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Tribute Held For Donald Rumsfeld On His Last Day As Defense Secretary; Ground Search For Three Missing Climbers On Mt. Hood Continues; Attacks Across Iraq Sharply Lower Today; Senator Tim Johnson Remains In Critical Condition But On Course For Recovery; Norman Francis Receives Presidential Medal of Freedom; Prince William's Commissioning Ceremony Cause For Celebration At Britain's Royal Military Academy

Aired December 15, 2006 - 14:01   ET

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

KYRA PHILLIPS, CNN ANCHOR: Our Jamie McIntyre also at the Rumsfeld tribute. Let's go to him live, talk about a couple of things that the president had to say.
Jamie, are you with us?

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: I am.

PHILLIPS: What did you make of the president's speech?

MCINTYRE: I am indeed.

PHILLIPS: Straight and to the point, very professional, talking a lot about the profound changes that Rumsfeld made in six years. Do you agree with that?

MCINTYRE: Well, he ticked off a long list of things that Rumsfeld did, and the thing is, he's going to be remembered for Iraq.

Let's listen now to Rumsfeld himself.

DONALD RUMSFELD, SECRETARY OF DEFENSE: Thank you so much for joining us, and I thank you for those generous words, for your support these many years.

Chairman Pace, thank you for your sound advice and for your unfailing good humor through enormously challenging times.

Deputy Secretary Gordon England, you've been a valued partner in this mission, and I thank you so much. You make a difference here every single day.

Thank you, Gordon.

(APPLAUSE)

Service secretaries, members of the Joint Chiefs of Staff, combatant commanders -- I saw my friend, former chairman General Dick Myers, down here in the front row.

Dick, it's always good to see you Chairman Warner, members of Congress, Ladies and Gentlemen, thank you all.

And all of those gathered, military and civilian, who make this great department what it is, thank you so much for what you do for our country.

As I look back over these past six years and reflect on what's been achieved, I feel a sense of gratitude. Gratitude to Joyce, to be sure, and our three wonderful children, seven grandchildren. We have been together in this every minute.

Gratitude to the hundreds of thousands of people in this department who, out of love of country, contribute so much. And gratitude to all of those amazing young people who volunteer and step forward and proudly wear our nation's uniforms.

PHILLIPS: Long-serving and much criticized Defense Secretary Donald Rumsfeld saying good-bye. As he's out, Bob Gates in.

Constantly defended by the White House, but you can see after six years no longer in that position.

You can continue to listen to his farewell, CNN.com/pipeline. We'll continue to follow it as well.

T.J. HOLMES, CNN ANCHOR: Meanwhile, blizzard conditions, avalanche warnings. The ground search for three missing climbers on Mt. Hood is just about a mission impossible, though rescuers are hoping to get off the ground shortly.

CNN's Chris Lawrence joining us now from Parkdale, Oregon, with the latest for us.

Hello, Chris.

CHRIS LAWRENCE, CNN CORRESPONDENT: Hey, T.J.

I think one of the things we learned from the news conference just a little while ago is that -- how prepared these three climbers were. They parked their car a little bit south of here, but they stopped here at this ranger station where I'm standing right now, and they left a note that detailed who they were, what kind of experience they had. It described the route that they were going to take as they climbed Mt. Hood, and it also talked about what they had with them: food, fuel, rope, shovel, and a bivy sack, sort of an outer shell which could provide waterproof warmth.

The brother of Kelly James, one of the climbers, says it really shows how professional and how prepared these three climbers were.

(BEGIN VIDEO CLIP)

FRANK JAMES, KELLY JAMES' BROTHER: The note was very encouraging, because it does suggest -- and this is what I've said all along -- is that these are three professionals, in a sense. They're well-prepared, well-organized.

In fact, as I understand it, this note here, ordinarily climbers just go on without filling out the registration form. These three guys got -- dotted all of their Is and crossed all of their Ts, and made sure -- even when there wasn't a form there, they took the time to write this out in detail, the list of equipment, their plans and so forth. I think that just, again, reiterates how prepared they were and intentional they were to do all this.

(END VIDEO CLIP)

LAWRENCE: Now, the three climbers have been up on that mountain now for a week, and the weather has been brutal, to say the least. The gusts have been kicking up to 100 miles per hour at some of the higher elevations. Wind, ice snow, all a hazard. It has pretty much been a brick wall for the rescue teams who have had to hang back, can't cross beyond much further than about 6,000 feet elevation.

They believe Kelly James is at 10,000 feet, so that gives you an idea of just how far away they can get to with the weather being what it is. They've sent some unmanned drones out, but with all of the precipitation the lenses weren't able to capture much. Now they're going to be bringing in a bigger piece of equipment that may give them a better eye on the situation.

HOLMES: All right. Chris Lawrence reporting live for us.

Chris, thank you so much.

And we just heard him make a reference to just how brutal the weather has been there. The weather's been brutal for a big chunk of the Northwest.

We're going to check in again with Reynolds Wolf, keeping an eye on that for us in the weather center -- Reynolds.

(WEATHER REPORT)

PHILLIPS: Railcars hauling toxic chemicals. Nothing unusual there. It happens more than a million times a year. But Homeland Security sees a disaster waiting to happen.

CNN "Security Watch" now. To Brianna Keilar in Washington -- Brianna.

BRIANNA KEILAR, CNN CORRESPONDENT: Kyra, each year in the U.S., 1.2 million containers of hazardous material are shipped by train. And just in the last few years we've seen several attacks on train systems -- Madrid, London and Mumbai -- and because of those bombings security experts have worried about how vulnerable these freight rail cars carrying these hazardous materials are to terrorist attacks.

Homeland Security Secretary Michael Chertoff announced plans today to protect Americans from this threat.

(BEGIN VIDEO CLIP) MICHAEL CHERTOFF, HOMELAND SECURITY SECRETARY: The risk does increase when cars are sitting still, either in storage yards or transfer points. And the risk gets even greater when there's a change in custody or a handoff between one company and another company, because that's a time when something can fall through the cracks and someone may drop the ball.

(END VIDEO CLIP)

KEILAR: These proposed regulations include having rail carriers make sure there's a secure change of custody between shippers and receivers, and they would also have to create special security for railcars parked in vulnerable urban areas. And the new rules would also establish security coordinators who will share intelligence with the government.

The proposed rules apply specifically to railcars that carry what are called toxic inhalation hazardous chemicals. These are dangerous chemicals like chlorine or anhydrous ammonia, and inhaling these hazardous chemicals can cause nausea and possibly even fatal breathing problems -- Kyra.

PHILLIPS: Brianna, thanks.

And stay tuned to CNN day and night for the most reliable news about your security.

HOLMES: A welcomed reprieve from a terrible war. Attacks across Iraq were sharply lower today. Iraqis cheering on their national soccer team.

CNN's Nic Robertson is in Baghdad.

(BEGIN VIDEOTAPE)

NIC ROBERTSON, CNN SR. INTERNATIONAL CORRESPONDENT (voice-over): Crowded around TV sets, Iraqis of all stripes had time for only one thing this afternoon: soccer and their national team.

The Iraqis, in green, took on Qatar in the Asian games final in Doha. It had been a Cinderella run to get so far in this prestigious tournament. Exciting, and even briefly uniting an increasingly fractured Iraq.

"If, god willing, we win, it will unify Iraqi people," says 22- year-old Abbas (ph), "and there will be no difference between Sunni and Shia."

"It's so important to win, especially at this time," says 19- year-old Mohammed. "Iraq is very thirsty for this happiness."

Forty-five minutes into the game and still no goals. Nail- biting.

(on camera): Even Iraq's president says he's taken the afternoon off to watch the match. He's called the team and wished them luck in their sports battle and told them if they do win, they'll bring joy to every home in Iraq from the north to the south of the country.

(voice-over): Soccer is a passion here. Wherever there's an empty patch of ground, you'll find a game, with kids even playing barefoot.

It's become an escape from the daily brutalities of war. This fan explains why.

"Because sport has nothing to do with politics," he says. "It's for all Iraqis."

On the eve of national reconciliation talks, the fans here just wish Iraq's politicians would show some of the same team spirit that its footballers have shown at the Asian games.

"Our problems are all political," this fan says. "If politicians agreed among themselves, then Iraqis will unite and there will be no difference between Sunni and Shia."

Back at the match, Qatar has gone one up. And despite some top- class soccer by Iraq, the home team holds the lead until the whistle. A sad moment for the fans, a brief escape from reality over.

(on camera): It wasn't the win everyone was hoping for, but it was a rare glimpse into something in incredibly short supply these days, unity.

Nic Robertson, CNN, Baghdad.

(END VIDEOTAPE)

HOLMES: And actually, Nic Robertson going to join us live now from Baghdad.

And Nic, we saw in your piece there, of course, it's a little quieter, people not as much out on the streets and whatnot. But is there no question that people's attitudes and their behavior and everything about them is different on this day, when they all come together for one reason, sports?

ROBERTSON: Well, one of the striking things about today is there have been very, very few reports of violence around the city. And absolutely, this really does unite people.

They're thinking about the soccer, they're thinking about their national team. This reminds them of a time just a few years ago when everyone was an Iraqi and no one knew who was a Sunni and who was a Shia. And that has really changed these days.

And this just gives people an escape. They're sick and tired here of talking about the situation, and that's all they get on their television. So this really is a real opportunity to get some hopes up and just think about something different for a change -- T.J.

HOLMES: All right. Well, that is certainly nice to see. Soccer, sports, it can do it sometimes. Nic Robertson for us in Baghdad.

Thank you so much, Nic.

PHILLIPS: Well, if you thought a gold star from a teacher was cool, imagine this: an "atta boy" from the president of the United States.

We're going to talk with Dr. Norman Francis and his brand new Medal of Freedom. Hold your head up high.

You're in the CNN NEWSROOM.

HOLMES: And he's not even running, but it's still a critical election. Iran's president watching a vote that many call a test of his popularity.

Reading political tea leaves in Tehran, that's next in the NEWSROOM.

(COMMERCIAL BREAK)

PHILLIPS: A blink here, a touch there. Small signs mean the world to the family and friends of South Dakota senator Tim Johnson two days after Johnson suffered a brain hemorrhage and underwent hours of surgery. He's said to remain in critical condition but on course for recovery.

Our congressional correspondent, Dana Bash, joins us now with an update -- Dana.

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Well, Kyra, it's nice to be able to report good news every now and then, and so far -- now and then, I should say -- and so far, all we have heard for the past two days since Senator Johnson has gone in and had brain surgery is good news, small signs.

For example, I just spoke with the senator's spokeswoman, who said that he has been able to move both sides of his body. That, in addition to things that we've been hearing over the last couple of days, that he is responding to voice, is responding to touch. He even, according to his wife, Barbara Johnson, followed her directions and reached out to hold her hand.

So those are very encouraging signs from Senator Johnson about his condition, and certainly his office is quite happy about that. But they also caution that this is going to take a lot of time.

He had massive surgery, of course, surgery on his brain to stop bleeding for a defect that he had when he was born. But this is something, again, that as I said is going to take some time.

In fact, his press secretary just said in terms of this caution, look, we live in a 24-hour news world but the body doesn't heal that way. It does take a lot of time, and this is massive surgery. So right now, what we're seeing in the United States Senate is still Senator Johnson's colleagues and friends going to pay visits. The Democratic leader, Harry Reid, was there, as he has been every day. Another colleague, Senator Jack Reed, went as well, in addition to the Senate chaplain went to visit Senator Johnson in the hospital.

Of course, at this point, you can really sort of sense a collective exhale, I can tell you, Kyra, about the senator's condition. But again, a lot of caution, a lot of concern still, because not only are these couple of days after his surgery so important and critical, but the long-term prognosis for the senator is still very much a mystery -- Kyra.

PHILLIPS: Well, that's interesting then, because we can still talk about that balance of power issue. You say it's good news, but you're still saying there's a lot of mystery within all of this. So how could that affect it?

BASH: Well, you know, over the last 24 hours, you know, everybody has prefaced every conversation about politics with talking about the need to focus on Senator Tim Johnson, the fact that he's a 59-year-old man who had this sudden brain hemorrhage, and that the idea is really to focus on his health, especially in this kind of atmosphere, where even with partisanship, it really is one of the world's most exclusive clubs.

Having said that, there has been a discussion about the fact that it has raised the reality that Democrats won control of Congress -- of the Senate, I should say, and they will take that control in January, with just one vote. So any kind of change in status could tip the balance back to the Republicans.

But, you know, we've been -- as we've been talking about this and as we've been learning that Senator Johnson's health does seem to be better, the reality is that, when you look at the rules, Kyra, the fact is that a sitting senator simply cannot be removed from office, even if they are ill, if they are incapacitated for months, even years. There's precedent for that.

The only way for a senator to leave office is if he dies or if he resigns. In that case, the governor does replace the senator. But there is no sense right now in talking to Democrats or, more importantly, Republicans, that they are there yet, that especially given the fact that they are getting such good news from Senator Johnson's office in terms of his condition.

And I should mention we're going to get much more information this afternoon. We're expecting a statement from the hospital, from Senator Johnson's doctors, with many more specifics about his medical condition as we speak.

PHILLIPS: Dana Bash live on the Hill.

Thanks.

HOLMES: And coming up, the nation's highest civilian honor. What's it like to get a presidential Medal of Freedom? We'll ask somebody who has got one now, Norman Francis, one of this year's recipients.

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

(COMMERCIAL BREAK)

HOLMES: He isn't on the ballot but Iran's fiery president is likely to be a factor in today's local elections, which could signal how Iranian's rate his bluster today the West.

From Tehran, here's CNN's Aneesh Raman.

(BEGIN VIDEOTAPE)

ANEESH RAMAN, CNN CORRESPONDENT: It is a first major test of political support for Iran's president since he took office over a year ago. Iranians going to the polls at centers like this, a mosque, to vote for national elections, as well as local city councils. Mahmoud Ahmadinejad is not on the ballot, but it is seen as a referendum on his policies, those of increased defiance against the West and, of course, explicit quests for regional strength.

For Iranians that we've spoken to it all comes back to domestic issues. They feel that Iran's regime has pursued foreign affairs at the expense of economic reform that was promised to them by Iran's president when he ran for office over a year ago.

To give you a sense of where we are, this is one of many polling stations, but one of the biggest in Iran. Behind me, to the left, as at every polling station, you have segregated voters, the men on this side, the women on the other.

They don't expect dramatic change, nor does anyone, to emerge out of the elections. It's a nuance change that could come among conservatives, the reformists who would pursue an alternative path, one could assume from Iran's president, are largely missing from this election. In part, they've been marginalized over the past few years, as well as having a number of candidates disqualified from even taking part in this election.

Instead, it's a battle between hard-line conservatives and the more traditional conservatives. Unlikely again, as I say, for dramatic change to emerge. What is likely, though, is if the hard- liners win big in the election, Iran's president will claim this as a mandate, will grow evermore confident, evermore defiant in his stance against the international community.

Aneesh Raman reporting from Tehran.

(END VIDEOTAPE)

PHILLIPS: Well, the bulls needed a good reason to rally after Thursday's big gains, and they got it this morning in a reassuring report on inflation.

Susan Lisovicz live from the New York Stock Exchange.

(STOCK MARKET REPORT)

(COMMERCIAL BREAK)

PHILLIPS: Hello everyone. I'm Kyra Phillips at the CNN World headquarters in Atlanta.

HOLMES: And I'm T.J. Holmes.

He was tested by Katrina and saluted by the president. Xavier University President Dr. Norman Francis received the nation's highest civilian honor. What's it like to get a Presidential Medal of Freedom? We'll ask him.

PHILLIPS: Norman Francis remembers when we to drink from a water fountain that said "colored only." Today the president of Xavier University was an honored guest at the White House, an honored guest of the president of the United States.

Dr. Francis received the Presidential Medal of Freedom along with a few other dignitaries -- including blues legend B.B. King and baseball great Buck O'Neil. We'll never forget the devastation caused by Hurricane Katrina and now the president has made it clear he'll never forget what Norman Francis did during and after that storm.

Dr. Francis risked his life to save his students and his school. I'm honored to know him and I'm thrilled to interview him just after he left the White House. Norman, I'm curious, are you going to sleep with that medal of freedom?

DR. NORMAN FRANCIS, PRESIDENTIAL MEDAL OF FREEDOM WINNER: Seems that way, doesn't it?

PHILLIPS: You look fantastic.

FRANCIS: Thank you.

PHILLIPS: What an incredible time. What was it like? Just give me a feel for when the president put it around your neck.

FRANCIS: Well, I think you described it with the word incredible. You know, you read about these things all the time, and you watch it. You admire it. You never think one day that maybe you'll be there, and so it's hard to describe, and I don't think there are words you can use to describe it.

PHILLIPS: Now, this is probably the first time in a long time you and your family were all together, the six kids, your wife, Blanche, your sister, Mabel. It takes a Presidential Medal of Freedom to get that family in one place.

FRANCIS: Well, you're absolutely right. They're all over the country but they all were there. We had a nice dinner with the boys last night and the two girls joined us this morning so we spent the morning together and it was good. It was good to have them all there. I said at the luncheon afterwards this medal of freedom affirms to all of them, and my wife, that well, maybe I did have a brain in my head and the like, so.

PHILLIPS: Well, we must give a little shout out to Blanche. Your wife has been absolutely incredible. She's supported you through so much and in so many years. I know she's been involved with Mary Landrieu, the senator there doing things for the women who survived the storm. Very lucky to have this partnership with this woman.

FRANCIS: It's been a 51-year love affair, and I could not have done it without her. Believe me, she was indeed everything that anybody would want in a wife and made it possible for me to do what I've been able to do and serve this country.

PHILLIPS: Well, back in April, you wrote that Louisiana had received no substantial funds from FEMA. Has that changed? Did you get a chance to talk with the president about serious issues like this?

FRANCIS: Well, we talked about this about a month ago to be exact. Actually, on the anniversary of Katrina, on August 29th he was in New Orleans. We had supper with him with about 10 other people. We described the challenges we were having.

We described the challenges that FEMA was having and we knew it was a big job, but it was a little slow and I must confess that he asked Don Powell, who is his czar, and Don has done an excellent job to speed it up and it has sped up and we are getting some support now, some funds now, and we are grateful. We are really grateful for that support, but it's now coming. It wasn't in April like it should have, but it's now coming.

PHILLIPS: Well as we know, a lot of lawsuits were filed and just to put it in perspective here, your endowment at Xavier is $52 million dollars, but $90 million dollars you took in losses due to the storm damage and lost tuition and scholarships. You just won a lawsuit against the insurance company, right?

FRANCIS: Yes, yes, we did. And it's a big victory in a way. Of course it's going to be appealed. We don't know whether or not it's going to be affirmed. But the fact of the matter is, the judge ruled in our favor on the exclusionary of an all-risk policy that the judge felt was not clear, was ambiguous and that he had to find in favor of the plaintiffs and we were one of the plaintiffs.

And so, we're hoping that that will bring us more funds because indeed, we have to borrow some from our unrestricted endowment, as small as it was and we're still outstanding with respect to capital construction that have already -- those construction projects have already happened, and we're still $50 million dollars out in that regard. So we're looking forward to that money flowing as fast as it can.

PHILLIPS: Well, now Norman, does the insurance company have to start paying you now or do you have to wait to get through this appeals process?

FRANCIS: Well, they can start doing some payments now. They have made some small payments. We still are arguing about some of the things that we should be receiving.

PHILLIPS: What's the insurance company, Norman?

FRANCIS: Well, it's Travelers' insurance company that was sued because of its exclusionary policy on an all-risk and the judge ruled that the wording in the exclusionary for flood did not appropriately describe what happened in New Orleans and therefore he ruled in our favor and that we were deserving of payment of all of the damages regardless of whether they were flood, wind, or the like. So the exclusion did not (INAUDIBLE) our policy.

PHILLIPS: Well, we'll follow up on that case and definitely follow up with the insurance company on if you're getting your funds.

Now, you're the longest university president in the nation. You also were tapped by the governor to help chair the Louisiana Recovery Authority. How is that going? What's been the biggest challenge?

FRANCIS: Well, the biggest challenge for us, being very frank is our road home. We have a contractor who is administering the road home policies for the state of Louisiana. This is not a contractor that works under our aid, but for the state of Louisiana and it's a big job and it has been slow and a lot of people have complained that they're waiting a long time for their funds.

I must say, without trying to defend the slowness, this is a massive job. There will probably be as many as 120,000 people who will apply for those funds. I suspect by now it's close to 85,000 or 90,000 people who have applied and this process is a big real estate operation, and the agency is doubling its efforts.

It's now trying to get to 11,000 of those applicants every month, but it's slow, and we are hoping that it will speed up, but we don't want it to speed up at the expense of denying anybody their monies that they are deserving and the amount of money they're deserving.

We are good stewards. We thank the people of the United States, the Congress, the president for the funds that we are distributing and we want to do it well, and we want to do it accurately, and we hope that we speed up the process.

PHILLIPS: Norman, two final thoughts, two highlights for you through all of this. Barack Obama, could possibly be making a run for the presidency, was your keynote speaker at Xavier University. He actually called to congratulate you when you received the medal, correct?

FRANCIS: He did indeed and I appreciated that very much.

PHILLIPS: Well, and the other highlight of course through all of this, during that storm, your granddaughter, Sarah Catherine, was born. That had to have helped you keep a lot of strength through everything you were dealing with.

FRANCIS: You know, from time to time in controversy, you've got to be diverted and you hope the diversions are good diversions. And that was one of them. The latest granddaughter was born, I guess about maybe ten days after Katrina, but we prefer to call her Sarah and she is called Sarah and she's a doll, a very great doll, like all the grandchildren. There are 11 of them.

PHILLIPS: Of course. You can never get enough of all 11.

FRANCIS: Absolutely.

PHILLIPS: Norman Francis, appreciate your time. Congratulations. We got to get to some breaking news, but what an honor to have you on.

FRANCIS: Thank you so much, Kyra.

PHILLIPS: All right, take care.

HOLMES: And that breaking story is coming to us out of Detroit.

Fredricka Whitfield is watching that for us from the newsroom -- Fredricka.

FREDRICKA WHITFIELD, CNN ANCHOR: What we understand is an explosion has taken place underground, near the proximity of the Detroit Police Headquarters. You're looking at live pictures right now. Our affiliates are reporting to us that the police headquarters has been evacuated. That building is located on Beaubien Street, if you happen to know downtown Detroit, near Lafayette Boulevard.

We have not been able to get a clear view of any kind of evacuations underway. There you're seeing the building, the emergency apparatus outside. We don't know how many people have been evacuated but we're told that the entire police headquarters has been evacuated as it relates to this underground explosion. Of course, the source of this explosion is still under investigation.

This is the information, and these are the pictures that we have right now, T.J.

HOLMES: Fredricka Whitfield watching that story for us. Fredricka, thank you so much.

Meanwhile, a prince marks a milestone with his grandmother and his girlfriend looking on. A day of pomp and interesting circumstance. That's next in the NEWSROOM.

(COMMERCIAL BREAK)

PHILLIPS: Let's get straight to the newsroom, Fredricka Whitfield still working the details on a developing story out of Detroit -- Fred.

WHITFIELD: Right. We know that an evacuation has taken place involving the Detroit Police Department Headquarters. We'll show you some of the pictures that we've gotten in with the emergency vehicles on the exterior.

The evacuation has taken place. We don't know of any kind of reported injuries but we understand that an underground explosion has taken place, and that the fire department in Detroit is saying there may be a fire in a manhole resulting from this explosion.

We're still trying to work details to find out how serious this explosion is and what could be the source of this explosion taking place there in downtown Detroit, right on Beaubien Street near Lafayette Boulevard -- Kyra.

PHILLIPS: Do we know if everybody is out of that building?

WHITFIELD: We don't know.

PHILLIPS: OK, we'll follow it. Thanks, Fred.

HOLMES: Well, he may be second in line to the British throne, but he's only a second lieutenant in the British army. Still, Prince William's commissioning ceremony was cause for celebration today at Britain's Royal Military Academy. William's grandmother, the queen, was there. So were his father, his stepmother and his increasingly high-profile girlfriend.

And last but not least, also there, CNN's Paula Newton.

(BEGIN VIDEOTAPE)

PAULA NEWTON, CNN CORRESPONDENT (voice-over): As much as Prince William has always said he just wants to be a rank and file soldier, he is anything but.

Amid the precision and grace of this historic military parade, the point was lost on no one. 24-year-old 2nd Lieutenant Wales will one day be King and command all British forces.

This was, though an intensely personal day for the royals. William's grandmother Queen Elizabeth beamed as she inspected her grandson, no doubt more confident now that in his hands, the monarchy can have a secure future. She didn't mention him by name in her speech, but reminded all the officers here of their duty.

QUEEN ELIZABETH II, UNITED KINGDOM: I'm speaking to every individual one of you when I say you are very special people. In your hands lies the task of maintaining the effectiveness of not just the British Army but also the armies of our friends and allies represented here today in peace and war.

NEWTON: Williams' father, Prince Charles, and his stepmother Camilla looked on, but all eyes were on the lady in red, Kate Middleton, the prince's girlfriend. This is one of the first times she's been invited to a royal occasion and rumors about an engagement are the talk of Britain. This is a milestone, though, for William. His military graduation a turning point for his role not just as a royal, but as an officer.

(on camera): As much as the ceremony is all about tradition and pageantry, Prince William has made it clear he wants to be a working soldier. But the Ministry of Defense here has not yet said exactly what they will allow him to do.

MAJOR GEN. SEBASTIAN ROBERTS, COMMANDING THE HOUSEHOLD DIVISION: There are a lot of different factors that have to be taken into account. Of course there are special factors with Prince William. But, nothing, I think, should be ruled in or out by anyone.

What is absolutely the case is he will join his regiment, take part in all its activities, and judgments will be made at the right time, and place about his actual deployments.

NEWTON (voice-over): Few believe he will ever set foot on a front line, especially in Iraq and Afghanistan, even though he said he'd be humiliated if he couldn't.

As momentous as this day is for Prince William, it must be bittersweet, too. He has spent the week talking of his mother's memory, poring over the report into her death. His graduation caps the week when William has come of age.

Paula Newton, CNN, London.

(END VIDEOTAPE)

PHILLIPS: Our conception and birth were such a huge deal it's no wonder that people are all worked up about her name. We're not talking about Suri Cruise here so don't be bamboozled. That's a hint. Details from the NEWSROOM.

HOLMES: Although straight ahead, entertainment news with A.J. Hammer of "SHOWBIZ TONIGHT."

A.J., what's up?

A.J. HAMMER, CNN ENTERTAINMENT CORRESPONDENT: Well, T.J., today we're talking about a beauty queen in trouble, a daytime TV queen expanding her empire and the death of music royalty. All that just ahead in the NEWSROOM.

(COMMERCIAL BREAK)

PHILLIPS: Straight to the NEWSROOM, Fredricka Whitfield with details on two developing stories right now -- Fred.

WHITFIELD: Well, first in Detroit we're hearing from our affiliates that apparently there was a transformer malfunction in the building where the Detroit police department has its headquarters.

It's an all clear right now, and so all of those folks who were evacuated are now being allowed to return to the building. That's the best explanation we're able to get right now about the problem that took place in the building. It doesn't appear now that there was that underground explosion as first reported.

Then off to Seattle, Washington, or at least just southeast of Seattle in a town called Sammamish, Washington. Well, there apparently, there is a pretty serious apartment building fire currently underway.

You're looking at the live pictures right now. We don't know anything about the residents of that apartment building or even the cause of this fire, but we do understand that there have been a lot of power outages in this entire area because of weather-related power outages that have had a lot of people in the dark, without power, et cetera.

Reynolds Wolf knows a lot more about that, because it is weather- related and we think a lot or at least the power outages we know are weather-related. What's the situation there?

REYNOLDS WOLF, CNN METEOROLOGIST: Oh, absolutely. I mean, they've been dealing with strong wind over the last couple of days. The wind has dropped considerably. But you still have to remember that throughout parts of Seattle as well as Portland, you have about a million and a half people there without power at this time, with temperatures in the 30s and 40s.

I'm sure there are a lot of people out there that are trying as hard as they can to stay warm. Who knows, maybe they had a stove on of some kind, a gas stove, something to keep those temperatures a little bit more in the comfort range for them and you just have a fire set. That's is the best thing possibility I can think of.

At this time though as far as wind causing more power outages, I don't think that's in the cards at all because the wind has really dropped considerably out of the north about seven miles per hour.

From this vantage point that you see, compliments of station KING out of Seattle. This is Sammamish, Washington again. You see the apartment complex, it's just the top, looks like the third story end unit right there on the corner, the fire is going right up.

If you'll notice, the smoke appears just to be going right up in a pretty steady column. You don't see a lot of wind affected. Trees aren't pushing it hard at this time right now. So, I don't think there's any threat of the fire being pushed on by wind but of course some of those fir trees are awfully close and Fred as you know, those things can burn very quickly and spread and then you have a whole different problem of (INAUDIBLE).

WHITFIELD: Right. Well, let's just hope that the evacuations have taken place in that building and no one is in a serious, direct danger.

WOLF: Absolutely.

WHITFIELD: All right Reynolds, thanks so much. All right, that's it for now, Kyra.

PHILLIPS: All right. Fred, thanks.

HOLMES: Is Miss USA about to go missing? A.J. Hammer, please, say it ain't so. We need to know where Miss USA is at all times.

HAMMER: Yes we do, but it's sad to report this may be happening, T.J. Miss USA, Tara Conner may actually be forced to turn in her tiara and leave her throne behind. That's because pageant officials say the 20-year-old has some personal and behavioral problems that are affecting her reign.

The underaged beauty queen has been hitting the New York City club scene and the speculation is that her partying is going to cost her the Miss USA title. Now, the Miss USA pageant is part of the Miss Universe contest. Both competitions are owned by Donald Trump.

CNN spoke with Trump yesterday. He dismissed reports that he had stripped her of her crown. He added quote "We are right now looking into what we can do to work with her and what we will do about her reign going forward."

Now Trump has fired a beauty queen before back in 2002. You might remember, he got rid of Miss Universe Oxana Federova (ph) after she had problems with her demanding schedule. Now T.J., there are already unconfirmed reports that this has already taken place and that the first runner up to Miss USA is now Miss USA. We're going to follow those reports and we'll get back to you with an update on "SHOWBIZ TONIGHT."

HOLMES: Yes, please do. I'm very concerned about this story.

All right, well moving on -- you mentioned Donald Trump.

HAMMER: Right.

HOLMES: Of course his show "The Apprentice" going to have new competition in the world of reality television. So what's going on with him?

HAMMER: Looks that way. The queen of daytime herself, Oprah Winfrey, finally jumping into prime-time. Oprah's Harpo Productions is going to be producing two reality shows for ABC. She'll be appearing in at least one of them, although at this stage, her role is still a bit unclear.

Now the two shows are both, as you might expect with Oprah, charity-based. One show is called "The Big Give" and it will follow ten people as they compete to give money and resources away with one contestant being eliminated every week. The last person standing receives what is being called their wildest wish as a reward.

The other show tentatively titled "Your Money or Your Life" and each episode is going to follow a different family in crisis. Now Coming up tonight on "SHOWBIZ TONIGHT," in addition to much more on Miss USA, we'll be dealing with stars and their addictions, why so many celebrities are battling everything from drugs to alcohol.

We'll be talking about how some stars border on the brink of disaster, while other stars manage to come out on top. It is a very special report, RX for Rehab, tonight on TV's most provocative entertainment news show -- it's "SHOWBIZ TONIGHT" at 11:00 p.m. Eastern on Headline Prime.

HOLMES; All right, A.J. And please, stay on that Miss USA thing for me.

HAMMER: More on it. Have a good weekend.

HOLMES: All right, thanks, man.

PHILLIPS: Well, he said good-bye to his staff and his troops. Now a final sendoff for outgoing Defense Secretary Donald Rumsfeld. Just ahead, live coverage from the Pentagon.

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