, and with it, the will to live.

SUSAN WILLIAMS, HOMEOWNER: He told me when I go to bed I pray I don't wake up. He said I've got nothing to live for anymore.

DONALD WILLIAMS, HOMEOWNER: I was hurting then.

CALLEBS: Their insurance company had even more crushing news.

D. WILLIAMS: We've been with them for 20 years.

S. WILLIAMS: They didn't even give us wind damage for our roof.

D. WILLIAMS: And I had faith in them.

CALLEBS: The insurance company ruled all the damage was flood- related. They didn't have flood insurance. They say their agent originally told them they didn't need it. State Farm says because of privacy issues it doesn't comment on individual claims. The Williams say they found out they were getting nothing about the same time the insurance industry was predicting record profits for 2006.

S. WILLIAMS: If they're making record profits right now, I hope they sleep well at night.

ROBERT HARTWIG, INSURANCE INFORMATION INSTITUTE: I feel proud to be associated with an industry that has paid over the past two years over $80 billion dollars. And we have a very high degree of customer satisfaction.

CALLEBS: Industry officials say profits could reach $60 billion this year. One reason, despite dire predictions, there were no hurricanes this year. Even so, people along the Gulf getting socked by higher premiums should not expect their bills to go down. Here's how the industry explains it.

HARTWIG: Louisiana cannot receive subsidies from homeowners, for example, in the state of Ohio. In the same way, people in Louisiana should not be expected to pay for outsized winter storm losses in the state of Minnesota.

CALLEBS: And he says 95 percent of Katrina's 1.2 million claims have been settled. That still leaves some 60,000 policy holders, like the Williams' in the lurch. S. WILLIAMS: How do you start over at 76 years old and 62?

CALLEBS: Their home had been paid off. Now the retirees on a fixed-income have built a new home with a low-interest government loan. It also got them a brand new 30-year mortgage. Which Donald Williams says should be paid off when he's 106.

(END VIDEOTAPE)

CALLEBS (on camera): Tough news for the Williams family. They are pursuing some legal action against their insurance company. But, Soledad, so far it's gone nowhere.

S. O'BRIEN: Yes, and everybody's got the same story. I mean, that's the problem. It's their story and everybody else's story too. Sean Callebs for us in Mississippi this morning, thank you Sean.

Ahead on AMERICAN MORNING -- more on Pfizer's decision to pull that promising new cholesterol drug. We'll take a look at what it means for millions of Americans who could have benefited.

Plus a CNN exclusive on board the U.S.S. Intrepid as it moves out of the Hudson River mud. Got a live report on AMERICAN MORNING.

(COMMERCIAL BREAK)

M. O'BRIEN: Well, maybe they did forget to untie her. The Intrepid is still stuck in the mud. And they're pulling like the Dickens with those tug boats out there. Here's my question Heidi Collins, you're on the deck there. There are a lot of other people on the deck. There are some airplanes on the deck. Maybe you guys should get off. What do you think?

HEIDI COLLINS, CNN ANCHOR: Well, I tell you what, Miles. You're right. They are pulling like the Dickens. If you look over my right shoulder, you can see we've got three of the five tug boats. Those tension lines are as tight as they can get. They are pulling as we're told, full steam ahead. They have been doing so for ten minutes.

So we are very hopeful at this point, but we have not felt movement up here on the flight deck. As you may remember, since November 6th, this ship has been sitting in the same spot. Take two, if you will, for this massive renovation project that will be taking place.

They tried to move the ship down, five miles down the Hudson River to Bayone, New Jersey 29 days ago, and she got stuck. Those propellers on the bottom just spun themselves right into the sludge and the river silt at the bottom of the Hudson River. 49,000 cubic yards of sludge was taken out by the U.S. Army Corps of Engineers. And it is floating, but we are not moving yet and we of course will keep you updated on any progress from the Intrepid here. Miles -- back to you.

M. O'BRIEN: So, how long -- I know they're waiting for high tide. How big a window do they have with the tides in order to unearth her during this opportunity?

COLLINS: Well, high tide, I'm told, is at 9:00 a.m. When we first showed up at 6:00, we saw this beautiful full moon, which obviously means high tide. What that meant was 5.6 more feet of water to help them lift up and get a little bit more sway, if you will, to get her going. So we're waiting.

M. O'BRIEN: All right. Heidi Collins, I still say they should take those planes off the deck. It would lighten the load a little bit. I just don't get it. I mean, they weigh something right?

COLLINS: It's kind of a drop in the bucket, though, when you're talking about 27,000 tons, I guess.

M. O'BRIEN: Oh, there you are. That's a great looking shot there. Put that other shot up there one more time. That's great -- pull back on that -- that's great stuff. All right, well, good luck. Good luck there. Make sure she's untied, OK?

COLLINS: OK, yes you got it.

M. O'BRIEN: OK, Soledad.

S. O'BRIEN: I'm sure they all appreciate your helpful advice from the anchor desk, Miles.

M. O'BRIEN: They are not appreciating me at all right now.

S. O'BRIEN: Thank you, Miles.

(WEATHER REPORT)

S. O'BRIEN: Turning to this morning's "House Call" now. A giant setback for the pharmaceutical giant Pfizer pulling the plug on what would have been a promising new drug because of increase in patient deaths during the clinical trials. Medical correspondent Elizabeth Cohen is at the CNN center in Atlanta with details. Good morning Elizabeth.

ELIZABETH COHEN, CNN MEDICAL CORRESPONDENT: Good morning, Soledad. Soledad, Pfizer called it an imbalance of mortality. Some would say that's quite a euphemism for simply too many people dying while taking this drug. The drug is called Torcetrapib and it was designed to increase good cholesterol, which is a good thing that help unclog arteries without having any nasty side effects.

But instead, look what happened. Here are the numbers: over the two-year course of this study, what happened is that 82 people who were taking this drug died during the study. However, among patients not taking torcetrapib, 51 died. And there were 7,500 in each group. So an equal number in each group -- you would have expected to see an equal number of people dying, but as you can see, a more than 30 person difference. That is huge.

Now, no one is quite sure why this happened. There's some suggestion that perhaps the drug increased blood pressure, which is of course, a bad thing. What they do know is that this is a huge blow. There were high hopes for this class of drugs -- Soledad.

S. O'BRIEN: Let me ask you a couple questions. There's nobody else, it only in the trials, right? So, right now there's nobody else who is in danger?

COHEN: That's right. Nobody else is in danger. Pfizer, when they saw the numbers, they immediately took people off the drug. Nobody else is taking it. And we should add Soledad -- that obviously cholesterol is a huge health problem in this country and around the world, and there are drugs to help you if you have cholesterol problems. There are drugs called statins that lower bad cholesterol. Millions of people have used these for many, many years.

S. O'BRIEN: There was so much excitement about this drug. Then, of course, they've been working on it since the '90s and pouring billions of dollars into it for R&D and now, gone like that. What are the implications do you think, not just for this particular drug, but for the industry?

COHEN: Right. Because other companies were trying to do the same thing. I mean it is a great idea -- increase good cholesterol, you unclog arteries, you can hopefully prevent heart attacks and death. And now other companies are going to have to ask themselves the question does our drug have the same problem?

We don't know if this is a problem just with torcetrapib or also with other drugs in this class. So, certainly this news will slow down the research to some extent in what was considered to be one of the most exciting fields of pharmaceutical research.

S. O'BRIEN: Yes, and now it all comes to nothing for the most part. Elizabeth Cohen for us this morning. Thanks, Elizabeth.

COHEN: Thanks.

M. O'BRIEN: CNN NEWSROOM just minutes away. Tony Harris is -- well, he's an intrepid anchor, but his co-anchor is ever more intrepid today as she's on top of the flattop there trying to encourage Intrepid to go to Bayone for gosh sakes.

TONY HARRIS: Is it moving yet?

M. O'BRIEN: No. Not a budge.

HARRIS: Still in the muck. All right. We've got these stories on the NEWSROOM rundown this morning. Robert Gates in front of the Congress shortly for a job interview. President Bush wants to hire him to run the Pentagon. Extensive live coverage for you this morning.

A poll of Iraqis, a majority see American troops as the problem. They want them out now.

And searching Oregon's back country for this man today. His wife and two daughters rescued after days in the snow. So, Betty is with me here in Atlanta. Heidi is in New York. Join us all in the NEWSROOM top of the hour right here on CNN. Miles back to you.

M. O'BRIEN: All right, thank you Tony, we'll be watching. Soledad.

S. O'BRIEN: Ahead this morning, our holiday travel survivor guide, irritating delays, a flight you always want to avoid. And our very own Alina Cho got to check it out firsthand. The flight that never gets in on time, we sent Alina on it. We'll tell you the story straight ahead -- stay with us.

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M. O'BRIEN: Well, clearly Alina Cho got the short straw on this assignment. Our bosses here told her to book a seat on the flight that is never on time. And guess what? She spent a lot of time sitting at the gate, thumbing her blackberry and gossiping with the crew. Alina Cho joins us now from LaGuardia with her tale of woe -- first installment in her holiday travel guide. Hello Alina.

ALINA CHO, CNN CORRESPONDENT: Gossiping with the crew, Miles? Never.

M. O'BRIEN: Just a little bit.

CHO: All right. Well, you know, we are talking about delays. You know, getting to your destination on time is always the goal. But as you know, not always the reality. So as you mentioned, we recently took one flight that in September was late all the time -- 100 percent of the time, including the time we took it.

(BEGIN VIDEOTAPE)

CHO (voice-over): 4:30 p.m., I arrive at New York's JFK airport, plenty of time to catch Delta Flight 5283. Scheduled departure time, 6:30 p.m. Destination, Washington, D.C. Checking in is easy, I skip the line in favor of the kiosk.

(on camera): All right, here we go.

(voice-over): With boarding pass in hand, I drop off my bag.

(on camera): Thank you so much.

(voice-over): I'm off to security. The line looks long, but in less than ten minutes I'm at the gate. That's where the problems begin. We're initially told the flight will depart 45 minutes late. Then it's an hour. Finally more than 90 minutes after we're scheduled to leave, we're boarding. I take my seat at 8:05. I think I'm home free.

UNIDENTIFIED MALE: Once we get airborne, 51 minutes to Washington.

CHO: Key phrase, once we get airborne. Problem is, it's rush hour on the tarmac.

UNIDENTIFIED MALE: There are still quite a few airplanes in front of us, best estimate maybe 25 to 30 aircraft.

CHO: I wait. What choice do I have? And 90 minutes after boarding, we're airborne. Time, 9:30 p.m. The flight is exactly three hours late.

(on camera): It's 10:30.

(voice-over): 15 minutes later, I have my bag, and I'm off for a very late dinner.

(END VIDEOTAPE)

CHO: Now, ConAir, which operates the Delta flight told us somewhat surprisingly that they don't expect any improvements any time soon. What they are doing is adding staff and equipment. And they're even moving the departure time up to 5:55 from 6:30 p.m. later in the month, hoping to beat the evening rush that way.

One important point is that Delta of course is not the only offender, Miles. In fact, one in every four flights is late. That's the worst it's been since 2000.

Now, stay tuned for tomorrow because we will continue our holiday travel guide tomorrow. We will be talking about family vacations. I recently spent some time at Disney World. We'll have information about that for you tomorrow.

M. O'BRIEN: Like I say, short straw all the way.

S. O'BRIEN: Alina. You look good traveling, but, man, what a miserable little flight that must have been.

M. O'BRIEN: She always looks good regardless. All right Alina.

S. O'BRIEN: Thanks, Alina.

M. O'BRIEN: Thank you.

S. O'BRIEN; And of course, you can find holiday travel tips anytime at CNN.com/holidaytravel. Quick look now at what CNN NEWSROOM is working on for you for the top of the hour.

HARRIS: Some of the stories you'll see in the NEWSROOM. The man the president wants to run the Pentagon in front of senators this morning for confirmation. Robert Gates facing tough questions on Iraq. Extensive live coverage.

Another bloody day in Iraq. Car bombings and shootings killed more than two dozen people.

And a mother and two daughters rescued after nine days in the snow. Today searching for the father. you're in the NEWSROOM at 9:00 Eastern, 6:00 on the West Coast.

(COMMERCIAL BREAK)

(NEWSBREAK)

S. O'BRIEN: We are out of time. That's it for us on AMERICAN MORNING. "CNN NEWSROOM" with Tony Harris and Betty Nguyen and, of course, Heidi Collins who is right on board that flattop begins right now.

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