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AMERICAN MORNING

Hurricane Gustav Aftermath: Residents Ordered to Stay Away; GOP Convention to Push Through Tonight; Gov. Palin's Revelations Knock McCain's Camp off Message; Obama on Rebuilding New Orleans and Addressing the Issue of Experience

Aired September 2, 2008 - 07:00   ET

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


JOHN ROBERTS, CNN ANCHOR: Just after 6:00 a.m. here in St. Paul, Minnesota, and in New Orleans where this morning the mayor is telling residents, don't come back yet. Debris, downed trees and power lines making conditions dangerous across the Louisiana Gulf Coast after Hurricane Gustav slammed ashore yesterday.
The first priority today, rescue and recovery. The Coast Guard will be in the air in just a few hours looking for survivors who refused to evacuate but need to get out now. They'll continue to chopper around the hardest hit areas all morning long. In the United States, seven people have died from the storm.

Another worry, the levees. White caps crashed into the floodwalls along the Industrial Canal for three hours in New Orleans, but that wall thankfully held. Others were saved by sheer manpower in the middle of the storm.

And the threat is not over yet. Reynolds Wolf is at the CNN hurricane headquarters in Atlanta watching Gustav, Hanna and Ike. Storms still out there in the ocean.

Ali Velshi, who was face to face with the eye wall yesterday, is live on Grand Isle again this morning. First, let's go to Chris Lawrence though who's live in Plaquemines Parish south of New Orleans where an all-out sandbagging effort may have saved some 200 homes in the area.

This was a privately owned levee, Chris. How is it faring?

CHRIS LAWRENCE, CNN CORRESPONDENT: Well, they're keeping a close eye on it. Looks like they made it out of the woods, John, but they still want to keep a close eye on it. You can see these are the bags, some of the 2,000 bags that they were using at the last minute. These guys were sandbagging even as the back end of the hurricane was still passing through. It was that frantic.

The sign kind of says it all for the folks who live here. "Times are hard." Most of the folks who live here were evacuated, but they might not ever know how close their neighborhood came to flooding.

All this water just on the other side of this and you can see the dirt, the sandbags. I mean, they were rushing right up until this way as the hurricane, the back end was passing through trying to get this levee shored up. You can look over there and see just how close the homes were to this water if this levee had collapsed.

Now, what was happening was the U.S. Army Corps of Engineers was using siphons and pumps to try to alleviate some of the pressure on it. And on this side, some of the local workers were sandbagging, trying to shore it up. They say that that's what made all the difference. But because this levee is not part of the federal system, they say eventually they're going to need some help from the federal government to get it to the point where it can withstand those really strong storms -- John.

ROBERTS: Chris Lawrence for us this morning. Chris, thanks so much -- Kiran.

KIRAN CHETRY, CNN ANCHOR: Well, it's as close to the center of the storm as you're going to get. CNN's Ali Velshi reporting from Grand Isle, Louisiana, a barrier island southwest of New Orleans, as the eye wall slammed into it. The whole area was entirely under water by late morning.

There you see some pictures of just how high the water got and what it was like to be there. Well, it's a new day and Ali Velshi joins us now from Grand Isle. I guess they're getting a chance to take a look at the damage caused by that ferocious storm that hit you guys.

ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: Yes. Good morning, Kiran.

It was a look that they started to get yesterday. You know, that water came up probably six or seven feet. And then by late afternoon, the man whose house we're at, Dean Blanchard, you know, he's got this house. It was fortified for a hurricane. That's why we stayed there.

About a quarter mile down, he's got a shrimp processing plant. He wanted to go out and see how the plant was and see how the town was going. He took his buddy out, and the two of them walked out. By the time they went out, the water as you can probably see from the pictures, well above their waist. They walked for several hours. He also took our car keys with them, walked to where we have left our cars on higher ground, and reported back to us that the cars are fine. They will drive. But there is no way we're driving out of here.

The 80 or 90 percent of the electrical poles are down. They are all across the roads. There's debris on the roads and that, by the way, doesn't include the roads that are still under water. So he said hunker down. You're here with us for a little while. There's no way to get out of here right now.

We also -- plan B was that the fire department would come back with a boat. They had evacuated about half. Most of the fire department have evacuated with the townspeople. The idea is that they would come back with a boat. They're not being allowed back in because of the destruction here on the island.

There are many houses with the roofs blown off. Houses that are completely destroyed here. The waters are receding and hopefully if they recede enough, we'll get a chance to sort of assess the damage ourselves. But there are going to people who are trying to get back here, Kiran, and it is tough.

I just also wanted to show you our vista is different today than it was yesterday morning. The camera is in the same position, but we've turned it around so that you get a sense of this house. This is the fortified house that we were in that really helped us through that -- that hurricane.

This house was solid. It trembled at moments. It lost the carport and lost some sort of roofing, but not much. This house is pretty strong and it stayed up through the hurricane, Kiran.

CHETRY: Yes. And I'm thinking back when we're live with you when that carport roof blew off. Boy, amazing.

All right. Good thing everything's still in order there. Thanks, Ali.

And right now, we're tracking two more major threats. This is Gustav continuing to dump rain on parts of Louisiana and eastern Texas and the possibility that Gustav could still spawn tornadoes. Then there's Hurricane Hanna headed for the East Coast. And then Ike may be the next threat to the gulf.

Reynolds Wolf is at the CNN hurricane headquarters tracking all of this for us. Active hurricane season, this is right -- this is the thick of it right now, right, Reynolds?

REYNOLDS WOLF, AMS METEOROLOGIST: I know. And you know, you named all the storms. I got one more for you. Try this one on for size.

Tropical depression number ten which possibly could be a named storm later on today, maybe tomorrow. This is what we refer to in meteorology as a full plate. Starting off with tropical depression Gustav, this is the final update from the National Hurricane Center on this dying system. But, still, although it is weakening considerably it's still a threat in many ways. The biggest threat is going to be in terms of flooding for parts of Louisiana back into Arkansas, Mississippi, and even into Texas through a good part of the day.

OK. Let's continue onward and let's get right to, at this time, let's get to Hanna. Hanna at this time gaining some strength. Winds are at 80 miles per hour gusting to 100. And take a look at the path of this storm.

It has been all over the place, most recently heading south near the Bahamas. Now the path from the National Hurricane Center brings it up shore right along the Florida coastline possibly making landfall between Georgia and South Carolina, and that would be as we get into late Friday, perhaps even into early Saturday. A lot can change in that storm. We're going to watch it for you very carefully.

Moving quickly from Hanna to Ike. Ike is the next one out there. This storm also gaining strength, moving a little bit faster out of the west at 15 miles per hour. Winds at 50 gusting to 65.

Kiran, I want you to notice how rapidly this storm is expected to intensify. Moving into an area of warm water, minimal shear environment, expected to reach hurricane status as we get into Thursday. Winds of 85 then becoming a Category 2 storm north of Haiti in the Dominican Republic as we get into Saturday and Sunday.

Now, we have the other storm. The other one we're referring to is tropical depression ten. This storm is also expected to veer its way to the west and should become a hurricane as we get into the weekend. A Category 1 storm.

It's going to be a busy season. That's how it happens. This is the real peak of the season. Remember, Kiran, the season is going to last all the way through November 30th and it may extend a little bit later. You'll remember both in 2004, 2005, it went all the way into December and into January. So it could happen again this year. It's been crazy.

CHETRY: Absolutely. All right. Well, you're tracking it all for us and we appreciate that. Reynolds, thanks.

WOLF: You bet.

ROBERTS: Coming up now on 10 minutes to the top of the hour. And here's -- or 10 minutes after the hour, rather. Sorry. Here's what we're working on for you this morning.

Barack Obama praises the government's reaction to Hurricane Gustav, but says there is more work to be done. We'll have Anderson Cooper's exclusive interview with the presidential nominee.

CHETRY: Open for business.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: The 2008 Republican National Convention in session.

(END VIDEO CLIP)

CHETRY: They got the party started, but did the storm steal all their thunder?

Jessica Yellin has the latest on the Republican Convention.

You're watching the "Most News in the Morning."

(COMMERCIAL BREAK)

Just in to CNN here in Saint Paul, Minnesota, at the Xcel Center, home of the Republican National Convention. On a Tuesday, it looks like it's game on for the Republicans.

Our John King, chief national correspondent, has been working his sources this morning. He's on the phone. John, what's the latest on the program for today?

VOICE OF JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: John, good morning.

The official announcement will come later, but the planners were up early. They checked in with the gulf state governors and all of the governors told them go ahead with the convention program. So they will gavel it into order tonight and we will have a full program this evening.

The main speakers will be the Democrat turned Independent Joe Lieberman, the senator from Connecticut, who is, as most of our viewers know, a very close friend of John McCain, and Fred Thompson, former Republican presidential candidate and former Tennessee senator, also known, of course, for his roles in movies and on television programs. They will be the main event tonight.

And President Bush also will speak to the Republican National Convention via video link from the White House. President Bush will be in the 9:00, around 9:30 or so, Eastern time tonight. Fred Thompson and Joe Lieberman in the prime time hour of 10:00 to 11:00 Eastern.

Convention planners tell us, don't look for too much red meat bashing Barack Obama. There still will be a theme of service because of the conditions in the Gulf Coast. The theme of tonight is, who is John McCain. So the close friend from his Senate days, Fred Thompson, and perhaps his best friend in the Senate Joe Lieberman giving testimonials to the Republican presidential candidate John McCain, as the convention gets under way tonight as there was a brief session yesterday, as you know. But the main event now will begin tonight, John.

ROBERTS: All right. John King for us this morning with that breaking news. John, thanks very much.

And we should point as well, Joe Lieberman will be joining us in our next hour here on AMERICAN MORNING -- Kiran.

CHETRY: All right. There we have it. John, thanks.

And we're going to talk more about the "Most Politics in the Morning." And this is the several -- the several new revelations coming up this morning about Governor Sarah Palin. And she's making some headlines away from the Republican Convention.

Joining me now to talk about this is Republican strategist Ed Rollins and Democrat strategist Lisa Caputo. Good morning to both of you. Thanks for being with us.

So, experience and reform, Ed. These have been two of the things that John McCain has made a centerpiece of the campaign. And we have some new information about Alaska Governor Sarah Palin this morning that seems to contradict that. One is that apparently she's under investigation for what they're calling "Troopergate," which is possibly pressuring some powers that be to get rid of her brother-in- law, to fire her brother-in-law, who is a state trooper.

The other question is this report from the "Washington Post" today that says that she also hired a lobbying firm to secure $27 million in earmarks when she was mayor of Wasilla. What do you think? A liability for McCain?

ED ROLLINS, CNN CONTRIBUTOR: No. I think she's still an asset. I think it's still an unproven case. The "Troopergate" was, this was a guy who threatened her father. Basically not just the divorce case. Tasered her nephew. She did not think he was a good representative of the state highway patrol and basically some of her staff asked to have it looked into. He had been suspended once for these kinds of activities.

I think there's not a governor in the country that wouldn't have fired him. Equally as important on the --

CHETRY: Earmarks?

ROLLINS: Earmarks. Joe Biden's son basically is in the lobbying business getting earmarks including getting earmarks from Barack Obama. I think the bottom line is there's a lot more to know about this woman. And I think so far at least -- at least the base of our party is very, very happy with her.

CHETRY: Lisa, do you think it raises some questions about what the vetting process was and whether or not this was a pick that perhaps was a little bit too risky for McCain.

LISA CAPUTO, DEMOCRATIC STRATEGIST: Oh, absolutely. I mean, this raises questions about presidential decision-making. It's very clear. I think that Senator McCain made this decision at the 11th hour. As has been reported in today's papers, it seemed that he really wanted to go in the direction of Senator Joe Lieberman or Tom Ridge. Couldn't go there because they were pro-choice candidates and he needed to go somewhere where he could rally his base.

Made this pick, I believe, five days before it became public. And now they've got a team of lawyers on the ground in Alaska trying to do a full vet of her. It does beg the question of presidential decision-making, I would argue.

CHETRY: I have a question now about this situation. And while it is fair game to take a look at people's records and to talk about earmarks and any pending investigation, do you think that she is unfairly being scrutinized? Do you think there's any element of sexism here in terms of whether or not Joe Biden is under as harsh of a light as she's been?

CAPUTO: I don't think there's an element of sexism at all. I think that -- and I say this as somebody who obviously supported Senator Clinton. What you had here is somebody who is a public official and has been put into the limelight as the VP nominee. And anything's game.

Now, I do agree with Senator Obama, which is that family should be off limits. I fundamentally believe that. But when you peel back the onion here, I think that Senator McCain made a move to try and not only rally the base, but attract those female voters who may feel disenfranchised by Senator Clinton's failure to win the nomination. That's just not happening.

Obama's ahead with Clinton voters by 50 percent. He's ahead with women. He's ahead with independents as you see in the latest CBS News/"Time" magazine, "New York Times" poll. So I don't see the Palin effect happening on Democratic voters. In fact, I see a lot of questions being raised about can this -- can this person really be qualified to be a heartbeat away from the presidency when she's only been governor for two years?

CHETRY: All right. We'll have to see both of those issues. We're running out of time here, but I did want to ask you guys quickly, no big convention doubts for the Democrats either. If you go both quickly, tell me.

ROLLINS: This is a very close race, a very close race regardless of who the vice president is. At the end of the day, it's going to come down to the same five, six, seven states that it was in 2004 and 2000.

I think the country is polarized. I think the country is looking for new leadership, and I think they're looking at both parties. Democrats nominated the two most liberal members of the Senate. We nominated two conservatives. It'll be a clear choice for different voters.

CHETRY: All right. Well, I want to thank both of you for being with us. Lisa Caputo as well as Ed Rollins, thanks.

CAPUTO: Nice to see you.

ROLLINS: Thank you.

CHETRY: One on one with Obama.

(BEGIN VIDEO CLIP)

ANDERSON COOPER, CNN ANCHOR: Do you think New Orleans has been forgotten?

(END VIDEO CLIP)

CHETRY: The candidate on Gustav, Katrina, and the charge that McCain's running mate has more experience than he does.

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA (D), PRESIDENTIAL CANDIDATE: Governor Palin's town of Wasilla has, I think, 50 employees. We've got 2,500.

(END VIDEO CLIP)

CHETRY: You're watching the "Most News in the Morning." (COMMERCIAL BREAK)

CHETRY: Welcome back to the "Most News in the Morning." New Orleans residents breathing a sigh of relief this morning as Hurricane Gustav blows through with less damage than expected. Still problems out there but there are efforts now to prepare for the storm and they did help limit the damage.

Senator Barack Obama discussed the government response in an exclusive interview with our Anderson Cooper. Here's a look.

COOPER: Kiran, I spoke with Senator Obama on Monday night from the Lower Ninth Ward. I asked him about his assessment of the federal, local and state response to Hurricane Gustav as well as to criticism by Republicans over his experience, comparing it to the experience of Governor Palin. Take a look.

(BEGIN VIDEOTAPE)

OBAMA: A lot of the front end planning that was done I think clearly paid off. But it's a little bit too early to tell whether or not the back end of the crisis in terms of housing, in terms of dealing with flood damage, if there is any, whether small businesses and homeowners are getting the relief they need right away, whether that's being dealt with.

COOPER: The storm damage folks are seeing them right behind me now. That's not from this storm. This is from three years ago. It's still sitting out here.

There are a lot of folks here still spread around the United States who would like to come back home. Do you think New Orleans has been forgotten and what would your administration do differently?

OBAMA: Well, it hasn't been forgotten by me, because one of the pledges that I've made when I was a senator and one of the pledges that I intend to keep as president is to make sure that we rebuild New Orleans and its vitality and its place in American culture. There's nothing like New Orleans. And the truth is, is that we have been too slow.

There was a report today, or maybe it was yesterday in the "New York Times" indicating that the Road Home Program, hundreds of millions of dollars that have not ended up being utilized just because of red tape and bureaucracy.

The American people are generous, and they understand that during moments of crisis we need to come together and provide people help. But what we haven't seen are the kinds of efficient programs that get to the people that need help right away. And that is going to be one of my highest priorities, making sure that we respond immediately after a storm, but also that we're putting in the levee systems and the pump systems that are necessary to survive a Category 5 hurricane.

COOPER: Some Republicans critics have said you don't have the experience to handle a situation like this. They've, in fact, said that Governor Palin has more executive experience as mayor of a small town and as governor of a big state of Alaska. What's your response?

OBAMA: Well, you know, my understanding is, is that Governor Palin's town of Wasilla has, I think, 50 employees. We've got 2,500 in this campaign. I think their budget is maybe $12 million a year. You know, we have a budget of about three times that just for the month.

So I think that our ability to manage large systems and to execute I think has been made clear over the last couple of years. And certainly in terms of the legislation that I've passed, just dealing with this issue post-Katrina of how we handle emergency management. The fact that many of my recommendations were adopted and are being put in place as we speak I think indicates the degree to which we can provide the kinds of support and good service that the American people expect.

(END VIDEOTAPE)

COOPER: Kiran, I should also point out we extended an invitation to Senator McCain for an interview. But so far, he's declined our request, but we'll keep after him -- Kiran.

CHETRY: The running mate surprise.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: This is the most vile blog I've ever seen.

(END VIDEO CLIP)

CHETRY: Top Republican strategist Mary Matalin on the fallout from the Sarah Palin secrets. You're watching the "Most News in the Morning."

(COMMERCIAL BREAK)

CHETRY: We're coming up to the bottom of the hour now. We got the very latest on Hurricane Gustav and the aftermath.

Mayor Ray Nagin telling people to stay away from New Orleans this morning. But he says they may be able to return in days, not months. Close to a million homes and businesses lost power across the region. The Coast Guard will be in the air this morning looking for anyone trapped. The levees did hold up against a surge that sent white caps over floodwalls in some areas, but the estimated wind speed in New Orleans was really that of a Category 1 hurricane.

ROBERTS: Well, Gustav did leave its mark on the city in much different ways. That wind estimated to have reached about 80 miles an hour. It was a bigger problem than the water in some areas. Debris and downed power lines are keeping thousands of people away today.

Our Rob Marciano rode out the storm in the roof of the Omni Hotel in the French quarter. He was pelted by rain and hurricane force winds for hours. He joins us now with a look at the damage that Gustav left behind. Rob. ROB MARCIANO, CNN, METEOROLOGIST: Hi, John.

You know, it was that constant punishment of hours of nonstop east winds from the same direction that had officials worried yesterday, especially when it came to those canals and levees. You know, it was about a week ago when all the anxiety and hysteria started with this storm.

As you would imagine, folks who live here are certainly on edge. Then the National Hurricane Center forecast really on the money bringing it very, very close to New Orleans. It definitely wasn't a Katrina. But Gustav was nothing to sneeze at.

(BEGIN VIDEOTAPE)

MARCIANO (voice-over): Gustav slammed into New Orleans. Knocking down trees and hurling debris through the air. But this time, officials say, the Big Easy was ready.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The coordination on this storm is a lot better than on -- than during Katrina.

MARCIANO: Three years after Katrina, what went right? Well, this time, nature showed some mercy. High winds threatened, but did not flood the crucial levees. Eastern New Orleans, hit hard during Katrina, suffered mostly wind damage this time. The few residents who stayed to ride out the storm say officials were more prepared this time around.

UNIDENTIFIED MALE: Much better the second go than the first. That's for sure. Much more organized.

MARCIANO: 95 percent of the city's residents were evacuated. Normally packed streets were empty. That's exactly what authorities wanted.

ADM. HARVEY JOHNSON, DEP. FEMA ADMINISTRATOR: We did a very good collective job in terms of response. And we'll do an equally effective job in terms of recovery.

MARCIANO: Recovery may take days. Power authorities say tens of thousands in New Orleans remain without electricity.

At the height of the storm, more than 100,000 customers had no power.

GOV. BOBBY JINDAL (R), LOUISIANA: We still have several days and weeks and perhaps even months of work ahead of us.

MARCIANO: The mayor says it'll be days before damage is properly assessed and residents can come back.

MAYOR RAY NAGIN, NEW ORLEANS: The city of New Orleans looks like we're not totally out of the woods, but we're getting close.

(END VIDEOTAPE) MARCIANO: Still raining here. Still some south winds. And the mayor says, he and his city officials coming today, will check out assessments. They'll do some repair work as they see fit. And then the next step will be to allow businesses to come back in. They hope to have residents in at the latest by the end of the week. School is closed, by the way, until the end of the week.

All right. Where is Gustav? Northwestern parts of Louisiana, still flood watches up for a good chunk of Louisiana, especially the eastern half. Heavy rains expected today as (INAUDIBLE) rolling off the Gulf. Also tornado watch in for extreme eastern Louisiana and southwestern Mississippi until 7:00 a.m. local time.

Up next on the docket, southeast coastline. Hurricane Hanna right now 80 miles an hour winds. About 400 miles from Nassau heading to the west, drifting to the west. And then forecast to become a Category 2 storm. Potentially affecting anywhere from the northern Florida coastline to the Carolina coastline as early as Thursday or Friday. That's something that we're watching carefully. Also, tropical storm Ike with winds of 50 miles an hour. That also scheduled to become a Category 2 storm and be in the Bahamas by this weekend.

We are ramping up for prime time hurricane season, John. And certainly it's getting busy. Back to you.

ROBERTS: It certainly is, Rob. Thanks so much for that. Kiran.

CHETRY: Thanks, guys. Well, you know, in the days before Hurricane Gustav, New Orleans mayor, Ray Nagin, called it the mother of all storms. The city got a head start on evacuations and the police got ready as well. The levees held their ground despite some scary moments. And crucially, the hurricane's eye wall missed New Orleans going a little farther to the south and west. Unlike three years ago, apparently, it appears, at least, this morning the city was spared.

I'm joined now by Mayor Nagin, live in New Orleans.

Thanks for being with us, Mayor.

MAYOR RAY NAGIN, NEW ORLEANS: Good morning.

CHETRY: First of all, give us an update, if you will, about what you've been able to determine. Damage assessments and how the city fared.

NAGIN: Well, we're going to do a full assessment today and really begin in earnest with repairs. But my initial assessment is that there's still some damage out in the city. Many power lines are out. We have over 50 percent of our citizens without power. Our sewer system is damaged and not operational. And our hospitals are still with skeletal crews. So we'll repair most of that today and tomorrow and start the process for reentry thereafter.

CHETRY: I know you mentioned some of the other concerns like downed power lines, the possibility of electrocution. You know there's a lot of people eager to come back. What are you telling them today about when it's likely they can start heading back to the city?

NAGIN: Well, basically, my message is, you know, hold tight for today. Let us do our assessments. Let us get in front of everybody, do most of the repairs. And then starting tomorrow, on Wednesday, we will start to allow all of our businesses in. And then the latest, Thursday, we'll start our citizens to arrive. So we're going to have an orderly process for reentry. But it's only days and not weeks.

CHETRY: Certainly that's some good news. You know it was a Herculean effort on the part of everybody to get many people, thousands, really, 30,000, who couldn't get out themselves out. What is that process going to be like as you have to get those same people that couldn't get themselves out, now back in?

NAGIN: Well, we're just going to reverse the process. We have buses and trains and planes that took people out. And once we give them the word, that same process will bring them back and get them back into their neighborhoods. These were special needs people and people who don't have transportation. So we're going to provide them with all the assistance to get them back efficiently and effectively.

CHETRY: I know you guys are in a tough situation here. You know, we saw what happened in Katrina when people didn't heed the warnings. This time you called it the mother of all storms. It looked like it was going to be the big one and it wasn't.

NAGIN: Yes.

CHETRY: Does it end up making it more difficult to convince people to leave next time around?

NAGIN: You know, I don't think so. It still was a Category 3 storm that hit which was similar to what Katrina was. It just came a different direction and our levee systems held. The next time we have a storm like this one, that's approaching us that's a Category 4 and potentially strengthening, once it gets into the Gulf, I think our citizens are pretty smart and savvy and they will leave again.

CHETRY: Mayor Ray Nagin of New Orleans, thanks for being with us this morning.

NAGIN: Thank you.

ROBERTS: North and west of New Orleans where many evacuees headed the damage may be even worse. Our Ed Lavandera standing by for us in Lafayette, Louisiana right now.

Hey, Ed.

ED LAVANDERA, CNN CORRESPONDENT: Good morning, John.

Here, I'm here on the banks of the Vermilion River in Lafayette, Louisiana, where the brunt of the storm from the center of Hurricane Gustav roared through here in the towns west of New Orleans. We'll have an update on how those towns fared when AMERICAN MORNING continues.

(COMMERCIAL BREAK)

ROBERTS: Yes, there we go. 39 minutes after the hour. Welcome back to the most politics in the morning. Vice presidential nominee Sarah Palin has brought a lot of surprise and a lot of interest to the McCain campaign. And that can be good and bad as they are finding out here in St. Paul.

Joining me now, Mary Matalin, she served as an assistant to President Bush, council to the vice president Dick Cheney. And she is supporting John McCain. Good morning, Mary. It's good to see you.

MARY MATALIN, FMR. ASST. TO PRES. BUSH: Good morning, big time supporting him.

ROBERTS: The first rule of running mates is no surprises. But Sarah Palin has now become the story here. And the campaign is spending an awful lot of time and effort defending her. As a strategist, is this where you want to be opening up your convention?

MATALIN: Where you want to be is where we are. Not just in the polls but with this hall and with these delegates. You can see. You've been here a couple of days. They are electrified by this choice. This is not spin. They are not just unified. They are energized. They are increasingly energized with Senator McCain's trifecta of getting ahead of energy, getting ahead of the Georgia- Putin situation, and his baffled appearance in Saddleback. This choice is what they wanted. She's the future of the party.

ROBERTS: But are they awfully surprised as well about the announcement yesterday and many people are scratching their heads thinking is there something else out there that the campaign may know about that we don't know about?

MATALIN: Well, this campaign -- these facts are coming out appropriately. But it's hard for you all to get your arms around it. It's a surprise to you. It's not a surprise to many of these delegates. The choices, they're delighted with it. She was fully vetted. She was vetted all summer. The senator has been watching her for a while.

ROBERTS: You don't think yesterday's announcement was a surprise to most of these delegates?

MATALIN: I think, of course, it was a surprise. But it was not anything that is disqualifying obviously to Senator McCain nor is it unembraced by this delegation. All of these delegations. In fact, they're very supportive of her -- their -- the parents' unconditional support and love of their child as any parent would be.

ROBERTS: I'm going to try to leave her daughter out of this. And stick more with the issues and the policies now. There's a story in the "Washington Post" today, a report in "The Post" that despite the fact that John McCain says she is a champion against earmarks and wasteful spending that as the mayor of Wasilla over the course of 40 years, she hired a lobbying firm which attracted more than $26 million in federal funds for home district projects calling it pork barrel spending.

MATALIN: You know, she --

ROBERTS: How does that jive with what Senator McCain says?

MATALIN: I actually met with some Alaskans last night who said for all of this talk by the opposition and some of the press about the mayor of Wasilla, it's a very up and coming town. She cut taxes there. She increased jobs. It's where people want to go and live. It's like the Tyson's corner, with reference to inside the beltway type, of Alaska.

She has used her veto and she did stop the bridge to nowhere. She has ethics reform record. She has spending cuts record of reform. So, you know, that's bringing jobs in and bringing investment into your community is what you're supposed to do as a mayor but she has not --

ROBERTS: But how does that square with John McCain's vehement opposition to those things, --

MATALIN: To bring investments into the community?

ROBERTS: No, to get earmarks?

MATALIN: She's vetoed the earmarks, many of the earmarks, particularly the ones that are pork. There are some investments that can be made in communities. That's what you're hired to do. That's what you should be doing to grow your community. But not pure pork like the bridge to nowhere.

ROBERTS: Let me ask you about experience because you work for one of the most powerful vice presidents in this nation's history. Does she when you look particularly at the standard that John McCain has set in this campaign, for saying, this is what it takes to be commander in chief, measured against his own standard, does she have the experience to be a heartbeat away from the presidency?

MATALIN: She has the judgment. She has the principles that would guide policy should she ever be in that position. You've been around, we've both been around many White Houses in times of war. As you know, the President supported and advised by generals, intelligence chiefs, and other advisers, a secretary of Defense. She know what is the policies are. She's aggressive, tough. She knows the peace through strength. She's been to Iraq as many times as Obama.

ROBERTS: So is that a suggestion that experience is overrated in that position though?

MATALIN: No, I'm not saying it's overrated or underrated. I'm saying more important than anything is judgment and understanding what the mission is and what is the vision to secure America. She absolutely shares those policies and principles with Senator McCain. I'm ecstatic about this choice. Doesn't matter what I think. But this delegation and the country, if the polls are any evidence, are equally enthused by the fresh young governor from Alaska. It's going to be the running mate and the next vice president of these United States.

ROBERTS: Mary, it's always great to see you.

MATALIN: Thank you.

ROBERTS: We don't get together often enough. Hope you come back soon.

MATALIN: Not this early, though.

ROBERTS: Thanks. We'll try to move the morning show to the afternoon.

MATALIN: Thank you.

ROBERTS: Appreciate it. Kiran.

CHETRY: As the Republican Convention starts to take a familiar shape tonight, supporters of one congressman are holding their own separate party. We're going to speak with Texas Representative Ron Paul and what he's seeking with his new political action group the Campaign for Liberty.

Also, John McCain making a bold play for the female vote but will putting Governor Sarah Palin on his ticket attract independent women? We're going to talk to one, coming up.

(COMMERCIAL BREAK)

ROBERTS: At 47 minutes after the hour, brand-new video coming in of the storm surge across the border in Mississippi. It reached 11 feet in some areas of the coast. The same area where Katrina's wall of water wiped out entire blocks. This time Gustav slipped west, sparing the state the worst of it. There could still though be millions of dollars in damage. Several feet of water flooded homes and buildings. Two feet of water reported in the lobby of the Hard Rock Casino. Katrina, you might remember, caused $125 million in damage to the casino floor and delayed its grand opening for two years. And that's a shot of Grand Isle there where our Ali Velshi rode out the storm. A fire truck hit deep in water there. Kiran.

CHETRY: Amazing pictures. Well, even though the worst may be over, the residents along the storm's path are looking back with relief. Take a look at front page from New Orleans, the headlines from "The Times-Picayne," saying "Safe at Home," that's what it reads there. Industrial canal wall holds despite fears.

A much different story on the south Louisiana "Advocate." The headline BR, meaning Baton Rouge, pounded. Shows a tree that split a home in two and an elderly couple was killed in that. It also says Gustav did more damage than the infamous hurricane Betsy back in 1965. And another shot, "Hammered." This is the headline from the "Sun Herald" of south Mississippi. The front page photo showing two battered shrimp boats in the parking lot of past Christian Harbor.

Gustav left a deadly path to the north and west of New Orleans. In Lafayette, Louisiana, wind took down an oak tree smashing a home and killing the only man inside at the time. The city that took in many evacuees during this storm as well as Katrina. Ed Lavandera is standing by for us in Lafayette this morning.

Hi, Ed.

LAVANDERA: Good morning, Kiran.

Those deaths that you referred to, the two in Baton Rouge and the one here in Lafayette seemed to be the worst of the news that have emerged from Hurricane Gustav. We're standing here on the banks of the Vermilion River in Lafayette where the water level is about ten feet above where it normally is and it's expected to crest at about 13 feet in the next 24 hours or so. So they'll continue to watch this closely and similar rivers and tributaries throughout the region.

They still say that there is some concern for possible flooding. Of course, this takes a little bit of time for the waters to make their way into the river and see this play out. So they'll continue to watch that. But as we've checked in with various communities in the south of Lafayette, everyone reporting that they feel like they've come out of this storm very well considering that the brunt and the center of the storm roared through here yesterday.

Yesterday afternoon, we drove down to Abbeville, Louisiana and New Iberia, even all the way down to Morgan City, which is about 60 miles away, and really just reported kind of the typical storm damage. Downed trees, some downed power lines. But all in all, considering the center of the storm roared through here yesterday, everyone feeling they've come out of this pretty well -- Kiran.

CHETRY: Ed Lavandera for us in Lafayette this morning. Thank you.

Deserted isle.

(BEGIN VIDEO CLIP)

VELSHI: There are only 10 of us left here.

(END VIDEO CLIP)

CHETRY: Gustav destroys it's first target.

(BEGIN VIDEO CLIP)

VELSHI: We're in Grand Isle. I think we're going to have to get off of this right now.

(END VIDEO CLIP)

CHETRY: Leaving homes underwater in the eye of the storm. Our Ali Velshi rides it out. Plus, crashing the party.

(BEGIN VIDEO CLIP)

CINDY MCCAIN, WIFE OF SEN. JOHN MCCAIN: This is a time when we take off our Republican hats and put on our American hats.

(END VIDEO CLIP)

CHETRY: How John McCain can bounce back after Hurricane Gustav stole his thunder.

(COMMERCIAL BREAK)

ROBERTS: Well, welcome back to the most politics in the morning here on CNN. CNN confirms the Republicans are going to return to their regularly scheduled convention tonight. After putting politics aside for Hurricane Gustav. President Bush will address the delegates via satellite tonight at 9:30 Eastern. Also on tap, former Senator Fred Thompson and Senator Joe Lieberman. Stick around with us this morning because Senator Lieberman is going to join us live on AMERICAN MORNING in about 15 minutes time.

Meantime, thousands of former presidential candidate Ron Paul supporters are attending a counter convention not far away from the Xcel Center here. The official name of the gathering is the Rally for the Republic, to officially launch Paul's new political action group the Campaign for Liberty.

And Texas Republican Congressman Ron Paul joins me now. It's great to see you again.

REP. RON PAUL (R), TEXAS: Nice to see you.

ROBERTS: Always good to have you on. A report I read this morning that the McCain campaign and the Republican National Committee are actively reaching out to you to try to get your support for Senator McCain's candidacy. Is that true?

PAUL: I wouldn't put it in those words.

ROBERTS: How would you put it?

PAUL: I imagine -- I don't even know where they got a statement like that. I mean, we've been reaching out. We were requesting whether I could come to the floor. And really, we've been just up against a wall.

ROBERTS: So they haven't been reaching out to you?

PAUL: Well, I wouldn't call it that. I mean, they had one individual come and talk to us and said what would we like. We listed a lot of things and we didn't get anything. We said could we go to the floor? And then they said yes you can come under very restricted conditions. You know, a Republican congressman should have a pass to the floor but they said your pass will be at the gate and you'll pick it up when you leave and you can't take anybody with you. I mean, my staff -- they said we would have, you know, three guest passes that I could take on to the floor with me, but they never confirmed that.

ROBERTS: Well, one place where you are going to be welcome is at your -- could we call it a counter convention today? What's that all about? What's the message you want to get across?

PAUL: It's a very positive thing to talk about the issues we think the Republicans ought to be talking about. You know, where our problems are, the spending problems, the deficit, our foreign policy, our national defense, our monetary policy, the things that are totally ignored. Personal liberty. We, our group don't like the intrusion of personal liberties like the Patriot Act and the Real Idea Act. They're not talking about that.

So we're saying, you know, if we're Republicans we believe in limited government and personal liberty. We ought to be talking about these things and I don't think they are really too interested.

ROBERTS: You have been very critical of Senator McCain's economic policy, his foreign policy, national security policy. You've also been very critical of Senator Obama for the same thing. Is there anything to like with either of these candidates for you?

PAUL: Not a heck of a lot. But --

ROBERTS: Is there anything?

PAUL: Well, I like it when they shift their positions, but then you don't know where they are. I mean, John McCain used to be for taxes. Now he's against taxes. Obama talks about, you know, less military intervention, but he's the first one to say we should increase the troops in Afghanistan. They both say we should put more money and more investment into Georgia to protect that oil line.

ROBERTS: But if you don't put more troops into Afghanistan, are you not risking a bigger problem?

PAUL: No. I think we risk very little. I mean, what did the Soviets do? It brought the Soviets to their knees. We're doing the exact same thing.

ROBERTS: You think if we pulled out the Taliban wouldn't be completely resurgent there?

PAUL: I have no idea. But I do know that Osama Bin Laden would like us to go in Afghanistan because he loves us there because that's exactly what he wants us to do.

ROBERTS: Let me ask you something quickly because we're running out of time here. Governor Palin of Alaska had some very nice things to say about you. In a recent MTV interview, she called you cool, a good guy, independent and a party machine. What do you think of her and her candidacy?

PAUL: Well, that sounds like she should be my friend. ROBERTS: Or your running mate.

PAUL: Yes. That's good. I haven't met her. But I was delighted to hear that. So I hope she puts the right kind of pressure on our platform and our positions.

ROBERTS: Congressman Paul, it's great to talk to you again as always.

PAUL: Thank you.

ROBERTS: All right. We'll be watching today, and see what you have in store.

PAUL: All right. Very good. Thanks a lot.

ROBERTS: Kiran.

CHETRY: Well you were just talking about her, Senator John McCain's running mate shocking some of the political world. But the announcement that her teenage daughter is pregnant. Sarah Palin says that her daughter has their family's unconditional love and support in her decision to keep the baby and marry the father.

CNN's Kyra Phillips is in Anchorage, Alaska, the hometown and she gets some reaction and what, if anything, it could mean for the Republican ticket.

(BEGIN VIDEOTAPE)

KYRA PHILLIPS, CNN CORRESPONDENT: 17-year-old Bristol is Governor Palin's oldest daughter, a high school senior. She's been seen at campaign events in the last few days holding her baby brother Trig. What we didn't know then, she's five months pregnant. The father's name is Levi and they intend to marry. The parents issued this statement. "We are proud of Bristol's decision to have her baby and even prouder to become grandparents. As Bristol faces the responsibilities of adulthood, she knows she has our unconditional love and support."

Prominent Republicans in Alaska and beyond have been just as supportive.

UNIDENTIFIED MALE: She's a human being like everybody else and it certainly doesn't mean that your kids are. To me, it makes them more human. My guess is that's how the public is going to react.

PHILLIPS: Aides to Senator John McCain say he was aware of Bristol's pregnancy even before he chose her mother for his running mate and didn't even consider it relevant. Nor does Democratic nominee Barack Obama.

OBAMA: I have said before and I will repeat again, I think people's families are off limits. And people's children are especially off limits. PHILLIPS: But to some, the 17-year-old's pregnancy is a political issue. Her mother supports strong family values and teaching abstinence but not sex education in schools. Abortion rights activists say they won't comment on Bristol's case. But it does underscore the need for teaching teenagers about sex.

GERAN TARR, ALLIANCE FOR REPRODUCTIVE JUSTICE: Even in the best of circumstances, with the best family and a loving family where they probably have the conversation that this type of thing can happen unexpectedly.

PHILLIPS (on camera): Why not support abstinence only?

TARR: It doesn't educate teenagers about how to prevent STD transmission.

PHILLIPS (voice-over): According to Tarr, Alaska has one of the highest teenage rates of sexually transmitted diseases in the country. Although the rate of teenage pregnancies has dropped sharply.

We asked a man who knows Governor Palin well. Can she juggle being a mom and Vice President of the United States?

FRED DYSON (R), ALASKA STATE SENATE: She's a very capable person and very bright and tough, without being abrasive. I don't know whether she can do it or not. Time will tell.

(END VIDEOTAPE)

CHETRY: And that was Kyra Phillips reporting.