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American Morning
FEMA Waste of Supplies for Katrina Victims; Paris: The Next Stop on Bush's European Farewell Tour; Future of American Troops in Iraq Being Discussed; Airlines Hiking Fees on Tickets Again
Aired June 13, 2008 - 08:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ROBERT GIBBS, OBAMA CAMPAIGN COMMUNICATIONS DIRECTOR: I don't think there's any doubt that this party, the Democratic Party will be united. It's going to come together because John McCain's policies are the same tired, worn out ideas of George Bush that we've tried over and over again. And we see the result, you know.
We've got record jumps in the unemployment rate. We've got millions of people without health care, millions, millions more watching their premiums skyrocket. The same old worn out tired ideas haven't worked for eight years, they won't work in the next four.
JOHN ROBERTS, CNN ANCHOR: There's one other problem that John Brody, who appears in this program from time to time from the Christian Broadcast Network pointed out. Senator Obama is pushing age-appropriate sex education as early as kindergarten.
Brody talks about some Republican polling that shows that that makes evangelical voters who you are trying to target with things like your Joshua Generation Project, a little skittish. I mean, is kindergarten too early to start sex education?
GIBBS: Well, let's be honest here, John. You guys should do a little bit better research here on CNN in the mornings. But let me tell you what age appropriate is. I don't know if you have children, John. I have a soon to be 5-year-old, right? And what you're talking about is teaching them what is inappropriate for somebody to do to them. What is inappropriate for an adult to ask them to do?
They're not teaching them sex education. They're teaching them the warning signs of somebody that might want to harm them. I don't know about you, John. I don't know if you have kids. I'm fully comfortable making sure my 5-year-old knows what is inappropriate for an adult to try to do (INAUDIBLE).
ROBERTS: So are you saying then that this CBN report is just totally way off base here?
GIBBS: No, no, I'm not what maligning David Brody's report, I'm maligning the fact that what the polling suggests and what the polling is asking is something markedly different.
The polling would have you believe that somehow my 5-year-old is learning about sex education. That's not what this does. My 5-year- old would be learning about what is inappropriate for an adult to try to ask him or her to do. And I think -- I got to tell you, John, as a parent, I think that's definitely appropriate. I don't want something happening to my son. And I don't think people would want that to happen to their children, either.
ROBERTS: Robert Gibbs, communication director from the Obama campaign.
Thanks for being on this morning. Appreciate it. Good to see you.
GIBBS: Thanks, John.
KYRA PHILLIPS, CNN ANCHOR: Top of the hour right now. And here's some of the stories that we're following. Paris is the next stop on President Bush's European farewell tour. He's expected to arrive there within the hour. The president and first lady received a warm welcome from Pope Benedict XVI at the Vatican this morning.
And breaking news just coming in to AMERICAN MORNING. The future of American troops in Iraq being discussed right now. The U.S. and Iraq apparently in deep discussions about a very sensitive negotiation process aimed at charting the course of the security mission, but the deadline is rapidly approaching. We're going to be talking more about that.
CNN is in Baghdad this morning. And our Michael Ware is watching the developments right now.
Michael, tell us about the developments.
MICHAEL WARE, CNN INTERNATIONAL CORRESPONDENT: OK, Kyra. Essentially the U.S. mission at Iraq is yet another make or break moment. What's happening right now is that the United Nations authority for the U.S. troops to be here is running out. Its clock is ticking down to the end of the year. So Washington is trying to broker an agreement with Baghdad to regulate the presence of U.S. Forces. Now, these are those negotiations.
There's been some dramatic developments this week. Some of which we'll tell you about exclusively right now. First of all, we had the Iraqi Prime Minister visiting neighboring Amman. This morning saying the negotiations are in deadlock.
He then quickly pulled that back a little bit to say -- well, the negotiations over America's first draft of the agreement are in deadlock. Yet, we can tell you now that yesterday we interviewed one of the senior aides to the prime minister. And he said that just this week, America, in fact, delivered a second draft of the agreement. And he said that in principle, nothing has changed from the first draft and it's going to be rejected as well.
So it seems to confirm the prime minister's initial, perhaps more truthful statement that the negotiations over this critical arrangement for America have been stalled and are in deadlock. What we can also tell you is that there's another option.
The Iraqis may go it alone. The Iraqis are saying that they can go and create their own laws and they will dictate to America under what terms your troops will remain here. This could determine the fate of the U.S. mission in Iraq.
PHILLIPS: All right. We apologize for that. We just lost Michael Ware out of Baghdad. But pretty interesting developments right now, talking about this Iraq-U.S. security plan. You know there's been huge debate right now about whether troops should stay in Iraq. How long troops will stay in Iraq. It's one of the main discussion points among all the presidential candidates right now.
Michael Ware coming in to us, bringing this developing news that Nuri al-Maliki, the prime minister of Iraq, saying that a long-term security pact right now has reached a dead end. So what exactly does that mean and is this a decision that can be made before a new president is elected in the United States?
One of the most volatile issues, of course, on the plate, on the campaign trail right now. We'll try and get Michael back to talk about this more. But at this point, getting word out of Iraq of this long-term security pact in Iraq reaching a dead end. Negotiations of course still continue.
ROBERTS: You're watching the "Most News in the Morning." How do people around the world feel about the U.S. and the candidates in the upcoming presidential election? We've got the results of a new survey, just ahead.
PHILLIPS: And everyone wants to pay less for gas. The presidential candidates are saying -- hey, they can help you save money. But are their policies just talk or will you really see the action? We'll take a look.
ROBERTS: And calling the 2008 election today? We'll talk to baseball's ultimate stat guy who is now crunching numbers for a race that will take place a few days after the World Series.
PHILLIPS: And they're supposed to go to the victims of Hurricane Katrina. But tens of millions of dollars of brand new household items ended up going to waste. CNN investigates.
ROBERTS: And that new shower curtain smell may be dangerous. The latest warnings about chemicals in another everyday household item. You are watching the "Most News in the Morning."
(COMMERCIAL BREAK)
ROBERTS: Welcome back to the "Most News in the Morning." The war in Iraq has hurt the way people around the world feel about the United States. But America's image is on the rebound with many people hoping the presidential election will bring change.
Our Jill Dougherty has that story for us this morning -- Jill.
(BEGIN VIDEOTAPE)
JILL DOUGHERTY, CNN CORRESPONDENT (on camera): John and Kyra, would you believe that at least in one country, more people are following the U.S. presidential election than Americans are? A new survey shows enormous interest internationally in who will be the next U.S. president and there's more news on the U.S. image abroad.
(voice-over): The United States' image around the world is still reeling from the Iraq War. But the new Pew Global Attitude Survey conducted in 24 countries has some encouraging news for the U.S. Since last year, favorable views of the United States are up significantly in ten of those countries.
Citizens in most of the Muslim world still are overwhelmingly negative about the U.S. Another headline, in many countries people are fascinate with the U.S. presidential election.
ANDREW KOHUT, PEW RESEARCH CENTER: But the poll found many people in the survey, majorities in some countries saying that they've been paying close attention to the American election. In fact, in Japan we had 83 percent of the people we polled saying that they were following the election news very or fairly closely, which compares to 80 percent in the United States. It's just unbelievable.
DOUGHERTY: In fact, in half of the countries surveyed, at least 40 percent of the people said they were following the U.S. election. In nine of the countries, more than half of the people felt the next U.S. president will bring change for the better in America's foreign policy.
The survey interviewed 25,000 people. And in nearly every country surveyed, Barack Obama was the candidate of choice. More people expressed confidence in him than in John McCain. The survey has one warning sign for the U.S., in 18 of the 24 countries, people said their own country's economy is bad and they blame the U.S. for its strong negative influence.
(on camera): The survey indicates there's a connection between the slight improvement in America's image and interest in the election. People are more positive because they think a new U.S. president means change -- Kyra, John.
(END VIDEOTAPE)
PHILLIPS: Jill Dougherty, thank you so much.
Well, airlines hiking fees on tickets again. They're citing sky high oil prices.
But Ali Velshi, we have a new means of transportation, don't we?
ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: Yes, I got pictures of them. This is how we're going to go. No more commercial aircraft.
PHILLIPS: We have our own personal AMERICAN MORNING F-18 squadron that has decided to take us around.
VELSHI: If you look really closely, you can actually see Kyra in these, right, Kyra?
PHILLIPS: That's right. I'm the whiz-o in the backseat.
VELSHI: That's right. Let's see. So, that's how we're going to fly. We're going to fly that way because it's going to get too expensive to do this.
ROBERTS: Yes, that's a pretty fuel-efficient way to get around. Is that --
PHILLIPS: Flight 103.
VELSHI: I'm not the only guy who can wear a military cap and look like a complete -- let's forget that, actually.
PHILLIPS: And you know who's the new squadron is? The new squadron is Jolly Rogers. How do you like that?
PHILLIPS: It fits you perfectly.
VELSHI: Let me tell you, I need a mascot. Let's talk a little bit about airfares. You've got another airfare increase. This will be the 19th time that the major airlines have tried it this year. And it will unfortunately be the 13th time that it has succeeded, meaning they've all matched it and they're keeping it.
So, $20 fuel surcharge now on domestic flights on American, Delta, Continental, Northwest, United, and U.S. Airways. Also, United and U.S. Airways are joining up with American and they are charging for the first bag that you check in domestic travel if you're not a sort of a fantastic member of their frequent flier program.
So, you're now going to be paying extra for the first bag. You'll be paying $15 for the first bag. All those other airlines I mentioned already now charge you in domestic for the second bag -- American, Delta, Continental, Northwest, United, and U.S. Airways.
That's just not going to be fun. I just think this is a bad plan because people are going to be stuffing stuff into their clothes and it's going to take a long time and the carry-on is going to take a long time to get through security. Generally, not a good plan.
So, that's the story we've got. I like the suggestion, though, of flying on fantastic jets.
ROBERTS: It's a wonderful thing but I don't think it's very green.
PHILLIPS: Oh, and not only that, I don't know how safe it is when your emblem is a skull and cross bones. Hi, I'm your pilot.
ROBERTS: And if you have to wear that hat to get on it. I don't know about it.
VELSHI: I got to tell you -- you know, hats are really hit and miss with me. You know, sometimes they work and sometimes they -- ROBERTS: A lot of miss with that one.
VELSHI: That's a lot of miss with that, yes.
ROBERTS: Thanks, Ali.
From the gas tax to tax in the profits of oil companies. The candidates are hoping that their proposal to save you money at the pump will give them a political advantage.
PHILLIPS: Also, much of the Midwest flooded and more rain on the way. We're going to get the latest forecast from Rob Marciano.
Coming up on AMERICAN MORNING -- stuck on a shelf.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: (INAUDIBLE), I didn't get nothing.
(END VIDEO CLIP)
PHILLIPS: Bought with your money to help victims of hurricane Katrina. Millions of dollars worth of supplies wasted in a warehouse.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: These are exactly the items that we are desperately seeking donations of.
(END VIDEO CLIP)
PHILLIPS: Why it sat in stockpiles when it could have been put to use.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Is there any way we can still get this stuff? Is it all gone?
(END VIDEO CLIP)
PHILLIPS: The unbelievable story of where it is now. You're watching the "Most news in the Morning."
(COMMERCIAL BREAK)
PHILLIPS: And welcome back to the "Most News in the Morning." Devastative flooding in Cedar Rapids, Iowa. A huge section of that city under water. Thousands of homes evacuated and more storms are in today's forecast for this exact area.
Rob Marciano is following the extreme weather for us live in Aspen this morning.
Hi, Rob.
ROB MARCIANO, CNN METEOROLOGIST: Good morning, Kyra.
I want to get you right to some breaking news out of Lawrence County, Illinois. The Lavish (ph) River -- authorities there are saying that there may be a levee that may fail later on this morning. Hasn't failed yet but may fail later on this morning.
And then you've got Iowa and Cedar Rapids. Boy, this new video coming in. And they are just into it. And this is not going to go down any time too soon. So unfortunately for those folks, the water is high. Fortunately for Iowa, they're not expecting much in the way of rainfall today or tomorrow. It has shifted a little bit farther down to the south.
I just want to pop up a Google earth and show you some of the river gauges which highlight moderate to major flooding. But also, on top of that, some of the tornado reports that we saw yesterday, 22 in all, ranging from northeastern Kansas across the Mississippi River, across some of the areas, as you can see there in the purple.
Those are major flood river stages. And that's where some of the tornado reports happened yesterday. We do have rain on the radar scope this morning. Tornado watches and warnings have been allowed to expire for the most part. But more showers and thunderstorms for Missouri in through parts of central Illinois.
And most of the action has been across north of Tulsa into southwestern Missouri and a slight risk for severe weather will push off to the east today. And there you see the 48-hour forecast foreseeing rainfall.
There was a worry foreseeing flooding here in Colorado Rockies after double the snow pack they usually see here. But it's been so cold. It's like 27 degrees here this morning. It's been so cold that most of that snow has been locked up in the mountains and hopefully it will come down nice and easy as we go through summer. Hard to believe we're in the middle of June.
Kyra, back up to you.
PHILLIPS: All right. Rob Marciano, thanks so much -- John.
ROBERTS: Seventeen minutes after the hour. You're watching the "Most News in the Morning." A stockpile of government wastes. You won't believe what happened to truckloads of brand new household items that were intended to help hurricane victims from Katrina. It's a CNN special investigation ahead.
Major League Baseball teams make multi-million dollar decisions based on this fellow's projections. Meet a stat master who says he thinks he knows which candidate is going to win in November.
Coming up on AMERICAN MORNING -- talking the talk.
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R), PRESUMPTIVE PRESIDENTIAL NOMINEE: Americans a little relief from the gas tax.
(END VIDEO CLIP)
ROBERTS: But can they walk the walk?
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: If he can't get a bill passed out of the Senate, why should people believe that, as president, he'll be able to get anything done?
(END VIDEO CLIP)
ROBERTS: Carol Costello looks at the things candidates say to win your vote.
(BEGIN VIDEO CLIP)
MCCAIN: If you want to call it a gimmick, fine.
(END VIDEO CLIP)
ROBERTS: You're watching the "Most News in the Morning."
(COMMERCIAL BREAK)
ROBERTS: Gasoline prices hitting a new high overnight. And Barack Obama and John McCain both say they have a plan to ease your pain at the pump.
PHILLIPS: But can they really do anything about gas prices or is it just all talk?
Here's CNN's Carol Costello.
(BEGIN VIDEOTAPE)
CAROL COSTELLO, CNN CORRESPONDENT (voice-over): They were talking the talk again.
MCCAIN: Give Americans a little relief from the gas tax.
COSTELLO: Ah, the gas tax holiday -- a summer-long suspension of the federal gas tax, a plan that might save you on average 18 cents a gallon.
MCCAIN: If you want to call it a gimmick, fine. You know, the economists, they're the same ones that didn't predict this housing crisis we're in.
COSTELLO: But what critics call a gimmick is having a tough time of it is a Senate committee. Yes, the Senate, right now.
Months ago back in April when McCain's idea was born, he introduced Senate Bill 2890 to provide for a fuel tax holiday. Today, as that old Schoolhouse Rock song describes it -- I'm just a bill. Yes, I'm only a bill and I'm sitting here on Capitol Hill.
COSTELLO: And analysts say that its sitting only proves that it's a gimmick. After all, they say, John McCain is a presidential candidate. There are 49 Republican senators and the support of independent Joe Lieberman on this issue.
PROF. LARRY SABATO, UNIVERSITY OF VIRGINIA: The question arises, if he can't get a bill passed out of the Senate while he's a presidential candidate and his colleagues have lots of incentive to help him, why should people believe that as president he'll be able to get anything done?
COSTELLO: Sabato throws the same dart as Senator Barack Obama. He's for a windfall profit tax on oil companies. A few days ago an energy bill, that included a 25 percent tax on an unreasonable oil company profit, died in the Senate, even though Obama expressed support for the measure.
SABATO: The truth is that presidential candidates always try to get the voters to believe that if they will only elect them president, all of their problems will be eased or even disappear. If only it were that easy. It's not.
COSTELLO: But politicians seem to believe neither candidate is giving up on their ideas.
MCCAIN: Is there anybody here who would like to have that relief from their gas tax? Yes, thank you. Most Americans want that.
COSTELLO (on camera): You can argue once you become president you'd have more clout. But cash-strapped Americans are frustrated by the stalemate in Congress and they're looking for a sign that someone can reach across the aisle and get something done -- John, Kyra.
(END VIDEOTAPE)
ROBERTS: Carol Costello for us this morning.
Thanks, Carol.
PHILLIPS: And where to shop and drop the least cash. We sent out the belt wave team to find the best deals and the best tips to get around sticker shock. You won't want to miss it.
Coming up on AMERICAN MORNING -- wasted in a warehouse.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: These are exactly the items that we are desperately seeking donations of.
(END VIDEO CLIP)
PHILLIPS: Plates, cups, coffee makers, stoves. $85 million worth of supplies -- all meant to help victims of hurricane Katrina, all sitting on a shelf. (BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: It's unreal because we haven't received none of this.
(END VIDEO CLIP)
PHILLIPS: Why your money went to waste while people waited. You're watching the "Most News in the Morning."
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
JAY LENO, HOST, "THE TONIGHT SHOW WITH JAY LENO": And "The New York Times" reporting that Clinton associates are keeping an enemies list -- an enemies list of all the people who are considered Clinton traitors. And ironically, both Bill and Hillary are on each other's list.
(END VIDEO CLIP)
ROBERTS: Some late night laughs there for you. It looks like they haven't packed away all of the Clinton jokes. Sadly, not yet.
Baseball statistics star is now in the business of predicting politics.
PHILLIPS: Nate Silver founded the Web site FiveThirtyEight.com named after the number of votes in the Electoral College and he's crunched the numbers all through primary season and is now looking ahead to November.
Nate, tell us why you went from baseball predictions to politics.
NATE SILVER, FOUNDER, FIVETHIRTYEIGHT.COM: Well, you know, I've always been a political junkie. I kind of had the Mike Dukakis coloring book, I think, back in 1988. And, you know, with there being so many numbers in politics but maybe people using them the wrong way, kind of looking at the wrong poll or paying too much attention really to maybe one number -- maybe telling a narrative that isn't quite true.
I thought it was, you know, time to look at the sport of politics instead of baseball (INAUDIBLE).
ROBERTS: So, Nate, we're standing here at the magic wall, which, of course, is the knower of all things political here. And we programmed the swing states here to reflect what you believe might haven't -- typically, the conventional wisdom is, it's anywhere between 13 and 15 swing states.
You brought it down to four and let's highlight those now. Those are Iowa, Michigan, Ohio, Pennsylvania, and then also New Hampshire here. So, it's a total of five. What do you think is going to happen in these states based on your analysis? SILVER: Well, if you start out with Iowa and New Hampshire, those are the two states that are most likely to change sides, I think, from 2004.
ROBERTS: So, we'll take Iowa, we'll make that blue. We'll take New Hampshire, we'll make that red. Go ahead.
SILVER: Sure. You know, I mean, Iowa is a state where Barack Obama ran very strong in the primaries; John McCain's on the wrong side of ethanol. It's just some local issues there.
In New Hampshire, remember, John Kerry in 2004 barely won New Hampshire. He was a candidate from right next door in Massachusetts. So, that state's not quite as strong for a Midwestern candidate as, you know, say Iowa might be. So, those two states might flip.
ROBERTS: OK. So, let me get -- we got Michigan, Ohio, Pennsylvania. How will those go?
SILVER: Well, good question. To me, I think Pennsylvania is the strongest Democratic state. I think when you see these Hillary supporters start to consolidate behind Obama, we've seen it happen in some polls already. I think you will see --
PHILLIPS: Is that the key voting bloc?
SILVER: I think it is the key voting bloc in the entire election, yes, because Democrats have such an edge as far as partisan identification. You have about four Democrats for every three Republicans. If the Hillary supporters get behind Obama, it's very tough for John McCain. If they turn their base out and get Hillary supporters, then he's kind of running from behind.
ROBERTS: OK. What about Michigan? John McCain currently pulling ahead of Barack Obama. What do you think is going to happen there?
SILVER: Yes, Michigan, you have the special factor. The fact that Obama didn't have a campaign organization in Michigan during the primaries. And a lot of voters there were upset that their, you know, state's votes maybe weren't counted the same way as other states. So, Obama does have maybe a two or three-point gap to make Michigan. And that's something --
ROBERTS: But you think that will stay blue?
SILVER: If you have the election now, I mean, it was one poll from (INAUDIBLE) and other states, say Michigan is gone blue by a couple of points. But it is John McCain's opportunity to play offense.
ROBERTS: And then what about Ohio?
SILVER: Ohio, I mean, the whole election, I think, just like you had kind of Florida in 2000. I think it's going to be Ohio in 2008. It's going to come right down to the wire. You know, Democratic Party registration is up in Ohio. But still, it's always been a frustrating state for the Democrats. I think nothing can be taken for granted.
PHILLIPS: You put out Nebraska, too, though.
ROBERTS: So, you're predicting, though, that they would turn that one? Ohio would go blue?
SILVER: I think -- I think if you had the election today, I think Obama would win by about 30 electoral votes, you know.
ROBERTS: So, that would put him ahead, 275 to 263. He would win the election based on your suggestions today, just a statistical analysis, that's interesting.
SILVER: Yes. And it, you know, it changes every day, though. I mean, you know, Mike Dukakis was ahead this point in '88. You know, Jimmy Carter had a big lead over Ronald Reagan, if you look far back enough in 1980. So, it's really early now. I think people can, you know, just get too excited about one polling result right now where, you know, most of the campaign is still going to be had.
PHILLIPS: All right. We'll see how well Nate is going to do.
ROBERTS: Yes, we'll keeping watching, Nate. We'll check back with you from time to time.
SILVER: Of course. Thank you, John.
ROBERTS: Good to have you on. Thanks.
PHILLIPS: We want to get to breaking news now out of Iraq. Major developments in the future of the U.S. mission there.
CNN's Michael Ware just told us a few minutes ago that the Iraqis may reject the second draft of a U.S. security agreement. The Iraqis instead could create their own laws which would dictate under what terms U.S. troops can remain in the country.
Now, apparently a new agreement is needed because the U.N. granted authority for troops to be in Iraq, runs out at the end of the year.
We're also following other breaking news. This time the extreme weather in the Midwest and Cedar Rapids, Iowa, more than 100 city blocks totally under water. Thousands of people have been forced to leave their homes. Even one hospital is evacuating now with more than 170 patients.
And prison officials in California may release Charles Manson follower Susan Atkins because she's near death from a terminal illness. Atkins, who's 59 years old, was convicted in the 1969 murder of actress Sharon Tate. Authorities say that Atkins is being considered for a so-called compassionate release. Doctors say she has only six months to live.
And Paris is the next stop on President Bush's European farewell tour. He's expected to arrive there in about half an hour. The President and First Lady received a warm welcome from Pope Benedict XVI at the Vatican this morning. The Pope and the President had an informal meeting. Asia and African world poverty are among the topics that they discussed. Pope Benedict also took the Bushes on a rare stroll through the private Vatican Gardens.
ROBERTS: The Japanese government deciding to ease some sanctions against North Korea. The decision comes after Pyongyang vowed to open a new investigation into the kidnappings of Japanese citizens back in the 1970s and '80s. Japan says it will do away with the ban on travel between the two countries, but Japan says more serious economic sanctions will remain in place.
A diplomatic breakthrough between historic rivals China and Taiwan have agreed to begin chartered flights between the two nations. Details of the deal are still being hammered out, but China's news agency says the flights could begin shortly.
And breaking news this morning. A truck driver strike in Britain is raising fears of a fuel shortage. The drivers who delivered Shell gas stations started a four-day strike today over complaints about pay. The government has back-up plans to keep the fuel flowing, but there was a big increase in gas purchases over the last few days by people who were worried that they would not be able to fill up.
PHILLIPS: And following hurricane Katrina, the government stockpiled tens of millions of dollars worth of essential household supplies to help the victims and what happened from there is a tragedy in its own right.
The investigation now from our Abbie Boudreau, CNN special investigations unit.
(BEGIN VIDEOTAPE)
ABBIE BOUDREAU, CNN SPECIAL INVESTIGATIONS UNIT (voice-over): Warehouses full of plates, cups, and dinner ware, brand new coffee makers, 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's unreal because we haven't received none of this. I know I haven't.
BOUDREAU: CNN learned that Debra Reed and others who were still struggling 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 thought -- 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: This one right here?
REED: Yes, the little bitty one.
BOUDREAU: 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's still nearly empty. She can't afford to buy even modest items.
MARTHA KEGEL, EXEC. DIR., 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's been hard to find these kinds of donations.
BOUDREAU: Right. 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.
KEGEL: Right.
BOUDREAU: This warehouse is really just full of mostly used items.
KEGEL: Right.
BOUDREAU: And it's in the back of an abandoned church. So what happened? FEMA tells CNN it did distribute household starter kits to 140,000 families. As for the rest of the warehouses and $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: It seems to me that FEMA is acting like this crisis is over. It's been over. It's 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. FEMA turned down our request for an on-camera interview, saying the surplus property was, quote, not news.
KEGEL: This stuff really is beautiful stuff.
BOUDREAU: Yet those who spend every day still helping victims of Katrina are stunned. KEGEL: This makes me sad to look at this, to -- is there any way we could still get this stuff? Is it all gone now? It's all gone.
BOUDREAU: It's all gone. Abbie Boudreau, CNN, New Orleans.
(END VIDEOTAPE)
ROBERTS: Forty five minutes after the hour and this just in. New inflation numbers out. Our Ali Velshi in the newsroom now with more on that.
Good morning, Ali.
VELSHI: Good morning, John.
We're just going through the numbers right now. It looks like inflation for May compared to last year is up 4.2 percent according to how the government measures it. That's on the high side. Inflation traditionally we calculate it usually at about 3 percent, so we're a little high. I'm just looking at how it breaks down, the transportation costs compared to a year ago, 8.1 percent higher. Energy costs, 17.4 percent higher than a year ago; food costs, 5.1 percent higher than a year ago.
So these are numbers that we expected. They're a little higher than what economists were expecting. But for those of you feeling the pinch, these are the government's numbers that confirm that it is actually a pinch, inflation up 4.2 percent. One of the interesting things to note by the way that we were talking about earlier John, air fares are up 3.2 percent. We were just talking about these fuel increases. That's pretty much everywhere. That's all of the increase in airfare. We are paying for fuel. It's working its way through the economy. Inflation is higher than most peoples' wage increases and that's the bottom line for most of our viewers John.
ROBERTS: Seventy percent increase in energy prices. Ali, thanks very much.
That new shower curtain smell, you like it, right? Well, it may be dangerous. Latest warning about chemicals in another everyday household item.
PHILLIPS: Coming up on AMERICAN MORNING, tightening the beltway. Jamie, Zain and Tom set off on the great grocery challenge. So who will come out on top? The big box boy, the corner grocer or the health nut? The results of the great grocery challenge just ahead. You're watching the most news in the morning.
(COMMERCIAL BREAK)
PHILLIPS: It's issue number one this election year, the economy, and we're attacking it I guess you could say from every angle. First it was the great commuter races.
ROBERTS: Now three of our beltway correspondents taking on some of the worst rush hour traffic in the world looking for ways to save you money and time. That's what we showed you up until now. Today they're trying to get over sticker shock at the supermarket.
PHILLIPS: Let's meet our contestants once again. State department correspondent Zain Verjee.
ROBERTS: Pentagon correspondent Jamie McIntyre.
PHILLIPS: And Tom Foreman, our politics guy. Off they go.
(BEGIN VIDEOTAPE)
TOM FOREMAN, CNN CORRESPONDENT: 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.
ZAIN VERJEE, CNN STATE DEPARTMENT CORRESPONDENT: I'm going to be going to Whole Foods and look for the healthy organic stuff.
JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: 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)
ROBERTS: Everybody notes a Belgian chocolate Pentagon.
PHILLIPS: Every now and then.
ROBERTS: Every now and then.
PHILLIPS: And maybe a few other things while you're shopping at the grocery store.
Hello, Zain Verjee.
VERJEE: Good morning, Kyra Phillips.
How are you?
PHILLIPS: I'm doing just fine. I'll a little distracted by your live shot. I'm not quite sure why. I don't know. Maybe --
VERJEE: We're looking -- we're in the fresh fruit section here. That's a great part about being at a place like this. You get some healthy, ripe and good organic foods here. You're paying a little bit more but it's a lot of healthy stuff. The other fun part about being in a shop like this is that you can get a lot of free foods. You can walk around and just have a nibble. We came in on an empty stomach and we can eat as much as we want and leave on a full one. But you are paying more for some of this kind of stuff. You know and with food prices so high, some people right not choose to go this way.
ROBERTS: What was the best part of doing this whole thing, Zain?
VERJEE: Well, the best part was just being able to wander around and get some of the good stuff. You know, they've got so many different exotic types of foods, but again, you are paying more. Everyone was pretty helpful, too. They knew what they were talking about. You know, as you know, I'm a pretty healthy person, so it's nice for me to shop in a place like this.
They also get all these fruits and vegetables chopped up. Kyra, I like to cook a lot, John, too, so, you know, it's convenient for me to get chopped up papaya as you say or melons and just not have to bother with too much time cooking. But you're paying more.
ROBERTS: Very own little producer manager.
PHILLIPS: That's right. Zain Verjee, the most melons in the morning.
Great to see you.
ROBERTS: Thanks, Zain.
PHILLIPS: All right. Well, check your bathroom, what your shower curtain is made of and why could it be harmful to your health? We're going to explain.
(COMMERCIAL BREAK)
PHILLIPS: This morning we meet a CNN hero. Carolyn Lecroy, a woman who helps repair the bond between parent and child that prison threatens to take away. Meet her now.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: Hello. This is your father.
UNIDENTIFIED FEMALE: Hi, JJ, it's mommy. I love you very much.
UNIDENTIFIED FEMALE: Your mommy misses you.
CAROLYN LECROY, CHAMPIONING CHILDREN: The children of incarcerated parents are the silent victim of the parent's crime. These children is forgotten sometimes. My name is Carolyn Lecroy and I started the messages project so that incarcerated parents can keep in touch with their kids.
In 1994 I was arrested and charge with possession of marijuana. I was very fortunate. My children came to see me all the time. And there would be women who never got visits. And I would look at them. If they were this unhappy, what about the children? I know how important it was for my children to see me. When I got out, I took a bad situation and I made something good of it.
Just talk from your heart. That's what this is about. UNIDENTIFIED MALE: Hey, Caleb, this is daddy, buddy. I love you. I hope you enjoy this.
LECROY: They know they've made mistakes but they're still human beings and they have children and they all love them.
UNIDENTIFIED MALE: One fist, two fish, red fish, blue fish, black fish, blue fish, old fish, blue fish. This one has a little star. This one has a little car. Say, what a lot of fish they are.
LECROY: We have found that with the videos, for many, it's re- establishing a bond that got broken. It's hard when a parent is in prison. So I think that makes all the children heroes.
(END VIDEOTAPE)
PHILLIPS: If you nominate your own hero, so go to CNN.com/heroes right now.
ROBERTS: CNN "NEWSROOM" just minutes away now. Tony Harris at the CNN Center with a look at what lies ahead on this Friday the 13th.
Good morning Tony.
TONY HARRIS, CNN ANCHOR: Good Friday to you, John.
We have got these stories in the "Newsroom" run down for you this morning. Flooding takes a huge toll on the Midwest. Thousands evacuated, highways closed, the hospital shut down and the rivers just keep rising.
Is there a break in the case? A witness who saw two Oklahoma girls before they were killed comes forward. We will hear from investigators. And this is one no low joe, coffee praised and pricey. We're talking 15 bucks a cup.
Join Heidi and me in the "NEWSROOM." We get started at the top of the hour on CNN.
John, back to you and Kyra.
ROBERTS: Looking forward to that Tony, 11 and a haflf minutes from now.
PHILLIPS: Last thing we need is more caffeine. Trust me.
HARRIS: I'm going shopping with you when you get back here, all right?
PHILLIPS: You got it. We'll go shopping for some fruit.
HARRIS: Now.
ROBERTS: Get them both the decaf today.
Just for fun, here's more on Friday the 13th in an a.m. extra. Today is the only Friday the 13th in 2008. It's estimated that more than $800 million in business is lost today because folks don't want to go to work. They don't want to fly, like Kyra is today. And they don't want to shop. What's the fear of Friday the 13th called? Here's a world for you, paraskavedekatriaphobia. Say that five times fast.
PHILLIPS: I'll just say it's a fear of Friday the 13th.
ROBERTS: Paraskavedekatriaphobia and it's estimated that phobia afflicts some 17.21 million people.
PHILLIPS: Serious stuff. How many places do you -- I feel better when I get in an elevator and there isn't a 13th floor, in a weird way it makes me feel better.
ROBERTS: Thirteen has always been a lucky number for me and I don't know why?
PHILLIPS: Really, today's your lucky day my friend.
ROBERTS: Except for today because today is your last day. It's kind of sad.
PHILLIPS: All right. Don't make me cry.
ROBERTS: A new warning about plastic shower curtains for you. They may smell good when they're brand new in a weird kind of way, but you might not want to inhale.
PHILLIPS: And roaming with a microphone in hand. Both Barack Obama and John McCain thrive on the town hall style of meetings. Coming up, our Jeanne Moos takes a unique look at their public performances.
(COMMERCIAL BREAK)
ROBERTS: Just about seven minutes now before the top of the hour. A new study warns that that new shower curtain smell may be toxic. Our medical correspondent Elizabeth Cohen is live for us in Atlanta following this story.
What are we talking about here? Chemicals embedded in that shower curtain?
ELIZABETH COHEN, CNN MEDICAL CORRESPONDENT: Right. We're talking about chemicals John called phthalate and they're what makes plastic bendy, so they're in all sorts of products. These phthalates have been linked in some studies to health problems, like nervous system problems, reproductive problems, liver problems. Let's take a look at what phthalates are in. It is a whole host of products.
For example, toys, vinyl goods, food packaging, ear tubing, hairsprays, soaps and shampoos. The European Union and California have banned some phthalate in some products. We do want to let parents know phthalates are not in products like pacifiers that obviously go into baby's mouths -- John. ROBERTS: What's the deal then with shower curtains, that new shower curtain smell that everybody knows about when they take one of the out package. Is that actually these chemicals becoming volatile and getting into the air, getting into your lungs, your breathing passageways?
COHEN: It's interesting. The folks who make these products say phthalates don't smell. They're odorless. So while there is such a thing as a new shower curtain smell, it's not from the phthalates. But the bottom line is is that it's not clear if phthalates are even dangerous. The industry says they're not. Environmentalists say they are.
Here's what the CDC says. They say more research needs to be done until they can figure out if phthalates are dangerous. So in the meantime, if this makes you nervous, you can look for phthalate-free products and if you don't like that new shower curtain smell, we suggest just sort of hanging it outside for a day or two. It will go away.
ROBERTS: Elizabeth Cohen for us from morning from Atlanta.
Elizabeth, thanks.
COHEN: Thanks.
PHILLIPS: The town hall wars are heating up from pointing fingers to pointing out colors in the crowd. Both presidential candidates have unique habits when holding open forums. Jeanne Moos takes a look coming up next.
(COMMERCIAL BREAK)
PHILLIPS: John McCain challenging Barack Obama to town hall meetings.
ROBERTS: Our Jeanne Moos takes a look at how it might play out with the most news in the morning.
(BEGIN VIDEOTAPE)
JEANNE MOOS, CNN CORRESPONDENT (voice-over): Phil Donahue may be the gold standard when it comes to rooming around with a mike. With the current town hall mania, the presidential candidates are getting pretty good at it with the occasional exception. The award for best way not to use a microphone goes to John McCain.
A few weeks ago he talked into the wrong end but made a great recovery. Lately, McCain is taking to resting his chin on the mike.
Neither candidate seems able to make a point without finger pointing.
SEN. BARACK OBAMA (D) PRESIDENTIAL CANDIDATE: We're going to pay for it.
MCCAIN: Learn the lessons of it.
MOOS: When it comes to picking the questions, Obama tends to pick by outfit.
OBAMA: Yellow blouse over there. Is that yellow? I think it is. Is it pink. I'm sort of colorblind. That is pink, I can tell.
MOOS: Talk about picking by the outfit, the award for fearlessly choosing hostile questions on purpose goes to Senator McCain. He once took a question from a 14-year-old wearing a T-shirt saying "John McCain doesn't care about our future."
MCCAIN: I don't know who printed your shirt but here's the microphone and you can explain.
MOOS: She asked about equal pay for women. The award for toughest question goes to this one.
UNIDENTIFIED MALE: What does life mean to you?
OBAMA: When I was your age, I think life was all about me.
MOOS: Senator Obama says that now life revolves around the kind of world he leaves for his daughters. Wittiest prepared joke goes to Senator McCain
MCCAIN: And if you took all the economists in the world and put them end to end, you wouldn't reach a conclusion.
MOOS: And best ad libbed quip goes to McCain.
UNIDENTIFIED MALE: We're the same age sir
MCCAIN: You're looking good.
MOOS: But straight to that, the award for most sips for town hall meeting, well, it depends on whether you count almost sips. Senator McCain had a couple of near sips. He also had the longest run up to a question.
UNIDENTIFIED MALE: Maybe as a Christian voice in general for this nation.
MCCAIN: Can I have a question?
MOOS: So long that McCain and the audience repeatedly tried to cut him off. As for the line that got the biggest laugh, it didn't come from a candidate.
UNIDENTIFIED MALE: I would like to request that George W. Bush be appointed U.S. ambassador to Iraq.
MOOS: Jeanne Moos, CNN, New York.
(END VIDEOTAPE) ROBERTS: That's just about going to do it for us. We should mention that Kiran Chetry will be back again on Monday morning after her two months of maternity leave so we welcome her back on Monday morning and Kyra, thank you so much for the last two months.
PHILLIPS: I had a great -- let's do a little Barack-Michelle thumbs up, yes, and then I'll just add my little kick.
ROBERTS: Thanks. Always remind me.
PHILLIPS: "CNN NEWSROOM" with Tony Harris and Heidi Collins starts right now.
ROBERTS: Great job. Thank you.
