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Benefit Concert to Honor Diana; More on British Terror Attacks

Aired July 01, 2007 - 22:00   ET

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

SUSAN ROESGEN, CNN ANCHOR: Tonight, we'll talk to the man who took this stunning picture.
And what about your safety?

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: This is not by no means a European problem. It's a problem here as well.

UNIDENTIFIED MALE: I've been there 40 years and I ain't never seen anything like this.

(END VIDEO CLIP)

ROESGEN: Hundreds can't go home tonight. Their homes under water. We'll take you there.

(MUSIC)

And Elton John, Fergie, and Duran Duran bring 70,000 fans to their feet. A birthday celebration fit for a princess. You're in the CNN NEWSROOM.

And hello, I'm Susan Roesgen filling in for Rick Sanchez. It's been a weekend of fear, frustration and a fast-moving search underway in Great Britain. Brand new developments tonight. Here's the rundown.

First, look at this amazing photo from Glasgow, Scotland. An off-duty British firefighter sprays a man engulfed in flames with a fire extinguisher. The man had apparently set himself on fire after crashing that jeep into the front of the Glasgow Airport. He lived, but he's in critical condition. And his suspected accomplice is among several people now in custody.

The threat is being felt all the way to the U.S. President Bush spoke publicly about it for the first time today.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: It just goes to show the war against these extremists goes on. You never know where they may try to strike. And I appreciate the very strong response that the Gordon Brown government's giving.

(END VIDEO CLIP) ROESGEN: And here is amateur video shot last night on the motorway that links Glasgow and London, showing the police as they were tracking down two more suspects. We understand that one of those suspects is a woman.

So here's how we've got this story covered. Correspondents in London, in Glasgow, and here in the U.S., where your own travel plans could be dramatically affected. You'll hear from all of them this hour.

We'll start with CNN international senior correspondent Nic Robertson.

(BEGIN VIDEOTAPE)

NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice- over): The burnt, the twisted hull of the jeep using in the blazing attack on Glasgow's airport is slowly removed. Gas canisters and fuel packed inside. An apparent suicide mission to kill and maim. Police say they are making progress.

UNIDENTIFIED MALE: The investigations into these events, these attacks, this extremely fast moving. It is no exaggeration at all to say that new information is coming to light hour by hour.

ROBERTSON: New information revealing al Qaeda may be behind the attack.

GORDON BROWN, BRITISH PRIME MINISTER: It's clear that we are dealing in general terms with people who associated with al Qaeda.

ROBERTSON: Chasing those leads just a few minute's drive from the Glasgow Airport, police sealed a street, searched a house in a quiet village, shocking neighbors. May Gordon lives across the street.

MAY GORDON: It's a quiet village, nothing ever happens here, nothing at all. And I just can't believe it.

ROBERTSON: The two-story house, the only rental property on the street. Almost unnoticed by neighbors. Now police say it's a focus of their investigation into the airport blast. Callum (ph) Graham's friend lives next door to May Gordon. Says two men of apparent Pakistan, Indian or Bangladeshi origin moved in a few months ago.

UNIDENTIFIED MALE: He just told me a couple of Asian people moved in. He's only seen one of the men so -- and he's only seen them once. Must have kept to themselves.

ROBERTSON (on camera): The street here could not be more nondescript or ordinary. When you look up the road, there's a Mercedes outside one house, another Mercedes, a BMW, another new vehicle at the very top of the street. So close to the airport for anyone trying to blend in and hide in a quiet location, this is perhaps perfect. After an emergency session of top Scottish parliamentarians and intelligence chiefs, revelation the two men arrested in the attack on the airport not from Scotland.

ALEX SALMOND, FIRST MINISTER OF SCOTLAND: The people involved in the incident have not been Scotland for any length of time.

ROBERTSON: Further south, more arrests linked to London and Glagsow bombers. A 26-year-old man taken into police custody in Liverpool, bringing the total detained since Friday's attempted bombing in London to five. More searches, too. This time, central England and Newcastle on the line.

Sources tell CNN of the five arrested, two were doctors, and suspect their cell or network is based upon doctors, some of whom came to Britain to study.

BROWN: We will have to be constantly vigilant. We will have to be alert at all times. And I think the message that's got to come out from Britain and from the British people is that as one, we will not yield.

ROBERTSON: At Glasgow Airport, where lines of holiday makers waited patiently to get food tight and security, Brown's message seemed in tune with expectations. Terrorism is now a very real threat here.

UNIDENTIFIED MALE: I don't think you can stay from it. So it's (INAUDIBLE) and that's it.

ROBERTSON: Stiff upper lip, or simple resignation to the new reality. Al Qaeda is changing its tactics, simplifying its attacks to get around British security, which has been picking up on their larger more complex attacks.

Nic Robertson, CNN, Houston, Scotland.

(END VIDEOTAPE)

ROESGEN: And more now on two of those five people currently in custody, the two suspects snagged by police on one of the main north- south highways in England. One was a man 26-years old. The other a woman, 27-years old. The police say both are now in London being questioned. No word on their nationalities, but law enforcement officials in the U.S. tell CNN that they have the suspect's names and are running them through criminal databases here.

And here's something that may be very helpful in this investigation. The attacker's decision to strike the Glasgow Airport in broad daylight on a busy day in front of hundreds of witnesses. We talked to one of them earlier.

(BEGIN VIDEO CLIP)

THOMAS CONROY, WITNESS: I arrived about two minutes after the car had hit the front of the terminal. There was one man in the middle of the road surrounded by people. And anyone came close to him, he was throwing punches at. And as I looked over to the car that was on fire at this stage, and then I think the other occupant of the car spreading petrol. And the car just completely was engulfed with flames. At this stage then, the police and the bystanders grabbed the man who was fighting in the middle of the road. And the police subdued him and put handcuffs on him. Meanwhile, there was about three explosions and quick succession from the car. And but let's say the terminal itself had caught fire.

(END VIDEO CLIP)

ROESGEN: Well, threat in Britain is affecting air travel security right here in the U.S., as thousands of flyers are already finding out. CNN's Kathleen Koch is monitoring the security set-up at Reagan National Airport in Washington. And Kara Finnstrom is at Los Angeles International. Kara, what's happening there now?

KARA FINNSTROM, CNN CORRESPONDENT: Well, the security worries come during a very busy travel holiday week. So LAX police say they will be adding some extra security measures to try to keep everyone safe out of what they call an abundance of caution. They're going to be switching up their surveillance and adding some different measures, so that they say they can keep their operations somewhat unpredictable and more efficient.

Now as drove into today, we took some video of one of the checkpoints. These are random checkpoints that can pop up here on a normal day, but they have been up and running for the past two days. Officers looking for any contraband in this case, particularly any explosives in vehicles coming in and around the airport.

LAX police have also told us that they're adding some extra bomb sniffing dogs, some extra uniform patrol officers, who are keeping an eye on the airport. All this could add up to some extra delays for travelers during this busy holiday travel period. We spoke with some of them earlier today, who actually ran into delays before they even got to this airport.

(BEGIN VIDEOTAPE)

FINNSTROM: What about the delays? Do you notice anything different today? Everything running about the same as normal?

UNIDENTIFIED MALE: Two and a half hours this morning from Dallas to Los Angeles. So missed the connection but, hey, anything for the sake of security.

UNIDENTIFIED MALE: We do a lot of traveling. Security has been superb. I - you know, I just hope they continue to do the good job that's being done.

(END VIDEOTAPE)

UNIDENTIFIED MALE: And LAX police say that travelers can do their part by staying more vigilant and keeping their eye on what's happening around them. And as a note here, another note, LAX a particular concern because we've been the target of terrorist plots in the past. Back to you, Susan.

ROESGEN: OK, Kara Finnstrom at LAX.

Now let's head over to Washington and check in with Kathleen Koch at Reagan National Airport. Kathleen?

KATHLEEN KOCH, CNN CORRESPONDENT: Well, Susan, it has been a relatively uneventful holiday weekend here at Reagan National Airport, an airport that handles normally some 275,000 flights a year. We were told by the Metropolitan Washington Airports Authority that they have beefed up security here, some of the measures evident, some of them not so evident, but that this airport and airports all around the country were contacted by the Transportation Security Administration over the weekend and told ramp up security, increase your vigilance, increase all the security measures that you're taking.

Now passengers that we have talked with say that they are not overly troubled by what happened in Great Britain, in Scotland over the last couple of days. They're sticking to their travel plans. And they say that they're actually very comforted by the additional security that they are seeing here in addition to what security measures like random vehicle searches.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: There's a van pulled over. And they had the driver get out and open up the hood and the trunk. And they were searching underneath the car with mirrors. So I feel pretty safe that we're being checked.

UNIDENTIFIED FEMALE: No, not worried about it. I have confidence in our system to this point. So every once in a while I think something might get in, but not worried about it.

(END VIDEO CLIP)

KOCH: So again today what we've seen here at Reagan National Airport just outside the nation's capitol, patrol cars outside the terminal. We've actually seen police officers on bicycles cycling through the terminal. That's certainly an unusual sight. Some of the measures not so evident. The Transportation Security Administration is putting more air marshals on overseas flights. And then also something called behavioral profiling. And that's where authorities are looking very carefully at how people are acting in the terminal, passengers, people they're greeting. They're looking for anyone acting suspiciously, Susan. Back to you.

KOCH: OK. Sounds like some good things they're watching for. Thanks, Kathleen.

Now back to the United Kingdom and the latest on the investigation. John Roberts of CNN's "American Morning" is in London. And he talked to a former Scotland Yard detective about what the police there have so far.

(BEGIN VIDEOTAPE) JOHN ROBERTS, CNN CORRESPONDENT: Typically an investigation like this -- investigators are trying to put together the forensics with shards of metal and back trace the movements of people who are already dead.

JOHN O'CONNOR, FMR. DETECTIVE, SCOTLAND YARD: Yes.

ROBERTS: What have investigators gotten their hands with this case? A couple of cars? They've got five people.

O'CONNOR: Yes, that's right. They've got three cars. They're going to have a massive forensic evidence. They've got the full details of the bomb maker's signature, how he made the bomb. They will know what went wrong with it, why it didn't work. They'll be able to trace back the materials that were used. They'll be able to trace back the prominence of the car, where that was acquired, what the history of that car is.

There's such a wealth of intelligence and information that will come out of this.

And secondary to that is the raid on the addresses, where suspects have been arrested where they live. That means they're going to get the computers. They're going to go through the hard disks. They're going to go through all the relevant material in those properties. I mean, it's an ongoing inquiry that's going to take a long, long time before they go through all this information and intelligence. And there will undoubtedly be more arrests come out of that

(END VIDEOTAPE)

ROESGEN: Well, you can watch more of John Roberts reporting live from London tomorrow on CNN's "American Morning". The most news in the morning starting at 6:00 Eastern.

Coming up, the war in Iraq and the war on terror has gotten even tougher for U.S. forces.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: The American military has now realized it's fighting even more enemies in Iraq than it ever knew.

(END VIDEO CLIP)

ROESGEN: CNN's Michael Ware has the exclusive story on a new enemy in the war zone.

Plus...

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: I can see the water now. It's coming this way. It's about a block away.

(END VIDEO CLIP)

ROESGEN: Yes, the rain keeps coming. Thousands of people are out of their homes. And now there could be an environmental hazard as well. We'll take you there live.

And a new man on the job trying to make sure one of the worst school districts in the country finally gets a passing grade. Can he take the pressure? That's our Sunday spotlight right here in the CNN NEWSROOM.

(COMMERCIAL BREAK)

TIME STAMP: 2216:18

ROESGEN: And now this CNN exclusive. With the largest U.S. military operation since the invasion of Iraq in full swing, there appear to be emerging signs that America is fighting yet another enemy. CNN's Michael Ware now with exclusive details on how a manhunt for the people who ambushed and killed U.S. soldiers led the military down an unexpected path.

(BEGIN VIDEOTAPE)

MICHAEL WARE, CNN CORRESPONDENT (voice-over): These men are masters of guerilla warfare, Lebanon's Hezbollah. Last year, they claimed victory over the might of the Israeli Defense Force. Now believed to be fighting another war in Iraq.

U.S. intelligence sources say they have captured one of Hezbollah's top special operations commanders. Ali Musah Datul (ph), said to be an expert with these roadside bombs. His role in Iraq was so covert, there are no known pictures of him here, say for his prison mug shot and a confession, which coalition forces have not released. Captured on March 20 in the southern city of Basra, the Americans say he and the Iraqi militia commanders he trained and led admitted working with Iran's Kudbo (ph) special operations unit.

Documents, forensic evidence, and the personal effects of dead American soldiers seen by members of the Iraqi government and shown to CNN support their claims. After months of interviews with Shi'ia militia members in Iraq, as well as Iraqi government and intelligence officials, CNN sought the U.S. military's comments on the arrests, but the military declined.

However, senior U.S. intelligence officials say the confirmation of Hezbollah's long rumored involvement in Iraq began with the January 20 attack on American soldiers in Karbala, a well-planned attempt to kidnap five GIs that went horribly wrong, ending with the soldiers' execution.

Senior U.S. military officials tell CNN that after the attack, the order came to hunt down the men responsible and kill or capture them. That mission has been a stunning success. A few weeks ago, during a raid in Baghdad, Sadr City slum, American and Iraqi forces killed this man, Azar Adulami (ph), said to be the mastermind who led the Karbala attack. While Mehdi army militiamen mourned his death in this memorial in Sadr City filmed by CNN, coalition operations across the country had already seen most of those behind the kidnap attempt killed or imprisoned.

Early results in the U.S. investigation led to this man, Kai Kazali (ph), seen here in 2003 when he was the spokesman for rebel cleric Muqtada al Sadr's Mehdi army. By the time of his March arrest, he had left the Mehdi army and come to head one of the most feared organizations in the country known as the special group, a well- trained, well-financed and efficient paramilitary unit modeled on Hezbollah. And according to U.S. intelligence sponsored by Iran's (INAUDIBLE) force.

A claim Hezbollah's (INAUDIBLE) and the Iraqi leader Kazali (ph) have apparently admitted during their interrogations. Looking for Kazali (ph), the coalition troops found more than even they had hoped.

(INAUDIBLE), telling the planning, training and conduct of the failed kidnap. What they didn't know is they had also scooped up Hezbollah's advisor to the Iraqi special group. Originally pretending to be deaf and mute, Dahduk's (ph) is real identity was not revealed for weeks. Once uncovered, though, American officials say he began to talk.

The Americans now believe his role was crucial to the Karbala attack. What remains a mystery is why Lebanese Hezbollah's leadership would risk sending advisors to Iraq, American intelligence officers suspect Hezbollah had no choice - indebted to Iran's Kutz (ph) force for its decades of military and financial support.

Contacted by CNN, a Hezbollah spokesman in Lebanon said he would not dignify the U.S. allegations with a response. And though representatives of Iraq's Mehdi army militia and cleric Muqtada al Sadr say they share some of Hezbollah's ideals, they deny receiving any military aid.

"I said clearly that we did not accept any logistics, financial, or any other kind of support from anyone outside the borders of Iraq," says this advisor to Sadr. The Iraqi government declined to comment. And though Tehran has repeatedly denied arming or aiding any militia forces in Iraq, Dahduk's (ph) arrest and the weight of Washington's new evidence of Hezbollah's presence in Iraq may just demand fresh answers from Iran.

Michael Ware, CNN, Baghdad.

(END VIDEOTAPE)

ROESGEN: Well, normally, VIP visits to Iraq are low key, at least until the very day of the trip. But Senator John Mccain says he's heading there on Monday. This will be Mccain's sixth trip to Iraq. The GOP presidential hopeful says he would rather spend the 4th of July with the men and women in Iraq than anywhere else in the world. President Bush and Russian President Putin are at the Bush family compound in Maine tonight for what they're calling the lobster summit. That's what reporters are calling it anyway, since Maine is lobster country.

But actually, this is a serious session. Both leaders will try to ease strained relations between the two countries. Former President Bush greeted Putin warmly as he stepped off the plane. But right about the same time, this was going on. About a thousand protesters took part in a large march near the Bush home in Kennebunkport, carrying signs against the war in Iraq and calling for President Bush's impeachment.

Today, Hong Kong celebrated 10 years of independence from Britain with pomp and circumstances. But tens of thousands of pro-democracy campaigners gathered to call for political reform. Chinese President Hu Jin Tao, who attended the celebration, said democracy should grow in an orderly way. Hong Kong was handed over to Communist China after nearly 150 years as a British colony.

Well, it's time for presidential wannabes to show you the money. And this time, there's an apparent record breaker in the Democratic party. We'll crunch the numbers later.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I'm Reggie Aqui in Coffeyville, Kansas, but it's not coffee that's in the flooded waters here. It's oil. Nasty stuff. And that means thousands of people out of their homes. A live report's coming up next.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

TIME STAMP: 2225:52

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: This is my ditch.

(END VIDEO CLIP)

ROESGEN: You're listening to i-reporter Cheryl Bucknor. She sent us this video from Oklahoma, where people are still viewing the flooding caused by days and days of heavy rain. Her ditch looks more like a river now. Oklahoma got more than nine inches of rain in June, double the normal average, making it the state's wettest June on record.

And it isn't just Oklahoma. Missouri and Kansas are also taking a beating from the recent rains. Now reporter Reggie Aqui is in Coffeyville, Kansas. Or maybe it's Oilville, right, Reggie?

REGGIE AQUI, CNN CORRESPONDENT: Yes, this is nasty stuff. OK? The water that we're talking about here, it's not just an overflow from the river combined with whatever's in the street. It's also a leak that happened at the refinery, which is just down the road. Apparently, we don't know how much, but some oil got into this water. And so I'm only in it right now just to show you how deep it.

It's about up to my knees where I'm standing, but gets very deep, very fast. In fact, you can't see it because they're in the dark right now, but there are people floating in a boat just behind me. And I imagine if I were back there a couple hundred yards, it would be up to my chest.

(BEGIN VIDEOTAPE)

AQUI (voice-over): Here in Coffeyville, the Verticro (ph) River has shattered its old flood record. It's now a full 10 feet above flood stage.

UNIDENTIFIED MALE: I have been here 40 years and ain't never seen anything like this.

AQUI: Residents here are under a mandatory evacuation order. But some are choosing to stay put. Overnight, the waters breached a nearby levee. And firefighters had to make about 50 water rescues. So far, no reports of injuries.

The flood waters have also reached Coffeyville resources. That's a huge petroleum refinery complex. The facility, that also makes nitrogen fertilizer, has been shut down since Friday. And the plant remains under water tonight.

In a statement, the company acknowledged a crude oil overflow in what it described as a small ammonia gas leak since the flooding began. State and federal environment officials have been called in to investigate.

Southeast Kansas and southwest Missouri have been battered by heavy rains for days, up to 20 inches in some areas. The Kansas governor has declared a state of disaster emergency in more than a dozen counties.

Rivers are also near record levels in Osawatomie, Kansas. The National Guard has been called in to help enforce a mandatory evacuation order. And workers are trying to reinforce a nearby levee.

Across the region, roads are closed and even some railways are under water. In many areas, all people can do is wait for conditions to improve. Forecasters say the rivers may keep rising for several more days before they finally start to recede.

(END VIDEOTAPE)

AQUI: All right, you can see right now these guys are floating in a boat. You guys live how far down there? They live three blocks down there. This is your boat or did you borrow it from someone? Or what? OK, and you're just coming back - you're not going to go back there, are you?

UNIDENTIFIED MALE: Not tonight.

AQUI: OK. So I guess they're coming back for tonight. The police are also patrolling the area, of course. We understand there has been a curfew here for the last couple of days.

And Susan, it could be a while before all this water finally recedes. The city is hoping for midweek, but that all depends on the forecast. Right now, we are experiencing a little break from the rain, but that could change at any moment.

ROESGEN: Man, what a mess. Thanks, Reggie, reporting there live for us.

We want to take a look at some i-reports that are coming in from the area. Alicia Williams says it has been raining in Neodesha, Kansas, for 12 straight days. She says people in some neighborhoods there have been evacuated because of the rising waters. So we'll check in Kara McGuiness in our CNN Weather Center a little later to see if the forecast will ever clear up.

Coming up, students desperate to learn, desperate to succeed after Hurricane Katrina, but they and their schools are still failing. Just ahead in our Sunday spotlight we'll talk to the man who wants to turn things around on the first day on his new job. Then later...

(BEGIN VIDEO CLIP)

WILLIAM, PRINCE OF WALES: This evening's about all that our mother loved in life, her music, her dogs, her charities, and her family and friends.

(END VIDEO CLIP)

ROESGEN: A family affair in front of thousands of adoring fans. William and Harry get star-studded help to keep their mother's memory alive. It's all coming up right here in the CNN NEWSROOM.

(COMMERCIAL BREAK)

ROESGEN: From the administration to the academics, the New Orleans school district has long been one of the worst in the country. And then two years ago Hurricane Katrina hit and many people thought, well, maybe the silver lining to that storm would be a chance for the school system to start over. It did, but when schools opened up again last fall, the system was still struggling.

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ROESGEN (voice-over): Many New Orleans schools face a new reality after the hurricane and so do some of the students. They look like any other teenage siblings waiting for the school bus, but Roger, Teranika (ph) and Jonathan Smith (ph) are among hundreds of New Orleans children who are living and going to school on their own.

UNIDENTIFIED MALE: Don't stand and look, let's move. ROESGEN: At John McDonogh High School, Principal Donald Jackson says he believes of his nearly 800 students, as many as one-third are in the city without their parents, sometimes without any adult supervision at all.

DONALD JACKSON, PRINCIPAL: It's especially once we started having problems and we started making phone calls to parents, having them come in for parent conferences, kids were saying, well, my mom can't come. I would say, well, why can't your parent come? Well, they are in Texas. Well, what you doing here? You know what I mean? Why are you here? Oh, I'm living with my aunt, my aunt is 20, 21. So just no structure there. No support structure.

ROESGEN: At 19, Roger Smith is considered an adult but he is not legally responsible for his 17-year-old sister and 16-year-old brother. The Smith family evacuated to Houston but the kids begged their mother to let them come back to New Orleans to go to school. And until she can find work here the kids are in a FEMA trailer on their own.

TERRY SMITH, MOTHER: I felt like I was abandoning them. And I'm like, they have already been through so much already and just, you know, the idea but it's just that I'm trying to do the best that I can to get back to make sure that everything is (INAUDIBLE).

ROESGEN: New Orleans Police say they don't keep tabs on underage kids living alone, but at McDonogh High School, some students who don't have parents at home have become a big problem. Principal Jackson says they have attacked not only each other but also the guards and one teacher.

The violence has calmed down in the last few weeks with the school trying to improve discipline and morale but New Orleans public schools have other post-Katrina problems. The district is short on teachers. At McDonogh nearly half are rookies, never in a classroom before Katrina. And many school libraries are empty.

Books that weren't destroyed by the flood were thrown out by state inspectors, worried they might have been contaminated by toxic mold. After decades of failing public schools in New Orleans, a fresh start was supposed to be Katrina's silver lining, the state took control and promised changes.

But Principal Jackson, who lost his house in the flood, says it's not that simple.

JACKSON: You know, there is just no magic wand to wave or say that after Katrina all these things would be taken care of. Because it's going through a rebuilding process myself. It's just not easy.

ROESGEN: Now with Terry Smith heading back to Texas, her kids, like hundreds of others here, fend for themselves.

(END VIDEOTAPE)

ROESGEN: And the New Orleans kids are in our "Sunday Spotlight" tonight. The city schools have a new man in charge now. He's Paul Vallas. Vallas was behind some major improvements in the school systems in Chicago and Philadelphia, but he faces what may be his toughest test yet in New Orleans. Paul Vallas joins us now on his first official day as New Orleans recovery school superintendent.

Paul, how do you fix schools when you have still got some kids living on their own, rookie teachers in the classrooms, school buildings that are falling apart?

PAUL VALLAS, SUPT., NEW ORLEANS RECOVERY SCHOOL DISTRICT: Well, let me point out, I think the challenge is a manageable one from my experience. Because in Chicago I had 10 times as many students as I will be responsible for in New Orleans. And, of course, in Philadelphia, I had about six times as many students.

So while clearly the problems are severe, the fact that I'll be dealing with a much smaller student population I think I'll be able to spend more time focusing on programs and initiatives that are designed to turn the district around and probably less on day-to-day crisis management.

ROESGEN: What's your number one priority? What are you going to go after first?

VALLAS: Well, you know, the -- to open the school year we have got to make sure we have enough adequate facilities. We have to make sure we have enough teachers. We have to make sure that we have got capable principals. I mean, those are kind of our immediate priorities.

But let me point out that while many of the buildings are temporary buildings, many of the buildings are modular classrooms. We have put together a checklist of what we want to see available in every classroom. And we want to start the year with every classroom being a classroom environment that is equal if not superior to that in some of the more affluent suburban schools.

So for example, small class sizes, no more than 20 students. New curriculum instructional models for the teachers, new textbooks, technology in the classroom, a classroom aide to assist that teacher, coaches in the schools to help many of the teachers, many of whom are new and are just starting.

For many of them this is their first, second year experience. So even if children are being educated in a building that is -- at least appears to be second-rate or for that matter these temporary classrooms, the classrooms themselves are going to be a superior learning environment.

We're also -- also let me point out very quickly to address this issue of children who have returned to the district alone and not being raised by their parents, not living with their biological parents, we intend on keeping schools open through the dinner hour and we intend on keeping schools open 11 months so that we can have our -- have kids in that -- have our young people in the controlled environment for a longer part of the day and a greater part of the year.

We think that that will help offset some of the disadvantages to effect so many children returning to the district without the living with their biological parents.

ROESGEN: But you know, so much of what you're talking about costs money. I mean, and I know from experience, we know in New Orleans that cash is tight.

VALLAS: Well, you know, at least initially the district has a lot of Title I money and a lot of poverty dollars that have gone unspent over the last year, year-and-a-half because schools were closed for a year. And when the children returned to the district, a much smaller number returned to the district as had been in the district prior to the hurricane.

ROESGEN: Well, Paul, let me ask you this, you know, you were in Chicago and in Philadelphia. In Chicago, your detractors there said you bullied people into making reforms. And in Philadelphia, the place that you've just left, you left that district with a $73 million deficit. Are you sure you're the right guy for New Orleans?

VALLAS: Yes, well, let me point out that I'm pretty stubborn about pushing people to rise to expectations. And you know, this year's budget deficit in Philadelphia is actually $41 million, and it's a $2.3 billion budget. So if in the next three years, we dramatically expand school choice, we improve test scores, we improve graduation rates, we rebuild the district from an infrastructure standpoint and the district is left with the equivalent deficit, which incidentally, by New Orleans standards would be about $6 million, I think people will be more than satisfied with those results.

ROESGEN: All right. We'll see. We'll see if people are satisfied. I know that they are looking to you, hoping for good things in the district. Paul Vallas, thank you for joining us.

VALLAS: Thank you.

ROESGEN: Well, speaking of money, we are still more than a year away from the presidential election but the campaign cash is pouring in. A whole lot of it. Coming up, Barack Obama's war chest sets a record. We'll tell you how much he's piling up.

Plus, we have shown you firsthand accounts of flooding in the Midwest. Coming up next, we'll check in with your own Karen Maginnis to see if you're in for a soggy or a sparkly Fourth of July.

(COMMERCIAL BREAK)

ROESGEN: We have this new video in to CNN to give you another look at just how bad the flooding is in the Midwest. Those are bison swimming in what used to be farmland in Bartlesville, Oklahoma. We know we have had those heavy rains in Oklahoma, and in Kansas. On the phone with us now is Sharon Watson with the Kansas Emergency Management. Sharon, what can you tell us about the environmental danger with the oil that is spilled in Coffeyville that we saw in our report earlier?

SHARON WATSON, KANSAS EMERGENCY MANAGEMENT: We have more than a thousand barrels of crude oil that has been released from that facility at the Coffeyville refinery. And it was a result of a storage facility leaking when the oil was being transferred into a main storage tank in the refinery.

So unfortunately we -- there will be a large amount of cleanup that will be necessary there. And right now flood waters are spread throughout that area and a lot of evacuations had to occur in the town of Coffeyville due to the flooding there.

ROESGEN: Yes, we mentioned the oil spill and an ammonia leak. Are people in danger in that area?

WATSON: The ammonia leak is a small release. And we do not believe that there's a threat to the community at that time. And of course, the oil is in the flood water so we are asking people to avoid the flood waters, not just because of the oil but because of any number of issues that might be there to pose a risk to your health.

ROESGEN: OK. Sharon Watson, thanks for calling in tonight from Kansas Emergency Management.

(WEATHER REPORT)

ROESGEN: Well, Senator Barack Obama is attracting some serious campaign cash. In fact he may have set a new record. Donors contributed a whopping $32.5 million to his presidential campaign from April through June, $32.5 million. His war chest now is believed to be the highest ever raised in a quarter by a Democratic candidate, topping the $27 million that Hillary Clinton's campaign predicted she would raise in this same period. By contrast, another top runner, Senator John Edwards, has raised only about $9 million.

And what would you ask the presidential candidates if you could ask them something? Here's your chance. CNN is teaming up with YouTube for the next presidential debate. You can submit your videotaped question to our "CNN YouTube Presidential Debate." The Democrats on July 23rd, the Republicans on September 17th. Just go to cnn.com/youtubedebate. Stand up and be heard only on CNN, home of the best political team on television.

Well, she was adored by millions, and today Princess Diana's sons made sure that her memory lives on. To them it is no joke.

(BEGIN VIDEO CLIP)

PRINCE HENRY OF WALES: When William and I first had this idea, we forgot that we would end up standing here desperately trying to think of something funny to say. Well, we'll leave that to the funny people.

(END VIDEO CLIP)

ROESGEN: Funny people, music, a little bit of everything. More than 60,000 fans were there. And you'll see much more of it next in the CNN NEWSROOM.

(COMMERCIAL BREAK)

ROESGEN: Can you believe today would have been Princess Diana's 46th birthday? It has been 10 years now since the much-loved princess died in a Paris car crash. But instead of spending this day in sadness, her sons chose to remember her with a huge party in London with more than 60,000 guests.

Here is CNN's Becky Anderson.

(BEGIN VIDEOTAPE)

BECKY ANDERSON, CNN CORRESPONDENT: Well, Sunday would have been Princess Diana's 46th birthday. And her sons, princes William and Harry, organizing the event at Wembley Stadium behind me here in order to commemorate her life. Security forces here in the U.K. taking absolutely no risks, as you can imagine. Four hundred and fifty police officers here on duty along with the Wembley Stadium security here.

Well, the concert kicked off with Sir Elton John opening the event with his hit song, "Your Song." He played the piano against the backdrop of black and white images of Diana which were taken by the photographer Mario Testino. It was Elton John who introduced the princes to the audience here at Wembley, 63,000 of them in what was a truly memorable event.

It was an emotional day, as you can imagine, as this event began. And Prince William had this to say about his mother.

PRINCE WILLIAM OF WALES: This evening is about all that our mother loved in life, her music, her dance, her charities, and her family and friends.

ANDERSON: Duran Duran, the '80s heartthrobs, one of Diana's favorite bands, and they came on after Elton John, a plethora of artists here today that Diana would have enjoyed. And indeed, those that her sons enjoyed. A very, very special day here at Wembley Stadium.

Becky Anderson, CNN, London.

(END VIDEOTAPE)

ROESGEN: And here's something that you might find hard to believe. Hundreds of thousands of American children as young as 9 and 10 years old forced into prostitution every year. This woman says she was one of them. What she was forced to do and why it has become her mission to save others. Her story is next in the CNN NEWSROOM.

(COMMERCIAL BREAK) ROESGEN: You know, there are people around us every day who are doing extraordinary things to make the world a better place. We call them "CNN Heroes." And all this year we're telling their stories. Tonight a woman who helps people who suffered some of the worst abuse imaginable. Tina Frundt is her name. And she's not only a "CNN Hero," she's also a survivor.

(BEGIN VIDEOTAPE)

TINA FRUNDT, "FIGHTING FOR JUSTICE": Men, women and children are being sold each day for somebody else's profit. I think when we hear about trafficking, we automatically think about what goes on overseas. However our own children in the U.S. are being forced out every day at 9, 10, and 11 and 12 years old.

"KITTY," AGE 17: They beat you. They make you go out there. They make you stay out all night. They really don't care. You could be 9 years old, if you can work for them.

"ANGELA," AGE 21: People are raped and beaten into submission to do it. You can be killed and it wouldn't really make a difference to other people because other people would think of you as just a prostitute.

FRUNDT: My name is Tina Frundt. I'm a survivor of child trafficking within the United States at the age of 14. In my situation, I was a child and a grown adult who was in his 20s started paying attention to me, telling me how beautiful I was, picking me up from middle school.

I found out that he was actually a pimp by going with him to another state. Some of the things I went through was the manipulation, the violence and the abuse. I went through it so that's why I think I'm so dedicated to helping others. I'm the director of outreach for Polaris Project and I fight to end human trafficking.

I don't want what happened to me to happen to somebody else.

What we do is offer services for women and children who want to get out. Basically our outreach program started two-and-a-half years ago. We go out to the street and hand out information. We actually go into the courtroom and do outreach. We take clients of all ages. Our youngest client has been 9. The oldest so far has been 40.

Please get the number, call any time, even if it just to talk. Our lines are 24 hours a day.

I think in this job you have to love what you do and have a passion for it, because it's not a job to me. It's my life. I couldn't imagine doing anything else.

(END VIDEOTAPE)

ROESGEN: You can find out a lot more about Tina Frundt and her work on our Web site. And it is also where you can nominate your own hero for special recognition later this year. All the details are at cnn.com/heroes.

We'll hope you'll stay with CNN as we continue our coverage of the U.K. terror threat. Recapping the latest, five people are now in police custody, and investigators are combing through three vehicles, that on in Glasgow and two in London.

They're also collecting evidence in homes throughout Great Britain. CNN's John Roberts will lead our coverage starting at 6:00 Eastern tomorrow morning. Until then, thank you for joining us, and good night.

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