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Levees on the Brink; President Bush Urges Congress to Lift Ban on Offshore Oil Drilling; Hunting Down Militants in Afghanistan

Aired June 18, 2008 - 10:00   ET

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

TONY HARRIS, CNN ANCHOR: Now, the rising floodwaters carry the dangers southward to Quincy and Canton. Can those levees hold?
CNN's Sean Callebs has the latest from Iowa's Des Moines County. Sean, good morning.

SEAN CALLEBS, CNN CORRESPONDENT: Good morning to you, Tony.

We're told that the river either crested or is getting ready to crest in this area. It's good news. About 30 hours ago, the river was actually up to the very top of these sandbags. Because of those breaches in Illinois, it's taken the pressure off and the water has begun to flow into that area and gone down here somewhat significantly. People are keeping their eyes on these orange flags here all along the levee.

I want to show you a picture of ATVs going up and down the levee. These are volunteers. They're farmers chiefly in this area. What they're doing is going up and down and they're looking at areas where they expect seepage, where the levees could be, the integrity threatened. That is a major concern in this area.

We talked about the levee recently that was breached near the town of Quincy. We want to take you to a map and show you exactly where that is. It's about an hour south of where we are right now just north of Burlington, Iowa. A major problem there. The levee breached, apparently pouring into farmland down in that area. Who knows how long that will happen. We can use what happened yesterday as somewhat of a gauge.

Look at these pictures from Gulfport, Illinois, right across the river from Burlington. Huge holes in the middle of that levee that is allowing the Big Muddy, the Mississippi to pour in, flooding that area with ten feet of water. Very, very serious situation.

Come back here and look at this levee here. You can see it's wet. There's water right here. But it's clear so that is good news. The corps tells us if it's actually muddy, it had sediment in it, that would mean there would be scouring, eating away at the dirt, and that would threaten it.

This is what's at stake, Tony. Look out there, just thousands of acres of fertile farmland. You're looking at Iowa corn. So certainly the battle on trying to keep this area as safe as possible -- Tony?

HARRIS: Sean, I know you've been talking pretty much constantly with the Army Corps of Engineers. Share with us some of the conversations you had with them this morning that indicated just how delicate those levees are.

CALLEBS: You're exactly right. This area is saturated. We're told not to stand on these sandbags. Here's why. We have dirt and then a layer of plastic and then the sandbags are on top. What they're concerned about is if we step on the sandbags, you could cause little depressions and even the smallest amount of condensation on that plastic could build up creating a little trickle.

That trickle could lead to some scouring underneath. If the water from the Mississippi began to eat into that, you could have a hole, then it leads to a bigger hole. And you know the rest of the story from there.

HARRIS: All right. Sean Callebs for us this morning; Sean again, thank you.

HEIDI COLLINS, CNN ANCHOR: We're going to take a minute now to get over to Rob Marciano in the weather center, talking more about the flood threats throughout the day and obviously, as we have learned, for many days to follow.

Rob, what do you have now?

ROB MARCIANO, AMS METEOROLOGIST: Well, the rivers continue to rise as they flow south toward the Gulf of Mexico. I think we'll probably see more of this overtopping basically the levees just not high enough. Then you have what Sean was talking about, some of that seepage. 25-mile stretch there from North Shore down to Quincy. Adams and Hancock County that's under the gun in Illinois.

I want to take you to the other maps highlighting the flood warnings and watches, which there are several. Then also the timing of when this river, the Mississippi, is going to crest over the next several days. Burlington and Quincy pretty much happening today and tomorrow. Hannibal on Friday, Clarksville Saturday, St. Louis now has been pushed all the way to Monday and has been upgraded to major flood forecast status, meaning the water is going to get up and over the major flooding stage of 40 feet which will be slightly over that.

It won't get to 48, 49 feet, which is what happened back in 1993. That's the good news for St. Louis. But, again, these forecasts for rivers are not an exact science and they change on an almost hourly basis.

Severe thunderstorm watch in effect for parts of southeastern Oklahoma. This has been a pretty good cluster of thunderstorms that's been motoring to the south and east. The good news here is most of it has stayed away from the flood zone. There you see this watch expected to come to an end here in the next couple of hours.

Here's the forecast for rainfall over the next 48 hours. Notice that Iowa, Wisconsin, Illinois, most of eastern Missouri won't see a lot of rain. That's certainly good news. Generally the flow is northwesterly. That means fairly dry and mostly cool across the northeast and hot. We'll see record breaking high temperatures across the desert southwest.

Tony, Heidi, back over to you.

COLLINS: All right. Rob, thank you.

So the big question -- will the levees hold? What's being done to make sure the people who depend on them are safe? We'll ask the man in charge of the levees, the chief of the army corps of engineers, General Robert Van Antwerp. He will join us live in the 1:00 hour of the NEWSROOM.

HARRIS: Looking off the U.S. coast for relief from high oil prices; later this hour, President Bush calls on Congress to lift the ban on offshore drilling. The current ban covers areas outside the western Gulf of Mexico and some areas off Alaska. It was imposed in part to protect tourism and reduce the chances of major oil spills.

The president's latest push comes the day after Republican presidential candidate John McCain called for lifting the ban. Opponents of offshore drilling say it would harm wetlands, contaminate water and pollute the air.

COLLINS: A closer look now on what offshore drilling could mean for oil prices and the price you pay at the pump. Ali Velshi minding your business now live from New York.

Well obviously Ali, it's not an instant sort of fix, but something's got to be done.

ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: This is exactly the point we need to make. We need long-term plans. This is a long term plan. It's not going to have any effect immediately on the price of oil except that people who think more oil is coming into the system might think that there's not such a crazy demand to buy it all now.

That's not typically how the futures markets work. They usually price a few months out. This is years away. I guess the earliest you could sort of hit oil if you decided to expand drilling offshore is about three months, but it could take as much as ten years in some cases.

This all depends where you feel the problem lies. There are three places, Heidi. One is, do you feel that the problem is supply? We need to find more oil, in which case you might think John McCain's idea, which he proposed yesterday and what President Bush is going to tell Congress, allow for more drilling offshore in the United States or even on land in had some cases is the idea.

Do you feel like demand is growing much faster than supply and the answer is curtailing demand and getting us off our reliance on oil? If you feel that way, some of Barack Obama's ideas may be more suited to you.

If you feel this is because of excessive speculation, the price of oil being at 135 or over $100 a barrel, then you're going to think that maybe this Congressional investigation, these bills that are before Congress, this federal agency, the Commodities Futures Trading Commission, look being into speculation, maybe that's the direction to go or maybe a combination of those. But John McCain is saying we've got a lot more oil in the United States. Let's drill for it.

COLLINS: All right. CNN's Ali Velshi minding your business this morning. Thank you, Ali.

HARRIS: Some facts and figures now about the offshore ban on oil and gas drilling. It covers the waters along the east and west coasts of the United States as well as the eastern Gulf of Mexico. The moratorium imposed by Congress has been in effect for 26 years, since 1982. It expires in 2012. Parts of the Gulf of Mexico and Alaska are open for drilling. Offshore rigs account for about 25 percent of America's fuel production.

COLLINS: We want to take a moment to check in with one of our White House correspondents, Brianna Keilar. She is standing by to tell us a little bit more about President Bush's plans, I believe, about visiting Iowa.

BRIANNA KEILAR, CNN CORRESPONDENT: I just came from a briefing with one of the president's economic advisors. Of course -- pardon me. I'm sorry. I misunderstood. I thought we were talking about offshore oil drilling.

What I can tell you is I understand, Heidi, that President Bush is going to be visiting Cedar Rapids tomorrow. Of course, Cedar Rapids really ground zero for the area there in Iowa. Of course, hard hit by the floodings. He'll be taking a visit there tomorrow. We just learned that on the record today.

Meantime, I just got out of a briefing with President Bush's economic advisor talking about offshore oil drilling; President Bush going to make an announcement very shortly here in the rose Garden. We learned a little bit about what he's going to say.

He'll be calling on Congress to lift the Congressional ban on offshore oil drilling and we were told by his economic advisor Keith Hennessy that if -- he's going to basically tell Congress, as it was put by this advisor, you turn your key, you lift the Congressional ban, and I will lift the executive order. That executive order put in place in 1990, in fact, by his father when he was president.

So, they say there's this way to basically do environmentally friendly and safe shore oil drilling. A lot of controversy because environmentalists say that's really an oxymoron. Democrats very much not onboard, of course, the majority in Congress. It's a really question of whether they would even cooperate with this, Heidi.

COLLINS: Forgive me, didn't mean to throw you a curveball. We just got the alert that he made this plan to stop by Cedar Rapids, Iowa tomorrow too. Talk more about this announcement he'll be making and the timing of this. I mean, we know -- we reported here this morning that John McCain announced a very similar plan just yesterday.

KEILAR: Yeah. John McCain announced it as part of his overall energy policy strategy. The White House is careful to point out that they don't agree with McCain's entire energy policy but this is a point where President Bush and John McCain see eye to eye.

The White House putting it this way that gas is $4 a gallon. A lot of people are trying to come up with solutions. There is a growing number of Republicans, it's not just President Bush, it's not just John McCain who are looking at this as a solution. There is a growing number of Republicans, Heidi.

COLLINS: All right, very good. We'll keep our eye on it. We're about 20, 30 minutes away from the president giving that address. Thanks so much, Brianna Keilar.

I'm going to bring you that statement on his call to lift the ban coming up 10:35 eastern live right here in the CNN NEWSROOM.

HARRIS: Going up against a militant movement, Afghanistan, Pakistan and the Taliban threat. An expert breaks it down for us in the NEWSROOM.

(COMMERCIAL BREAK)

COLLINS: Want to take you to some of the pictures that we are getting in from the private funeral for "Meet the Press's" Tim Russert. As you know, he died of a heart attack on Friday. We are just looking now at the casket being taken from the vehicle and brought into the church.

Standing by outside that church you see his NBC News family, Tom Brokaw on the left and Bryant Gumbel, Matt Lauer, as they are going into that church to remember the life of Tim Russert. We will keep our eye on these pictures, a very somber day there in Washington.

(COMMERCIAL BREAK)

COLLINS: Adams County, Illinois, two levees overwhelmed, homes and farmland under water. Let's get the very latest now from Julie Shepard. She is with the emergency management office in Adams County.

Julie, put this in perspective for us, if you would. The situation has clearly changed. These two levees that are no longer holding.

JULIE SHEPARD, ADAMS CO. EMERGENCY: Right. We did lose two levees, one at 1:00 a.m. this morning, the other one at around 6:00 a.m. this morning. The first was in Meyer, which is a farming community outside of the Quincy area. About 40 to 50 people live in that community. They were all evacuated safely, which was the primary concern that we have, obviously. With that breach in the levee, that impacts in that area about 30,000 acres of farmland.

COLLINS: Boy, when you talk about that many acres of farmland, this is something that is going to have such a long effect on the residents there.

SHEPARD: Yes, it is. It's very unfortunate. They worked very hard to try to prevent this, but unfortunately they weren't able to. Yeah, 30,000 acres of farmland just in that one area alone.

COLLINS: Wow, just unreal. We're looking at aerial pictures now of the area, just to let you know what we are seeing on the screen. What's the plan next? I know that there are Illinois national guardsmen there. They've been called by the governor to come and help. What can people be doing? I guess it's horrible just standing by and watching.

SHEPARD: Right. I was down there earlier and it was truly amazing to watch the water and know there's nothing that can be done to prevent it. At this point, we're focusing efforts on the levees that are remaining and trying to build those up. So continuing sandbagging efforts and directing the sandbags to the levees that are holding at this time.

COLLINS: All right. We, of course, are going to keep our eye on this situation because it really has changed sort of the entire situation for many people involved, even further downstream now because of these two levees. Julie Shepard with Adams County Emergency Management, thank you.

HARRIS: Burying the dead. Funerals today for victims of a massive bombing that ripped through a northwest Baghdad neighborhood yesterday. 63 people were killed, 5 of them children. 71 others wounded. The U.S. says the blast may have been the work of an Iranian-backed militant trying to stir up Shiite violence against Sunnis. The bomb was detonated on a mini bus and ripped through a nearby market.

COLLINS: Taking on Taliban militants. Afghan and Canadian forces going village to village right now trying to rout out militants in southern Afghanistan. The country's president saying he will send his troops into Pakistan if he has to.

Jim Walsh is an international security expert. He is joining us from Newton, Massachusetts.

Nice to see you, Jim. The Taliban is actually in these Afghan villages now near Kandahar, how big of a threat are they? I'm sure if you're someone who lives there, watching them come in has got to be incredibly frightening, given the past history.

JIM WALSH, INTERNATIONAL SECURITY ANALYST: Frightening and demoralizing. Remember these were all prisoners that U.S., coalition, NATO forces, Afghan forces had arrested and put away and now they're back on the street again. 1,000 of them. And, of course, it's not just that.

The reason why the president is complaining is this is the 800- pound gorilla in the room. It is Pakistan and the flow of the Taliban into Afghanistan from safe havens in Pakistan that are making the lives of those Afghans miserable and making the project of rebuilding Afghanistan very difficult if not impossible.

COLLINS: I want to double check. Where are you getting the numbers from, the 1,000? We mostly have between 400 and 500. WALSH: This was yesterday. It may have changed since I last checked. In any case whether it's 400 or whether 1,000, it's a huge number of people. Again, those are just people from the prison. They are complemented, if you will, from the people coming in helping them, the foreign fighters, Taliban just across the boarder in Pakistan.

COLLINS: What do you make of this situation, the strength, if you will, of the Afghan military? Is that going to be a suitable match-up?

WALSH: As we have learned in Iraq, the process of building a police force, building an army, is a long-term project, not a short- term project. They are getting better, but at the end of the day, they cannot survive without the U.S. forces and NATO forces taking more of a stand there.

The main problem is that as long as the Taliban and the foreign fighters have safe havens they can attack and run away before they ever engage any Afghan army or police. It's the safe haven that makes the prosecution against the Taliban all the more difficult.

COLLINS: If you're a person who lives there and you see this visual coming in, are you saying to yourself, oh, my lord, I think the Taliban is going to be this in charge again?

WALSH: I think you know you don't want to encourage the modify, but it won't be surprising if local people around Kandahar start hedging their bets, thinking, well, I want the U.S. and Afghan government to succeed here, but these guys are right in my backyard. I'm not going to do anything to makes them angry, cross the line. I would think a lot of people are going to walk very delicately and hedge rather than put themselves out there and put themselves in the face of danger.

COLLINS: Is this really a new low point between Afghan and Pakistan relations?

WALSH: Yes, absolutely. Afghanistan had the unfortunate luck of being right next to Pakistan. Remember it was Pakistan's intelligence service, the ISI, which created the Taliban in the first place. A lot of the ethnic groups on the side of that border have commonalities, shared values. So it is very difficult for the Afghan government to get control of that southern part of Afghanistan as long as they have friends and sympathizers with the Taliban across the border.

COLLINS: It's certainly a story we will continue to follow and are on top of here at CNN. Jim Walsh, always nice to see you. Thanks for your insight. Our international security expert, thank you.

WALSH: Happy to provide it. Thank you.

HARRIS: A lawsuit settlement may mean free credit monitoring for you, but, as always, Gerri says the devil's in the detail.

(COMMERCIAL BREAK) HARRIS: Want to get free credit monitoring for up to nine months? You can thanks to a lawsuit settlement from TransUnion, but is it worth it? That's the question. Personal finance editor Gerri Willis has the details.

Gerri, good morning, good morning.

GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Good morning.

HARRIS: What's in it for you and me? What's in it for the consumer?

WILLIS: Let's work right through that. This is the settlement. You can choose from two options. The first, six months of the credit monitoring service with unlimited access to your TransUnion credit report and credit score. If you select this service, you'll be able to apply for a cash payment from the settlement fund. But guess what, it's not expected to be much.

The other option, second option, is nine months of credit monitoring services plus a mortgage simulator service. Now, a simulator lets you see what your mortgage rate would be based on your credit score and it also gives you access to your insurance score, which is used by some insurers to set rates. If you choose this option, you're not eligible for cash money, but it's not going to be much anyway.

HARRIS: Yes, it's -- I'm sorry. Was there something else you wanted to add?

WILLIS: I was going to say, it's just not a lot of dough. It could be pennies. So you've got to go with the free stuff. It's worth money.

HARRIS: I like that. I wanted to pick up on the eligibility point. Who's eligible for this?

WILLIS: Lots of people. You may be eligible if you had an open line of credit between 1987 and May 28, 2008. That means in the last three or so years you took out a car loan, opened a department store credit card, took out a student loan, actually the right number is for the past 21 years, you'll qualify. To sign up, go to the Web site listclassaction.com. They also have a telephone number to call, 866- 416-3470. Lots of you out there will eligible.

HARRIS: You know how I like you to bottom-line these issues. What's the real value in this for consumers?

WILLIS: You know Tony, I think it's limited. The TransUnion score is not the FICO score, which is what most lenders are looking at. One expert we talked to says less than 5 percent pay attention to the score. However, some folks will really enjoy credit monitoring. That's important to see what's going on with your credit, help you understand how all of that works. Hey, look, if it's free, it' a good thing.

HARRIS: OK. Give us your best advice on this.

WILLIS: Well, there are things you can do for free without having to sign up for this thing and giving away some of your personal information. First up, simulated credit scores you can get for free without giving up personal info. Check out bankrate.com or credit.com. Of course, you can get your credit report from all three credit bureaus from free every year at annualcreditreport.com. How many times do I say annualcreditreport.com? And, of course, if you have any questions send them to us. We love hearing from you.

HARRIS: How often do we see that commercial -- get your free credit from --

WILLIS: Don't say that. We want to send people to annualcreditreport.com. I'm just saying.

HARRIS: Let's not sing it. Give us a preview of what's come up noon eastern "ISSUE #1."

WILLIS: We've got all kind of things. Banks are jacking up your fees. We'll tell you all about it, help you understand how to beat it.

And then, meet the woman who spends millions of dollars a year just on fuel. Great story coming up at noon, "ISSUE #1." Join us. We're answering your questions by e-mail.

HARRIS: Great to see you. See you at noon, Gerri.

WILLIS: Thank you.

HARRIS: Thanks.

COLLINS: President Bush making a statement on energy and his call to lift the ban on offshore drilling is coming up 10:35 Eastern Time. We'll have it live for you right here in the NEWSROOM.

(COMMERCIAL BREAK)

COLLINS: Good morning once again, everybody. Just about to hear from the president, I believe.

HARRIS: Absolutely, President Bush calling for an end to the ban on offshore oil drilling. We are awaiting his remarks. I believe we're actually inside the two-minute window to those remarks from the Rose Garden.

Ali Velshi live from New York to talk about what all this potentially means. Ali, help us understand. We know that the president is going to call for lifting the Congressional ban. And if that happens, the president will then lift the executive order banning offshore drilling.

VELSHI: Right, which has been in place since 1982 with the exception of about 4,000 oil wells in the western Gulf of Mexico and about 40 oil wells off the shore of California. According to the White House, John McCain yesterday said that he thinks there's about 21 billion barrels of oil offshore that remain to be exploited if we want them. We just got comment from the White House now. They think that there are 18 billion barrels of oil. So again, this is just indicative of the fact that we don't actually know.

It would take -- if we were to lift the ban on the other offshore drilling, it would take somewhere between three and 10 years to start drilling all of those sites where there is oil. The cost of drilling for oil offshore tends to be a little higher than drilling on land and it also depends on how deep you go.

But the bottom line here is, is the answer drilling for more oil or reducing our dependence. And here's the president to tell us about it.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I want to thank Secretary Kempthorne and Secretary Bodman for joining me here.

For many Americans, there is no more pressing concern than the price of gasoline. Truckers and farmers, small business owners have been hit especially hard. Every American who drives to work, purchases food or ships a product has felt the effect and families across the country are looking to Washington for a response.

High oil prices are at the root of high gasoline prices. Behind those prices is the basic law of supply and demand. In recent years, the world's demand for oil has grown dramatically. Meanwhile, the supply of oil has grown much more slowly. As a result, oil prices have risen sharply and that increase has been reflected in American gasoline pumps.

Now, much of the oil consumed in America comes from abroad. That's what's changed dramatically over the last couple of decades. Some of that energy comes from unstable regions and unfriendly regimes. This makes us more vulnerable to supply shocks and price spikes beyond our control, and that puts both our economy and our security at risk.

In the long run, the solution is to reduce demand for oil by promoting alternative energy technologies. My administration has worked with Congress to invest in gas saving technologies like advanced batteries and hydrogen fuel cells. We've mandated a large expansion in the use of alternative fuels. We've raised fuel efficiency standards to ambitious new levels. All these steps we're bringing America closer to the day when we can end our addiction to oil which will allow us to become better stewards of the environment.

In the short run, the American economy will continue to rely largely on oil. And that means we need to increase supply, especially here at home. So, my administration has repeatedly called on Congress to expand domestic oil production. Unfortunately, Democrats on Capitol Hill have rejected virtually every proposal. And now, Americans are paying the price at the pump for this obstruction. Congress must face a hard reality. Unless members are willing to accept gas prices at today's painful levels or even higher, our nation must produce more oil. And we must start now. So this morning, I ask Democratic Congressional leaders to move forward with four steps to expand American oil and gasoline production.

First, we should expand American oil production by increasing access to the Outer Continental Shelf or OCS. Experts believe that the OCS could produce about 18 billion barrels of oil. That would be enough to match America's current oil production for almost 10 years. The problem is that Congress has restricted access to keep parts of the OCS since the early 1980s.

Since then, advances in technology have made it possible to conduct oil exploration in the OCS that is out of sight and protects coral reefs and habitats and protects against oil spills. With these advances and a dramatic increase in oil prices, Congressional restrictions on OCS exploration have become outdated and counterproductive.

Republicans in Congress have proposed several promising bills that would lift the legislative ban on oil exploration in the OCS. I call on the House and the Senate to pass good legislation as soon as possible. This legislation should give the states the option of opening up OCS resources off their shores, provide a way for the federal government and the states to share new leasing revenues, and ensure that our environment is protected.

There's also an executive prohibition on exploration in the OCS. When Congress lifts the legislative ban, I will lift the executive prohibition.

Second, we should expand oil production by tapping into the extraordinary potential of oil shale. Oil shale is the type of rock that can produce oil when exposed to heat or other process. One major deposit, the Green River Basin of Colorado, Utah and Wyoming. There lies the equivalent of about 800 billion barrels of recoverable oil. That's more than three times larger than the proven oil reserves of Saudi Arabia. And it can be fully recovered. And if it can be fully recovered, it would be equal to more than a century's worth of currently projected oil imports.

For many years, the high cost of extracting oil from shale exceeded the benefit. But today, the calculus is changing. Companies have invested in technology to make oil shale production more affordable and efficient. While the cost of extracting oil from shale is still more than the cost of traditional production, it's also less than the current market price of oil. This makes oil shale a highly promising resource.

Unfortunately, Democrats in Congress are standing in the way of further development. In last year's omnibus spending bill, Democratic leaders inserted a provision blocking oil shale leasing on federal lands. That provision can be taken out as easily as it was slipped in. And Congress should do so immediately. Third, we should expand oil production by permitting exploration in the Arctic National Wildlife Refuge or ANWR. When it was created in 1980, Congress specifically reserved a portion for energy development. 1995, Congress passed legislation allowing oil production in the small fraction of ANWR's 19 million acres. A drilling footprint of less than 2,000 acres, less than one-tenth of one percent of this distant Alaskan terrain, America could produce an estimated 10 billion barrels of oil. That is roughly the equivalent of two decades of imported oil from Saudi Arabia. Yet, my predecessor vetoed this bill.

In the years since, the price of oil has increased sevenfold and the price of American gasoline has more than tripled. Meanwhile, scientists have developed innovative techniques to reach ANWR's oil with virtually no impact on the land or local wildlife. Urge members of Congress to allow this remote region to bring enormous benefits to the American people.

And finally, we need to expand and enhance our refining capacity. Refineries are the critical link between crude oil and the gasoline and diesel fuel that drivers put in their tanks. Recent changes in the makeup of our fuel supply, upgrades and our refining capacity are urgently needed. Yet, it has been nearly 30 years since our nation built a new refinery. And lawsuits and red tape have made it extremely costly to expand or modify existing refineries.

The result is that America now imports millions of barrels of fully refined gasoline from abroad. This imposes needless costs on American consumers. It deprives American workers of good jobs and it needs to change.

So today, I'm proposing measures to expedite the refinery permitting process. Under the reformed process that I propose, challenges to refineries and other energy project permits must be brought before the D.C. Circuit Court of Appeals within 60 days of the issuance of a permit decision.

Congress should also empower the Secretary of Energy to establish binding deadlines for permit decisions and to ensure that the various levels of approval required in a refinery permitting process are handled in had a timely way.

With these four steps, we will take pressure off gas prices over time by expanding the amount of American-made oil and gasoline. We will strengthen our national security by reducing our reliance on foreign oil. We will benefit American workers by keeping our nation competitive in the global economy and by creating good jobs in construction and engineering and refining maintenance and many other areas.

The proposals I've outlined will take years to have their full impact. There is no excuse for delay. As a matter of fact, it's a reason to move swiftly. I know the Democratic leaders have opposed some of these policies in the past. Now that their opposition has helped drive gas prices to record levels, I ask them to reconsider their positions. Congressional leaders leave for the Fourth of July recess without taking action, they will need to explain why $4 a gallon gasoline is not enough incentive for them to act. And Americans will rightly ask how high oil -- how high gas prices have to rise before the Democratic-controlled Congress will do something about it.

I know this is a trying time for our families, but our country has faced similar strains before and we've overcome them together. And I think we can do that again. With faith in the innovative spirit of our people and a commitment to results in Washington, we will meet the energy challenges we face and keep our economy the strongest, most vibrant and most hopeful in the world.

Thank you for your time.

HARRIS: And there you have it. President Bush, a Rose Garden statement this morning talking about his desire to have Congress lift its ban on offshore oil drilling. And if that happens, the president says he will lift the executive order covering the same ban.

Let's get to Ali Velshi in New York. And Ali, got to ask you this question. It seems to me we're spending a lot of time over the last couple of days and maybe in this whole presidential cycle talking about oil. And I just wonder if that is, in fact, the right discussion to be having if we're talking about the short term and then the long term ...

VELSHI: Yes.

HARRIS: ...energy needs of this country. Is this the right discussion to be talking about drilling for oil, or should we be splitting the time here at least talking about renewables and alternative sources?

VELSHI: Well, both. Yes on both counts. The first one is, remember, we didn't talk enough about -- the president referred to the push that he had an alternative energy. Well, that was largely the mandate to put ethanol into gasoline. Boy, if we had talked about that one a little more fully back then, maybe people wouldn't ...

HARRIS: Yes.

VELSHI: ...be as surprised by the price of corn. So, we should talk ...

HARRIS: Yes, good point.

VELSHI: ...about all of these options and drilling more is definitely one of them.

In fact, the president hit on two very key elements here. One is what John McCain said, expanding the drilling to the Outer Continental Shelf, giving us access to what the president says is about 18 billion barrels of oil or 10 years of U.S. consumption, and enhancing and expanding refinery capacity. And I think that last point he made was very significant, expediting the refinery permission process. One of the reasons we haven't built refineries is because no one can get one approved. Now, there may be reasons, Tony, valid reasons for people who say, we don't want more refineries or that only enhances the problem. But we just got a report out of the government just moments ago while the president was speaking about the refining capacity in the country right now.

As of last week, the refineries were running at 89.3 percent. That's actually at the high end of where they've been running. So, if our refineries are running full tilt and we're still paying $4.08 for a gallon of gasoline, at least we have to have this discussion. So, the president is talking about some very specific things that he'd like Congress to tackle.

HARRIS: In addition to the supply, in addition to speculation as well.

VELSHI: Right, and remember --

HARRIS: It's a big discussion.

VELSHI: We actually -- as you did earlier very nicely, actually, Tony, I appreciate that you did it, you distinguished between the question of supply ...

HARRIS: Yes.

VELSHI: ...should we be looking for more oil, or the question of demand growing so quickly that we should be talking about curtailing demand. Those are two issues. We normally talk about supply and demand in the same sentence, but we can either deal with supply or we can deal with demand.

And those are, you know, the two major presidential candidates are taking very different approaches on this. John McCain is saying let's deal with supply, let's put more oil on the market. Barack Obama is saying, let's pull back our demand.

HARRIS: Nice. Ali Velshi for us in New York, Ali, appreciate it. Great help this morning.

VELSHI: Thank you.

COLLINS: There is a Democratic response to all of this. Want to make sure that we put that out as well. Also, want to let you know that these statements were actually made before the president came to the podium there to talk about lifting the ban on oil drilling.

Coming to you now, a Democrat from Oregon, Representative Peter DeFazio and Representative Ed Perlmutter from Colorado. Let's listen.

(BEGIN VIDEO CLIP)

REP. PETER DEFAZIO (D), OREGON: Come on, guys! They are not developing what they have now. There's 20 years' supply out there underneath their idle leases that could double our domestic production. And plain and simple, they haven't developed it. And then when they're done with that, then we can have a debate about more leasing in other places.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

REP. ED PERLMUTTER (D), COLORADO: There 68 million acres under lease for oil production not being used, being horded, being kept out of the market. It's a red herring to say we need to drill more.

(END VIDEO CLIP)

COLLINS: Also, want to let you know in case you don't already the presidential candidates' statements -- actually, not statements, just opinions on the drilling. Let's go ahead and put that up on the screen as well.

Senator John McCain in favor, as you probably know, of lifting that ban and then letting the states decide how they want to handle it. And Senator Barack Obama is not for lifting the ban, wants to keep it in place, as you can see on the screen.

Meanwhile, want to get back to this other story that we have been following for days now. It won't top the arch, but the swollen Mississippi River is supposed to crest above flood stage in St. Louis.

(COMMERCIAL BREAK)

HARRIS: Good morning and welcome back to the CNN NEWSROOM, everyone. I'm Tony Harris.

Search for a swindler. Is he in the waters or on the lam? The life and possible death of a fugitive financeer.

(COMMERCIAL BREAK)

COLLINS: An important oil inventory report just released could shape the trading day on Wall Street. Stephanie Elam is watching all of it on the floor of the New York Stock Exchange this morning.

Hi there, Stephanie.

(BUSINESS HEADLINES)

HARRIS: Going village to village, Afghan and Canadian troops target Taliban militants, a live report.

(COMMERCIAL BREAK)

HARRIS: You know, so much about Samuel Israel was fake: non- existent profits, bogus audits. He billed (ph) investors in his hedge fund. Now, a new piece of evidence suggests his apparent death may be just one more fraud.

Here's CNN's Erica Hill. (BEGIN VIDEOTAPE)

ERICA HILL, CNN CORRESPONDENT (voice-over): This is Samuel Israel, the Wall Street scam artist who may have saved his best con for last.

ROSS INTELISANO, ATTORNEY FOR INVESTORS: If I was a betting man, I would bet that he is on the lam and that he gets caught. I think it's unlikely that he jumped off the bridge.

HILL: Last Monday, Israel, a hedge fund manager, was supposed to start a 20-year prison sentence for defrauding investors out of $450 million. He never showed up. But his GMC Envoy did, in the middle of the Bear Mountain Bridge in upstate New York. Scrawled on the SUV, the words, "Suicide is painless."

UNIDENTIFIED MALE: Probably a mile and a half north.

HILL: Immediately, police started searching the waters of the Hudson River for Israel's body.

SGT. DENNIS STOLL, ROCKLAND CO. SHERIFF'S DEPT.: We'll continue to search if it takes a week, a month or you know, the next -- the rest of the summer.

HILL: But the search of the river is now over, and the U.S. Marshal Service isn't treating this as a suicide but as a case of a fugitive who is very much alive. Why? No witnesses saw anyone jump off the bridge, but reports say security cameras do show a second car pulling up behind Israel's SUV. The driver of that car is being questioned as a possible accomplice. And as for the people Israel swindled, their lawyer says they never believed he killed himself.

INTELISANO: They were hoping to get a good portion of their money back, have him go to jail and just move on. And they're very frustrated that it's not.

HILL: Israel may have more than a few days head-start and some suspect he has tens of millions of dollars at his disposal. So, just where could this white collar criminal be?

PHIL PARROTT, NATL. WHITE COLLAR CRIME CTR.: Where he would likely go would be out of the country if he could. If not, it had to be pretty well planned where he would go. A person who's made their living, their entire life, on their personality to be now a quiet, submissive, background person, that's just out of character.

HILL: Out of character and on the run.

Erica Hill, CNN, New York.

(END VIDEOTAPE)