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Shuttle Discovery Returns Tomorrow; Midwest Still Reeling from Massive Flooding; Boy Scout Victims of Iowa's Tornado Remembered
Aired June 13, 2008 - 10:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
HEIDI COLLINS, CNN ANCHOR: Some interesting news that we are watching coming out of NASA and actually some of the video that they are getting. Miles O'Brien is standing by. He's going to tell us a little bit more about what exactly they think they are looking at the last day in space aboard the shuttle.
Miles, what's going on up in space? Do we have any idea?
MILES O'BRIEN, CNN CHIEF TECHNOLOGY & ENVIRONMENT CORRESPONDENT: Yes. We are putting some pieces together, Heidi.
The crew is getting ready for landing. Landing is scheduled for tomorrow morning, 11:00 a.m. Eastern hour Part of the process of getting ready for landing is a series of tests to ensure that the spacecraft, that' is after all a spacecraft can operate as an airplane. What they do is they fire a series of reaction control thrusters, little rockets that are located all throughout to make sure they are work properly. In the course of doing that - by the way, I should set this up as if we were in space with these doors.
The course of doing this reaction control system hot-fire test, they call it, happened a little before 7:00 this morning Eastern time, the crew noticed a piece of potentially ice, debris, whatever you want to call it, about a foot to a foot and a half in length floating past the starboard or right wing. Take a look at it. They got the video camera up quickly. Notice how it kind of shines. It almost looks like it is metallic as it shines in the sunshine.
What is it? We don't know.
They took some high resolution still pictures. They are going to check that out to make sure that they know exactly what it was, could be ice. Could have been something, Heidi, inside there's all kinds of things inside the payload bay. They delivered that huge (INAUDIBLE) module so it's pretty much open. There could have been something that came loose. And in the process of firing all those thrusters, knocked it free.
COLLINS: Was that a big deal if that ends up being -- we call it foreign object debris.
O'BRIEN: Let's go to chapter two of this story and then we'll see if it is a big deal. In the same process, they are also testing out all the control services, the (INAUDIBLE) flaps, the speed brakes, the rudders. In the course of doing that, they noticed something odd in this section right in the rudder section of "Discovery." Take a look at this picture right now we will give you a sense.
Now it's kind of hard. You got to look down and I don't have my telestrator operating. But if you look pretty much dead center, the middle of your screen, where that thin little black line goes down and you see something protruding out there at the edge of the white. Do you see that?
COLLINS: I do.
O'BRIEN: Does that have something to do with that debris that came off? Did it hit something on the way out? Or is this a separate thing entirely? We don't know exactly yet. But they do want to make sure that they understand what that is. Likely, a piece of insulation. You know, I -- we told folks time and again that the shuttle -- there is another piece.
Look at that section of the tail rudder. We told folks that the shuttle is covered by about 20,000 pieces of tiles, insulating tiles, to protect it from the heat of re-entry and blankets and all kinds of insulating material because it gets between 2,000 and 3,000 degrees in certain spots on its way in. If that is a piece of insulation that's exposing -- because it is not in what should be exposing a piece of aluminum or something, that would cause some concern, clearly, for mission control before they clear the space shuttle "Discovery" for entry. Way too early to say that though. It could just be a stray little piece that would cause no harm to the crew or the orbiter. We are watching it very closely.
COLLINS: OK, very good. Miles, before we let you go, what's the time of the landing? Hopefully they are going to be able to go ahead and land.
O'BRIEN: It is just after 11:00. I can't remember the exact time after 11:00 Eastern time tomorrow. I think it is 11:10.
COLLINS: I hope it is during our show so we can watch it. Thanks so much. We'll come back to you should you learn any more.
Thank you, Miles.
TONY HARRIS, CNN ANCHOR: A city submerged, the Midwest battered by more record floods and reeling from deadly tornadoes this morning. A huge section of downtown Cedar Rapids, Iowa, is under water right now. We will take you there live in just a couple of moments.
Also remembering four Boy Scouts killed when a tornado flattened their Iowa campus, picking up the pieces from tornadoes that killed at least two people in Kansas. Iowa's governor and Federal officials surveying the damage this hour. They are getting a first-hand look at the flooding and so is our Betty Nguyen. She joins us live from Cedar Rapids, Iowa.
Betty on Wednesday, we were so concerned about Cedar Falls and documenting the story of the people doing a terrific job of sandbagging and protecting the downtown. We see behind you the real tragedy is there in Cedar Rapids. BETTY NGUYEN, CNN CORRESPONDENT: Look at it. Talk about city submerged, just look at this neighborhood. We're 19 blocks away from downtown. That gives you an idea of how far this water has traveled and how high it has gotten. Take a look at where I'm standing. This ruler right here, this yardstick, it's about a foot of water. But that's not nearly what you see when you travel down that way. You can see street signs under water. I actually saw a couple of cars that had water up to their roofs.
In fact in this particular area, not only are homes flooded, but people are being taken out of their homes by boat. I want you to take a look at some video. We had the fire department that had to go out in the boat and carry a couple of guys, tow them in to safe ground just because this water has risen so fast. And as far as the water goes, it has crested.
At this moment, it is cresting and they are thinking that it is going to -- when they tally all of it, it's going to be around 32 feet. That's an epic proportion for this area. When you look back into the history books, aside from all this water you see right now, they have only gotten to 20 feet in the past. That was in the 1800s, did it again in 1929.
Over to my left, you know, despite all the water you see here, you can see a home just like this one where I can walk up to the steps. It looks like, you know, it's pretty much made it through the floodwaters. Oh, no. Take a look inside. We went in with the owner when he got a first-hand look at his basement. It was not something that anyone wants to see. You see this muddy and murky water floating inside this man's home and it is just one of many homes in this area.
Seven thousand homes and businesses had to be evacuated because of these floods. We are talking 19,000 people. On top of that, the local hospital, Mercy hospital, that had to be evacuated overnight because of the floodwaters. That was 176 patients. In all, Tony, despite all that you are seeing, no one was killed in this flood. So that's the good news here. But the bad news is that the 55 of the state's 99 counties have been declared disaster zones. The governor is touring it today. They are estimating a whopping $5 million in damage.
HARRIS: Those poor people. Betty, we are watching a picture now of a car submerged, essentially floating down the street. It is just amazing some of the video that we are seeing out of Cedar Rapids.
NGUYEN: Absolutely. Let me tell you something Tony. I heard on the radio coming in yesterday -- I want you to try to imagine this. They were reporting that in downtown Cedar Rapids, an 18-wheeler was floating through the streets, an 18-wheeler. So that takes not only a lot of water but a lot of current to make something like that happen. The folks here have a lot on their hands and waiting for this river to finish cresting so it can start to recede.
HARRIS: And Betty is in Cedar Rapids, Iowa, for us this morning. Appreciate it, thanks Betty. COLLINS: One of the good things might actually be the fact that they were able to declare a disaster because then it is possible of course to get the Federal aid money when we are looking at cleaning up which according to Reynolds Wolf, might be a few days because there could be more rain on the way.
(WEATHER REPORT)
COLLINS: Lots to talk about again today.
Thank you, Reynolds. Glad you are there.
HARRIS: The devastating toll of a deadly twister in Iowa painfully evident on these faces among 100 people gathered last night, a memorial vigil to honor four Boy Scouts. They were killed after a tornado tore through their camp in western Iowa Wednesday. The twister's 145-mile-per-hour winds destroyed a building where the scouts had taken shelter. Among those grieving at the vigil, parents whose children survived the ordeal.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: It could have easily been my kids. You do think of scouts as your family. They are all our kids.
(END VIDEO CLIP)
HARRIS: At least 12 people injured at the Boy Scout camp are still at the hospital.
COLLINS: Deciding the end game in Iraq. U.S. and Iraqi officials stalled over a long-term security agreement. Iraqi Prime Minister Nuri al Maliki says the first draft reached a deadlock. He says both sides are putting new ideas on the table that now Maliki's aides tell CNN the Iraqis are thinking about pulling out of the security talks and coming up with their own plan. That would have Iraq telling the U.S. how long American troops can stay in the country. Washington is trying to reach an agreement by the end of the month.
HARRIS: Murder on a country road. Two girls shot to death and now police say they may have a new lead. Police will give us the latest on the investigation.
(COMMERCIAL BREAK)
COLLINS: The battle in northern California, fierce flames. Several major wildfires are scorching thousands of acres and threatening homes. This fire in the town of Paradise (INAUDIBLE) nearly 30-square miles and destroyed at least 10 homes; 30,000 people live in the area. All of them ordered to evacuate and all roads leading into the town have now been closed.
About 900 firefighters are battling this blaze near Santa Cruz. About a thousand people have been told to get out. Right now the fire is just 25 percent contained. A third fire in Monterey County has charred 28-square miles.
HARRIS: Residents in Kansas are picking up the pieces today. They're cleaning up from a series of deadly tornadoes that ravaged much of the state Wednesday. Hardest hit was Chapman, a small town about 70 miles west of Topeka. The National Weather Service says the storm in Chapman was an EF-3 with winds of 150 miles per hour.
The twister killed one woman and damaged or destroyed 60 percent of the town and another man died when a twister slammed into the tiny town of Soldier. That is northwest of Topeka and the storm in Manhattan that damaged Kansas State University was an EF-4 with winds of listen to this, 170 miles per hour.
COLLINS: One of the twister's victim, Aaron Eyler. He was a relative new kid in town, moving to Iowa just three years ago, but that's all it took to leave a lasting impression in his hometown of Eagle Grove.
Here's Aaron Hampton from our affiliate KCCI.
(BEGIN VIDEOTAPE)
AARON HAMPTON, KCCI CORRESPONDENT (voice-over): Most main streets might have heroes.
UNIDENTIFIED FEMALE: He was all about everybody else but him. He just wanted to make people's lives better.
HAMPTON: But a 14-year-old.
UNIDENTIFIED FEMALE: He donates to the fire department, to the police department.
UNIDENTIFIED FEMALE: He was trying to write a cookbook.
UNIDENTIFIED MALE: He was never sitting down.
UNIDENTIFIED FEMALE: Food drive, whether it was starting collections at school.
HAMPTON: Folding napkins at the senior center. Three years ago a teenager moved to town from Nebraska. Aaron Eyler's impact started immediately.
UNIDENTIFIED MALE: Me and my brother tried to set up a tent. We had no idea how to do it. We were just about beating each other up and he gets over there and lifts it up in about two seconds.
UNIDENTIFIED FEMALE: Not your average 14-year-old kid.
UNIDENTIFIED FEMALE: This one is probably of my favorites with the fish.
HAMPTON: What other boy would put down a playstation to start sewing? Two years ago, Aaron called the local hospital.
UNIDENTIFIED FEMALE: His mom is like -- that's Aaron.
HAMPTON: Ever since, every Wright County kid who's scared of scary instruments rested their head on a pillowcase from Aaron.
UNIDENTIFIED FEMALE: He wanted them to feel like they were in a very safe place and that had something very cheery when they were experiencing an uncomfortable or possibly painful situation.
UNIDENTIFIED MALE: (INAUDIBLE) Come over. He's working on them.
UNIDENTIFIED FEMALE: This is a great one for a girl.
HAMPTON: He sewed pillow cases for every teacher in school and every firefighter on the force, paying for them himself.
UNIDENTIFIED FEMALE: He would sell me jams and jellies that he made with his mom during the summer.
HAMPTON: He was a boy who would do anything to help others. Even shield them from a storm.
UNIDENTIFIED FEMALE: I had goose bumps. I didn't even know how to respond.
UNIDENTIFIED MALE: Anybody you talk to just can't believe it.
UNIDENTIFIED FEMALE: I just can't believe it.
HAMPTON: Eagle Grove is hurting.
UNIDENTIFIED MALE: If they didn't know him personally they knew him for what he had done.
HAMPTON: Three years in town, 14 years on earth.
UNIDENTIFIED FEMALE: This kid truly was a difference maker.
UNIDENTIFIED MALE: He was just like perfect. He knew exactly what to do all the time.
(END VIDEOTAPE)
COLLINS: Such a tragedy. Iowa's governor is expected to talk about the tragedy later this morning. We are going to bring that to you live when it happens.
HARRIS: This has been an extremely deadly year for twisters. Forecasters say so far tornadoes have killed 118 people, 118, making it the deadliest year for twisters since 1998 when 132 people were killed. The only year worse than that, 1953 with 519 deaths.
If you would like more on this story, horrible story it is, just go to CNN.com.
(COMMERCIAL BREAK) COLLINS: Chances are you know your money is not going as far as it used to. Today some new measures on how much your dollar seems to be shrinking. First up, the inflation we are facing at the cash register, the government's measure at the retail level is called the consumer price index.. This morning, we learned it rose 0.6 percent last month. That's the biggest climb since November and more than most analysts expected. Higher energy prices are being blamed for that.
Also, new staggering increase in the number of Americans losing their homes. Bank repossessions booted 73,000 owners from their home just last month. That increase nothing short of breathtaking, a 158 percent spike from May of last year.
HARRIS: So how are the markets doing so far? Let's take to you New York, the New York Stock Exchange, Wall Street, the Dow up 145 points so far, a little bit off of session highs. At least we are talking about session highs so far this morning, the Nasdaq, a tech heavy, Nasdaq up 46 points. And just for our producer Sarah McDonald, the S&P, the S&P up 18 as well so a good start to the morning about an hour into the trading day. We will check the markets with Susan Lisovicz coming up in just a couple of minutes right here in the NEWSROOM.
COLLINS: If you plan to fly this summer, you might want to pack a few extra bucks not bags. United Airlines and US Airways have announced they too will start charging passengers for all checked luggage. American Airlines started the trend. Now all three charge $15 for the first bag. The price is higher for additional bags. Airlines are looking for ways to offset the soaring cost of fuel.
Here is another sign at the turbulent times. US Airways is doing away with free drinks we've all come to expect. That includes soda, coffee, bottled water and juice. Beginning in August, they'll cost coach passengers, that is very hard to say, cost coach passengers $2 each.
Your money, your questions. In this economy, you may need financial guidance more than ever.
CNN's personal finance editor Gerri Willis answers your e-mails.
(BEGIN VIDEOTAPE)
GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Today is Friday. That means it is time to dip into the mailbag.
Let's start with this one from Jurani who writes in from Washington, D.C.: "I recently received a paid raise. With every raise I contribute more money to my 401(k). With the market being so turbulent should I scale back on my contributions and invest in CDs?"
Congratulations Jurani on developing a great habit, putting extra income from a raise or a bonus automatically towards your retirement. It is a painless way to pad your nest egg. This way you won't miss the extra cash. Continue putting that money towards your retirement rather than in CDs. Granted, it is scary to watch the market's turbulence but you have to think long term. You can't think of short term fluctuations. Plus with interest rates so low, the rate of return you will get on the CD is pretty measly right now. A return on the five-year CD is less than 5 percent on average.
Our next question comes from Jeremy in Colorado. He writes: "My wife and I recently had our four-month-old daughter baptized. She received about $4,000 in cash. My question, how should I invest her money? I am looking to invest long term, maybe something for college."
Well Jeremy, putting that money in a 529 college savings plan is a great move. First, you get generous tax breaks and the money you put in grows tax deferred and the money you take out to pay for your daughter's college will come out Federally tax-free. Plus there may be tax breaks on the state side too. Now the money in the account also won't have much of an impact on your child's financial aid eligibility. That's good news.
To compare plans, check out savingforcollege.com. And of course, if you have any questions, send them to us at hottips@cnn.com.
(END VIDEOTAPE)
HARRIS: On your mark, get set, shop.
(BEGIN VIDEO CLIP)
JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Should we synchronize our lists?
TOM FOREMAN, CNN CORRESPONDENT: Yes, let's do it.
MCINTYRE: Milk, bread, cereal, meat, eggs, cheese, veggies, crackers.
ZAIN VERJEE, CNN STATE DEPARTMENT CORRESPONDENT: Soda, dessert and a prepared meal.
FOREMAN: Let's go.
(END VIDEO CLIP)
HARRIS: This is good stuff. Our intrepid reporters cover three angles to find the best food store value.
(COMMERCIAL BREAK)
HARRIS: A town submerged, thousands of people evacuated this morning in Cedar Rapids, Iowa. The city is swamped by record floods battering, just absolutely hammering the Midwest. Rescuers had to use boats to get some residents to safety. Nine Iowa rivers are at or above historic flood levels. The flooding even forced the evacuation of a hospital in Cedar Rapids. More than 170 patients had to be taken to other hospitals in the region. Flooding is also causing problems in parts of Illinois, Wisconsin, Minnesota, Michigan, and Missouri. COLLINS: Somebody we need to check in with, once again Reynolds Wolf standing by in front of all of those maps that are showing exactly what's going on across the country. A lot of people are saying, man, it has been days and days and days of weather stories. Whether we are talking fire, tornadoes, floods.
REYNOLDS WOLF, AMS METEOROLOGIST: Oh, absolutely.
One thing that's really frightening, is that we've been seeing all the rain and all the flooding that's in parts of Iowa. Today Iowa getting a break. But we are still expecting the water to rise a little bit, cresting around 31 feet -- 31 feet. The normal, or actually the record, make sure I say this correctly, just to give you an idea how extreme this is, the record flood level for the rivers that we have in Cedar Rapids right at 20 feet.
We are going up to 11 feet today -- 11 feet higher than that, so 31 feet will be your flood stage. Thing is, all this water has got to go somewhere, so it's going to find its way through the tributaries in spots like the Mississippi River, and then it's going to flow its way downstream. So water levels in some 200 spots along the Mississippi River are going to crest over the next couple of days. Looks like many of those places will crest as you get into Thursday of next week.
As it stands, we have more rain that continues to fall. Notice (ph), a lot of this, some of the heaviest forming just to the west of St. Louis. So places like Missouri, the water issues are just going to be mind-boggling there, too. We can anticipate more rainfall.
And in fact, the latest computer models that we have indicate that we can see anywhere from two to three, maybe as much as four inches of rainfall near the St. Louis area, in points northward, too, just to the west of Springfield and south of Davenport. Keep in mind, you have the Mississippi River right here. You've got these tributaries that feed into the river. So all of this water is going to pull its way into the Mississippi River and then past St. Louis. So you can expect water levels there to begin to rise up.
It's going to be something that's going to take not just a couple of days, but possibly a week or so to see all of the flow its way downstream. What we can anticipate is more of the same in the recent (INAUDIBLE) because as we have mentioned we have the omega block pattern, the omega effect where we have the big bridge right in the middle of the country, blocking high, over parts of the southeast where we're mired in an incredible drought. We're getting a deficit in the southeast, but an abundance of rainfall.
And more on the way as we make our way into late Saturday and Sunday, perhaps even into Monday, too. So we are looking at the potential of another three days of rainfall over places that are completely soaked by all of this moisture. We are not out of the woods by a long shot. It is certainly going to be a very harrowing thing to watch, especially over the next 12, 24, 48, 72 hours and on. We'll certainly keep a close eye on it for you.
COLLINS: That's awful. Don't want to hear that. All right, Reynolds. Thank you.
WOLF: You bet.
HARRIS: Whether it is fires, floods, or tornadoes, if you would like to help go to CNN.com, and impact your world. Add your name to the growing number of CNN viewers grabbing the opportunity to take some action here. Logon to CNN.com/impact.
COLLINS: Rural Oklahoma. Parents are scared; children are kept close, and police admit they are baffled. Who would have murdered two girls? Eleven-year-old Skyla Whitaker and her 13-year-old pal, Taylor Pascal-Placker were shot to death along a country road. Police say they may have a new lead.
Let's get the very latest now. Jessica Brown is with the Oklahoma State Bureau of Investigation.
Jessica, there may be a witness now?
JESSICA BROWN, OKLAHOMA STATE BUREAU OF INVESTIGATION: We do have a witness.
Early Thursday we can came across a man who believes, or who knows he saw the two girls walking down the dirt road only moments, we believe, before they were shot and killed. Now I can't get into more of what he saw, we're not identifying him, but his story does check out and we believe that it is going to be very helpful for us.
Also, we have come across some new leads since then. We are working very quickly on this, as quickly as we can.
COLLINS: Well of course. That's a huge, huge development if by chance someone could possibly have seen anything in all of this.
What about these other developments that you are talking about? Can you mention any of those to us?
BROWN: I cannot get specific with you.
But since this tragedy happened, we have gotten a lot of leads. We've put even more of our agents on it so we can run the leads more quickly. And yesterday we had our crime scene agents, several of those, at the scene again, the scene of the crime, to measure things, look at trajectories, see if there is anything we missed, to have new eyes on it. We also went in a helicopter above to get a different view of that crime scene, just to get a different perspective.
Also, we do believe -- we do know, actually, there were two different caliber weapons used here which we seem to believe that that might mean two people.
COLLINS: Yes. We had been reporting a little bit on that yesterday. At this thing seems to develop, as they usually do, once you get the investigators out on the scene.
About that crime scene, though, and this area in general, we have heard quite a few reports this is a common hangout for teenagers.
BROWN: It is a common hangout for teenagers.
However, it is quite isolated. Unless you live in that area or are familiar with that area you wouldn't know how to get there. That's why we believe that someone who is a local or from that area and that's how they got there, and so they are still in the community. That's why we have been interviewing a lot of people in that community, probably more than 75, perhaps 100 by now. That's why we are getting more and more information in.
A reward is going out. That is up to more than $30,000 now for information leading to the arrest and conviction.
COLLINS: OK. Yes, because I believe it started off at $14,000. So that's quite a boost there. Hopefully that will motivate even more people to call in if they know anything about what could have happened to the two young girls.
You mentioned the suspects and the possibility of there being two. Is that how many you are looking for? And if so, any type of profile that you can talk about yet? Other than them being local.
BROWN: We don't have a profile.
Well, we believe they are local.
COLLINS: Right.
BROWN: Probably young people driving in that area. We don't really have much more. Again, we are getting good leads in. We can't give you as much as I would like to give you right now. But it is very hopeful. And this is a solvable case. We just want to get it solved very quickly, of course.
COLLINS: Of course, that's very good news.
The big question, though -- I have to ask you, you have been in this business for a while, you have seen some, I'm sure, pretty horrible things.
What type of motivation could there possibly be to murder these two young girls?
BROWN: That's a good question. We really don't know.
Any number of things we are looking at. Did these two girls happen upon another crime scene? Did they see something they shouldn't have? Is this just a thrill kill?
We do not know. If we had a motive it might be easier to solve this case. But right now we do not know.
COLLINS: Well, I'm sure it is frustrating on your part and we, of course, are thinking of the families in all of this as well. It is such a terrible story. Jessica Brown with the Oklahoma State Bureau of Investigation, we appreciate your time.
BROWN: Thank you.
COLLINS: Investigators are asking the public to come forward with any information on the killings. You may have heard her mention it, the Oklahoma State Bureau of Investigation offering -- I believe that number has gone up actually.
Did she not say $40,000, guys, $40,000 reward?
We're going to double-check that, because it was $14,000 and then raised to $25,000. So we're going to follow that for you.
And we want to also -- pardon me, I'm hearing that that number has gone up to a $30,000 reward.
The hotline has also been set up. You see that number in front of you -- 800-522-8017.
HARRIS: A suburban Atlanta family is in a hospital this morning after a daring home invasion, and a lifesaving escape.
Listen to this story. It happened Wednesday in DeKalb County. Police say a woman and her children were taken hostage and tied up by two gunmen. The woman was pistol-whipped and bleeding from the face. She was forced to call her husband saying she was sick and that he needed to come home. He did. But just as the gunmen were about to force him the withdraw $100,000 from the bank, she escaped. Still tied to a chair, she managed to flag down a motorist.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: She was duct taped to a chair with handcuffs on. She was bloody, like somebody had beat her up.
UNIDENTIFIED MALE: She was telling us that her kids were in there. They said they are going to kill the kids.
UNIDENTIFIED FEMALE: Oh, my God. When I saw the kids come out and were OK, I was so happy for her. I was so happy for her because she was just hysterical.
(END VIDEO CLIP)
HARRIS: Wow. Police believe the gunmen may have known the husband. They are looking for a white SUV that may have been used in the home invasion.
What a story.
COLLINS: They were supposed to go to victims of Hurricane Katrina. But tens of millions of dollars of brand-new household items ended up going somewhere else. CNN investigates.
(COMMERCIAL BREAK)
COLLINS: Just about everyone remembers the horror that followed Hurricane Katrina. But did you know $85 million in common household items that could have gone to some victims never made it there?
Abbie Boudreau of CNN's Special Investigations Unit has more on this exclusive report.
(BEGIN VIDEOTAPE)
ABBIE BOUDREAU, CNN SPECIAL INVESTIGATIONS UNIT CORRESPONDENT: Warehouses full of plates, cups and dinnerware, brand-new coffeemakers, stoves, cleaning supplies -- $85 million worth of brand- new household items, $85 million. And your tax dollars paid for most of it. The federal government stockpiled the warehouses to help Hurricane Katrina victims.
DEBRA REED, KATRINA VICTIM: It is unreal. We haven't received none of this. I know I haven't.
BOUDREAU: CNN learned that Debra Reed and others who are still struggling and never received any of this, and now they never will. Instead, we discovered for the last two years FEMA did nothing. It just kept these items in storage. And then it gave it all away to other federal and state agencies for free.
REED: I fought, I fought to get my money. But they wouldn't give it to me. So, I ended up going under the bridge.
BOUDREAU: With nothing, she moved to a tent city.
REED: That little bitty tent right there. That's my tent.
BOUDREAU (on camera): This one right there?
REED: Yes, the little bitty one.
BOUDREAU (voice-over: Like hundreds of others after the storm, Reed was homeless. She lived here until a rehousing group called Unity of Greater New Orleans helped her find a home.
But it is still nearly empty. She can't afford to buy even modest items.
MARTHA KEGEL, EXECUTIVE DIRECTOR, UNITY: FEMA, in fact, refers homeless clients to us on a regular basis and asks us to house them.
How can we house them if we don't have basic supplies?
BOUDREAU: In fact, Martha Kegel says FEMA never told her that it had tens of millions of dollars worth of brand-new supplies meant for Katrina victims. She says FEMA was told in regular meetings the group was desperate for supplies and that now she's forced to beg for donations for those still in need.
KEGEL: It has been hard to find these kinds of donations. BOUDREAU (on camera): And this warehouse, if you call it a warehouse, is nothing like the FEMA warehouse where everything was completely brand-new, items stacked to the ceiling in some cases. This warehouse is really just full of mostly used items and it is in the back of an abandoned church.
(voice-over): So what happened?
FEMA tells CNN it did distribute household starter kits to 140,000 families. As for the rest of the warehouses, and the $85 million of relief supplies, it says the need wasn't there anymore. And since it was paying more than $1 million a year to store them, it decided to give them away as government surplus.
KEGEL: Seems to me that FEMA is acting like this crisis is over, that it has been over. It is not over.
BOUDREAU: First, FEMA offered the household items to federal agencies -- prisons, the post office, the border patrol and elsewhere. Next, the items were offered to all states. But for some reason, Louisiana said no thanks. It took absolutely nothing. Hard to believe, but a state official tells us they were unaware that Katrina victims still had a need for the household supplies.
In all, the government says it gave away 121 truckloads from the warehouses.
(on camera): FEMA turned down our request for an on-camera interview saying the surplus property was,"not news."
KEGEL: This stuff is really -- really is beautiful stuff.
BOUDREAU (voice-over): Yet, those who spend every day still helping victims of Katrina are stunned.
KEGEL: Just makes me sad to look at this.
Is there any way we can still get this stuff? Is it all gone now?
It is all gone.
BOUDREAU (on camera): It's all gone.
(voice-over): Abbie Boudreau, CNN, New Orleans.
(END VIDEOTAPE)
HARRIS: More pain for your wallet. New numbers released this morning show the cost of living jumped last month. Oh, boy. Susan Lisovicz is on the floor of the New York Stock Exchange with a look at how much prices are going up. And where our money is going.
You know, Susan, the Fed chief Ben Bernanke seemingly, since the day he took the job, has been concerned about inflation.
And now there's evidence, isn't there?
(STOCK MARKET REPORT)
COLLINS: John Klein (ph) is on the phone. He says no.
HARRIS: No, not happening.
COLLINS: OK. So food is, obviously, eating up some of your budget. But people will now pay $15 for a cup of coffee. Really?
In Vancouver, Washington, it's not your average cup of joe.
Boy, it must be really good.
Customers are gulping Panama Esmeralda (ph) special reserve. A rare brew billed as the world's best coffee, and they say it is worth it.
(BEGIN VIDEO CLIP)
GAYLE ROTHROCK, COFFEE LOVER: This one has a sort of a tropical fruit thing that is coming through there. Notes of pineapple and a little bit of mango.
MELISSA LAYMAN, COFFEE SHOP OWNER: You spend a lot of money on a four-ounce glass of wine and you're getting an eight ounce cup of coffee. So -- and you can drive legally.
(END VIDEO CLIP)
HARRIS: Yes.
COLLINS: Once hooked, there is takeout, too. A half pound will set you back $100.
HARRIS: Oh my goodness.
Shopping for answers. What's the best way to stretch your grocery budget?
(BEGIN VIDEO CLIP)
MCINTYRE: Milk, bread, cereal, meat, eggs, cheese, veggies.
(END VIDEO CLIP)
HARRIS: Three reporters a mission. Their findings in the NEWSROOM.
(COMMERCIAL BREAK)
COLLINS: With gas prices hitting record highs, many of us are looking for other places to cut back including the electric bill. You may be surprised what's running up your bill.
CNNMoney.com's Poppy Harlow, has our energy fix from New York. Hi, there Poppy.
POPPY HARLOW, CNNMONEY.COM: Hi there, Heidi.
Yes, I don't know if I can do anything about gas prices. But we can help you with your electricity bill. I have a pop quiz for you today, Heidi.
COLLINS: A pop quiz from Poppy. Get it? I couldn't resist.
HARLOW: Pun very intended, there.
What uses more electricity? A refrigerator or Playstation, when you leave it on?
COLLINS: Well, I'm going to tell my 7-year-old, definitely the Playstation.
HARLOW: You're exactly right. It sounds like a no-brainer. You think of the fridge, it's not. It's really not even close. According to a study by the Australian Consumer web site, it is the Playstation by far. In fact, if you left the play station on year round it would use five times the energy of a medium-sized refrigerator.
COLLINS: Wow.
HARLOW: Hard to believe given the size difference, I know. The site says the Xbox 360, that's not far behind. It uses nearly as much energy as the Playstation, Heidi. So turn those video games off.
COLLINS: Yes, this is so great. Because now I have more ammunition so that he doesn't get to play it 24 hours a day. But you're not really saying don't use the Playstation, are you? You're just saying don't leave it on.
HARLOW: Yes, I don't think Sony would like that. And we're not saying that, we're not recommending that. It's just a good idea not to have it on when you're not playing it, or when your kids aren't playing.
Troy (ph) says, that could save you about $250 a year on your electric bill. That's real money. That's enough to pay for more than 60 gallons of gas right now.
COLLINS: Oh!
HARLOW: Yes, it's a lot.
And some other tips. Leave your electrical equipment such as your computer, your DVD player in standby or in sleep mode. Better yet, unplug them or turn them off altogether whenever you're not using them. You can activate the power saving mode on your computer or you can go as far as upgrading your computer monitor to an LCD monitor. That's a flat screen. And it's twice as efficient as the old, clunky monitors. By the way, Troy says that apple's iMac, that uses just two-thirds the energy of a normal PC. COLLINS: That's why I have one of those.
You mentioned the flat-screen computer monitors, though. What about flat-screen TVs?
HARLOW: I know, you'd think it would be the same there, but it's really not. Troy says, flat-screen TVs are real energy hogs. They may look nice but they cost a lot to run. Plasma TVs use four times the energy of the old tube style TV. The cost of running a plasma, more than $230 a year, versus about $50 a year for the older TVs. Again, the message is when you're at work, when you're out at night, just turn it off when you're not using it. I know people like to leave them on for their dog and stuff like that. Don't do that. It will cost you a lot of money.
So, it's an energy fix for you, it saves you money, it's good for the environment.
COLLINS: We never do that. Oh, that's funny.
All right, well, Poppy Harlow, we appreciate it. A reminder there. Turn all your stuff off.
Thanks, Poppy.
HARLOW: Sure.
HARRIS: How much longer will American troops remain in Iraq? U.S. and Iraqi officials having problems in reaching an agreement.
(COMMERCIAL BREAK)
HARRIS: How you shop can make a big difference in what you pay. We challenge our intrepid trio reporters Zain Verjee, Jamie McIntyre and Tom Foreman.
(BEGIN VIDEOTAPE)
FOREMAN: If you have been to the grocery store lately, you know pretty much getting groceries involves taking out a loan. So I'm going to go to my local store and do the best I can to get a bang for my buck.
VERJEE: I'm going to be going to Whole Foods and look for the healthy organic stuff.
MCINTYRE: And I'm going to try to save the American way by buying big in bulk at my neighborhood warehouse store. Should we synchronize our lists?
FOREMAN: Yes, let's do it.
MCINTYRE: Milk, bread, cereal, meat, eggs, cheese, veggies, crackers.
VERJEE: Soda, dessert, and a prepared meal. FOREMAN: Let's go.
MCINTYRE: We're here at Costco. It's a warehouse store, and we're going to save a lot of money, milk, $3.09 a gallon. That's cheaper than gasoline, 2 percent for $3.79.
VERJEE: Some skim milk. This costs me $3.89.
MCINTYRE: Two packages of 18, still $3.99, pretty good deal.
VERJEE: Twelve eggs, $3.89.
FOREMAN: Medium eggs here for $1.89.
VERJEE: Could I try the oldest cheese you have here?
MCINTYRE: The average grocery store you buy cheese if you want to make something, here you buy cheese if you want to build something out of cheese.
VERJEE: $29.99 a pound?
FOREMAN: Look at all these cheeses.
VERJEE: Who can resist trying the aloe vera face and body lotion?
MCINTYRE: What are these?
Spinach and feta cheese. Mad Croc energy drink. Sounds good.
One great thing about these stores is they have some great specialty items like this white chocolate Pentagon, the beat I cover. Zain and Tom will find nothing like this.
FOREMAN: And so we're all finished. How did you do?
MCINTYRE: Costco is a marvel, but I got some great deals but I had to buy more than I wanted of some things. But a sort of limited selection compared to what I had here. I got sort of all-American shopping here. Good buys on a variety of items.
VEJEE: You got bulk, you got variety, but I got the most healthy foods.
FOREMAN: What did you spend overall?
MCINTYRE: $95.24.
FOREMAN: Not bad, $64.38.
VERJEE: $80.09, pretty comparable.
MCINTYRE: So I paid the most but I got the Belgian chocolate Pentagon. Can't go wrong with that.
FOREMAN: Let's eat. (END VIDEOTAPE)
