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Al Qaeda Insults Obama; Should Congress Help Auto Industry?; AP Photographer Reunites Girls with Family; New Advances in Organ Transplants

Aired November 19, 2008 - 13:00   ET

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

(BEGIN VIDEOTAPE)
KYRA PHILLIPS, CNN ANCHOR (voice-over): Congrats from the president of Iran. A courtesy call to the Palestinian president. A nasty message, allegedly from al Qaeda. Is Barack Obama bringing change the Middle East believes in?

If you ran across these two girls, lost, terrified and desperate, could you just walk away? The guy who took this snapshot of Congo's sorrow couldn't.

Remember when were you in the third grade? Learning times tables, cursive, Miranda rights? Were you savvy enough to know your legal rights, if the cops were grilling you without your parents or even a lawyer? A case in Arizona makes you wonder if there's any justice in the law.

(END VIDEOTAPE)

PHILLIPS: Hello everyone. I'm Kyra Phillips live at the CNN world headquarters in Atlanta. And you're live in the CNN NEWSROOM. Let's get right to it.

The president-elect has gotten congratulations and well wishes from across the world. But Al Qaeda, not a big fan. A new message supposedly from the group's second in command rips Barack Obama for his support of Israel, his stance on Afghanistan, his Christian faith and even throws a racial insult into the mix, calling him a house Negro. That's a term Malcolm X used to describe blacks who were subservient to whites.

Let's talk with Professor Fawaz Gerges about this. He's an expert on the Middle East. He joins me now live from Rome.

Good to see you, Fawaz.

FAWAZ GERGES, PROFESSOR: Same here, Kyra.

PHILLIPS: You know, and I know that we are actually -- we have Malcolm X on tape, putting in context exactly what he meant by house Negro. And as we wait to get that ingested, let's just explain to our viewers exactly what that means.

He was giving a speech about slavery, saying, "I've been referred to as the house Negro. Not a field Negro. Field Negroes are those are that understand the plight of slavery, whereas you know, me, I'm referred to as a house Negro, because I'm a black man trying to play in a white man's world."

What do you make about the fact that al-Zarqawi (sic) is quoting Malcolm X, is using this phrase? Is he even smart enough to understand what was being said by Malcolm X?

GERGES: I think it tells you, Kyra, how desperate al Qaeda is. Barack Obama terrorizes al Qaeda, which is very ironic. That is, bin Laden and Zawahiri are terrified. The election of Barack Obama, it presents a game changer. He basically denies them legitimacy in the eyes of Arabs and Muslims. He talks about reconciliation, about engagements, about coexistence. He promises to pull out of Iraq, to engineer a political settlement on the Arab-Israeli conflict. He says this is not a war between Islam and the United States.

Barack Obama is bin Laden's and Zawahiri's worst nightmare, literally speaking.

And I think what you need to understand, Kyra, today, the statement by Zawahiri, the violent terms used by Zawahiri, including the so-called term in Arabic, I mean, the term is a very violent, racially violent -- about what he's saying is that Barack Obama and Colin Powell and Condoleezza Rice are slaves of their white masters, even though they're African-Americans, that they are basically doing the bid of white imperial America.

He's trying to tell Arabs and Muslims, trying to regain initiative and tell them, please, don't pin your hopes on Barack Obama. Barack Obama is an extension of white domineering America.

PHILLIPS: Well, but...

GERGES: The reason why he says so, because there's a great deal -- there's a great deal of excitement about Barack Obama in the Arab and Muslim world. And that's why al Qaeda and Zawahiri are terrified of the elections.

PHILLIPS: And what's interesting is al-Zawahiri, it's like he's trying to use the black card. I mean, you never heard racial slurs or these types of comments when there was a white president. Now all of a sudden the target is becoming bigger and saying, OK, let's go ahead and throw that whole racial aspect into things. That will get people fired up.

But actually, it may be even more polarizing, because younger Muslims see Barack Obama as change, as good -- as good for the future of the Middle East. So this may completely backfire on ignorant terrorists.

GERGES: You're absolutely correct. In fact, many Muslims will ask the question. I mean, the man has not been in the White House yet. As Muslims, even though they are skeptical about any kind of radical change in American foreign policy, they like the discourse, the rhetoric of Barack Obama. Barack Obama does not traffic in polarities. He does not talk about us and them. In fact he promises to visit a pivotal Muslim country and basically appeal to young Muslims and Arabs that this is not a war between the United States and Islam. This is a -- primarily a war against al Qaeda war, not a war against the so-called global war on terror.

So many Arabs and Muslims will ask themselves, "Why is Ayman al- Zawahiri doing this at this particular stage? Give the man a break. Let's see whether Barack Obama would carry out his promises."

But it tells you, Kyra, the larger point. It tells you about the existential crisis in which al Qaeda finds itself today.

PHILLIPS: Right.

GERGES: Al Qaeda has lost, not just losing, Arab and Muslim hearts and minds. And what Ayman al-Zawahiri -- is basically now the leader, the operational leader of al Qaeda, because Osama bin Laden is incognito, either that or hibernating deep underground -- is trying to regain the initiative and turn the tables on Barack Obama.

The worst thing that Barack Obama and his foreign policy team would do is to respond to this letter. It's noise. Don't lend legitimacy to this man, because he is desperate to basically regain the initiative and the lost -- in the next few weeks (ph).

PHILLIPS: Absolutely. And on the positive side, you're seeing leaders all across the Middle East, praising who Barack Obama is and what he stands for. Leaders that were completely anti-American. So it's interesting to watch the dynamic change over. And that's the good news.

Fawaz Gerges, thank you so much.

Let's find out what team Obama is now saying about this message. CNN White House correspondent Ed Henry has that covered for us. He's joining us once again from Chicago.

Hey, Ed.

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Good afternoon, Kyra.

What's interesting is they're not saying anything. I spoke to a senior Obama transition aide, who said basically they do not want to get into a tit for tat with a terror organization. They're not going to respond to every audio tape that may come up.

Obviously, there's inflammatory language in this one, but -- and that's new, but they were expecting all along that al Qaeda would try to sort of get involved in the transition.

In fact, both the Obama transition officials and the current White House officials have been saying they think during this transition period al Qaeda will try to take advantage of it, try to launch terror attacks against the United States, because of this transfer of power. And in fact, that's one of the very reasons why we saw Barack Obama go in, as president-elect, to the White House early last week, very quickly after the election, sooner than we had seen before during other transfers of power, because this is the first independent handover since 9/11.

And so all along the Obama transition people and the Bush White House people have known that al Qaeda would try to sort of muddy the waters and get involved. And so it's not that much of a surprise to the transition team, and so they're saying they're not going to comment, Kyra.

PHILLIPS: All right. Well, on another side, then we'll move on. We're hearing that Senator Obama has made a choice for health and human services secretary. Is that true?

HENRY: That's right. Three officials close to the transition tell CNN first that, in fact, Tom Daschle, the former Senate leader, is the choice of the president-elect to be health and human services secretary and that Daschle has indicated privately he wants the job.

What's significant as well, is he's negotiated this so that he'll also be the White House point person on all health issues, to make sure that it's not White House staff that's writing the eventual health bill -- health bill that Obama sends up to Capitol Hill next year.

Interesting, as well, that Tom Daschle right now is technically not a registered lobbyist, but his wife Linda is. And that's a sore point, because the Obama folks have been saying that their administration would have real strict restrictions on federally registered lobbyists.

I've just gotten a new piece of information, which is that is a source close to Daschle is telling me that his wife, Linda, has informed her firm, Baker Donelson, in D.C., that at the end of the year she's going to be leaving, because they have health-care clients, and that could be a potential conflict of interest.

She's now opening her own lobbying firm that will focus on transportation issues, which is her specialty, and not have any health-care work. So that's yet another sign that this clearly is in the works and it's going to happen, Kyra.

PHILLIPS: All right. Ed Henry, thanks so much.

And with the new Obama administration, the U.S. may be getting its first African-American attorney general. According to two prominent Democrats, the president-elect has settled on Washington lawyer Eric Holder for the job. Those sources say that Holder is still being vetted, and he's indicated that he will accept the job. He was a former deputy attorney general under President Clinton.

Detroit's Big Three today, more like the beg three. The CEOs of GM, Ford and Chrysler are back on Capitol Hill, hands out, lobbying the House to tow them out of a financial ditch. Right now, it's not an easy sell to the House Financial Services Committee, though the Senate is talking about how to help families save their homes. The judiciary committee held a hearing on the role of bankruptcy law in the housing crisis.

Well, back to the Big Three bailout. Auto executives that say their companies are running on financial fumes, and they think that $25 billion taxpayer dollars could be the difference between ruin and rescue.

Lawmakers from Michigan are all for a Big Three bailout. They say letting them die on the vine could damage the entire economy. But others aren't so keen to throw Detroit a life preserver.

(BEGIN VIDEOTAPE)

REP. PAUL KANJORSKI (D), PENNSYLVANIA: How many money do you need survive, General Motors, from today until March 30?

RICHARD WAGNER, CEO, GENERAL MOTORS: Congressman, it's going to depend on what happens with suppliers and marketers.

KANJORSKI: I understand that. Give me your worst-case scenario.

WAGNER: Worst-case scenario, the amount of money would be significant. I mean, we have -- we have supplier...

KANJORSKI: What is significant?

WAGNER: Five billion dollars every month.

WAGNER: So -- so what you're telling us, that since you anticipate borrowing $15 billion to $18 billion under this authorization, if the market doesn't turn around, and the economy doesn't recover by that time, and I think you have to be a wishful thinker to think it will, by March 30, you're out of money? Is that correct?

WAGNER: The analysis that we've done is based on an assumption that the U.S. market continues at about the current rate, which is a weak level. We don't assume a lot of recovery. We hope it won't get worse.

(END VIDEOTAPE)

PHILLIPS: Now, former presidential candidate Mitt Romney wrote an op-ed piece in today's "New York Times." The title: "Let Detroit go bankrupt." Romney's father was an auto executive, by the way.

And foreign cars aren't exactly selling like hot cakes these days, either. Look at all the lonely imports just sitting at the port of Long Beach in California. This is what a go-nowhere auto market looks like. Mercedes, Toyota, Nissan, have all asked to lease space at the port for these rides because dealers just can't sell them.

Kick out top management. Tough words from Republican Senator Richard Shelby on how to fix the Big Three mess. On the other side, Democratic Congresswoman Maxine Waters has a very different take. We're going to hear from both of them in just about five minutes.

And on Wall Street, concerns about the automakers are hitting stocks. Also coming into play, a new report showing prices on everything from groceries to airline tickets tumbled last month. Lower prices sounds like good news for you and me, but we need check the fine print.

Susan Lisovicz is very good with that, when she puts on her glasses.

Hi, Susan.

SUSAN LISOVICZ, CNN CORRESPONDENT: Hi, Kyra. My glasses are on, believe me.

We're talking about consumer prices for a second day. We have a record decline when it comes to prices. Yesterday was wholesale prices. Today the CPI, Consumer Price Index, declined by a record amount in October, 1 percent. Big reason, of course, we all know: energy prices. But also declining clothing prices, new and used car prices, airline fares, fruits and vegetables, dairy products. And the trend is expected to continue.

Here's the problem; here's the fine print. Deflation is also bad for the economy. Think about it. If the price of goods keeps declining like this for a long time and slower than what it costs to make it, well, lower corporate profits. More job cuts. And we certainly don't want that right now.

In any case, we do have this big decline for the month of October.

What else do we have? Housing starts, building permits, both of them falling to record lows last month. Mortgage applications fell more than 6 percent last month.

We have more job cuts. La-Z-Boy cutting 10 percent of its work force. HSBC mortgage eliminating 20 percent within the mortgage division.

But here's the bright spot. It's a great time to be in the wholesale club business. B.J.'s wholesale club, its quarterly profit rose nearly 25 percent. Costco, Sam's Club, you know, they're seeing a lot of business. Customers are buying things in bulk, for better deals -- Kyra.

PHILLIPS: All right. Season Lisovicz. Thanks so much.

Well, straight ahead, a shocking double murder case in Arizona. The suspect, an 8-year-old boy. Police have just released video of the boy's confession, and it's raising a lot of question with juvenile justice experts. We're going to tell you what they're concerned about.

And in Europe, a medical breakthrough. We're going to tell you why doctors there are so excited after a first-of-a-kind transplant. (COMMERCIAL BREAK)

PHILLIPS: Well, should Congress let the auto industry sink into bankruptcy protection or worse? Or throw them a multibillion-dollar rescue package?

Joining us with two very different views on the pressing issue, Democrat Congresswoman Maxine Waters of California and Alabama Senator Richard Shelby, the senior Republican on the banking committee.

Good to have you both.

Senator Shelby, let's start with you. Tell me why you're against the bailout.

SEN. RICHARD SHELBY (R), ALABAMA: Well, I think it's just throwing good money after bad. They have burned about $100 billion, from the testimony we heard yesterday. They haven't turned the company around. We've got management that obviously is awful that are presiding over failed institutions.

So they haven't come forth with the products they need to do. This is not the Ford, General Motors and Chrysler that we knew years ago. They're bloated. They're not very innovative.

And I see this. They call it a bridge loan. It's a bridge loan to nowhere. And I'm afraid that the money will never be paid back. It could be not $25 billion or $50 billion. It could be more and more.

And then it will about slow death, I'm afraid. I think they could go into Chapter 11, rearrange and strip -- get rid of the management. Get rid of all those people that have brought them to where they are today and start again. Slim those companies down and save them. But if we put this money in, it's not going to save them, in my judgment.

PHILLIPS: You bring up an interesting point about changing management. You talk about burning money.

Maxine Waters, I want you to respond to this: Gary Ackerman bringing up the point, what about all those expensive jet rides? Let's take a listen.

(BEGIN VIDEO CLIP)

GARY ACKERMAN (D), NEW YORK: There's a delicious irony in seeing private luxury jets flying in to Washington, D.C., and people coming off of them with tin cups in their hand, saying that they're going to be trimming down and streamlining their businesses. It's almost like seeing a guy show up at the soup kitchen in high hat and tuxedo.

(END VIDEO CLIP)

PHILLIPS: Maxine Waters, I don't know if you were able to hear that sound bite or not, but that was Representative Gary Ackerman from New York, talking about the delicious irony in seeing private luxury jets flying to D.C. and people coming off of them with tin cups.

What do you think? Are these men that should be getting a bailout, getting more and more money to keep these companies afloat when so much has been wasted?

REP. MAXINE WATERS (D), CALIFORNIA: Well, as you know, most of us are opposed to just bailouts for the richest people and the richest companies in this country.

We didn't like the bailout, necessarily, that we gave to Wall Street. We don't like the idea that this industry is coming before us, having mismanaged, having ignored us, having built bigger cars, having ignored the CAFE standards that we wanted them to adopt.

We're sympathetic to the idea that three million jobs are going to be lost.

I'm trying to put in place some criteria by which they can be judged before there's any giving of this money or lending of this money. And so I'm asking them not only to come up with a plan, as other members are asking them, so that we will know how this bridge is going to be used, but also how they're going to help the small companies, the dealerships that are out there in our communities, creating jobs and making these automobiles...

PHILLIPS: What do you think about Senator Shelby saying, "Hey, fire -- get rid all the management. Totally change house. File bankruptcy. That's the better way to go"?

WATERS: Well, I'm not going to tell them how to do it. I don't know how to manage a big manufacturing firm. But I think they should have enough respect for us to come in with a plan that they can go over and explain to us how it's going to work and how it's going to make them more stable and how it's going to continue to provide the jobs.

All we're asking for is what any good company should be able to do. I don't know how to manage their company.

PHILLIPS: So you want more details on their new strategy.

Senator Shelby, you know, if it's just a loan, the money's got to be paid back, right?

SHELBY: I asked the question yesterday. They said to the CEOs. I said, first of all, why should we believe that you can use $25 billion or $50 billion and turn around a company? You've just burned $100 billion. And secondly, how would you pay this money back? I had no satisfactory answers.

Let me tell you how you save jobs. You save jobs by running a strong company, by building a good product, by selling that product, and making a profit. These people flew in here in corporate jets yesterday to try to get taxpayers' money. Some of them made 28 -- I think one of them made $28 million last year to help run a failing company. PHILLIPS: But Senator...

SHELBY: That is not the way companies should be run. That's horrible.

PHILLIPS: But Senator, I understand about changing management and trying to hold people accountable and change the whole dynamic of how you run a company, but what about the millions of people that would lose a job immediately? What about all...

SHELBY: First of all, it's not going to be millions of people. It's going to be some people. But if you go into bankruptcy, the company will, Chapter 11, the company will slim down, come out. A lot of our airlines have done that, and they've survived.

Most economists believe that's the west way to go. I believe it's the best way to go. Otherwise, we going to give them a blood transfusion. The next year, you're going to give them another one and another one. And they're going to be on life support, and they're going to be on the taxpayers' dole.

PHILLIPS: Maxine Waters.

SHELBY: That's not the way to run a corporate company.

PHILLIPS: Go ahead. Final thoughts. Maxine Waters.

WATERS: Hi. Let me just say this. Again, most of us don't like the idea of giving this -- rescue loans to the big businesses of this country.

Evidently, we're in an economic crisis. We've already agreed to $700 billion, which has been given to Wall Street and the biggest banks. And so the automobile industry is here, and I believe that, in the final analysis, they're going to vote for them to get some support.

If they're going to get some support, we should set some criteria and make some demands of them in relationship to showing us how they plan to use the money, how they're going to spend the money.

We should also make them show us and tell us how they're going to help the dealerships who are on the front line, who have lots of employees, too.

I'm no automatic vote for them. I am going give them an opportunity to try and prove how they're going to turn this thing around, how they're going to do better. And I will consider giving them a vote, but I have not decided to do that yet.

PHILLIPS: Democratic Congresswoman Maxine Waters of California, Alabama Senator Richard Shelby, appreciate you both.

SHELBY: Thank you.

WATERS: You're welcome. PHILLIPS: Democrats are moving a little closer to their goal of a filibuster-proof majority in the Senate. After absentee ballots were tallied, unofficial results in the Alaska Senate race show that Senator Ted Stevens lost to his Democratic challenger, Anchorage Mayor Mark Begich.

Stevens, the longest-serving Republican in the Senate, was convicted of corruption charges in October. State officials say that they hope to have official results the first week in December, but with overseas ballots still to be counted, there's still a chance for a recount.

A Begich victory would move Democrats within two seats of the 60 that they need for a filibuster-proof majority.

And in Minnesota, a recount now underway in the Senate battle between Republican incumbent Norm Coleman and his Democratic challenger, Al Franken. Almost three million ballots have been counted. The recount was automatically triggered, with Coleman only 215 votes ahead in the initial count. It's expected to be completed by December 5.

And in Georgia, big guns being brought in for a Senate runoff race. Democratic Jim Martin is getting some help today from Bill Clinton. The former president campaigned for Martin just a short time from now at Clark Atlanta University. Martin trailed incumbent Republican Senator Saxby Chambliss in the general election, but neither got a majority of the votes. John McCain has already been in Georgia to campaign for Chambliss. The runoff is December 2.

And an awful crime, a shocking suspect and a controversial confession. We're going to get some legal insight in the case of the 8-year-old boy accused of double murder, including his father.

And two terrified little girls separated from loved ones by fighting in Congo. This picture helped reunite them. We're going to talk with the photographer.

(COMMERCIAL BREAK)

PHILLIPS: Well, it's one of those photos that hits you right in the gut, and then it tears you apart. Two little girls overcome with fear, separated from loved ones by the fighting in eastern Congo. Just two little girls among hundreds of children in Congo that are torn from their families and surely no hope of a reunion. Except in their case. An unlikely good Samaritan offered a helping hand: Associated Press photographer Jerome DeLay.

He first took their picture, and then he set out to find their relatives. He joins us now on the phone from eastern Congo.

Jerome, it's such a pleasure to have you with us.

JEROME DELAY, ASSOCIATED PRESS PHOTOGRAPHER: Good afternoon, Kyra. PHILLIPS: Now, I know there's a bit of a delay. So go ahead and tell me how you connected with these girls initially and why you were so drawn in by the love that they had for each other.

DELAY: Well, at first we were in the (INAUDIBLE) area, because it was attacked (ph) by the rebels to push back the Mai-Mai (ph) offensive. And a lot of the civilian population tried to reach the (INAUDIBLE).

And I saw two little girls and snapped a couple of photographs, very simple pictures. And each girl was crying, the kind of cry that you hear somebody who's crying for a very long time. She probably had no more tears.

And I asked her, what is your name? Why are you crying? And she answered she was looking for her family. And I just turned around at the time and looked back at her. She was gone. She was lost in a sea of hundreds of thousands of people.

PHILLIPS: So Jerome, you had met them, and initially, they had smiles on their faces. They were just figuring out what they had to do. They found a blanket to sleep under in the church, but then they broke. And at what moment did you decide, out of all these children, that you wanted to help these two find their parents?

DELAY: Well, the picture was (INAUDIBLE) saw it on the wire. And the picture brought a sense of (INAUDIBLE) on Web site. And the next day, in the newspapers, all over the world. And all of a sudden my mailbox, my e-mail box was bombarded by e-mails from people from Melbourne, Australia, from Virginia Beach in the states, from Amsterdam, Holland, asking what happened to these kids? Did you find -- did they find their mother? Did you find their family? What is it we could do to help?

PHILLIPS: Well, it's amazing what you were able to do. Eleven- year-old Protegee and her sobbing niece, only 3 years old, Reponse, there, now reunited. You'll see the photo right here with their mother, actually this is the -- these are the two girls. There you go right there. That is after Jerome Delay connected them and found -- and just -- what -- well, pictures tell it all, that's for sure.

Jerome Delay, thanks so much for joining us.

Fighting fire with fire and water swarming with 21st century pirates. India says that one of its war ships exchanged fire with a pirate mother vessel in the Gulf of Aden. The pirates opened fire after being ordered to stop for inspection. Indian shells sparked a fire and set off explosions on the pirate ship. Two speedboats in tow fled the scene and since the beginning of this year, maritime officials say that pirates hijacked 39 ships in the Gulf. Of those, 17 are still held by pirates.

Talk about your brave new world of medicine. Doctors transplant an organ fashioned from a patient's own stem cells.

(COMMERCIAL BREAK) PHILLIPS: 1:34 Eastern time. Here are some stories we're working on in the CNN NEWSROOM.

Al Qaeda lashing out at President-elect Barack Obama. A new message said to be from the group's second in command slams Obama on his stance on Afghanistan and support of Israel and denounces him with a racial insult, calling him a "house Negro."

Leaders of the Big Three back on Capitol Hill desperately seeking a federal bailout, but they aren't finding much support. GM, for one, says it could run out of cash by end of the year, or early next year, without help from Uncle Sam.

And Nebraska appears on the verge of tightening its safe haven rules. Right now, parents from any state can abandon kids of any age in Nebraska for whatever reason. The new law has an age limit, babies 30 days old or less. That final vote is expected Friday, and the governor says he's going to sign it.

Arizona police have released video of an 8-year-old murder suspect being questioned in the death of his father. But the interview is only raising questions with juvenile justice experts.

Here's CNN's Anderson Cooper.

(BEGIN VIDEOTAPE)

ANDERSON COOPER, CNN ANCHOR: The murder suspect sinks in a sofa chair. His voice is low, he speaks softly. He's only 8 years old.

OFFICER: It's real important that you tell us what happened.

UNIDENTIFIED BOY, MURDER SUSPECT: I don't know if the gun went off by accident.

COOPER: Police interviewed the boy alone with no lawyer or family member present, a day after Arizona authorities claim he shot and killed his own father and another man who had rented a room in their home.

Initially, and repeatedly, the third grader told the two female officers questioning him that he found their bodies after coming home from school.

OFFICER: You walked around and then what did you do?

UNIDENTIFIED BOY: And then I started walking down the street towards my house. Then I saw the door open and I thought (DELETED). And I ran and I said, dad, dad, and then I went upstairs and I saw him.

OFFICER: And then you saw him? OK. And then what --

UNIDENTIFIED BOY: There was blood all over his face.

COOPER: But an hour later a second tape shows detectives pressed the boy again and again to tell the truth, saying we think you're not being honest and claiming they knew that he did it.

OFFICER: What happened with your dad?

UNIDENTIFIED BOY: I don't know.

OFFICER: Come on, tell us the truth.

UNIDENTIFIED BOY: I'm not. I'm not lying.

OFFICER: How about if we have somebody that told us that you might have shot them.

COOPER: Then, finally, the boy changes his story.

OFFICER: How many times do you think you fired the gun?

UNIDENTIFIED BOY: I think twice.

OFFICER: You think twice?

UNIDENTIFIED BOY: Twice.

OFFICER: Do you think it could have been more than twice?

UNIDENTIFIED MALE: No. I thought it was twice.

OFFICER: OK. You shot your dad twice.

UNIDENTIFIED BOY: Yes.

OFFICER: OK. And how many times did that gun shoot (DELETED).

UNIDENTIFIED BOY: I think twice like my dad.

COOPER: Why would he do it? The boy said he did it because his father and the other man were suffering, though he never says how.

UNIDENTIFIED BOY: I think I shot my dad because he was suffering I think. I thought he was suffering --

OFFICER: OK.

UNIDENTIFIED BOY: -- so I might have shot him. I didn't want him to suffer.

And then I went outside and then I saw -- at first when I -- then I saw (DELETED) I saw (DELETED) and he was shaking. And I think that time it went off. And then I went upstairs and I saw my dad and I think that I shot him because he -- he was suffering.

COOPER: The suspect is being charged as juvenile and held at a jail for minors. He's not entered a plea.

Under a gag order few details have come out, but police say they have probable cause to justify the murder charges and have cast doubt on reports the father may have abused his son. OFFICER: This is the room where we talk to people, and we make a promise to each other that we're only going to tell the truth. Is that OK?

UNIDENTIFIED BOY: Yes.

COOPER: The boy's lawyer says the interrogation was improper because the 8-year-old was never told his rights and a family or legal representative was not with him during the questioning.

"They became very accusing early on in the interview. Two officers with guns at their side. It's very scary for anybody, for sure an 8-year-old kid."

Anderson Cooper, CNN.

(END VIDEOTAPE)

PHILLIPS: Well in three hours the boy is due in court for a hearing. We'll be following that.

Meantime, let's get some insight on this pretty usual case from CNN legal analyst, Sunny Hostin.

Sunny, is this tape even going to be admissible in court?

SUNNY HOSTIN, CNN LEGAL ANALYST: Absolutely not, in my view. You look at it, it appears to be extremely coercive. You have two officers, no Miranda rights, but more importantly, Kyra, no parent, no legal guardian, no attorney. I would imagine that any defense attorney for this child is going to move to suppress that tape and any competent judge is going to kick this tape out of court. So we're not going to see this tape played in a court of law.

PHILLIPS: All right. Just before we re-listen to part of that tape, I just want to ask you, at 8 years old, can you expect an 8- year-old to know what Miranda Rights are? And even if you don't expect him to know what it is, do they have to say it anyway?

HOSTIN: And that's the issue. Of course an 8-year-old isn't going to understand Miranda Rights. Adults typically don't understand Miranda Rights, which is why you always have an attorney present or a legal guardian, an adult, when you are interviewing a child witness.

And so the fact that they not only didn't read it, they didn't have anyone there to be able to advise him of what was going on. It really makes this, in my view, very improper.

PHILLIPS: Well, he's got a mother, right? Was she contacted? Do we know anything about mom?

HOSTIN: We don't know if she was contacted, but we certainly know, Kyra, that she wasn't in the room during this interrogation. Mom has appeared with him since this interrogation, has been in the courtroom, walked out of the courtroom without comment. But we do know that his mother lives in Mississippi and visited with him every single weekend, although his father had legal custody. And so, why wasn't his mother there? Why wasn't an attorney there? Why wasn't someone there for this child?

PHILLIPS: Yes, that's what we want to know definitely. OK, let's go ahead and relisten to part of that tape. The first sound that we're going to hear is the boy saying that he came home and found his dad and then in the second one, from a little later in the interrogation, he actually talks about shooting his father. Let's listen.

(BEGIN VIDEO CLIP)

OFFICER: You walked around. And then what did you do?

UNIDENTIFIED BOY: And then I started walking down the street towards my house. Then I saw door open and I saw (DELETED) right there. And I ran and I said, dad, dad. And then I went upstairs and I saw him.

OFFICER: And you saw him? OK. And then what --

UNIDENTIFIED BOY: There was blood all over his face.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

UNIDENTIFIED BOY: I think I shot my dad because he was suffering, I think. Because I thought he was suffering, so I might have shot him.

(END VIDEO CLIP)

PHILLIPS: OK. So his story changed. How does that affect this case?

HOSTIN: I have to say typically, of course, when a suspect or a target is being interrogated they always deny it at first and many police officers won't even tape the beginning part of the interrogation and will tape record the confession. But it does matter what happened in the middle.

He certainly denied being involved at all. And then I know after seeing the tape that one of the officers says, I don't believe you. And I think that, Kyra, is where the coercion comes in. And shortly there after -- we're talking about 45 minutes -- he's now saying, um, I think I shot him because he was suffering. It really just doesn't make sense.

So, you have a denial, and then you have a confession and you have something that happened in between.

PHILLIPS: OK, well the police have two people shot to death. They had to question this boy, no doubt. But do you think they did it in the right way? You talk a little about the coercion there. But other -- when you watch this interrogation tape, did they pretty much follow procedure? I must say, I've watched a lot of child cases and they bring women in, because they're less intimidating and the kids think about it maybe like they would their mother, if they have a good relationship with their mother, and it's a lot easier to talk. So I thought that was sensitive, in that regard.

HOSTIN: Well it certainly was. And we know that this is a small town with a small police force. But Kyra, when you're interviewing child victims or child suspects, you really have to have special training. I was trained in that because I worked with a lot of children when I was a prosecutor. So there's specialized training, and there is a certain protocol.

You want to be at their eye level, you want to speak slowly, you want to speak clearly. You want to speak in open-ended, non- accusatory questions. You don't want to make the types of statements that they made -- I don't believe you, we have to tell the truth there. They were armed, as well.

And so when you have all of that into context, I understand that -- and we have to understand -- that they certainly were investigating a double murder. And that is serious business. But I don't believe they did it the right way. I don't think that they had the training to conduct this interview, interrogation, really, in the right way.

PHILLIPS: All right. Well, we all know that you're a perfectionist, Sunny Hostin. Appreciate it.

HOSTIN: You know I am.

PHILLIPS: All right. We'll follow the case.

Thanks, Sunny.

HOSTIN: Thanks.

PHILLIPS: A damaged windpipe was ruining her life. What doctors did to help her is now being called a medical milestone and could establish a new age in surgical care.

An elderly blind woman threatened with legal action if she didn't pay off a debt. Past due, one penny. Details plus the dramatic resolution, next hour.

(COMMERCIAL BREAK)

PHILLIPS: Frozen dinners posing a possible health risk. Nestle is actually issuing a nation-wide recall of more than 875,000 pounds of frozen chicken meals. Here's the problem with the product. Packages of Lean Cuisine Pesto Chicken with bow tie pasta with the best -- before date looks like of May 20010. Also, Lean Cuisine Chicken Mediterranean with best before date -- do you want me to say that -- best before date?

Yes, that threw me off. ELIZABETH COHEN, CNN MEDICAL CORRESPONDENT: Right, right. It's kind of an odd --

PHILLIPS: OK. Don't -- make sure you use it by September, October and November, 2010. I think that makes a little more sense. And then Lean Cuisine Chicken Tuscan, with the date of use it up before September, October, November, 2009.

There have been complaints about hard pieces of plastic actually in the food. One person was injured. You can find more information on this recall if you want at the USDA's Web site.

Sorry if that was a little confusing.

Well it could set a new standard for organ transplants. In June, doctors in Europe gave a woman a new specifically engineered windpipe. Cells were actually stripped from a donor trachea and replaced with her own stem cells and cells from a healthy part of her own trachea. So far, she hasn't rejected it and isn't taking anti-rejection medication. Medical correspondent, Elizabeth Cohen, here to explain.

Let's talk about why it's so exciting.

COHEN: This is so exciting, Kyra, because what these doctors did is they went in to Claudia Castillo's bone marrow. They just took out some bone marrow, extracted the stem cells and kind of voila (ph), they invented cartilage from her stem cells, which is what they use to make her new bronchus which is sort of an extension, if you will, of the trachea.

So this new body part she has, it isn't all her. There was a donor that was involved, but a lot of it is her. And that's why, as Kyra said, she's not rejecting it. It's going well. It's growing as you would expect any natural body part to grow. So that's really why it's so exciting.

PHILLIPS: All right. So kind of break it down for us then and show us the before and after.

COHEN: OK. Let's take a look at the before and after of Claudia Castillo's body parts here.

Here's the before. This is her bronchus. Air is supposed to be going through there. You can see from that arrow how thin -- how thin this little area is right there. That is so tiny. And it's like breathing through a straw. That's how one doctor explained it to me.

So let's see the after. In the after picture, look how much wider that is. I mean that is a huge difference. So it went from being just this little tiny line where she could get air through to being a much bigger area. And can you see, it's obviously easier to get air through this -- than through this.

PHILLIPS: Wow. And you talk about stem cell and stem cell research, and you look at this, and you think, wow, what else could this lead into? COHEN: Right. Exactly. Because if this worked for this, it could possibly work for other kinds of transplants, or for other kinds of procedures.

There is a huge advantage to using someone's own cells rather than someone else's cells. You don't have the rejection issues, you don't have to take anti-rejection drugs. So the doctors I've been talking to, and these are doctors who are pretty staid people, they are practically jumping up and down. They are truly excited about this. They think this could mean a big difference in how we do things from here on in.

PHILLIPS: Well that's a good point, because doctors don't like to get too excited.

COHEN: Exactly.

PHILLIPS: And then we all get excited. They always kind of look at worst case scenario.

COHEN: But this time they're excited.

PHILLIPS: Wow.

COHEN: It was interesting to hear.

PHILLIPS: Then we can all get excited.

COHEN: That's right.

PHILLIPS: Thanks, Elizabeth. Appreciate it.

Well, on this week's Edge of Discovery, Japanese doctors are using stem cells in a way you've probably never heard of for plastic surgery. CNN's Kyung Lah filed this report. And we must warn you, it does have shots of surgery being performed that might be a little disturbing to some viewers.

(BEGIN VIDEOTAPE)

KYUNG LAH, CNN CORRESPONDENT: Japanese doctors at work on what they call cutting-edge stem cell surgery, not to regenerate organs or nerves, but to enlarge breasts. This woman lost her left breast to cancer.

"I hope women are able to choose this type of surgery," she says.

It is controversial.

Doctors remove fat from a woman's body and separate fat and stem cells in a lab. Fat contains stem cells similar to ones found in bone marrow. The patient's own fat/stem cell mixture is injected into her left breast. The doctor describes the result as a "natural, soft, augmented breast."

(on camera): While still experimental, they hope it will give women another option to the silicone implant.

Right now, are you convinced that it is safe?

UNIDENTIFIED MALE: Yes.

LAH (voice-over): Dr. Kotoro Yoshimura (ph) has performed cell assisted lipotrans (ph) for more than 250 times. He says while he can't promise that the grafts will always take, short term studies show promise.

Clinical trials are moving forward in the U.S. But many plastic surgeons are not sold on the technique.

DR. JOAN LIPA, UCLA PLASTIC SURGEON: So the idea here for the breast augmentation, fat transfer is that they are hopefully going to turn into fat cells. But how do we know that they aren't going to turn into something else?

LAH: After the surgery, our patient says she looks forward to the future, one that will be watched by doctors around the world.

Kyung Lah, CNN, Yokohama, Japan.

(END VIDEOTAPE)

PHILLIPS: Firefighters gain ground on wildfires out west and they are also finding out who may have started them.

(COMMERCIAL BREAK)

PHILLIPS: Well, a youthful gathering and a poorly extinguished bonfire now blamed for igniting one of three major wildfires in California. Ten college students apparently started the bonfire on private property at the Tea Garden Estate. They didn't have permission to be there and authorities say the group left thinking that the fire was out. Well, it sparked a massive blaze destroying more than 200 homes and structures including a monastery. Prosecutors will decide if the group faces criminal charges.

Fire crews are also gaining ground on two other wildfires. One has destroyed more than 500 structures, including a mobile home park in northern Los Angeles. That blaze is now 70 percent contained.

The largest of the blazes, the so-called Triangle Complex Fire, is now 75 percent contained. Nine firefighters have been injured battling it. Fire officials say that evacuated residents in Orange County, Los Angeles and Riverside will be allowed to go home now. That fire has charred nearly 29,000 acres.

An indoor Main Street with movies, hair salon and more. The new look of retirement living for some very lucky seniors. And oh, yes, don't forget the Irish pub.

(COMMERCIAL BREAK)

PHILLIPS: Well, it looks like a casino or maybe a Disney park. But actually it's some pretty good incentive to retire. You are looking at the new face of senior living. It is a $10 million addition to a retirement community in Ohio. The idea was to keep seniors who don't get out much from feeling house bound. They can walk along the indoor Main Street to a movie theater, a cafe, even the Irish pub, or, my favorite, the ice cream parlor. Actually, no, my favorite is the pub.

Next hour of CNN NEWSROOM starts right now.