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American Morning
Craig Says: 'I'm Not Gay'; South Koreans Freed; Stock Slump; New FBI Info; Concerns About 737s
Aired August 29, 2007 - 06:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JOHN ROBERTS, CNN ANCHOR: Friendly fire. Republicans take new aim at Senator Larry Craig for a bathroom sting.
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN, (R) PRESIDENTIAL CANDIDATE: It harms our reputation. It's disgraceful.
(END VIDEO CLIP)
ROBERTS: This morning, a looming ethics investigation and a defiant denial.
(BEGIN VIDEO CLIP)
SEN. LARRY CRAIG, (R) IDAHO: I did nothing wrong at the Minneapolis airport. I am not gay. I never have been gay.
(END VIDEO CLIP)
ROBERTS: Plus, flight risk. Urgent, new safety inspections on planes. And, this morning, they are turning up trouble. Problems similar to the one that sparked a jetliner explosion, on this AMERICAN MORNING.
And thanks very much for joining us. It's a big day of news. Welcome to AMERICAN MORNING. Wednesday, the 28th of August. I'm John Roberts.
Welcome back.
KIRAN CHETRY: I'm Kiran Chetry. Great to be back, by the way.
You know, it was unbelievable that they're saying that possibly just one little bolt could have caused that plane fire. We're going to talk more about that . . .
ROBERTS: Tore a big hole in the front of the wing there, let all the gas leak out.
CHETRY: Now they're asking to check out all 737s. We're going to have more on that. But first our top story this morning, once again, Senator Larry Craig.
He says he pleaded guilty to make it all go away and that only made it bigger. Now a U.S. senator, who was busted in an airport mens' room, is in the middle of a major scandal. Idaho Republican Larry Craig is denying all of it. Craig says that he was the victim of a witch hunt and had no reason to go cruising for sex in an airport bathroom stall.
(BEGIN VIDEO CLIP)
CRAIG: I did nothing wrong at the Minneapolis airport. I did nothing wrong. Let me be clear, I am not gay. I never have been gay.
(END VIDEO CLIP)
CHETRY: Well, now members of Craig's own party calling for the Senate Ethics Committee to look into what happened. Here now live with more on the fallout from Capitol Hill, congressional correspondent Jessica Yellin joins us this morning.
Hi, Jessica.
JESSICA YELLIN, CNN CORRESPONDENT: Hi, Kiran. Good morning.
Well, Republicans say that they decided to call for the ethics committee to look into this issue after holding a conference call yesterday among leadership. And they thought it was serious enough to make this request and different from other scandals for a number of reasons.
First of all, they say in this instance, there is a guilty plea. It's not just an accusation. Second of all, they say they were troubled by an aspect of the police report. That the police officer says that Larry Craig, after his arrest, handed over a business card that showed he was a U.S. senator and said, "what do you think of that?" That troubled them. And finally, they say the facts are in dispute. So they're asking the ethics committee to look into both the incident and the plea that Larry Craig says he made without an attorney.
Now the ethics committee will begin or is expected to begin a preliminary inquiry, but they're not obliged to begin a full blown investigation unless they, the ethics committee, deems it necessary.
Still, with all this hanging over Larry Craig's head and the possibility of a re-election campaign next year, the question is, will he choose to seek re-election? He had already considered the idea of retirement. He said yesterday that that possibility still stands out there. He said he has not made a decision yet. He'll announce it next month. Republicans up here are in a wait and see mode.
Kiran.
CHETRY: Seems like Democrats are, too. In fact, they've remained pretty quiet so far. So if Senator Craig is forced to step down or down the road decides to step down, what are the chances that the Democrats will pick up his seat?
YELLIN: Right. Well, Idaho is a very red state. President Bush won there by 38 points in 2004. And so political watchers feel like it's pretty certainly still going to be a Republican seat. And, in fact, one political observer I talked to said, it might actually be easier for the Republicans to field a brand new, fresh candidate there than try to defend Larry Craig.
CHETRY: Jessica Yellin for us on Capitol Hill. Thanks.
Republican White House hopefuls weighed in on Senator Craig's situation. Here's what Senator John McCain had to say on "The Tonight Show With Jay Leno."
(BEGIN VIDEO CLIP)
MCCAIN: It's disgraceful. And the people of Idaho that he represents, I think, will make a pretty rapid -- reach a pretty rapid verdict in this situation.
(END VIDEO CLIP)
CHETRY: So what should Senator Larry Craig do after deciding to plead guilty to this incident in an airport bathroom? It's our CNN Quick Vote question on cnn.com. Log on and tell us what you think. So far this morning, 84 percent of you saying he should resign. Sixteen percent saying he should stay in office.
John.
ROBERTS: Coming up to four minutes after the hour.
President Bush is in New Orleans to mark the second anniversary of Hurricane Katrina. The president has got several stops in the city and the greater gulf region today. He'll also observe a moment of silence in remembrance of the victims. President Bush had dinner last night with Louisiana Governor Kathleen Blanco. New Orleans Mayor Ray Nagin among others. This is the president's 15th visit to the gulf since Katrina hit.
A couple of tornadoes touching down in central Iowa. They hit about 20 minutes apart last night, knocking down some trees, damaging roads. No serious injuries, though, were reported.
And some great pictures of a thunderstorm over the Gulf of Mexico. Take a look at this. This was shot last night off of Siesta Key in Sarasota, Florida. Unusual to get such a great view of a storm like that. Just take a look at all of that lightening. What a light show that gave people last night.
Kiran.
CHETRY: John, thanks.
Well, some other headlines new this morning.
Six Iranian government workers have been released now from U.S. custody in Iraq. This new video of American troops handing the group over to the Iraqi prime minister's office last night. There you see them. They appear to have blindfolds on and have their arms -- their wrists bound. They were detained after driving through a U.S. checkpoint with weapons that they did not have permits for.
Also new this morning, a curfew is in effect today in the Iraqi city of Karbala. And a Shiite religious pilgrimage has been called off. All this stemming from violence. More than 50 people have been killed in fighting between rival Shiite militias since Monday.
We have an AMERICAN MORNING follow-up and some added urgency this morning to the inspections of 737s that we first told you about yesterday. The FAA says that two planes failed initial inspections and airlines have been told now to step up the inspection process. They've been ordered to get all planes inspected over the next 10 days. The issue is a faulty bolt on the wing. Investigators think that was what caused this explosion of a China Airlines 737 last week. The bolt comes loose and then, in this case, it punched a hole in a fuel tank. We're going to be talking to an aviation expert in just a few minutes. We're going to ask him, should we be worried if we're flying 737s?
John.
ROBERTS: The first public words in months from Senator Tim Johnson. He says, "I'm back." Johnson is recovering from a brain hemorrhage he suffered nine months ago. He struggled a bit as he spoke to supporters in his home state of South Dakota yesterday.
(BEGIN VIDEO CLIP)
SEN. TIM JOHNSON, (D) SOUTH DAKOTA: In which I take great pride. So let me say just going forward, I am back. It must already be clear to you that my speech is not 100 percent. My doctors tell me that it will get there. And, in fact, if you ask Barb, she will say I'm already talking too much.
(END VIDEO CLIP)
ROBERTS: He's back out in public. Johnson also quipped that he has an advantage in Washington because his mind now works faster than his mouth does. He said in a television interview, he expects to run for re-election next year, but a spokesman for Johnson says no decision has been made on that.
And you still have a chance to get in on that monster Mega Millions jackpot. There wasn't a big winner in last night's drawing, so the jackpot is now up to a staggering, ka-ching, get this, $325 million. That's the fourth largest in the game's history. Next drawing is on Friday. Still no word on who won the big Powerball jackpot this weekend. The tickets were sold at a gas station in Richmond, Indiana. It's worth $314 million. And the fact that Kiran's back today would suggest that she wasn't the big winner.
CHETRY: Yes, I would have come back anyway with bushels of money and just handed them out to everyone here.
Well, it's time now to check in with our AMERICAN MORNING team of correspondents for other stories new this morning.
Three South Korean hostages are free in Afghanistan today. CNN's Monita Rajpal is live in London following this story for us.
Good morning, Monita.
MONITA RAJPAL, CNN CORRESPONDENT: (AUDIO GAP) in the area who then transported them to Red Cross officials. Now another five hostages are expected to be released in the coming hours. There are still 11 others that are still being held. And it's unknown when exactly they will be released. This comes just one day after the Taliban and South Korean negotiators secured and struck a deal securing the release of these hostages.
Now in all there were 23 who were kidnapped July 19th just south of Kabul. They were members of the Christian missionary aid group that were there in Afghanistan volunteering. Two male members of this group were killed after disagreements over negotiations and deadlines that came and went. But as a gesture of good will, the Taliban released two women just shortly after that.
Now as part of the deal, South Korea has agreed to not allow any Christian volunteer missionary groups to work in the area. But they have also agreed to withdraw its 200 troops from Afghanistan by the end of the year.
Of course, we'll continue to monitor this situation, bring you more when the two other hostages are released. And we'll bring you more world news headlines later on AMERICAN MORNING. But for now, Kiran, it's back to you.
CHETRY: Monita, thanks so much.
Well, stocks slump on Wall Street after some troubling news from the Fed. Ali Velshi is here to explain what's likely in store for the jittery market today.
It seems like there was just not one huge thing, but a lot of little bits of bad news yesterday that spooked people on the markets.
ALI VELSHI, CNN CORRESPONDENT: That's exactly right, Kiran. And just when people thought they were safe and those markets were starting to adjust again, we see a 280 point drop in the Dow. And most of that came in the last hour of trading. But as you said, those little bits of news started in the morning. That's what it looked like yesterday, the Dow closing at 13,041 points.
First we start with a consumer confidence number that says that American consumers are the least confident they've been in a year. And that's to be expected after the market turmoil that we've seen. Obviously these numbers are measured from a month ago. And a month ago is when all of this market turmoil was occurring. The market hit the bottom that we've seen so far on August the 15th.
Then there were numbers about home prices. A big drop from the second quarter of last year to the second quarter of this year of 3.2 percent. Now in the middle of 2006, home prices were the highest they've ever been recorded. So this is being measured as, you know, the biggest drop or the first drop in a very long time. And then finally the minutes from the Federal Reserve meeting on August 7th. They usually let these minutes out about, you know, several weeks later. The issue with these minutes is that the Fed didn't seem all too concerned about the sub prime matter and these credit concerns on August 7th.
And as we know, Kiran, on August 17th, 10 days later, the Fed took that drastic action of cutting the discount rate by 25 basis points. So some investors will a little concerned as to whether the Fed is on the ball. That ended up costing the Dow 280 points.
Asian markets were weaker overnight. Now it looks like the European markets are shoring up and futures are actually pointing to a positive open on the Dow. But these days anything can shake these markets. And we'll stay on top of it all morning.
Kiran.
CHETRY: Sounds good. Ali, thanks so much.
Reynolds Wolf is in the CNN Weather Center. He's tracking some extreme weather. A western heat wave for states like Nevada, as well as Oregon.
Hi there, Reynolds. Good to see you.
(WEATHER REPORT)
ROBERTS: Eleven minutes after the hour. Now to our terror watch. For the first time we're getting details of what two men were doing on ferries in Seattle. Our homeland security correspondent Jeanne Meserve is in our Washington bureau with more.
So what was this all about, Jeanne?
JEANNE MESERVE, CNN CORRESPONDENT: Well, John, the FBI released the pictures of the two men in hopes the public will identify them. CNN is among many media outlets broadcasting those pictures. The FBI has made the photos public because of what has been told about how those men were behaving on passenger ferries in Seattle.
Some new details about that. The men were observed on several different ferries taking notes and photographs of restricted areas. They were seen pacing off parts of some ferries, as if they were measuring, and studying an emergency evacuation poster. Their behavior was enough to prompt a ferry worker to snap the men's pictures on a cell phone. The FBI says there could be a benign explanation, but they need some questions answered.
(BEGIN VIDEO CLIP)
LARRY CARR, SPECIAL AGENT, FBI: When we vetted out this through the traditional investigative techniques and we got no answers. At that point in time, we've got to step it up because the result of not doing anything at that point in time is a ferry blowing up, capsizing and thousands of people lose their lives. We can't let that happen. (END VIDEO CLIP)
MESERVE: The FBI has gotten about 200 tips since releasing the pictures a week ago, but still doesn't have positive identifications or explanations for what these two men were doing.
John.
ROBERTS: But there was a little bit of controversy, Jeanne, over the fact that the FBI asked the media to release these photos. "The Seattle Times" published them. The "Seattle Post Intelligencer" didn't because they said that there was no evidence of a crime here. How is the FBI addressing that controversy?
MESERVE: Yes. And there were some groups, John, who felt that this reinforced stereotypes that Middle Eastern people might be terrorists. But the FBI responds that it never speculated about these men's ethnicity and they have an obligation to try and find out what they were doing.
ROBERTS: Yes, some people are saying it's more behavioral profile than it would be racial profiling.
Jeanne Meserve for us in Washington this morning. Jeanne, thanks.
CHETRY: A governor on the defense topping you "Quick Hits" now. Louisiana Governor Kathleen Blanco says that she won't take the blame for the deaths of 35 nursing home patients who drowned during Hurricane Katrina. The owners of the home are on trial, but their lawyers called Blanco to testify yesterday, trying to shift the blame to her for never issuing the mandatory evacuation order that would have "forced" the owners to move everyone out.
Lisa Nowak will be pleading insanity according to court papers released yesterday. The former NASA astronaut says that she was suffering from an array of mental disorders when she allegedly stalked and tried to attack a romantic rival. Her trial is scheduled to begin next month.
Increased concerns this morning about the safety of 737s. Worries about a faulty bolt and an urgent order from the FAA to speed up inspections. So are they safe to fly? More on that coming up on AMERICAN MORNING.
(COMMERCIAL BREAK)
ROBERTS: Armed in America topping your "Quick Hits" now. The annual small arms survey says Americans have more guns than anyone in the world. What was it that Phil Graham (ph) said, I've got more guns than I need, but not as many as I want? That's 250 million handguns and rifles in circulation. Nine guns for every 10 people in America.
The host country Finland owns first place at the eighth annual mobile phone throwing world championships. The winning toss went 294 feet. One tech paper in Britain measures the distance in Campbells, named for phone throwing supermodel Naomi Campbell.
And speaking of long distance, AAA says that fewer people will be on the roads this Labor Day weekend than last year. They say 29 million people will travel by car. That's down by about 100,000. AAA points to the high price of gasoline as the reason for that.
CHETRY: Well, as we told you earlier, airlines this morning are being ordered to speed up inspections of 737s. The added urgency comes after initial inspections found some problem on two planes. Now the issue originally came to light last week after this. It was a fire and explosion on a China Airlines 737. Unbelievable that people -- most people escaped completely unharmed from this plane. But investigators say that what caused that spectacular explosion was a bolt that came loose and punched a hole in the fuel tank. Joining us now to talk more about this is aviation safety analyst Todd Curtis.
Todd, thanks for being with us this morning.
TODD CURTIS, AVIATION SAFETY ANALYST: Thank you for having me.
CHETRY: Now I think people were already worried yesterday, and this certainly isn't going to make them feel any better. So far they've done these inspections and they've found faulty bolts on two planes. If someone's flying today, should they be concerned if the plane that they're in is a 737?
CURTIS: Well, they shouldn't be concerned because this is a problem that was actually caught very early by the Japanese authorities. It was communicated very quickly to authorities, including the FAA. And they're doing the prudent actions of making sure that every aircraft of these types are inspected very quickly.
CHETRY: Now see, that's interesting, you say it was caught by the Japanese authorities. So if we hadn't had that incident with that China Airlines, would we have not known about it? Would the FAA have not known about this potential safety problem?
CURTIS: Well, actually, the FAA did know about this problem quite some time ago. As early as December of 2005. Boeing released what's called a service bulletin which was a notice to airlines that there is a potential problem with that part of the aircraft. So this was an interest site (ph) well before the event in Japan.
CHETRY: OK. So how did this work? That if they put out some sort of notice in 2005, and there we see the plane on fire in 2007, what's the missing link?
CURTIS: Well, the big difference between what happened in the last few days with the FAA and what happened almost a year and a half ago is that the air worthiness directive is mandatory. That is the airlines had to inspect every airplane by a very short amount of time. In this case, 10 days from yesterday's announcement. Whereas the service bulletin did not have that authority to force them to look at the airplanes.
CHETRY: All right. So what I'm wondering, is the FAA doing enough here in your opinion? Why not just ground the planes for the number of days it takes to make sure all these bolts are tightened?
CURTIS: Well the problem in this case is not something which by itself would lead to the airplane burning up, as the case in Japan. There actually has to be a series of things going wrong before something pretty catastrophic happens. And so long as one link of the chain is taken out, in this case, the bolt coming loose, there won't be a problem with the aircraft. And there is not going to be a safety issue for passengers.
CHETRY: Can you just explain when we look at this video what had to have happened here? Could you say it was sort of like a perfect storm, if you will. What happened there?
CURTIS: Well, without going into great detail, the slats are at the leading edge of the wing. And there is an assembly with it and the slats held down by bolt, nut and other assemblies. And in this case -- and there was a photograph on the Japanese authorities website, the bolt had come loose and when the slat retracted, the mechanism pushed that bolt through the skin of the area where the slat was. And behind that skin was a fuel tank. Thus, we had the fuel leak, there was an ignition source and we had the fire and the explosion.
CHETRY: All right. Well, they're trying to rectify the situation, doing this with all -- I think about 800 Boeing 737s here in the U.S. and about 2,200 across the world.
Dr. Todd Curtis, aviation safety analyst, thanks for being with us.
CURTIS: Thanks for having me.
ROBERTS: Coming up now to 21 minutes after the hour.
Looking at a lightning strike. That tops your "Quick Hits." Officials with the D.C. Transit Authority say such a strike may have sparked a power surge and several small fires in the subway system. The power problems closed metro stations in northern Virginia on Sunday and Monday.
And a video from India shows police taking part in the vicious beating of an alleged chain snatcher. The video raises concerns about police brutality. Two police officers are suspended. An investigation of this incident is underway.
A startling tragedy for Spanish soccer. One of the league's star players is dead after collapsing on the field. Doctors now say they know what killed him. We're going to have more on that coming up.
And D.C.'s latest sex scandal. Lawmakers come back to the beltway and the race for the White House heats up. How Senator Larry Craig's crisis could change things. That's all ahead on AMERICAN MORNING.
(COMMERCIAL BREAK) CHETRY: Well, a close call tops your "Quick His" now. A guy fleeing cops, after an alleged armed robbery, jumped from the van in Greenville, South Carolina, and it rolled down the hill, through a fence. It flipped over and settled about a foot or so from an elementary school. There it is right there. Luckily no one was hurt and the man was arrested.
How about this? An unexpected drive-through at Wendy's in Landa (ph), Maryland. Police say a Ford Explorer plowed into the side of the restaurant. The driver and three people inside were hurt. There's no word on how serious the injuries are or what caused the crash.
And check this out. A man in Minnesota almost killed by a dangerous and idiotic prank. Police say that the hole in his windshield was caused by a bowling ball. Someone thought it would be funny to drop it from a highway overpass. It ended up knocking the driver unconscious. The semi continued across a median. Finally coming to a stop right there in that corn field. The driver is said to be doing OK, unbelievably. Do you remember a frozen turkey someone dropped down . . .
ROBERTS: Yes, I was just about to say, remember -- she was killed?
CHETRY: No, she -- there was another one that happened where she's going to have a lifetime of rehab and everything else to be back to normal again.
ROBERTS: Maybe I'm confusing that with some kids throwing rocks through windshields that killed one person.
CHETRY: Yes, off the highway overpass. This one, though, they have no suspects yet.
ROBERTS: They put the fences on those overpasses, but still some people manage to get thing over. Just nuts (ph).
CHETRY: Well, here's a story coming up that you can't miss. Take a look at this one. You know, they say diamonds are a girl's best friend, of course. Well, we have the king friend then today. Check that one out. That ---right next to it is a cell phone. And that's the diamond. It's said to be the biggest diamond ever found.
ROBERTS: Yes, but is it really? Where did it turn up? Why is it raising some eyebrows this morning? Does it look a little too much like a paperweight for some people's tastes? We'll have that story coming up when AMERICAN MORNING continues.
(COMMERCIAL BREAK)
CHETRY: Wow. A beautiful shot this morning coming from WESH in Orlando, Florida, this morning. The sun's coming up. And it's, what, 77 right now. Going up to a high of 91 today. But how many colors can you get in one sky this morning in Orlando? Beautiful.
ROBERTS: Yes, it's just lovely. What a thing to wake up to every day.
CHETRY: Welcome back, by the way. It is Wednesday, August 29th. Glad you're with us. I'm Kiran Chetry.
ROBERTS: Good morning to you. I'm John Roberts.
New this morning.
President Bush reportedly plans to ask Congress for $50 billion more to fund the war in Iraq. Today's "Washington Post" says this is on top of the $460 billion defense budget for 2008 and $147 billion in a supplemental request to fund the wars in Iraq and Afghanistan.
President Bush says that failure in Iraq could have dire consequences for the United States. Nuclear consequences. Speaking to thousands of American veterans at the American Legion Convention in Reno, Nevada, the president said that leaving Iraq now would allow extremists in places like Iran to gain a nuclear foothold in the region.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: And Iran's active pursuit of technology that could lead to nuclear weapons, threatens to put a region already known for instability and violence under the shadow of a nuclear holocaust.
(END VIDEO CLIP)
ROBERTS: President Bush also claims that the momentum in Iraq is turning in the U.S.'s favor. In two weeks the White House will report to Congress on the impact of the buildup of American forces in Iraq.
Some questions are being raised this morning about a top fund- raising for the Democrats. "The Los Angeles Times" is reporting that Norman Shu skipped out on a plea deal 15 years ago in a fraud case that could have meant up to three years in prison. But over the past three years, he's been out in the open. He's become a big fund-raiser for the candidates, bringing in over $1 million for candidates. He's even promised to raise over $100,000 for Hillary Clinton's campaign.
In New England right now, there are growing security concerns at the country's jails following a surprise strike by guards overnight. They walked off of the job within the past few hours as part of a pay dispute with the government. The guards watch over nearly 80,000 inmates. The courts are expected to quickly get involved because it is illegal for prison workers to strike.
Doctors say a series of heart attacks is to blame for the death of a Spanish soccer star. 22-year-old Seville midfielder Antonio Puerta collapsed on the field on Saturday and then again in the locker room. He died yesterday while in intensive care. Spain's el le leagua (ph) is asking for a moment of silence before the next round of the games. KIRAN CHETRY, CNN NEWS ANCHOR: Also this morning, a massive immigration raid outside Cincinnati, Ohio, 160 suspected illegal immigrants are now in custody. Customs agents detained them during a sweep of a chicken plant in Fairfield. The feds say they're moving quickly to deport the suspects.
It's an ambitious plan to fight poverty from New City's Mayor Michael Bloomberg. His plan includes tax incentives for the poor that could bring unwed fathers back to the dinner table. The mayor says that past anti-poverty programs which focused on women with children are reaching their limit in the ability to drive down poverty rates and it is time to focus on men.
(BEGIN VIDEO CLIP)
MICHAEL BLOOMBERG, MAYOR OF NEW YORK: Right now, fathers are missing from our strategy to drive down the poverty rate. They just don't figure. And the gains that we've made over the past ten years have all been fueled by mothers. That strategy has worked very well, but now we're approaching its limits and, in part, because fathers have been missing from the table and, in part, because of declining real wages for all low-income workers.
(END VIDEO CLIP)
CHETRY: So his plan again includes tax incentives, among other things. The latest numbers from the Census Bureau show that poverty rates are on the decline for the first time since 2000.
The Virginia Tech gunman may have written the blueprint for the worst mass shooting by an individual in U.S. history. "The Washington Post" is reporting that Seung Hui Cho wrote a paper for English class about a class shooting about year before he killed 32 people on campus. It's said to have some eerie parallels to the shootings inside of Norris Hall, where police say they found the doors chained shut after Cho went on his rampage.
NASA this morning saying that there is no evidence that astronauts were drinking and flying. The space agency is expected to release the official results of an internal review later this morning. It launched the investigation after allegations last month that some astronauts got drunk in the crew quarters and were still allowed to fly.
ROBERTS: It is the latest scandal to rock the nation's political scene. What does Senator Larry Craig's guilty plea and subsequent public statement about his sexuality mean for Washington? Joining us from Washington is co-founder of politico.com., Jim Vandehei.
Jim, it doesn't look like many people in the Republican Party are buying the Senator's statements yesterday. They appear to be just running for the exits preparing to throw this guy overboard.
JIM VANDEHEI, CO-FOUNDER, POLITICO.COM: That's for sure. You had Mitt Romney -- Larry Craig was backing him. Mitt Romney has a press conference, There's talking on TV before Larry Craig denies the allegations and throws him under the bus and says what he did was despicable and compared it to Bill Clinton in the White House and other scandals that we've seen, to include the Mark Foley scandal in Congress. Then Republicans leaders saying let's get this before the Ethics Committee. Nobody told us about this. Larry Craig had not alerted his fellow Republican leaders that he had this legal problem.
ROBERTS: John McCain came on "The Tonight Show" and called it, quote, "disgraceful." When you have that many people in your own party saying those things about you, what does it say about your political future?
VANDEHEI: It is not very bright, John. I can never recall an incident like this in Washington where someone gives such a bizarre press conference as he did yesterday, to go up there and have this Nixonian I-am-not-gay press conference, where he keeps repeating this. It was a very uncomfortable scene. Essentially, his voters are watching this. They know that, yes, you're innocent until proven guilty. But he pled guilty. He signed the legal document saying that, yes, I did something inappropriate in a men's bathroom. That's not good politics for a Republican, not good politics in Idaho.
Now, remember, Idaho does have -- 68 percent voted for Bush in 2004, a very Republican state. And voters tend to be forgiving and forgetful, but this one, I just don't see how this story ends any other way than him not running for re-election or having one heck of a hard winning re-election.
ROBERTS: He came out yesterday to talk more about the guilty plea on the charges of inappropriate conduct in a bathroom in the Minneapolis-St. Paul airport. Let's listen to just a little bit of what he said and then I'll get your reaction to it.
(BEGIN VIDEO CLIP)
SEN. LARRY CRAIG, (R), IDAHO: I chose to plead guilty to a lesser charge in hopes of making it go away. I am not gay. I never have been gay.
(END VIDEO CLIP)
ROBERTS: What do you think of that appearance? Gary Bower likened it to Bill Clinton's finger wagging episode where he said, I did not have sex with that woman.
VANDEHEI: This is a sitting U.S. Senator who has more than a passing familiarity with our legal system, who pled guilty. And this notion that I pled guilty hoping that this whole thing would go away. He didn't tell his wife, his fellow Republicans. It is so fishy. That's why people were really baffled by that press conference.
When you have Republicans -- this is a Republican loyalist. This isn't some Republican in name only who they'd love to throw over board. This is a guy whose voting record they love. These guys turned on him viciously, McCain, Romney and Republican leaders.
ROBERTS: Do you think he'll last through '08? VANDEHEI: It is hard to see how he does last. It is not like anyone is coming to his aid. Typically, in situations like where Republicans do rally around their own and they try to defend their members and say let the legal system work its way. The legal system has. He pled guilty.
ROBERTS: Yeah, they were even willing to cut David Vitter a break, but Larry Craig doesn't seem to get that same sort of treatment. Jim Vandehei from politico.com. Thanks for being with us. Appreciate it.
VANDEHEI: Take care.
ROBERTS: Kiran?
CHETRY: Your "Quick Hits" now. Cuban Dictator Fidel Castro weighing in on the possibility of a Hillary Clinton-Barack Obama Democratic ticket. I'm sure this isn't the endorsement either one of them are looking for. The leader says that the two candidates together would be invincible. Castro reportedly made the comment in an editorial in Cuba's state newspaper.
For the first time, South Dakota Senator Tim Johnson is talking about his recovery from brain surgery. He says he's been given a second chance at life and plans to make the most of it. The two-term Democrat even joked that he now has an advantage over his Senate colleagues because his brain works faster than his mouth does.
Two years ago today Hurricane Katrina slammed into New Orleans. After all this time, are those who were left devastated by the storm getting what they need? And where are your tax dollars going in the Gulf region? We'll get a live report on all that coming up next.
Plus a very unusual interview taking place in a few minutes. Reporters interview murder suspects who are safely in another country. More on that ahead on "AMERICAN MORNING."
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ROBERTS: 40 minutes now after the hour. Welcome back to the most news in the morning here on CNN. Your "Quick Hits" now. The force will be with the space shuttle Discovery when it launches this October. The crew taking Luke Skywalker's original light saber from the "Star Wars" movies up in space with them. The crew of "Star Wars" characters led by Chewi Dewooka (ph) brought the light saber to NASA.
And Myron, the emu, safe at home now. Myron somehow got out of his pen the other day in West Bend, Wisconsin, and went -- where else, like everybody does, the Wal-mart. Resourceful Wal-mart employees corralled him with shoppers.
CHETRY: I love how his owner describes that Myron is drawn to people and shiny things. So the Wal-mart parking lot, complete with the shoppers and the shopping carts, were just too much for Myron.
ROBERTS: There you go. CHETRY: Had to go there.
ROBERTS: Had to go to Wal-mart.
CHETRY: Very cute.
ROBERTS: Reynolds Wolf in the CNN Center watching extreme weather.
Lots of heat in the West today, Reynolds. Good morning to you.
REYNOLDS WOLF, CNN METEOROLOGIST: We're seeing a lot of heat out West and we're also seeing some showers and storms heat up this morning, especially in South Georgia.
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WOLF: That's the latest. Kiran, let's send it back to you in New York.
CHETRY: All right. Thanks so much, Reynolds.
It was two years ago today -- unbelievable to think about that -- Hurricane Katrina slammed into New Orleans as well as the Mississippi Gulf Coast. In New Orleans, it devastated the city, and after all this time, many of the areas hardest hit are still hurting. So how is the rebuilding and recovery effort going? And are your tax dollars helping?
Sean Callebs is live now in New Orleans with a look at what's changed and what's improved two years later.
Hi, Sean.
SEAN CALLEBS, CNN NEWS CORRESPONDENT: Hi, Kiran. Good morning to you. Lionel and Linda McGee have spent most of the past two years living in 400 square feet of FEMA trailer while they've tried to rebuild their home and rebuild their lives. Now, the feds realized early on because of this unprecedented flooding, that tens of thousands who lost everything, they were going to need to step in. And out of that, the Road Home plan was born. Billions of dollars to help more than 180,000 homeowners in this area get back on their feet. Well, the McGee's count themselves among the lucky. They received $75,000.
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LINDA MCGEE, KATRINA VICTIM: I was able to get as far as I'm going now. And as you can see, I still have to get flooring and I need furniture, I need appliances. And the money is just about gone already. You know? It's amazing what the labor costs -- in this city right now. The labor and the materials are killing you. You know, it's just not enough.
(END VIDEO CLIP) CALLEBS: Yeah, it's killing a lot of people in this area. Think back two years ago, this is how the Gentilly area of New Orleans looked once the six feet of water from the London Street canal receded -- debris, muck, mold.
Now look at this home here two years later after the family spent their insurance money, the $75,000. They've got a lot done. While a lot of people will be marking a somber anniversary here, Kiran, the McGee's will be spending the time waiting for the painters to come inside, the people to do the siding on the outside. This money simply isn't going far enough.
People expect there's going to be a massive shortfall from the $8 billion. And there are horror stories. We talked to somebody across the street who received $84. Not 8,400, $84,000 -- $84 -- Kiran?
CHETRY: So what's being done to help with that discrepancy or to figure out where the need is continuing two years later?
CALLEBS: Well, the people can appeal. And that is what this lady is doing across the street, saying, look, $84? I can't even buy a lock with that let alone rebuild my home. But so far, this program has been filled with bumps in road, the Road Home plan. Only about one in five residents have received any money two years after the storm. So that is a clear reason why this rebuilding is going so slowly despite billions of your tax dollars being earmarked for this area.
CHETRY: Sean Callebs, thank you.
Overall, Americans have a skeptical view of the recovery effort two years later of Katrina. According to a CNN opinion research corporation poll only 44 percent of you think that New Orleans will ever fully recover from Katrina, 55 percent saying it won't. As for reconstruction, 52 percent say they don't think the federal government has done enough and 33 percent think that the effort is about right and 10 percent think that the government has actually done too much.
A reminder, CNN has a new tool letting you impact your world when disaster strikes. If you like, you can head to CNN.com/impact and there are tips about what you can do to take action on the news that you witness every day -- John?
ROBERTS: New pictures of damage left behind by strong storms in Minneapolis on Tuesday. High winds uprooted a pole and shot it through the back windshield of a parked car. Take a look at that. Ripped half the roof off of it as well. There is a chance of more extreme weather in the area today as well.
The chief suspects in the murder of former Russian spy Alexander Litvinenko will hold a video news conference in Moscow. That is expected to happen any time now. We'll have more on that coming up in just a moment.
And a diamond has been found that is more than twice the size of the current world's largest diamond. Or has it? That's ahead on "AMERICAN MORNING."
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CHETRY: A phone call from the rubble. Rescue teams in Anderbyjen (ph) say as many as 10 people are trapped in the basement of a 14-story building that came down. They found out when one called from a cell phone. At least five people are reported dead in the collapse.
And reports of progress from the fire lines in Greece. Crews say that some major infernos are now receding with the help of firefighters from 12 different countries. Flames have burned half a million acres and killed at least 60 people.
ROBERTS: An unusual news conference about the murder of a former Russian spy taking place today. CNN's Monita Rajpal has more on that and the rest of today's international headlines.
Good morning, Monita.
MONITA RAJPAL, CNN NEWS CORRESPONDENT: Good morning, John. Yeah, Britain's main suspects in the murder of former Russian spy Alexander Litvinenko are holding a video news conference in Moscow, but they'll be answering questions -- that is they, Andrei Lugovoi and Dmitry Kovtun, will be answering questions from journalists in Britain. Downing Street has been seeking the extradition from Russia of Lugovoi and Kovtun but, so far, Russia has refused. Lugovoi has denied any involvement in Litvinenko's death.
A statue of Nelson Mandela has been unveiled in central London today. It happened just moments ago. British Prime Minister Gordon Brown called the former South African leader the greatest and most courageous leader of our generation. Those are live pictures that you're seeing there. You can see the British Prime Minister Gordon Brown, London Mayor Ken Livingston alongside Nelson Mandela. We have some of the entertainment that's taking place in central London. The nine-foot bronze statue stands in London's Parliament Square alongside statues of Winston Churchill, Abraham Lincoln, Benjamin Disraeli and David Lloyd George.
And that's what's happening right now live in London. John, back to you.
ROBERTS: Another great honor for a great man. Monita, for the last few minutes we've been showing pictures of this enormous rock that some are claiming is a diamond, other people are skeptical about it. What's the story behind that?
RAJPAL: Very skeptical about it. Apparently, this massive rock weighs about 7,000 carats. It's about the size of a cell phone. Imagine wearing that around your neck. It still has to be verified by geologists. It was apparently allegedly unearthed in a diamond mine but according to CNN -- CNN spoke to an owner of this land, of this area where this rock was found. He said he was very excited by this discovery. He was rushing back to Johannesburg from Cape Town to have it verified and put in a vault. Again, still many questions surrounding it. But if it is indeed a diamond, it will be the world's largest diamond, it will be the world's largest diamond -- the largest one right now, the largest confirmed diamond weighs about 3,000 carats. So it's still a little tricky.
ROBERTS: It looks a little too perfect. Too many flat and sharp edges.
RAJPAL: It looks a little too green, if you ask me.
ROBERTS: More like a paperweight. Monita Rajpal from London for us this morning. Monita, thanks. See you soon.
Falling SAT scores top your "Quick Hits." The College Board is warning us not to read too much into the dropping national average, saying it's likely the result of a more diverse pool of students taking the test. This is the second year in a row that scores have fallen.
There is a growing trend to delay the start of the school year. Pressure from parents and even the tourism industry has prompted 11 states to limit how early classes can start. Michigan, for example, guarantees that kids won't have to be back until after Labor Day.
A new housing report triggering a huge new headache. Home prices falling to a 20-year low and at one of worst possible times. We'll tell you why, ahead on AMERICAN MORNING.
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CHETRY: 55 minutes past the hour. Ali Velshi is "Minding Your Business," which means you have no good news today -- a big drop again yesterday and home prices now on the decline for the first time in years.
ALI VELSHI, CNN FINANCIAL ANALYST: Yeah, it's the first time -- it's one of those kinds of weird math things -- first time since they've been keeping track of this particular measure. In the second quarter of this year, April to July, compared with the second quarter of last year, the national average for a single family home is down 3.2 percent. And we've never seen that actual measurement. We've seen home prices come down but never seen that year over year decline in that way.
Some of the places where we're seeing the biggest declines, obvious most people can name this one. Detroit is the biggest, 11 percent in that same period year over year, obviously, because of those auto layoffs. San Diego, Phoenix, Las Vegas and Los Angeles are rounding out that list of the top five.
There have been increases in parts of the country. The number one place for an increase is Seattle, up 8 percent. Charlotte, North Carolina, up 6.8 percent. Charlotte, that was coming from a low base. They'd had a lot of problems as the manufacturing industries in North Carolina had been suffering over the years. Portland, Oregon, up 4.5 percent. And Dallas and Atlanta, which are things that even people in Dallas and Atlanta won't tell you, are up a little bit. I think there's still that feeling in those places. They're only up about 1.6 percent which means some areas are up and some areas aren't.
CHETRY: It was also interesting to see Boston down. Usually parts of New England and the East Coast seem to be immune to that.
VELSHI: Boston is one very, very healthy market. It has been for a long time because it is one of those cities whose populations go there unrelated to the normal course of business in Boston. It has been doing well over the years, down a little bit.
Again, these numbers all support the same theory that we are seeing a lot of softening in the housing market. Most people are saying this will go on until at least the middle or the end of next year, some people saying the end of 2009.
ROBERTS: On the back side of that, is there expected to be a sharp up swing or just a small one?
VELSHI: A moderate up swing. That's where the discussion is going now. As people have sort of digested all this news about foreclosures and housing prices, there are now questions about is this an opportunity to get in and buy houses. The summer is supposed to be a strong time for selling. It obviously isn't. As we move into the fall, that's when savvy buyers get in. This year might be one of your best opportunities.
ROBERTS: Ali, thanks very much.
CHETRY: If you can get a jumbo mortgage rate, right?
VELSHI: That's a big deal. If you can get a jumbo mortgage.
CHETRY: Thanks, Ali.
ROBERTS: Still coming up in our next half hour that you just can't miss, Democratic Senator Tim Johnson. Remember him? He had suffered a cerebral hemorrhage just after the election last year. Making big strides after suffering that stroke, stepping out in public for the first time. Speech still a little bit slurred but clear he's making a comeback. Take a listen.
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SEN. TIM JOHNSON, (D), : Hard work is something in which I take great pride. Let me say just going forward, I am back. It must already be clear to you that my speech is not 100 percent. My doctors tell me that it will get there. And in fact, if you ask Barb, she will say I'm already talking too much.
(END VIDEO CLIP)
CHETRY: So he certainly has kept his sense of humor about it. Also going on to joke that he, unlike some of his other colleagues, his brain works faster than his mouth. What are his chances for a complete recovery? We're going to be talking more about that with Sanjay Gupta about that. This happened right after the Democrats took control of Congress. People said will he run for re-election and what's the medical prognosis. We'll talk about that, coming up.
The next hour of "AMERICAN MORNING" starts right now.
ROBERTS (voice-over): Denial.
(BEGIN VIDEO CLIP)
CRAIG: I did nothing wrong at the Minneapolis airport. I am not gay. I never have been gay.
(END VIDEO CLIP)
ROBERTS: And fresh fallout. New Republican calls for an investigation into Senator Larry Craig's sting arrest. What could it mean for his career and the GOP?
Plus, stomach turner. A new warning for the millions of Americans who experience heart burn when the pain could be a sign of something more serious, on this "AMERICAN MORNING."
(on camera): Good morning. Welcome back. Thanks for joining us. Lots to talk about this morning. It's Wednesday, the 29th of August. I'm John Roberts.
CHETRY: And I'm Kiran Chetry. Glad you're with us.
Well, we start out with a scandal in Washington. He says that he pleaded guilty to make it all go away. That's only made it bigger.
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