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CNN: Special Investigations Unit

We Were Warned; Edge of Disaster

Aired April 29, 2007 - 20:00   ET

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

(NEWSBREAK)
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UNIDENTIFIED MALE: Terrorism is a fact of life in the 21st century.

UNIDENTIFIED MALE: We have a very large conventional explosive device, the dirty bomb. Human nature is going to be depleted.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We'll view this rolling black-out as a wake-up call.

UNIDENTIFIED MALE: We have a major public health emergency.

UNIDENTIFIED MALE: We're not ready to deal with the disruptions and the challenges of the 21st century.

CHRISTIANE AMANPOUR, CNN SENIOR INTERNATIONAL CORRESPONDENT: We uncover stories never heard, images never seen.

ANDERSON COOPER, CNN ANCHOR: Gang members driving down this street...

UNIDENTIFIED MALE: A deadly risk.

SANJAY GUPTA, CNN SENIOR MEDICAL CORRESPONDENT: You can hear and see the choppers.

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ANNOUNCER: Now Anderson Cooper, "Edge of Disaster."

COOPER: Since 9/11, much of the so-called war on terror has really been about taking the battle to the enemy, confronting terrorism beyond our shores. But by focusing so much abroad, are government leaders ignoring America's vulnerable positions here at home?

Security expert and author, Stephen Flynn, says yes. In his new book, "Edge of Disaster," Flynn writes, "The reality today is not if the next catastrophe will happen but where and how catastrophic will it be?"

In this SPECIAL INVESITGATIONS report, CNN correspondents, who cover our homeland security, paint a series of all-too-real scenarios Americans face within our borders everyday. We begin with a dirty bomb attack in our nation's capital.

(BEGIN VIDEOTAPE) UNIDENTIFIED MALE: WTLP news time 10:32. The high coast of gas...

COOPER (voice-over): An average morning in the nation's capital: fair weather, wind out of the southeast at about 10 miles per hour. Congress is in session. The president is in the White House. Buses along the mall are carrying tourists to and from museums and other sites. Suddenly an explosion, a massive bomb in a school bus rips into a museum and federal office buildings nearby. Suddenly there are hundreds of people dead, thousands injured.

CHIEF KATHY LANIER, WASHINGTON D.C. METRO POLICE: Always when we respond to incidents, life safety is first.

COOPER: Under this scenario devised by a Washington think tank, those devices detect radiation, a dirty bomb.

LANIER: The law enforcement, when they arrive, they're going to immediately don some sort of protective equipment.

COOPER: While the fire department personnel wearing breathing devices will be working feverishly to help and evacuate the wounded, the police and authorities would face the biggest danger of all from a radiological bomb, panic.

PHIL ANDERSON, CENTER FOR STRATEGIC INTERNATIONAL STUDIES: We Americans are radio phobic. We're desperately concerned about any source of radiation.

COOPER: In Phil Anderson's scenario, the secret service moves quickly to get the president out of the area for fear of additional bombs.

ANDERSON: Human nature is going to be to flee. If the president has to be moved, then that's reported in the media and people respond to that.

COOPER: It is the natural human instinct to run. It's what people did on 9/11 in New York and at the U.S. Capitol; it was the right instinct then. But with a dirty bomb, it could be a mistake.

CHIEF LARRY SCHULTZ, WASHINGTON D.C. FIRE DEPARTMENT: If you're in a building and the envelope of that building hasn't been ruptured, in other words, you don't have broken windows and there's no structural damage to the building, you are much safer off staying where you are, keeping the windows closed, shutting off the HVAC system.

LANIER: Once you come out into the open area, you are exposing yourself to contaminants that not only can be harmful to you but that you can take home and actually bring it into your home and contaminate your whole family.

COOPER: In dirty war, British filmmakers present a dirty bomb attack scenario in London.

UNIDENTIFIED MALE: (UNINTELLIGIBLE) are being overwhelmed by self presenters coming out of the hot zone. The crowd is contaminated. Hospitals requesting police assistance to hold them back. UNIDENTIFIED MALE: Tell them they'll have to wait.

COOPER: Everyone caught within the radioactive plume created by the wind would have to be corralled by police and held, whether they like it or not, until decontamination tents can be set up, a challenge noted by D.C. police who use the film in training.

LANIER: I think it was a very well-done movie. What struck me most was the responders and how what I do and what Larry does -- when the government comes in to deal with a situation, your activities very much influence the emotions of those people.

COOPER: As in the British film, civilians and first responders inside the hot zone, about 10 percent of Washington, would have to leave their clothes and be forced to take showers before they could leave.

Whether it's planning for a presidential inauguration or responding to the 9/11 attack on the Pentagon, the local and federal officials know each other well.

SCHULTZ: We've been able to train together. We've been able to plan together. And certainly one of the biggest strengths that we now have is the ability to communicate together.

COOPER: A dirty bomb could not make people radiation sick, though it could raise cancer rates in the population. And it would not be terribly difficult to clean up.

ANDERSON: The psychological aspect of thing is something all together different. You could have a perfectly safe city, free from radiation, and a fearful public that would continue to be unwilling to live and work in Washington.

COOPER: First responders in Washington have rehearsed to reacting to a dirty bomb. They believe they're ready if it should ever come to that.

Much would depend on whether Washingtonians would panic or keep their wits about them and listen to what the authorities advised.

Coming up next, preparing for the unimaginable.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

COOPER: From the East Coast to the West, America's ports are our economic lifeline. Still many experts believe they are wide open targets. In our next scenario, a horrific chain of events in the port of Boston.

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UNIDENTIFIED MALE: Just give me a good sweep of the piers tonight.

DAVID MATTINGLY, CNN CORRESPONDENT (voice-over): It's a clear, frigid night in Boston harbor. Everything looks as it should, and yet it's the kind of night Mayor Tom Menino worries about obsessively.

TOM MENINO, MAYOR OF BOSTON, MASSACHUSETTS: Everybody's in the denial state, it's not going to happen. Well, 9/11 wasn't going to happen either and it happened. We're in a different world today than we've ever been in the past. We better be prepared.

MATTINGLY: This is perhaps his biggest worry. It's late and a Coast Guard cutter watchfully shadows a so-called super tanker, a ship more than three football fields long as it sails into port.

UNIDENTIFIED MALE: There are 2. OTC has visual. They're coming right down the center of the harbor.

MATTINGLY: The tanker in our sights is carrying 30 million gallons of liquefied natural gas or LNG. It's a vital delivery. LNG is the fuel that heats Boston on freezing winter nights. And yet for the mayor, the sheer scale of these shipments means a terrorist attack could produce an enormous, explosive force.

MENINO: Thousands of people could lose their lives if a tanker did explode in the harbor.

MATTINGLY: If terrorists somehow got close enough to blow a hole through the tanker's double hulls, the effects could be cataclysmic. The liquid gas would spill into the harbor. Flames from the explosion would cause it to ignite into an uncontrollable fire.

MENINO: What happens is it's a cloud comes out of the ship and moves over the city and burns wherever is in its wake.

MATTINGLY: For 30 years, the LNG tanker was just a slow-moving ship in a busy port. There were fears of an accidental spill but little concern it could be used as a monstrous weapon. But after 9/11, when terrorists turned planes into missiles over the skies of Manhattan, the danger in Boston instantly came into focus. And a huge ship docked on the Mystic River that morning began to look a lot like a very big bomb.

George Nacaro (ph) was the Boston Coast Guard commander in charge here that day.

(on camera): It was a sitting duck?

UNIDENTIFIED MALE: It was. They had 100,000 cubic meters of liquefied natural gas onboard. From that moment on, the security around that vessel was remarkably enhanced.

MATTINGLY: The security zone that set up around the tanker is absolutely immense. It extends two miles in front of it, one mile behind it and 500 yards on either side. It is so large that in some parts of the harbor when the tanker comes through, all traffic virtually shuts down.

UNIDENTIFIED MALE: All clear back there.

MATTINGLY (voice-over): Tonight, a fleet of Coast Guard cutters escorts the LNG tanker into port. Out our window, the likes of Boston are gleaming. Bridges, offices, homes, all right in danger's path.

(on camera): City officials say they believe that the only way to really keep their city safe is to keep tankers like this out of Boston Harbor. They say build another place for them to go. Some place far away from this heavily populated area.

(voice-over): Mayor Menino and others like Stephen Flynn have been clamoring for people to open their eyes to the obvious.

STEPHEN FLYNN, AUTHOR, "EDGE OF DISASTER": The lesson of 9/11 should have been, look around, are there things here that could be used as a weapon of mass destruction.

MATTINGLY: Just look at the LNG tanker's path down the Mystic River, gliding by Logan Airport, under the Tobin Bridge, a key artery for the city, past the sky scrapers of downtown Boston and the booming residential waterfront, new condo developments dotting the shoreline. Nowhere else in the country does an LNG shipment get so close to so many people and businesses. And like the World Trade Center, once an attack is under way here, once the gas ignites, little can be done to contain the inferno.

One Boston fire captain told us the simple instruction he'd give his troops, run.

MENINO: LNG tanker in these times doesn't belong inside a harbor with close proximity to a residential area.

MATTINGLY: Mayor Tom Menino has been sounding the alarm for years, calling for an end to LNG shipments in the port of Boston. But it hasn't happened, so now officials focus their energy on preventing the unthinkable.

CAPT. JAMES MCDONALD, U.S. COAST GUARD: Prior to 9/11, we probably devoted about 6 percent of our total time and effort to security. Now that's up in the 50 percent to 60 percent range.

MATTINGLY: Now any tanker sailing into Boston needs to give the Guard a 96-hour warning before its arrival. Their crew lists are closely scrutinized. Each week when that ship makes that turn on the Mystic River, it's surrounded by a flotilla of official escorts by sea, land and air. Traffic on the Tobin Bridge shuts down and Logan Airport redirects incoming flights to runways far from the water.

MCDONALD: This is a sector command center. Basically, this is a 24- 7 watch deck.

MATTINGLY (on camera): You can actually get close enough with these cameras, you can identify people at the edge of the water, people just walking on the street next to it.

MCDONALD: We absolutely can. And in fact, any time we have ship movements, especially LNG, that's exactly what we're doing with this system.

MATTINGLY (voice-over): But Stephen Flynn, who served in the Coast Guard himself, says it's not enough.

FLYNN: The biggest opportunity to intercept a terrorist is not in the act of terror, it's almost too late. Where you can catch them is when they're out doing surveillance. Where you can catch them is out doing their dry runs, when they're casing essentially a potential target.

UNIDENTIFIED MALE: A lot of interesting things that go on and we try to keep our eye on all of it.

MATTINGLY: In fact, the best line of defense is not authorities but the people who actually live and work here. Guys like Chuck DeStephano (ph) who could spot a stranger or suspicious activity instantly.

(on camera): In all the years that you've been out here, you pretty much know who belongs in these waters and who doesn't, right?

UNIDENTIFIED MALE: I would say so, yes.

MATTINGLY (voice-over): It's an informal but efficient early warning system.

PAUL PENDER, BOSTON HARBOR FISHERMAN: We can see something and let them know. You know we're going to notice. I mean constantly guys are calling each other on the radio saying, hey, look at that guy over there, what he's doing? And we notice.

MATTINGLY: It is perhaps the highest stakes policing community network imaginable.

MENINO: But if something gets hit, how do you stop the fire? How do you stop the explosion?

MATTINGLY: And that's why Stephen Flynn insists prevention must work because if it doesn't, the devastation would be unimaginable.

(END VIDEOTAPE)

COOPER: The next scenario...

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UNIDENTIFIED MALE: Time is against you. So you really need to rush the response as much as possible in order to save the lives of as many people as you can.

(END VIDEO CLIP)

COOPER: A smallpox attack in New York City.

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COOPER: There are viruses and pathogens that are so deadly; they can kill tens of thousands, and even more in just a day. Consider this: the smallpox virus kills one out of every three people who contract it. Bioterrorism has become a major homeland security concern. But the question is just how prepared is America for an attack? Let's look at one major city, our largest, New York City.

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FRANK SESNO (VOICE-OVER): New York late at night, as much as the city of eight million ever sleeps. But in Chinatown, a middle aged man is restless. He has chills, aches, a fever of 103. With no regular doctor, he makes his way to the emergency room at New York Downtown Hospital not far away. The patient is sent to triage where his vital signs are checked, so far, no suspicions and no precautions.

(on camera): The nurses talk to the patient at this point? Is she wearing a mask?

PETER FROMM, EMERGENCY DEPARTMENT DIRECTOR, NEW YORK DOWNTOWN HOSPITAL: She's not wearing a mask.

SESNO: She's not wearing a mask.

FROMM: No, she's not.

SESNO (voice-over): Peter Fromm manages the emergency room.

FROMM: This is a typical room in the emergency center.

SESNO: The patient is examined by a physician, but no alarm bells ring. He's sent home to rest.

(on camera): And told what, probably?

FROMM: Well, they're probably going to get told if their symptoms worsen or other symptoms develop, that they need to call us back. They need to return to the emergency center.

SESNO (voice-over): Over the next 12 hours, a few more people show up with flu-like symptoms. That prompts a call to the city's Department of Public Health where Deputy Commissioner Dr. Isaac Weisfuse takes the call.

DR. ISAAC WEISFUSE, DEPUTY COMMISSIONER, NEW YORK CITY DEPARTMENT OF HEALTH: During the non-flu system, if we had a big spike in flu-like illnesses, that clearly would set off the signals to us that we need to investigate.

SESNO: Across the region, people are getting sick, many otherwise healthy, young and middle aged adults.

JOSEPH HENDERSON, CDC: This is going to be the trigger event of something suspicious here. It's not flu.

SESNO: Joe Henderson, the Centers for Disease Control senior official in New York State, is now drawn into this rapidly unfolding event. Testing begins. Henderson has a checklist.

HENDERSON: Just details about the specific case and where we are in acquiring a lab specimen. It's what we call pushing everything in the forward lean.

SESNO: Back at Downtown Hospital, that first patient returns, now with red spots on his tongue and in his mouth. Dr. Chester Learner, director of infectious diseases, sees him and is worried.

UNIDENTIFIED MALE: He may very likely have smallpox. We need to get the names and members of your family, people who you have close contact with.

SESNO: Investigators still don't know how bad it really is. A little over a week ago, terrorists sprayed smallpox virus into the air at train stations, subway spots and a packed event at Lincoln Center. The disease has been incubating ever since, 20,000 people may have been exposed.

It is a horrible disease. Between seven and 17 days from infection, victims experience aches, pain, fever, and then disfiguring rashes. That's when the disease is contagious. It's estimated each sick person could infect anywhere from three to ten others.

HENDERSON: If you do the math, it doesn't take long to get up to hundreds of thousands, if not millions of people over the course of 30 days.

SESNO: About 30 percent of those infected could die. Back to our New York scenario, CDC tests now confirm the suspicions, it is smallpox.

WEISFUSE: What goes through my mind is we have a major public health emergency not only in the city, but across the country and perhaps the world.

SESNO (on camera): How critical is time?

HENDERSON: Time is extremely critical. The vaccine is only good up to, you know, four to seven days from the time they were exposed to the virus. Once a person develops the rash when they're most contagious, the vaccine doesn't offer any help.

SESNO (voice-over): It's a colossally difficult race. The federal government says it can get vaccine to local authorities within 12 hours. New York must then distribute it to about 200 designated locations.

WEISFUSE: We are the beholden on the federal government to get the vaccine. Obviously, we'll move heaven and earth to get it to the right place.

SESNO: More people are getting sick. Public anxiety grows as rumors and speculation spread. Hospitals are overwhelmed by the worried well. Many are getting angry.

(on camera): Are you personally going to wade out into that crowd and say, "Folks, we don't have the vaccine here. We're not going to be doing this, go someplace else?"

FROMM: You know that's a difficult question to answer. Somebody is going to have to do it.

SESNO (voice-over): But the real front lines in this crisis are inside the hospital. The first responders here are health care workers. Only a few of whom have been vaccinated. For the rest, there's no vaccine on the premises yet.

UNIDENTIFIED MALE: Twenty-four, even 48 hours, and I'm counting on that vaccine arriving here in time in order to vaccinate our staff because otherwise, the health system collapses.

SESNO: And with no special provisions to vaccinate medical workers' family members, many health care workers stay home. In the intensive care unit, patients now exceed beds in isolation rooms like one, so whole floors become smallpox wards, isolated as much as possible. The newly sick are diverted elsewhere. People are starting to die.

WEISFUSE: And I think the health care system is going to be stressed and overwhelmed in certain ways very quickly. I mean clearly, it's a dismal day psychologically when we have a smallpox outbreak in our city.

SESNO: The crisis deepens. Schools and businesses are closed. Transportation in and out of New York limited. Smallpox is reported around the country. This scenario is daunting. But, there is a vaccine, a plan, and the CDC says enough doses now on hand for everyone in America.

HENDERSON: I think what we need to do is to be imaginative but not hopeless, not to be morbid but to think through how we will in fact survive the event.

SESNO: In 1947, New York had a smallpox scare: 12 cases, two dead, about six million vaccinated in just under a month. Still our 21st century scenario is unprecedented, thousands deliberately exposed in a much more crowded place where millions move in and out and around the world every day. It's why bioterrorism is such a threat and why this city has spent so much time and money trying to prepare.

(END VIDEOTAPE)

COOPER: Terrorism isn't the only threat we face.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: We have to stop adding more people to areas where there is not enough protection.

(END VIDEO CLIP)

COOPER: Living in the path of potential natural disasters. As we saw with Hurricane Katrina, not all the threats we face are man-made. But are we any better prepared today? What if, for example, a deadly earthquake were to strike, let's say, Sacramento, California?

(BEGIN VIDEOTAPE) DAVID MATTINGLY, CNN CORRESPONDENT (voice-over): This is the scenario: it's been raining for days. The normally dry, hard ground is now saturated, but the California sun is out now, peeking through the clouds in Sacramento. A rain cloud has at last lifted and the streets of the capital are busy again, people enjoying the outdoors. Then suddenly, a few hours later, the storms return. The wind kicks up and the Sacramento River, already swollen from the earlier rains, now surges, lashing at the 2,400 miles of aging, crumbling levees that snake around much of Northern California.

UNIDENTIFIED MALE: Well, things are going downhill in a hurry.

MATTINGLY (on camera): Here the water rises higher and higher. This is the city most vulnerable to flooding in the entire United States even more so than New Orleans. But the real danger is beginning to unfold just over there, beyond the capital dome and the skyscrapers of downtown.

(voice-over): In sprawling tracks of suburban housing built right up to the edge of the levees, people are anxious. Can the levees hold back a flood?

UNIDENTIFIED MALE: It's really blowing now.

MATTINGLY: And as the water rises, anxiety turns to fear. But the worst is yet to come. A powerful earthquake strikes and the decrepit water-soaked levees began to shake and start to dissolve.

UNIDENTIFIED MALE: This is the real thing.

MATTINGLY: Homes alongside the levees are under water. Owners who haven't evacuated swept away in a rushing muddy torrent. Thousands drove or were airlifted to shelters scattered across the Northern Sacramento region.

In downtown Sacramento, city streets are swamped, important government buildings cut off. As waters continue to surge, the effects of this catastrophe are just beginning.

To the Southwest, the earthquake has transformed the levees holding back the sea and the San Francisco Bay into jelly. Saltwater rushes in from the coast and up into the San Joaquin River Basin. California's biggest source of drinking water is contaminated.

As after shocks continue, fragile levees breech in as many as 30 places. Entire cities and 16 islands disappear under water. Farms become lakes. The central highways and rail lines are wiped out. Train loads of fruits and vegetables destined for refrigerators all across the country are ruined. In the end, economic losses are staggering. More than 300,000 people are left homeless.

GOV. ARNOLD SCHWARTZENEGGER, CALIFORNIA: We want to make sure we don't have the same thing like the Hurricane Katrina disaster where you wipe out a whole city just because we didn't take care of the levees. MATTINGLY: Though our scenario is fiction, it describes a genuine and terrible risk punctuated by recent and very real levee failures and floods. Some California officials are trying to stop development near the old levees.

LOIS WOLK, CALIFORNIA STATE ASSEMBLY: We have to stop adding more people to areas where there is not enough protection. Don't build houses unless there is sufficient protection.

MATTINGLY: At the same time, the state is pleading for more federal funding to repair the crumbling levees, many reduced to big piles of dirt weakened by invading tree roots and animal borrows. In just the last year, the list of critically damaged levees has grown more than 10 times over.

LESTER SNOW, CALIFORNIA DEPARTMENT OF WATER RESOURCES: There have been of probably 400 additional sites that have been identified, about a hundred of those critical.

MATTINGLY: Now a levee system on the edge of disaster, when not so long ago it was a manageable problem that everyone simply ignored.

(END VIDEOTAPE)

COOPER: According to security expert, Stephen Flynn, the nation's infrastructure is decades old and crumbling. Sometimes all it takes is one accident, one incident, for millions of people to suffer. A painful lesson we learned, of course, here in New York City.

(BEGIN VIDEOTAPE)

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT (voice-over): It was 3 1/2 years ago, August, nearly 90 degrees, when the power suddenly went out in New York and shut down.

UNIDENTIFIED MALE: The whole place just went black. Everyone started closing up all the stores and everything, scary.

UNIDENTIFIED FEMALE: I really don't want to be out on the streets. It's a little crazy out there.

UNIDENTIFIED MALE: You can't get nothing to drink. You can't get on the phones.

MESERVE: People trapped in elevators and subways, traffic lights out, throngs walking across dark bridges to get home. To stay cool, people climbing flights and flights of dark stairways to sleep on rooftops.

It was dangerous, but it wasn't terrorism. It was the biggest blackout in American history, 9,300 square miles in darkness, 15 million affected. For hours and in some places for days, conveniences indeed necessities had vanished. It started in Ohio, but pieces of the interconnected interdependent power grid fell like bowling pins. It was a terrible reminder of our vulnerability. Since then, there have been improvements in training, maintenance and equipment. But still, it could happen again. RICHARD SERGEL, NORTH AMERICA ELECTRICAL RELIABILITY COUNCIL: The system is still connected. It's still operating together. We all rely on one another. So the possibility is still there but the probability is less.

MESERVE: Yet with our heightened concerns about terrorism, the sheer size of the system puts Americans at risk. More than 200,000 miles of high voltage wire, more than 250,000 substations, some in remote locations.

So how to protect it? There have been instances of sabotage. And two years ago, Radio Canada exposed a yawning hole in security. Its reporters drove unchallenged right into a Quebec hydroelectric plant that's part of the North American power grid.

Some experts believe terrorists with simultaneous attacks on key choke points or with cyber attacks could knock out some or even all the power in the U.S.

UNIDENTIFIED MALE: I think it's a real possibility.

MESERVE (on camera): But the 2003 blackout wasn't caused by terrorists, it was caused by a tree hitting an overloaded line. Highlighting that the power infrastructure is old and overstressed.

(voice-over): Demand has sharply outpaced the growth in our integrated power supply system. Here's just one example: on average, transformers and substations have been online for 42 years but they were designed to last only 40. To replace them takes months because they're custom-ordered. Stock piles are limited.

Clark Gellings works for a group funded by the electric power industry.

CLARK GELLINGS, ELECTRIC POWER RESEARCH INSTITUTE: If you were to lose a large number of substation transformers at the same time through a natural disaster, or something of the sort, you would have a problem.

MESERVE (on camera): For how long?

GELLINGS: It could take weeks or months in order to patch it together.

MESERVE (voice-over): And if there is a problem on the grid, the technology to detect it quickly is limited.

UNIDENTIFIED MALE: Now I am sitting there operating a power system, literally like driving my car in reverse using the rear-view mirror going down the highway. I can't see its condition until 30 seconds after something occurs.

MESERVE: And that is how an event like the blackout can travel hundreds of miles in an instant. The American Society of Civil Engineers graded the national power grid and gave it a D. The answer, of course, is investment and massive upgrades soon. President Bush said as much after the blackout.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We will view this rolling blackout as a wakeup call.

MESERVE: But 3 1/2 years later, it's time to ask did the nation hear the alarm or simply go back to sleep?

(END VIDEOTAPE)

COOPER: The next scenario, an attack on the food supply.

(COMMERCIAL BREAK)

COOPER: Experts tell us that terrorists are always looking for more frightening ways to attack. And what if they struck against a basic need, food. How vulnerable are we to agro terrorism? In our next scenario, an attack on the food supply in Minneapolis, St. Paul.

(BEGIN VIDEOTAPE)

DR. MARGARET SIMPSON, INFECTIOUS DISEASE SPECIALIST, HEENPIN COUNTY MEDICAL CENTER: Hey, I'm Dr. Simpson. What kind of stuff have you been coughing up?

KELLI ARENA, CNN JUSTICE CORRESPONDENT (voice-over): Dr. Margaret Simpson is an infectious disease specialist at Hennepin County Medical Center in Minneapolis, a level one trauma center. She routinely deals with worst case scenarios. During this exercise, she finds herself facing a situation she never encountered before.

SIMPSON: Well, she's having trouble swallowing. In addition to that, they're having some, what we call, visual problems and they also can't focus their eyes quite as well. They're having trouble.

ARENA: Simpson says she's most concerned about two possibilities: polio or botulism poisoning. Another hospital physician comes across a different patient with similar symptoms.

DR. DAVID PLUMMER, EMERGENY PHYSICIAN: And at first I was worried about just a stroke up front, but I'm wondering if there's something more like an exposural or an infection that's going on here.

SIMPSON: And I agree with you. I think we have to look at a common source.

ARENA: Because they don't know what they're dealing with, they isolate the patients, interview and test them and send samples over to the Department of Health. While these two cross paths early in the process, Simpson worries that might not always be the case.

SIMPSON: We have multiple emergency departments and I think it's a case here, a case there, a case there, and getting that information together rapidly, I think, would be the question mark.

ARENA: If this were real, the rest of the city's residents would be blissfully unaware of the lurking danger. Dr. Simpson decides it's time to alert the hospital's director of emergency preparedness.

SIMPSON: He would be the one also to assess do we need more personnel here and do we need to go into an emergency mode of operation for our facility?

ARENA (on camera): It sounds like the next guy I need to talk to is Mark Laffey (ph).

SIMPSON: That's right.

ARENA: OK, we're on our way.

SIMPSON: Go to him.

PLUMMER: Good luck.

ARENA (voice-over): Laffy coordinates emergency preparedness for the region's 29 hospitals. As part of the exercise, he's been communicating with all of them about canceling elective surgeries and other proactive steps just in case.

UNIDENTIFIED MALE: We would look at trying to discharge up to maybe 12 to 15 percent of the patients that we have if it's safe to do so.

ARENA: He's also in touch with Minnesota's Department of Public Health where an investigation is already in full swing. Tests are being performed on serum sent from the hospital. Preliminary results show botulism.

CRAIG BRAYMEN, BACTERIOLOGY SPECIALIST: It's the most lethal toxin known to man. It doesn't take much to do a lot of damage. Fortunately, it's not very common.

ARENA: Epidemiologists from the bioterror division are bringing their section chief up to speed.

JAYNE GRIFFITH, MINNESOTA DEPARTMENT OF HEALTH: When they talk to the emergency room physician, he noticed that both children had difficulty swallowing.

RICHARD DANILA, MINNESOTA DEPARTMENT OF HEALTH: OK, so we do have a high toxin coming for all three cases at this point?

GRIFFITH: That's correct.

JOHN BESSER, MINNESOTA DEPARTMENT OF HEALTH: We may have another case. St. Mary's E.R. in Duluth just called.

DANILA: OK, so we definitely want to send out a health alert.

BESSER: Are we at a point yet where we would contact the FBI or should we still wait on that?

(CROSSTALK)

DANILA: Well, let's put a call into Bill just as a heads-up. ARENA: Interviews with all patients point to one common denominator, milk.

MAUREEN SULLIVAN, BIOTERRORISM LAB COORDINATOR, MINNESOTA DEPARMENT OF LABOR: All right, Rich, we got the results on the first four patients.

DANILA: OK.

SULLIVAN: All of them are positive for Botulism Type A.

ARENA (on camera): The State Emergency Operations Center is where all key agencies come together to address a crisis. We were asked not to disclose the location for security reasons but we were allowed inside to witness a simulated response to our botulism scenario.

(voice-over): It's about 6:00 p.m. Officials from Homeland Security, law enforcement, and the Departments of Health and Agriculture have gathered to deal with the crisis.

KEVIN ELFERING, FOOD INSPECTION DIRECTOR, MINNESOTA DEPARTMENT OF HEALTH: We isolated it to two different plants, both located here in the twin cities.

ARENA: Milk from both plants has been embargoed. Cartons already on the shelves are being recalled. Information on those cartons can help investigators enormously.

ELFERING: All dairy products that are produced first of all have a plant number on them. Every plant is listed in this interstate milk shipper's list.

ARENA: There are two goals: protect the public and find the culprit.

MAJOR KENT O'GRADY, MINNESOTA DEPARTMENT OF PUBLIC SAFETY: Those plants need to be sealed off here. They're potential crime scenes and we need to gathering lists of employees or people who would have access to that plant.

ARENA: There's also the potential for the public to panic. A warning was sent out just before the evening news cast.

(on camera): What should the top three priorities be for the public at this time?

GRIFFITH: If you have milk in your refrigerator, don't drink it but don't throw it away.

ELFERING: And of course, if you are having symptoms of this illness, you do need to see a physician.

ARENA (voice-over): The Department of Health put together a website defining those symptoms and set up a hotline. The next morning, as the victim count grows, there are not enough people or facilities to conduct tests or work the investigation. Meetings are underway to discuss a shortage of ventilators and anti-toxin. DANILA: We've involved ethicists and other intensive care specialists to make some decisions who should be given the limited supply of anti- toxins and who shouldn't be.

ARENA: Decisions that are extremely difficult to make in simulated exercises, let alone life. Health experts say Minnesota is one of the best prepared states for a food attack, but every practice run reveals challenges that have yet to be met.

(END VIDEOTAPE)

COOPER: Rebuilding after Katrina, is New Orleans still a city on the edge of disaster?

(COMMERCIAL BREAK)

COOPER: New Orleans is a modern American tragedy, a city where nature and human error teamed up for maximum destruction. But now as the city tries to rebuild, many are asking now will New Orleans avoid the mistakes of the past?

(BEGIN VIDEOTAPE)

MATTINGLY (voice-over): A year and a half after the waters swamped this fabled American city, they're dancing in the streets again. Pledging to come back bigger and better, rebuilding even here, in the lower Ninth Ward, which was totally under water and even today remains deserted. It's not hard to feel happy for people like Josephine Butler, who's lived here since 1949 and can't wait to move back into her rebuilt home.

UNIDENTIFIED FEMALE: That's the kitchen.

MATTINGLY: But while optimistic, Ms. Butler can see history repeating itself and another big storm washing her away.

UNIDENTIFIED FEMALE: Any where you put me, I'll stay. So I think anything happen, I'll move out again.

MATTINGLY: She understands the risk, but does the government? Why are people being allowed to rebuild in areas that have been hit before and will almost certainly be hit again?

STEPHEN FLYNN, AUTHOR, "EDGE OF DISASTER": We're actually compounding our risks on a daily basis. Katrina is a perfect illustration of this. We're putting people back where they were before, basically living in areas that are under water.

MATTINGLY: It seems so obvious. People were clearing debris from the streets of the French Quarter well before Katrina back in 1965 after Hurricane Betsy. In 1998, Hurricane George walloped New Orleans. Here's what that storm looked like off the Gulf Coast in a satellite image. Here's how Katrina looked seven years later.

It's a familiar cycle. The next big one may not happen again this year or the next or even the next, but it will happen again. Max Mayfield, who headed up the National Hurricane Center during Katrina, quit earlier this year. He said he was tired of his warnings falling on deaf ears.

WALTER MAESTRI, EMERGENCY MANAGEMENT EXPERT: Someone mentioned to me right after the storm, well, what does it feel like to be right? And my answer was, horrible.

MATTINGLY: Well before Katrina, disaster expert Walter Maestri was laying out nightmare scenarios. Today he's not confident the city will be able to guard against another major hurricane.

MAESTRI: We just haven't done the analysis to be able to determine that those levees will hold up, that they are safe and they provide the safety that everybody expects.

MATTINGLY: New houses are being built higher off the ground, but not high enough to have kept people dry during Katrina.

(on camera): Some of the old houses still show a water line on the outside. You can see this is well above my head. It's a constant reminder of what happened here and what could happen again even as construction goes on right across the street.

(voice-over): Local politicians, who want people to return, have encouraged the rebuilding but even they can do the math.

(on camera): Three feet off the ground.

OLIVER THOMAS, NEW ORLEANS CITY COUNCIL: How does that help tenants go through the water?

MATTINGLY: Right.

THOMAS: The levees we pray won't break this time.

MATTINGLY: Mayor Ray Nagin has repeatedly said he wants all of New Orleans rebuild, including the devastated Lower Ninth Ward.

UNIDENTIFIED MALE: The Lower Ninth Ward will come back. Our street grids are fine and it's just a matter of getting the money to the people so that they can rebuild their homes.

MATTINGLY: In the early days after Katrina hit, when the nation was still reeling, Dennis Hastert, the speaker of the House said, "It looks like a lot of that place could be bulldozed." Rebuilding a whole city below sea level didn't make sense to him. Not very P.C. but Hastert quickly backpedaled.

But today as we watch people sweat to rebuild right in danger's path, we wonder, Katrina may have scared us, but did it teach us enough?

(END VIDEOTAPE)

COOPER: Over the past hour, we've examined America the vulnerable, how gaps in our homeland security threaten us all. But now, let's focus on solutions, what we as a nation must do to protect ourselves. Stephen Flynn, author of the new book, "The Edge of Disaster," in his own words.

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FLYNN: Terrorism is a fact of life in the 21st century. It's going to be a bit like the flu. It's just going to be different strains each season.

We've decided that the best defense is a good offense, that the only way to win the war on terrorism, as the president says, is to take the battle the enemy. If the war could be won fully over there, why go through the inconvenience and expense of mobilizing a society engaged in the private sector here?

It simply hasn't been our priority. There's a missing leadership to point out to the American people, these are vulnerabilities, to talk through the risks and the tradeoffs. That's just been absent from our national conversation for me surprisingly and distressingly since 9/11.

The bottom line is the best defense may turn out to be a pretty good defense.

The biggest thing that we're not coming to grips with as a society is we're becoming more brittle. We're becoming more fragile. The infrastructure that we rely on was built largely by our grandparents and great-grandparents in the early part of the 20th century. And it wasn't designed to last forever. There are bridges that are failing. There are locks and dams that move barges up and out in our inland waterway systems to get farmers' goods to market that are falling apart.

Every summer, when it gets hot, the grid essentially threatens to shut itself down. That's the kind of thing that happens in third world countries. That's the kind of thing that happens in war zones. I mean Baghdad, you expect the lights to go out. In a country like Haiti, you expect the lights go out. But how is that Americans complacently let every summer the heat go up and lights go out and shrug and they'll just get back to business as usual? So there clearly is almost a sense of denial about this fragility that we're in.

We need to make a focus on building a resilient nation within our borders as much is a priority as confronting threats beyond our borders. I think we can do that.

(END VIDEOTAPE)

COOPER: Stephen Flynn in his own words.

You know the goal of the CNN SPECIAL INVESTIGATIONS report was not to frighten but to try and enlighten. And as you learn, there is real reason for concern.

I'm Anderson Cooper, thanks for watching.

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