Skip to main content


Return to Transcripts main page


Missing Soldiers Search; Why are Gas Prices so High?

Aired May 18, 2007 - 06:00   ET


KIRAN CHETRY, CNN ANCHOR: Some big stories on our radar, of course Paul Wolfowitz now out as the World Bank president. So, now what? And why does it matter to the U.S. and to you? We're going to talk about that coming up a little later.
JOHN ROBERTS, CNN ANCHOR: That was an interesting event last night in Virginia. Virginia is taking aim at New York City Mayor Michael Bloomberg, a gun give away in the commonwealth. We'll show you why some people actually came packing. They had their pistols strapped to their hips. We'll tell you what it's all about coming up next.

CHETRY: And that was Michael Bloomberg on that cake, by the way.

We're going to update you live from Sacramento, the latest on the attempted whale rescue as we saw yesterday. A mother and baby humpback whale going the wrong direction, ending up in a fresh water delta where they need to be in the San Francisco Bay in the saltwater. They're both injured. As you can hear, they're playing those whale sounds, trying to get them to follow that hopefully back into the bay. Is it working? We'll update you a little bit later in the show.

ROBERTS: Let's hope that they're saying just what they should be saying.

Just within the last few hours, we've learned the name of the fourth soldier killed in Saturday's ambush near Mahmoudiyah, Iraq. He was Sergeant Anthony Schoerber of Gardnerville, Nevada. The FBI and Australian forensic experts are helping the search for the three soldiers that are still missing. They're checking evidence that could mean that the men are still alive. Also, lots of false leads to run down as well. An update from CNN's Arwa Damon who just returned from an embed with search teams is coming right up. Kiran?

CHETRY: Now we turn to what could be the most sweeping immigration legislation in decades if it's passed. A new deal could pave the way for 12 million undocumented immigrants to become eventually U.S. citizens. That bill was written by a bipartisan group of senators and here is what it says. We're going to break it down for you. Current illegal immigrants would be given what are called "Z" visas and put on what they're calling a path to citizenship. They would have to pay a $5,000 fine and the head of household would have to actually go back to their home country and apply for a green card, all of this needing to take place within eight years. The deal also includes expanding the current border fence and doubling the border patrol. And there would also be a guest worker program which would give around 400,000 workers per year what are called "Y" visas. There would be new penalties for employers who hire illegals. President Bush says he views the bill as a major step towards solving a difficult problem.


BUSH: Immigration is a tough issue for a lot of Americans. The agreement reached today is one that will help enforce our borders, equally importantly, it will treat people with respect. This is a bill where people who live here in our country will be treated without amnesty but without animosity.


CHETRY: Before it gets to the president's desk, it must pass the full Senate and the House. We're going to talk more about that with our congressional correspondent in just a couple of minutes.

Also, hours after that deal was announced in Washington, 2,000 people gathered in Los Angeles to finish the immigration rally that police broke up ending in a violent clash on May 1st. Los Angeles Mayor Antonio Villaraigosa has stressed the importance of immigrants.


MAYOR ANTONIO VILLARAIGOSA, LOS ANGELES: We have a right to speak out. We have a right to march peaceably. We have a right to come together and say with our families that we work hard, we contribute greatly to this economy and we want to participate in the American dream.


CHETRY: A small group of demonstrators heckled the mayor calling on him to fire the commissioner Bratton over the police breakup of May 1st rally.

ROBERTS: What happens when you advertise free guns in Virginia? It turns out that you draw a pretty big crowd, check this out. A couple of hundred people turned out last night for what was billed as the Bloomberg gun give away. They were protesting New York City Mayor Michael Bloomberg's efforts to sue out of town gun shops. The city says that the stores sell guns illegally and they eventually end up on the streets of New York. A pistol and a rifle were given away to two winners. They tried to sell raffle tickets Kiran, but it's illegal to sell raffle tickets for a gun, so they had to give away those raffle tickets.

CHETRY: And on Capitol Hill the push for the resignation of Alberto Gonzales the attorney general is now heating up. Democrats are expected to call for a no-confidence vote in the Senate, as early as next week. The vote would be nonbinding. Six Republicans in the Senate have already sided with the Democrats calling for Gonzales to resign. And also yesterday Senator Arlen Specter called the Justice Department quote, dysfunctional and predicted that Gonzales would eventually resign. ROBERTS: Today the talk at the World Bank is about who is going to be their next president and the deal that the bank agreed to, to get Paul Wolfowitz out. Wolfowitz is resigning his presidency effective June 30th. State Department correspondent Jane Verjee is covering all of this and it looks like both sides gave just a little bit here in order for there to be a graceful exit. . ZAIN VERJEE, CNN STATE DEPARTMENT CORRESPONDENT: Exactly, the fight is finally over after two days of secret negotiations, weeks of paralysis of the World Bank and huge international pressure on Paul Wolfowitz to resign. Yesterday evening he came out and made this statement, "I have concluded that it is in the best interest of those whom this institution serves for that mission to be carried forward under new leadership." He got the compromise that he was looking for. He walked away, but didn't take all the blame. The bank shouldered some responsibility. They said this, "He assured us that he acted ethically and in good faith in what he believed were the best interests of the institution and we accept that." The statement went on to say, it's clear that a number of mistakes were made by a number of individuals. The bank also went on to praise him for his work over the last two years, said he did some good work, debt relief aid to Africa and so forth. As you mentioned earlier, he's going to be leaving the 30th.

ROBERTS: Vice President Cheney has backed him just about all the way on this. President Bush nominated him for the position. What's the White House saying today?

VERJEE: It really can be perceived as a big public defeat for the White House. But the White House spokesman came out and said that President Bush would really have preferred it that Paul Wolfowitz stayed and he reluctantly accepted that he had to leave.

ROBERTS: He's leaving on June 30th. What happens between now and then?

VERJEE: Between now and then, they're just going to figure out who's going to succeed him, with regards specifically to Wolfowitz. There's word that he may go on an administrative leave, he would see the day to day running of the World Bank, there wouldn't be any major personnel policy decisions and it may be decided today whether there will be an acting leader.

ROBERTS: There has been talk at the World Bank of having a different process of choosing the president of the United States because of its position in the World Bank. As nominated the presidents before, I'm sure the White House wants to keep going with that. So how soon could they nominate somebody?

VERJEE: As soon as they identify an individual. As you said, you know, the White House, the United States has always picked the successor of the World Bank. The Europeans said, look, if Wolfowitz leaves voluntarily, we're not going to oppose that. Because the whole thing here has been that they don't like the fact that the U.S. picks the head of the World Bank and that's been a lot of the animosity. ROBERTS: A conspiracy theorist might say, hey, nominate Bill Clinton that would keep him off the campaign trail. Zain Verjee thanks. Kiran?

VERJEE: Thanks.

CHETRY: Thanks John. Well marine scientists will try again today to move two humpback whales from a shipping channel near Sacramento. They're stranded some 70 miles from the ocean where they belong. Kara Finstrom is at the rescue site in West Sacramento right now. Did they make any progress Kara from yesterday?

KARA FINSTROM: Not really. When the sun comes up here this morning, the efforts out here will resume in full force. Right now, the whales are continuing to circle in a contained part of the river right behind me. Wildlife experts have been trying to coax them into turning around and headed back out to the ocean. One of those crews did stay out here overnight keeping watch. It did not move from where it set up yesterday when we arrived here this morning. And unfortunately that means, the whales haven't moved either.


FINSTROM (voice-over): Wildlife experts from around the world have converged on Sacramento to face what they call new territory.

PIETER FOLKENS, ALASKA WILDLIFE FOUNDATION: We've never been in a situation where we had a cow/calf pair, both of whom are injured and they are 77 miles up a fresh water river.

FINSTROM: To herd them back to the ocean in safety, they're turning to haunting unearthly recordings. Biologists say sounds like these of other humpback whales feeding and socializing may be able to entice the whales back to open waters. So far, it hasn't worked. This is part of the reason biologists are now working around the clock. The mother whale has a two-foot gash on her back. The calf has a similar wound, both possibly caused by a ship propeller.

FOLKENS: The two of them were together near the surface resting. The calf was rolled over a little bit perhaps in the possible nursing position. And as the wheel came by, it just clipped them both.

FINSTROM: Biologist Pieter Folkens believes the wounds would heal on their own if the whales were in saltier cleansing ocean waters. He says this mother and calf need to get back to the ocean and away from human interference.

FOLKENS: We also are pretty sure that there is no humpback food here, so it's doubtful that the mother is feeding at this time.

FINSTROM: The pair's dangerous journey is far from over, but it just may help in an unexpected way.

UNIDENTIFIED FEMALE: There she is. Look, look, look, she just sprayed, see her?

FINSTROM: By endearing them and the plight of endangered whales, the crowds of onlookers in a wide-eyed new generation.


FINSTROM: Now these whale recordings have worked in the past. Back in 1985, a whale named Humphrey wandered around these waters for about 26 days. It was the whale recordings that actually got him to finally turn around and head back out to the ocean. And because he survived here for so long, these experts are hopeful that they have some time to work with these animals and really try and coax them into heading back out to sea. Kiran?

CHETRY: Now Kara, did Humphrey have injuries as well?

FINSTROM: You know, I am not sure about the case with Humphrey. I know he was extremely fatigued when he headed back out to sea and that was a big problem with Humphrey because he was here for 26 days. These two whales, of course, have these injuries that were sustained from what they believe was the propeller of a ship. I don't know that Humphrey had anything like that. What we have heard was that he was very fatigued.

CHETRY: Well all right. I lived there for a couple of years right behind you and that was a sight we never saw for sure, humpback whales in the river in Sacramento. Kara Finstrom, thanks so much.

ROBERTS: Coming up, on the front lines of the fight against the new immigration deal, I'm going to talk with one congressman who is not pleased by the proposal.

And cycling champion Greg Lemond drops a bombshell.. He says he did it because he was being blackmailed by a fellow cyclist. You're watching AMERICAN MORNING, the most news in the morning is on CNN.



ROBERTS: A major step toward immigration reform, a bill written by a bipartisan group of senators attempts to strengthen the borders and slow the flow of illegal immigrants. As for the illegal immigrants who are already in the United States, some 12 million of them, they would be put on the path to legal status. They would get so-called "Z visas" which would let those who enter the United States before January 1st of 2007 stay for four years. But "Z visa" applicants would have to pay a $5,000 fine for that privilege. The bill has plenty of opponents, liberals who think that it's too tough and Republicans who think that it rewards people for breaking the law. Congressman Ed Royce of California is one of those people. Congressman Royce, good morning, thanks for being here.

REP. ED ROYCE, (R) CALIFORNIA: John thank you.

ROBERTS: You have called this bill a straight sellout. Why?

ROYCE: Well it is because when you look at what we could do to stop illegal immigration, all we would have to do is enforce our existing laws. We have employer sanctions on the books. These aren't being enforced. Only two miles of the 850 mile fence has been built. Instead, we're looking at not only a mass amnesty here, but one that is going to encourage additional illegal immigration into the United States based on what happened with the 86 amnesty and we're looking at a cost of about $2.5 trillion going forward for the American public as a result of this amnesty.

ROBERTS: I'll talk to you a little in just a second about border security. But let me ask you this question, what do you do with the 12 million people who are here illegally if you don't grant them some sort of status?

ROYCE: Well, what you can do is quit magnifying or increasing the problem by actually securing the borders. If you do that, then through attrition and through some requirements that employers show that their workers are here legally, a lot of people will leave. But what you don't want to do is do another amnesty like '86, which tripled the amount of illegal immigration to the country because everybody worldwide anticipates, I get to the United States, I'm eventually going to get amnesty.

ROBERTS: And there were promises of enforcement in the 1986 bill which never came to pass, but Secretary of Homeland Security Michael Chertoff is pledging that -- and the bill calls for 370 miles of Duncan Hunter's fence to be built before a guest worker program or the extended visa plan goes into place, 18,000 border patrol agents on the border, unmanned area vehicles, 70 radar stations. Is that not securing the border?

ROYCE: But John, here is the irony. We already passed a bill last year and funded it that the president didn't want to sign but he had to right before the election, we passed that bill for 850 miles of fence and they've only built two miles. So, again, we know from past experience, the will is not there for enforcement, it is for amnesty. This is the wrong way to approach this bill.

ROBERTS: Let me come back to this word amnesty. Here is what President Bush said yesterday when he learned that the bill had been passed or at least a deal had been done. Take a listen.


BUSH: This is a bill where people who live here in our country will be treated without amnesty but without animosity.


ROBERTS: Congressman Royce, there is the leader of your party is saying it's not amnesty. You're going against the leader of your party.

ROYCE: And the '86 amnesty was defined as that by Black's law dictionary. Basically, when you give somebody benefits, when you give them a pathway to citizenship, when you allow them, starting January 1 to stay here illegally, when you allow them to work here, that is amnesty. It's nothing but amnesty.

ROBERTS: So is the president shading the truth here?

ROYCE: Well a year ago, the Senate passed a bill which we didn't pass in the House which granted amnesty to some particular classes of people. This is a blanket amnesty. It's a mass amnesty. So by definition, yes, it's amnesty.

ROBERTS: So he's using --

ROYCE: He is wrong.

ROBERTS: He's wrong. Ok, there you go. The president of the United States is wrong. What are you hearing from Latina groups in your district, the 40th district down there in Orange County about all of this?

ROYCE: I held a town meeting last Saturday. What I am hearing about half, approximately half of the Hispanic groups, Latino groups in my district or individuals in my district are concerned about illegal immigration. So I think there's a split in that community just like every community. This is a worldwide problem. When the second best selling book in Ireland is how to get into the United States and they don't mean legally, it's a worldwide problem. There are one billion people in the world who say they would come illegally to the United States. That's why I say border enforcement is the way to handle this, not another amnesty.

ROBERTS: Well the House will be taking this up in July. I expect we'll be hearing a lot from you and your colleagues who are of a similar mind. Congressman Ed Royce, thanks for being with us.

ROYCE: John thank you.

ROBERTS: Appreciate you coming in so early.

ROYCE: Thanks.

CHETRY: All right, coming up, what starts as a wild high speed chase ends with an even wilder crash. How all of this started, ended and what happened to the suspect. Up next.

Plus, what was supposed to be a hearing into an alleged doping turned into something much more. A former cycling champion revealed a shocking secret during his testimony. That's all ahead on AMERICAN MORNING.


UNIDENTIFIED MALE: A toy for wired tots on this week's fortune first. You may remember the frenzy created by cabbage patch dolls, beanie babies and tickle me Elmo. Now the latest craze among elementary and middle school kids is stuffed animals that come alive online. Each webkinz comes with a code that gives you one year of free access to, where you name the animal, get an adoption certificate and are responsible for taking care of your virtual pet. Now, to earn kinz cash to buy your pet food and accessories, you play games, answer trivia questions and even get a job.

EUGENIA LEVENSON, REPORTER, FORTUNE: Webkinz is bridging the virtual and real world. The time was very, very right for this idea and it's been very successful. Last year it was one of the top 10 plush toys by revenue and then they have over 3.5 million visitors to their Web site per month this spring and that's triple what they had in November.

UNIDENTIFIED MALE: Retailing for around $13 apiece, webkinz hit the market two years ago and is now flying off store shelves.

LEVENSON: Kids today are very wired and toymakers are going to have to think really creatively about how they're going to capture these kids' imagination.



ROBERTS: A hearing about doping allegations against Tour de France winner Floyd Landis turned into something far more than that. Greg Lemond who you might remember won the Tour three times back in the 1980's was slated to testify against Landis in Malibu, California. The night before the hearing though, Lemond got a phone call from a man who told him, skip the hearing or he would make public the fact that Lemond was sexually abused as a child.


GREG LEMOND, FORMER TOUR DE FRANCE WINNER: (INAUDIBLE) used intimidation to keep me from coming here, thinking that -- I feared being exposed that I was sexually abused, somehow that this equates to me admitting that I doped -- or whatever their purpose was.

It was a real threat and it was very -- it was very -- I hate to say creepy.


ROBERTS: Lemond claims that he traced the origin of that call to a cell phone owned by Landis' business manager Will Gagan who Lemond said apologized to him after the hearing. Landis fired Gagan shortly after that.

CHETRY: Wow, that was quite unexpected at that hearing John, for sure.

ROBERTS: You know and also Landis is saying that the U.S. anti- doping agency told him that they would give him leniency if he dropped the dime on Lance Armstrong, so there's all sorts of intrigue going on in this case.

CHETRY: For sure. All right, 25 past the hour now. Ali Velshi is "minding your business," we're taking a look at how Wall Street responded to the news of a pending immigration deal. They don't usually like change. ALI VELSHI: No, and what Wall Street would like, what business in this country needs is some resolution to this issue because what's happening is, we've got an increasing dependence on immigrant workers. So there needs to be some solution. Let's take a look at who wins and who loses under this deal. First of all, we're way early in this thing, we're not quite sure how this is all going to play out. It's got to get through the House and the Senate. But the winners under this immigration proposal are industries like construction, packing plants and agriculture. They're the most likely to benefit from the 400,000 annual guest workers that the bill proposes or this agreement proposes. The losers are most likely to be high tech because they've got 140,000 visas a year and that's not changing and yet it's been the high tech leaders and people like Bill Gates who have been at the front of the idea that they need more skilled workers in the United States. The losers are also likely to be unions because people who come in as temporary workers are not likely to unionize. They're not likely to want to agitate or to get themselves into trouble.

CHETRY: Although, when you talk about the 400,000 guest workers, I mean presumably, they were the people that were here illegally and companies were getting away with paying them very little.

VELSHI: Right, but they're probably going to have to be here a while and get on the citizenship track before they feel like they want to be in a rally. You probably aren't as comfortable going on strike for instance if you're a guest worker, thinking how they're going to get in trouble and get kicked out of the country. The other thing to think about is the shift from dependence on the family to dependence on these workers. So the shift away from people who came into the country because they had family members, applications for status are now going to be based largely on job skills and education. Even if you're in the military or you're a student at a college, you're likely to get preference over people just because their family is already in the United States. And that's a historical shift because that's what it used to be based on. So if this goes forward, it is going to be a shift, but it might go some distance to addressing the two concerns of not enough skilled workers in the United States and security concerns of illegal immigrants.

CHETRY: All right, we'll see how it shakes out. Ali, thanks.

ROBERTS: The top stories of the morning are coming up next. The name of the fourth soldier killed in Saturday's ambush in Iraq was released just hours ago. Arwa Damon is just back from an embed with the team searching for the three still missing. She's going to join us live in just a couple of minutes.

And it hasn't worked yet, but marine biologists are not giving up hope that a creative plan will help to rescue two whales that are stranded way up in the Sacramento ship channel. You're watching AMERICAN MORNING, the most news in the morning is on CNN.


CHETRY: The landmark deal. Lawmakers agreeing to a plan that would give millions of illegal immigrants a path to citizenship. What it could mean from the borders to our businesses across the nation, and also why it's sparking plenty of outrage on many sides this morning.

And thanks so much for being with us. It is Friday, May 18th.

I'm Kiran Chetry, here in New York.

ROBERTS: And I'm John Roberts, here in Washington, D.C.

Other stories on our radar this morning.


CHETRY: Right now we have some developing news that we want to bring your attention to. This happened overnight.

We now the name of the fourth soldier that was killed in Saturday's ambush in Iraq in Mahmoudiyah. He was Sergeant Anthony Schober of Gardnerville, Nevada.

Thousands of troops now are still on the hunt for the three missing soldiers that were also there at the time that this ambush took place. This all happening in the so-called Triangle of Death.

CNN's Arwa Damon has been embedded with the troops searching this area, and she joins us by video phone with an update.

Hi, Arwa.

ARWA DAMON, CNN CORRESPONDENT: Hi, Kiran. Well, that's right, the fourth soldier you just mentioned has been identified as Sergeant Anthony Schober, just 23 years old. And I was speaking his platoon commander, who described his as a tall, goofy guy who had the metabolism of a god.

He, in fact, described this entire unit, the four soldiers who were killed and three that are now missing as being notorious for a unique sense of humor that they had that bound them together. And the hunt for them does continue, Kiran, in all of its intensity.

CHETRY: And what about the news of the identification of that fourth soldier, what's been the reaction?

DAMON: Well, there is a certain sense of relief that the identification has taken place. Everyone really wanted to know who that fourth soldier was going to be.

In terms of the search, however, that really is everyone's main focus right now. It is to find their three missing men, especially amongst the men of the platoon that suffered pretty much the heaviest loss.

They lost seven of their best friends. Again, this bond that bound them all together very unique. They went through an incredibly intense experience here, and that is an experience that is still ongoing for all of the soldiers out here right now in force trying to find their missing men -- Kiran.

CHETRY: And they've had some glimmer of hopes. I guess there's been at times some clues that perhaps they're still alive, but then again, they've also had a lot of false leads.

DAMON: That's right, Kiran. In fact, I was just speaking with the operations officer here, and it is a sentiment that is pretty much echoed throughout, that every single time that the information comes together credibly and they're able to launch a mission based on that, the levels of hope are elevated.

There are ongoing missions at all times. On average, at any point in time, about four to five missions. Raids going on based on intelligence.

Much of that actually being gathered from detainees, either individuals who are suspected of being directly involved in the attack, or just individuals who they have rounded up pretty much here, detaining military (INAUDIBLE) for questioning, and then releasing them once they believe that they have obtained the information that they need. But the military here really acting on any and all tips. And any time that the men step outside of their bases to conduct a mission, that level of hope that they will be able to find their missing soldiers is elevated -- Kiran.

CHETRY: Arwa Damon, reporting near Yusufiyah, Iraq, today.

Thank you.

ROBERTS: Here at home, what could be the most sweeping immigration legislation in 20 years. A new deal could pave the way for 12 million undocumented immigrants to become U.S. citizens.

Current illegal immigrants would be given Z visas and put on a path to citizenship after paying a $5,000 fine. The deal also includes plans to expand the border fence and double the size of the Border Patrol.

A guest worker program would give 400,000 workers per year the chance to find jobs here. And employers who hire illegal immigrants face new penalties.

President Bush views the bill as major step forward. Before it gets to the president's desk, though, it has to pass the full Senate. And then the House is expected to take up the immigration issue in July.

About 2,000 people gathered in Los Angeles to finish the immigration rally that police broke up violently on May the 1st. Los Angeles Mayor Antonio Villaraigosa stressed the importance of immigrants. A strong group of demonstrators heckled the mayor, calling on him to fire the police commissioner for how police handled that May 1st rally.

CHETRY: The World Bank is moving on. Its president, Paul Wolfowitz, has agreed to resign effective June 30th. President Bush says he'll act quickly to name his successor.

Wolfowitz cut a deal with the bank last night. He'll resign and the bank will take some of the blame for the ethics problems surrounding the promotion and pay raise given to Wolfowitz's girlfriend.

On Capitol Hill, the push for the resignation of Attorney General Alberto Gonzales heating up. Democrats expected to call for a no- confidence vote in the Senate as early as next week. The vote would be non-binding. Six Republicans in the Senate have already sided with Democrats, calling for Gonzales to resign.

Well, he provided some of the most dramatic moments at Tuesday's Republican presidential debate, but now some people are saying they don't want him back. We're talking about Texas Congressman Ron Paul.

Frontrunner Rudy Giuliani and Paul got into a pretty heated exchange when he linked the attacks of September 11th to U.S. bombings in Iraq. Well, for many, it was the highlight of the night.

Well, now the chairman of the Michigan Republican Party is floating a petition that would ban Paul from all future debates. The chairman called Paul a distraction and said he would probably be more comfortable on the stage with the Democrats.

So they want to pawn him off to the Democrats. He is, by the way, a libertarian.

ROBERTS: He has a constituency out there.

CHETRY: Yes, he does.

ROBERTS: I've been reading some of the blogs, and, you know, there are a lot of people who like him, think he should be up there on the stage.

CHETRY: Is he -- I believe he's a nine-term congressman. So...

ROBERTS: He was in Congress in the '70s and '80s and took some time off, and then came back in the mid '90s again. So he's a real veteran. He's been around.

CHETRY: He could technically go to both debates. I mean, he could join the GOP or the Democrats. He's a libertarian.

ROBERTS: Maybe through his views, but I don't think technically he could do that.

Hey, today marine scientists will try again to move two humpback whales from a shipping channel near Sacramento. They were hoping yesterday that the recorded songs of humpbacks would lure the injured female and her calf back toward the ocean. It's more than 70 miles away, and that's as the crow flies.

So far, though, it hasn't worked.


PETER FOLKENS, ALASKA WHALE FOUNDATION: We are in new territory. We've never been in a situation where we had a cow-calf pair, both of whom were injured or are injured, and they're 77 miles up a freshwater river.

This is all brand new to us. So what our scientists are trying to do is essentially an experiment, collecting data points, trying to figure out what is going to be the best solution.


ROBERTS: Scientists say that those injuries that both whales suffered appeared to have been inflicted by a ship's propeller.

You know that gas prices are high, but why are they high? Had any good explanations? Well, up next, we're going to take you to the oil refineries of Louisiana for a lesson in why supply is not keeping up with demand.

Plus, a police chase at 100 miles an hour ends in a spectacular crash. Take a look at the results.

And what started as a hearing on alleged doping turned into a startling admission from a former three-time Tour de France winner.

You're watching AMERICAN MORNING. The most news in the morning is on CNN.


ROBERTS: You don't need us to tell you that gas prices are going through the roof. But we're going to tell you anyway, though. You're literally paying the price because refineries can't keep up with demand. At last count, the price of gas across this country, the average, $3.11.

AMERICAN MORNING'S Sean Callebs joins us now from Norco, Louisiana, to explain why the oil industry is not keeping up with customer demand.

And Sean, we know how hard hit that the refineries down there were hit by the twin hurricanes of Katrina and Rita. Have they been able to rebound since then?

SEAN CALLEBS, CNN CORRESPONDENT: You know, it's an interesting question, because the Gulf Coast here in the Louisiana area, pretty much. Basically, the refineries here are refining about as much as they did pre-Katrina, pre-Rita.

However, there's a hangover effect, because a lot of other refineries that would have undergone routine maintenance over the past year and a half to 20 months, they kept running. And now there are problems, there are accidents. There have been some fires, most notably the BP plant.

But let me show you a graph. And look how -- this really explains a lot.

Really, before those two hurricanes, the U.S. refinery capacity was being utilized about 95 percent. Now, look what happened in August, September of 2005. Just look at that dip. It went down to 70 percent, and since then it has never, John, in one month reached that 95 percent utilization level.

ROBERTS: So, Louisiana is just one state, but how important is it in terms of the overall amount of gasoline that we utilize here in the United States?

CALLEBS: It is very important. The U.S. learned a very painful lesson during the hurricanes. About 38 percent of the refining capacity, more than a third, was right in the path of those two hurricanes.

Now, what has the U.S. done in the aftermath of that? Well, there's nothing overnight. However, they are trying to get more of a surplus on hand in case -- hurricane season right around the corner -- that would happen again. They wouldn't be caught so off guard.

And secondly, some refineries have also undergone some work, including some that have actually been raised in levels where they can. So, if there is indeed flooding, perhaps the refineries won't lose power or be adversely affected.

ROBERTS: Sean, we keep hearing that there hasn't been a new oil refinery built in the United States since the 1970s. Any hope on the horizon that we'll see either new refineries come on line, or at least the expansion of existing ones?

CALLEBS: Well, there is. There is hope, but nothing on the immediate horizon.

It's a very sensitive issue with the industry, because they would like to point out, look, there has been expansion at existing plants, but the expansion is almost negligible, maybe one percent, a half a percent of the U.S. daily need. But there is some.

There is the one in Arizona that we briefly chatted about off camera, and there's also other ones that are going to be constructed somewhere down the road. Here in the Louisiana area, a massive expansion is undergoing about 40 miles from where we are, and that facility is supposed to come on line full capacity about 2009.

ROBERTS: Well, it's fascinating to learn, Sean, that the refining capacity has never returned to where it was pre-Katrina and Rita.

Sean Callebs down there in Norco, Louisiana.

Sean, thanks.

CHETRY: About 15 minutes before the top of the hour. We check in with Chad Myers for a look at the weather picture today.


CHETRY: Well, coming up, a former cycling champ says he was blackmailed and told to keep quiet. The shocking story ahead.

Plus, giving away guns to prove a point and raise some money. Jacki Schechner will have that story.

Stay with us on AMERICAN MORNING.




CHETRY: All right. Three minutes until the top of the hour. Ali Velshi is "Minding Your Business".

Good to see you again.

ALI VELSHI, CNN CORRESPONDENT: Good. Did you see that thing with Sean Callebs in front of the...


VELSHI: ... in front of the refinery? That's exactly the important point about the gas prices, that across the country, we have refineries that are not putting out as much. They're just not making as much oil into gas, and yet we're using as much gas.

Take a look at how this bears out in terms of the prices.

Now, I'm going to take last year's July price of gas, which was the highest price it was last year, almost $80 a barrel, $79 a barrel. At that time, we were paying $3.03 a gallon for gas, which is pretty high. Now oil is at $65 a barrel and we're paying $3.11.

CHETRY: Something doesn't add up.

VELSHI: Right. And that's the thing.

When you look at -- people sit there and say, oil is going up, oil is going down, why is my gas price not going the same way?

CHETRY: Right.

VELSHI: Well, it's been well over a year, probably two years, since before Hurricane Katrina, when we started to have these refineries kick out a service more regularly than they're supposed to. And that's when we started to find that the price of gas and the price of oil stopped moving in lockstep.

Gas would -- oil would go like this, and gas would go like that. Is that the right direction?

The idea being that because of the refining, that's the big chunk that we're paying extra for. So, in the last month, the price of gas -- the price of oil in gas has gone up about 10 or 12 cents. The price of refining has gone up much more than that. So that's the point, it's this refining that is causing us to pay more money for our gasoline right now.

CHETRY: So, as you see it, that's the -- that's the biggest weak link right now in terms of why gas prices are climbing?

VELSHI: Right. And Sean Callebs referred to one refinery that's being built in Arizona. It's not being built anymore because, again, more problems in getting it built.

There are not refineries being built. As he said, there are bits of increased capacity at existing refineries.

CHETRY: Right.

VELSHI: But one of two things has to happen. We need more refineries, or, more logically, we need to use less gasoline.

CHETRY: All right. Thanks, Ali.


ROBERTS: Just before the top of the hour. Jerry Seinfeld, to be or not to be?

That's him in costume siding down a zip line. Here he goes, at the Cannes Film Festival. He's promoting his bee movie, an animated film in which he voices a bee that's suing the human race for stealing honey.

CHETRY: And meet Pablo, Venus and Carmen. They're 4-month-old Chihuahua puppies. They were born without their front legs -- or arms. Right now they're in an Long Island animal shelter, and they're hoping for someone to adopt all three.

The little guys were part of a litter of five. The two were born normal, and these three were missing their front legs.

Vets at the animal shelter say the pups are probably the result of either inbreeding or over-breeding. They also say, though, that they are doing pretty well, learning how to hop around like little kangaroos on their back legs. And they're still absolutely adorable.

The next hour of AMERICAN MORNING begins right now.


© 2007 Cable News Network.
A Time Warner Company. All Rights Reserved.
Terms under which this service is provided to you.
Read our privacy guidelines. Contact us. Site Map.
Offsite Icon External sites open in new window; not endorsed by
Pipeline Icon Pay service with live and archived video. Learn more
Radio News Icon Download audio news  |  RSS Feed Add RSS headlines