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Obamas Back in Chicago to Prepare for Move to D.C.; Bomb Threat Cancels Aspen New Year's Celebrating; Mideast Fighting Intensifies; Medical Advance Prolongs Female Fertility; Charles Barkley Arrested on DUI Charge; Family Removed from Plane for Comments

Aired January 2, 2009 - 08:00   ET


KIRAN CHETRY, CNN ANCHOR: Breaking news now and major developments out of the Middle East. Right now, new air strikes against suspected Hamas targets in Gaza as the death toll continues to rise. Palestinians say more than 421 people have now died since the raids began seven days ago. Israel newspapers also reporting the country's top military brass are recommending a short but major ground invasion of Gaza. We're going to be getting a live report from the border in just a moment.
A bomb squad interrupts New Year's in Aspen, Colorado. Police say James Blanning delivered threatening notes demanding $60,000 and four bombs across the resort town. Homes and businesses in the downtown area had to be evacuated. The 72-year-old parolee was found later dead in his car. Police say he committed suicide. The city tried to recapture the holiday last night with a rescheduled fireworks display.

And Rahm Emanuel plans to resign his seat today. He'll officially become Barack Obama's White House chief of staff in just 18 days. Emanuel also wrote a resignation letter to the Illinois governor. Illinois' Fifth Congressional District will have a special election to replace him.

And this morning, the vacation is over for President-elect Barack Obama. In just 18 days, he takes the oath of office at the U.S. Capital. New pictures from overnight of Mr. Obama returning to Chicago; it's a quick stop before moving his family to Washington this weekend. And then it's down to business.

CNN's Brianna Keilar is live in Chicago. The president-elect's certainly not wasting any time. Hopefully, he enjoyed those 12 days in Hawaii because he probably won't get them for some time.

BRIANNA KEILAR, CNN CORRESPONDENT: Hopefully, sure, no, I can use them Kiran, certainly.

Well, the Obama transition team not confirming a meeting is taking place on Monday in Washington between the president-elect, Nancy Pelosi and senate majority leader Harry Reid, but a Congressional Democratic leadership source says this meeting is happening and it's a chance for these leaders to talk about Obama's proposal for a huge new economic stimulus plan.

(BEGIN VIDEOTAPE) KEILAR: An economic crisis in full swing, a year when almost $7 trillion were lost in the stock market finally over. As Obama returns from vacation in Hawaii, he wants to focus on the economy, instead --

UNIDENTIFIED MALE: The Burris controversy or the Blagojevich controversy is a significant distraction and it's not what the Obama administration wants to be talking about. It's not what Democrats want to be talking about.

KEILAR: Roland Burris, embattled Illinois Governor Rod Blagojevich's choice to fill Obama's seat in the senate, is a fixture in the news cycle. A source familiar with the governor's thinking says Blagojevich was not against creating chaos with his pick. And he has certainly stirred the pot. As senate Democrats threaten to block Burris's appointment, race has become an issue.

ROLAND BURRIS, NAMED TO REPLACE BARACK OBAMA IN THE U.S. SENATE: Is it a fact there are no African-Americans in the United States senate? That's a fact. Is this racism taking place? That's the question that someone else may raise.

KEILAR: Even on vacation, the president-elect was forced to take a stand, issuing a statement saying, "Senate Democrats cannot accept an appointment made by a governor who is accused of selling this very seat." Political analysts say this type of distraction is part of being president.

UNIDENTIFIED MALE: This is a good reminder to the Obama administration, its political advisers and staffers that almost anything can come out of the blue and create a controversy that the president and senior advisers have to deal with even if they would prefer to ignore things completely. You can't.


KEILAR (on camera): at the same time, analysts say the Burris appointment will be a short term distraction and as this new stimulus plan takes shape, as Obama's inauguration grows near, those things will steal some of the limelight. That said, senate Democratic leaders are expecting Burris to show up to Congress for the opening day on Tuesday. And obviously, eyes will be looking on that potential showdown if it does happen -- Kiran.

CHETRY: Wow and so any word on what they're going to do? There was talk about saying they're refusing to let him into the Senate chambers? And whether or not the sergeant at arms will have to get involved

KEILAR: Yes, that's part of the contingency plan. Burris has said that he's not planning on making a scene, but just in case senate Democratic leaders according to sources on the Hill have devised a plan in case that does happen. They say that would involve calling capital police, not that he would necessarily be arrested. Then getting the sergeant at arms involved, but again, Burris saying he's not going to make a scene. What we're really going to be looking for see if he's turned away there at the door, Kiran. CHETRY: All right. Brianna Keilar, thank you.

JOE JOHNS, CNN CO-HOST: Now to breaking news out of the Middle East: The Israeli military appears poised for a possible grand invasion of Gaza. Israeli TV reporting hospitals near the border have been evacuated to make way for mass casualties.

Right now, tanks are gathering and troops are mobilizing apparently just waiting for word. The buildup comes as the fighting continues in the air for the seventh straight day. Yesterday, Israeli war planes killed a top Hamas leader.

Meanwhile, Hamas rockets are still making their mark causing destruction in southern Israel. In all, four Israelis and more than 420 Palestinians have died.

CNN's Paula Hancocks is live on the Gaza-Israel border. Paula, any sign that a ground battle could be coming soon?

PAULA HANCOCKS, CNN CORRESPONDENT: Well, Joe to be honest, we've been waiting for this for a couple of days now as have the soldiers themselves. The grand forces are in place. The tanks are in place. They're waiting, they're pointing in the direction of Gaza, just waiting for that order.

We know that a little earlier on today, some foreign nationals were allowed out of Gaza; about 280 of them. Israel did open up that border to allow them out. Interestingly enough, they didn't allow any traffic the other way. They didn't allow journalists to go into Gaza.

They're coming under a tremendous amount of complaints and criticism for that. But the air strikes are continuing. There's one just about five minutes ago where we understand targeting a house Jabaliah (ph) just east of Gaza city.

Hamas militants certainly going underground, we understand, at this point, trying to avoid these air strikes after the attack that took out one of the founders of Hamas, a very high member of Hamas. And certainly Israel showing that it's not just the insulations they're after, it's the Hamas leaders as well -- Joe.

Let's just talk a little bit about this notion of a ground attack. Why would Israel risk losing ground soldiers and not keep this an aerial operation?

HANCOCKS: It's a good question because if Israel goes in with its ground troops, it's going to take casualties. We've heard from Hamas leaders that there are going to be fire and volcanoes under their feet to welcome them if they come in and they have booby trapped some of the ways into Gaza.

So certainly they're going to take heavy casualties. It is expected. But the fact that you can't do everything from here, this is what the Israeli military is telling. That there's only certain rockets launchers and rocket caches that they can destroy from the air. Some of them they have to be down on the ground, maybe even going house to house, to try and root out all the leaders and all the rockets.

And of course, we must remember, this is why Israel said it's doing this, to stop the rockets. And at this point, it has not managed to do that through airstrikes alone. The rockets are still coming in.

JOHNS: Paula Hancocks, on the border. Thanks so much for that reporting.

And one of our own correspondents found out exactly what it's like to be under fire in Israel. Nic Robertson forced to take cover several times in the last 24 hours. Take a look.


NIC ROBERTSON, CNN INTERNATIONAL CORRESPONDENT: The siren's just gone off. Everyone's getting out of their cars, getting down in the road, waiting to see what happens.

That was the explosion. We just heard one explosion going off. I think it came from that direction over there.

There is no all-clear, but now the cars seem to be moving again. Everyone that stopped is going. People are coming out of the building right across the road there. So that's sort of an indication of whatever was going to come has come.

That's a strange feeling when the sirens go off. I was in the middle of a telephone call. As soon as you hear the sirens, stop the car, get out, lie down. Everything around you just suddenly stops in those few seconds.


JOHNS: Our correspondents haven't been able to get a firsthand look at the destruction in Gaza, because the Israeli government is not allowing us to cross the border.

CHETRY: A bus driver in New York City has been charged with first degree reckless endangerment for allegedly leaving a young man with cerebral palsy locked in a bus for 19 hours. It happened Wednesday night as the wind chill hovered near zero.

Investigators say they found Edwin Rivera yesterday morning still strapped in his seat right behind the driver's seat. He was taken to a hospital where he was treated for hypothermia. The driver of the bus could face seven years in prison if convicted.

This morning, nine passengers who removed from a flight to Orlando claim they were victims of racial profiling. The Muslim family and one friend say they were escorted off of an AirTran flight in Washington after they were heard discussing where the safest place to sit on the plane would be. The group was eventually cleared by the FBI but had to pay for seats on another carrier.

(BEGIN VIDEO CLIP) ATIF IRFAN, REMOVED FROM FLIGHT: The airline told us we can't fly their airlines. Basically what they're saying to us is that they wouldn't book us on any flight even though the FBI agent went to the counter and recommended to them that we're completely safe. Their company or corporate policy basically is to not allow them, anyone that I guess has been in the situation to be allowed onto the plane.


CHETRY: AirTran officials say they were simply following security procedures.

Coming up later in the hour, we're going to talk exclusively with the brother of the man you just heard from.

And Toyota, already the leader in green rides, reportedly has secret plans for a futuristic solar car. Japan's Nikkei newspaper has reported that the company is rolling the dice in an effort to turn around its struggling business. The first models reportedly of solar cells on the vehicle and also be recharged through solar cells on roofs of homes. But this technology and the car wouldn't be available for years.

JOHNS: Bernie Madoff, accused of pulling off what may be the biggest scam in Wall Street history. Investigators are examining his list of assets to find out exactly what's left and where his money may be.

And there's one place in the United States, if you're caught with pot, you pay a fine that's about the same as a traffic ticket. That's a new law on the books in one state; as long as you don't have too much. We'll tell you where.

It's nine minutes after the hour.


JOHNS: That's what I call a panoramic view of the studio.

CHETRY: And a very appropriate song.

JOHNS: Right, Christine Romans is here "Minding Your Business" and boy, look at this.

CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Yes, following the Madoff money, first of all; still following the Madoff money.

The court's trying figure out -- the SEC trying to figure what he's got, where it is. Is it offshore, is it here? Is it real estate? How much of it didn't even really exist Joe and Kiran? How much of it were paper gains, people who thought they were making 10 percent to 12 percent to 15 percent returns and it was on paper but they really weren't.

I mean the allegation here is that this is some kind of a Ponzi scheme where he would take the money, and he would pay out to certain investors. And then to pay them out, he would take more money in from other new investors.

People who I know, who know him and know his reputation and who's spent the last 40 years on Wall Street with him say that on the one hand, they're quite surprised. He was somebody who was very active in charities. He was somebody who was kind of a private person.

But on the other hand, they're not surprised because something didn't add up. The paper states, you couldn't go online to see the statements. The fact that people would spend years trying to get in to the hedge fund, he would say no, no, no, no, no. And then suddenly yes. In the last 2005, 2006 he'd start to let people in who hadn't been able to get in before.

We've talked a lot about who these investors were: the private banks, the heiresses, the rich foundations, these are his assets - just among some of the assets we know about. The Park Avenue apartment and the Palm Beach, Florida mansion were put up for his $10 million bail. He is in that Park Avenue apartment on --

JOHNS: But if they go after all of that stuff, it's just a drop in the bucket, right? It's not going to like recover the $50 billion that was allegedly taken.

ROMANS: And Kiran, I keep talking about this, was it really $50 billion. How much of it were paper gains. But we talk about these wealthy investors. There is this tragic story of the blue blood French aristocrat -- hedge fund manager -- who was found dead in his Madison Avenue office, and a huge investor in this. It's really touched a lot of people.

There are also small investors who have been hammered, too. And we've profiled some of them and some of them frankly don't even want to go on camera because they can't believe they got themselves into this mess.

JOHNS: There are people who got out of Madoff though. It may be very possible that even though they got out early and they didn't lose their money, the government could be coming to them.

ROMANS: This is what lawyers have been telling me. If they got out early, if they got out few years ago or even last year, they're probably OK. But people -- they're going to be looking very closely at who withdrew money in the last 90 days, in the last six months.

Who were the people who most recently withdrew money? Because the idea is maybe that payout was actually ill gotten gains from an alleged Ponzi scheme so maybe those ill-gotten gains can be put back in the pot so that everybody can --

CHETRY: What if you don't know you're part of the Ponzi scheme.

JOHNS: Right, fraudulent transfers, I think that's what they call them.

ROMANS: Is that it? It just gets more and more interesting.

CHETRY: What are you bets on whether or not the SEC and the feds can really get to the bottom of all this?

ROMANS: It will take years if they ever can. And I don't know if they'll be able to find all the money. Some of these statements are literally typewritten. This is how much you put in, how much you got out, you got ten percent. No header, no -- how are they going to ever track all that?

CHETRY: Don't hold your breath.

ROMANS: I know but it's going to be -- it's going to make for an interesting 2009 to follow this. And I think there's a lot of popular interest in this story. There really is. I mean, because it touches so many different incredible aspects.

JOHNS: It's a movie.

ROMANS: On the end of a crazy year in finance, anyway. Knocking people's belief in the American capital system, too. And then you put this right on the end of it.

CHETRY: Interesting. Thank you.

In Cuba, it's 50 years after the revolution that changed the country. Five decades after Fidel Castro took control in Havana. A look at this year's anniversary and the signs that things could change in the country.

We're live from Havana just ahead.

Also, new details on Charles Barkley's arrest. What he told police he was planning to do with a woman when he was pulled over on New Year's Eve.

It's 16 minutes after the hour.


CHETRY: Welcome back to the most news in the morning with the new year.

A lot of new laws officially go on the books in states across the country. One of the biggest taking effect will be in Massachusetts, where marijuana position is no longer a criminal offense as long as you don't no more than an ounce. Those caught with less than one ounce will receive a civil fine of $100 -- about the same as some parking or traffic violations. Officers with civil powers like campus police now have the power to bust you too.

The gas tax, it's back in the news, only this time, politicians want to raise it, not eliminate it. Right now a federal commission is working on the report recommending a 50 percent increase in the tax to help fund highway construction and repair. That would increase the cost of gas which is really at the lowest we haven't seen since 2004 by about 10 cents per gallon.

And while Israel troops mass on the Gaza border, protests to end the siege are being planned across the U.S. Palestinian groups will be holding demonstrations in Philadelphia, as well as Chicago and Springfield, Missouri -- Joe.

JOHNS: The Cuba as we know it began 50 years ago after Fidel Castro came to power. But now that the ailing former president has stepped down replaced by his brother, Raul, the tone for this year's anniversary lacked the same defiance of years past.

Our Havana bureau chief, Morgan Neill joins us now live from the Cuban capital.

Good morning.

MORGAN NEILL, CNN HAVANA BUREAU CHIEF: Good morning, Joe. That's right. It's hard to know just what to expect from this celebration of 50 years of Cuba's revolution. After all, it's been more than two years since Fidel Castro appeared in public. But that didn't stop him from being the center of attention.


NEILL: It had the feel of a lifetime achievement awards ceremony as a small audience in the eastern city of Santiago looked on, the low-key celebration kicked off with a documentary, whose star and hero was undoubtedly the ailing and absent Fidel Castro.

The only sign of him, a short note in the paper, congratulating the country on the 50th anniversary of the revolution he led.

His brother, President Raul Castro wasn't shy in praising the man still known here as "El Commandante."

RAUL CASTRO, PRESIDENT OF CUBA (through translator): An individual doesn't make history. We know it, he said, but there are indispensable men capable of influencing its course in a decisive manner. Fidel is one of those men. No one doubts him. Not even his worst enemies.

The small scale of the event paled next to the street flooding rallies of the past.

Mindful of the suffering brought in 2008 by three major hurricanes, the Cuban President's tone was reflective, rather than the sharp defiance so customary here.

Even as he praised the revolution's achievements, he warned against too much optimism.

"When we reflect on the future," he said, "the next 50 years, which will also be a constant struggle, we see the turbulence of today's world and we cannot think it will be any easier. I don't say it to scare anyone. It's the plain reality."


NEILL (on camera): And that's been a consistent theme here over the last couple of weeks, President Raul Castro warning Cubans to get ready for tough economic times ahead. So in a day when the aging rebels are looking back at the key moments of their past, there wasn't a whole lot said about the future -- Joe.

JOHNS: Our Havana bureau chief Morgan Neill, thanks for that reporting -- Kiran.

CHETRY: Well, today's tough economy is not only bringing down businesses, but it could also bring down the curtains on the arts. So do our theaters and performing art centers need a bailout as well?

And new details on Charles Barkley's DUI arrest. Find out what police in his car, who he was with and what he was saying that's raising some eyebrows.

Twenty-two minutes after the hour.


CHETRY: Well, the steel industry following in the footsteps of the car industry, big banks and Wall Street, looking for a piece of the bailout pie, eyeing $1 trillion over two years. The steel industry wants the money to be put toward a huge public investment program which would hike the demand for steel to build roads, bridges, buildings even mass transit systems.

While America's budget gets pushed to the brink, government funds and charitable donations are drying up in many cases which could bring down the curtain for the theater business. So do the arts deserve a bailout as well?

Michael Kaiser joins me now from Washington D.C. He's the president of the Kennedy Center for the Performing Arts and the author of the new book, "The Art of the Turn Around."

Good morning, Michael. thanks for being with us.


CHETRY: We're talking about 13 different Broadway productions that are going to be closing in three weeks, including nine shows on Sunday. Give us in a nutshell how tough times are for the arts.

KAISER: It's a very scary time for arts organizations because in addition to having a difficult time selling our tickets, we're also having a very hard time attracting contributions. And these contributions make up about 50 percent of our budgets.

CHETRY: Tell us more about how they're being impacted, the Kennedy Center specifically by the recession.

KAISER: We see a little softness in ticket sales, although we're doing ok. And we're fearful that we'll be losing some corporate and individual donations. Major corporations like Lehman Brothers don't exist anymore and of course their contributions go with them. CHETRY: Very true. And so, it's almost as a ripple effect when we see major organizations and major businesses that were once able to freely give out money. If they're struggling, and they're cutting corners of course, it trickles down to everybody.

You in fact, wrote in the "Washington Post" it was interesting on Monday. "We need an emergency grant for arts organizations in America. We need legislation that allows unusual access to endowments Washington must encourage foundations to increase their spending rates during this crisis, and we need immediate tax breaks for corporate giving."

Where would this money come from in the form of a grant or how -- where do you envision it coming from?

KAISER: First fact, we need a discussion and we need some leadership in Washington to talk about the arts as a major part of our economy. We employ almost 6 million people in this country and we play a major role in educating our children and in attracting tourists.

So I think we have to have a discussion of where this money would come from. I'm mostly concerned with having leadership, on encouraging corporate giving and encouraging foundation giving at this time.

And also hopefully, that we can increase the budget that Washington does give to the arts, which is very small budget.

CHETRY: People are facing loss of jobs right now, home foreclosures, there's a trouble putting food on the table and maybe paying for medical care for our loved one. How do you convince people that this is the best place for their money to go that the arts shouldn't be left behind if bailout money and part of the stimulus is approved by Congress?

KAISER: Well, in truly economic terms, we have almost 6 million people employed in our sectors; we want to make sure that they're not losing their jobs. But also as we try and change our economy to a creative economy, where most of the money will be made, we need to educate our children to be creative and that comes through arts training.

CHETRY: It's also interesting because you serve as the executive director of the Royal Opera House in the U.K. the American Ballet Theater and also the Al Binelli Dance Theater and you were able to turn these organizations around, if you will, make them financially healthy.

Is there more responsibility on the part of these organizations to maybe find fund raising opportunity rather than counting on the government?

KAISER: Absolutely. In this country the government provides less than 10 percent of our contributions, so truly we have to do most of the work ourselves to encourage corporate giving, to encourage foundation giving and to bring individuals into our families.

CHETRY: All right Michael Kaiser, the President of the Kennedy Center. Thanks so much for joining us this morning.

KAISER: Thank you very much.

JOHNS: Kiran, it's 28 minutes past the hour.

Here are this morning's top stories.

He's jumping over every roadblock in going to Washington. Roland Burris says he plans to show up Tuesday on Capitol Hill. He is the man Illinois governor Rod Blagojevich picked to fill Barack Obama's vacant senate seat.

Senate Democratic aides say Burris will not be allowed on the senate floor if he does show up. Burris told the "Chicago Tribune" quote, "He's not going to create a scene."

U.S. Coast Guard is searching off Florida for a carnival cruise ship employee who was seen falling overboard early yesterday. Crew members who saw it happen immediately notified the ship's command and search and rescue operations started. The Coast Guard says the victim fell more than eight stories.

New pictures of Barack Obama returning to Chicago early this morning; the President-elect and his family are now preparing to fly to Washington, but since the Blair House is booked, the Obamas will be spending a few nights in a hotel with a nice view. There is a new home.

Here's CNN Samantha Hayes.


SAMANTHA HAYES, CNN CORRESPONDENT: He won the most exclusive address in the country, but first, President-elect Barack Obama will be staying across the street in a hotel that claims to be the most prestigious.

GARRETT GRAFF, EDITOR-AT-LARGE, "WASHINGTONIAN": Hay-Adams's motto is actually "the only thing overlooked here the White House."

HAYES: And it's where other Presidents have looked for topnotch accommodations. President Bill Clinton stayed at the Hay-Adams which also happened to be conveniently located near one of his favorite restaurant.

The hotel also has a storied past. It was named for John Hay, assistant to President Lincoln and later Secretary of State and Henry Adams, an acclaimed author and descendant of President John Adams and John Quincy Adams. The hotel is thought to be haunted by Henry Adams' wife, Clover.

GRAFF: And it's said that Henry Adam's wife Clover, who committed suicide in 1885, still haunts the hotel grounds today especially -- and I don't know why this is -- in the month of December.

HAYES: The Obama's first choice was the official White House guest quarters called the Blair House, but President Bush says it's booked until the 15th.

GRAFF: There certainly was a lot of whispers when that came out, that it was a little bit rude to tell the president-elect that he couldn't move into Blair House early, but on the other hand there are legitimate needs for the space for the outgoing administration.

HAYES: So for now, the new president will enjoy the spectacular views of the White House from the Hay Adams as he prepares to see things from a different angle on the inside.


HAYES: If the Obama stay in one of the suites at the Hay Adams, the price could range from $2,900 to $5,000 a night. And who is staying at the Blair House? No one's saying for sure, but the house is booked for receptions and parties by outgoing administration officials and VIPs. Samantha Hayes, Washington.

CHETRY: Well, breaking news in the Middle East. Smoke rising from Gaza, proof of fresh attacks by Israeli war plans. This new video that you're seeing now is from Israel's military air strike leveling a Gaza mosque. Israel says that the place of worship is really being used to stash weapons.

An Israeli warplane also dropped a 2,000 pound bomb on the home of a top Hamas leader, leveling the four-story building. Ramadan TV in Gaza showed the body of that leader being pulled from the rubble. We now know some of the military hardware used in the attack was American made. Well for more on this, Pentagon correspondent Barbara Starr joins us here in New York. There has been, you know a lot of outcry around the world, calling on Israel to stop these attacks on Gaza. The United States and Britain however not saying that.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, not at the moment, Kiran. The Israelis are using really billions of dollars in weapons that they have purchased from the United States over the years. Tens of thousands of precision-guided munitions, a few moments ago we showed that video of that 2,000-pound bomb. All of this is U.S. bought technology, now sold to Israel for its self-defense against Hamas.

But at the moment, what we're seeing is civilian casualties in very high numbers and that's very problematic. Israel's strategy, they can't bomb Gaza into oblivion. So are they going to proceed because clearly they are running out of air targets. That's why we're hearing them now talk about a ground campaign. U.S. military has been down that road of course in counter terrorism operations in Iraq and Afghanistan for years and hasn't been able to wipe out Al-Qaeda or the Taliban.

So a lot of people asking questions, where does Israel go from here. CHETRY: Yes and there are a lot of questions about that, especially given the fact that there are so many people packed in such a small space in Gaza and while they have tried to be very precise, both with what they're doing from the air and if the do go on the ground, you can't help but wonder how are they going to be able to do it and make sure that there's not a lot of collateral damage.

STARR: That is going to be the problem. We are seeing these constant reports out of Gaza that are so heartbreaking. You know, the Israelis says they are trying to notify people and certainly Israeli citizens are dying because of the rocket attacks into Israel from Hamas. So these days, what is so tough to deal with, wars are happening in civilian areas, in Gaza, in southern Lebanon, in Iraq, in Afghanistan, in Pakistan.

How do you deal with this? A lot of military strategists are starting to look at the concept that the U.S. used in Iraq. Deal with the civilian population. Go in there. Rebuild. Economic aid and make the civilians want what you want which is peace, stability, everybody to have jobs and to get on with their life. That many strategists say is going to be the ultimate solution to dealing with Hamas.

CHETRY: Extremely challenging though --

STARR: Absolutely.

CHETRY: Because of the popular sentiment to Israel. I mean, the situation that's going on there right now, even it seems the Palestinians actually can't agree as to whether or not Hamas who has vowed for the structure of Israel has the right idea or it's Fatah, trying get some sort of lasting peace with Israel. I mean, even among the factions, there's a big difference in people on the ground.

STARR: Absolutely. I mean, if you think Afghanistan and Iraq are tough, the Palestinian question is multiples more difficult. But what many people will say is at least deal with the people on the ground. The civilians, the families, people trying to, Palestinians, ordinary Palestinians trying to get on with their lives everyday in Gaza. If you can make those people not want to have Hamas there, that's at least one step down the road. Make no mistake, very, very tough business.

CHETRY: All right. Barbara Starr, good to see you.

STARR: You too.

CHETRY: In person, for a change. Thanks so much.

JOHNS: A snowy ski holiday in one of Colorado's most beautiful resort towns turned into a night of terror. A bizarre bomb plot forced downtown homes, restaurants, and bars to evacuate. Polices say the suspect threatened mass death if his demands were not met. CNN's Thelma Gutierrez has more on this bizarre case.

(BEGIN VIDEOTAPE) THELMA GUTIERREZ, CNN CORRESPONDENT (voice-over): This is 72- year-old James Blanning captured on a bank surveillance camera, just as he was about to deliver a plastic tub with two packages wrapped in Christmas paper to a Wells Fargo bank.

ASST. CHIEF BILL LINN, ASPEN, COLO., POLICE DEPARTMENT: Those packages contained notes threatening detonation of devices contained in those tubs and "mass death if his demands were not met."

GUTIERREZ: And this chilling warning: "You had better be a very cool individual and not start a panic or many in Aspen will pay a horrible price in blood."

The bank employee immediately calls Aspen police. Then 12 minutes later, they received a second call, this time from the Vectra Bank which also received identical notes.

LINN: He claimed the devices each contained what he called a big fire cracker made of unique chemicals and electronics. The notes which are exactly the same at both banks seemed to indicate that four banks in Aspen were targeted. The notes also indicated the author had a problem with the Bush administration and wars in the Middle East and he declared this to be "a suicide mission."

GUTIERREZ: By late afternoon, just as New Year's Eve preparations are getting underway, downtown Aspen is evacuated. The bomb squad and federal officials move in. In the evening, the bomb squad, detonated the device at Vectra Bank. It explodes in a fireball. On the steps of the "Aspen Times," this handwritten note was found by an employees, indicating Blanning is planning on taking his own life.

Then, in the predawn hours on New Year's day, James Blanning is finally found inside his car, dead, from what police say was a self- inflicted gun shot wound.

GUTIERREZ (on-camera): When the surveillance photograph of Blanning was developed, the sheriff immediately recognized him from an incident back in the '90s when Blanning threatened to hang himself at the courthouse over issues he had with the way in which Aspen was growing.

Police also say that Blanning had spent time in prison in the 90s for fraudulent land sales. Thelma Gutierrez, CNN, Los Angeles.


JOHNS: Sir Charles Barkley arrested, suspected for drunk driving. But that's only half the story. Wait till you hear what Barkley told police.

And mad as hell at Madoff. The accused swindler quickly becoming one of the world's most hated men, is finally getting a taste of his own medicine perhaps. It's 37 minutes after the hour.


CHETRY: Well, Charles Barkley's apparently looking for a good time. He was busted New Year's Eve for allegedly driving under the influence but his arrest is getting more attention because of the play-by-play that he gave police. Here's CNN's Erica Hill.


ERICA HILL, CNN CORRESPONDENT (voice-over): Charles Barkley is known for his outspoken analysis on basketball.

CHARLES BARKLEY, BASKETBALL STAR: And these guys give up a lot of dreams. Are you kidding me?

HILL: And almost anything else.

BARKLEY: Every time I hear the word conservative, it makes me sick to my stomach because it's just really fake Christians as I call them.

HILL: When he was pulled over early Wednesday morning for running a stop sign, Sir Charles didn't hold back. According to the police report, the officers smelled alcohol on his breath. And when asked, Barkley admitted he had been drinking. When asked how much, he was blunt. "A couple. I could give a b.s. answer, but I didn't."

Barkley refused a breathalyzer test, but later, took a blood test. DMZ captured these photos of the former NBA star being processed. Officers say he cooperated fully.

LT. ERIC SHUHANDLER, GILBERT, ARIZ., POLICE DEPARTMENT: It was a very routine, typical DUI arrest.

HILL: Barkley, who is a commentator for CNN's sister network, TNT, issued this statement to Turner Sports - "I am disappointed that I put myself in that situation. The Scottsdale Police were fantastic. I will not comment any further as it is a legal matter."

There are plenty of others commenting, but not necessarily about the mug shot and the DUI charges. When he was pulled over, Barkley wasn't alone. According to the police report, there was a woman in the car with him who is not his wife. When asked where he was going, police say Barkley responded, "You want the truth? I was going to drive around the corner and get oral sex." Though he used a different term.

Barkley went on to tell the officer the same woman had performed the sexual act a week earlier and it was the best he'd ever had. While he was being processed, the 45-year-old also joked, "I'll tattoo your name on my blank if he would get him out of the DUI." The former NBA star lives in Arizona, but has been talking of a move back to his home state of Alabama, where he recently told CNN's Campbell Brown he plans to run for governor.

CAMPBELL BROWN, CNN HOST: So, are you going to run for governor? BARKLEY: I plan in 2014.

BROWN: You are so.


HILL: Barkley says his top priority as governor would be education. In Arizona, officers are hoping the aspiring politicians arrest will be a lesson of its own.

SHUHANDLER: This is another example. Please don't drink and drive. This is New Year's Eve. You have a choice whether or not you drink or drive, it is your choice. Please use this as an example to get a cab, get a designated driver or get another ride home.

HILL: Erica Hill, CNN, New York.


CHETRY: Well, amazing science making small miracles for families across the country. Just ahead in our ongoing series, "Baby Quest." ovarian transplants and how they can turn back the biological clock.

The FBI says it was all a big misunderstanding that one Muslim family says they were still kept off of a flight. Now, two brothers are demanding answers. They join us live. It's 44 minutes after the hour.


CHETRY: The news is just in now to CNN and it looks like Governor Paterson of New York may be getting closer to a decision on who will take over Hillary Clinton's Senate seat. Now sources closest to the New York Governor David Paterson are telling the Associated Press that he will pick Caroline Kennedy. CNN just spoke to Paterson's office, they say they cannot comment on the AP report. And the sources are not from the administration. Again, we'll keep you posted as we find out new details.

JOHNS: A Muslim family is looking for answers after an airline apparently kicked them off a flight. The nine Muslim passengers included three children who were heading from D.C. to a religious retreat in Florida, when other passengers on the AirTran flight apparently became worried about a conversation they overheard about the safest place to sit. When the FBI gave them the all clear, the airline did not let them back on the plane.

Joining us now for an exclusive interview from Orlando, Kasif and Atif Irfan, who are brothers who were banned from that flight. Now, I'd just like to ask either of you, from the statement we've gotten from AirTran here, they seem to be putting it on TSA and part of what they say is the departure time, the captain of the Flight 175 informed the airline there were two federal marshals on board who contacted local law enforcement about a security issue.

So what I want to ask you is, did you get the sense that it was air marshals on the plane that kicked this whole thing off and not necessarily the airline?

A. IRFAN: Well, I think for the most part, the marshals and the federal agents that we dealt with were actually pretty kind and pretty generous in how they dealt with it. I think more so, the blame falls on the airlines because I believe from what we were told, that they initiated the action.

That the stewardesses were told by some of the people on the plane who I think were two young girls that something was going on, and then they initiated by talking to the captain. And I believe that from what the federal agents told us that it was the captain's final decision whether or not to let us on the plane or not.

JOHNS; And what was this conversation that was going on that someone overheard that got the ball rolling?

IRFAN: Well, basically, my wife and I and my sister-in-law as we were walking into the plane, we're discussing normally where we would sit, near the wings or in the center of the plane because I have been told it's the safest place to sit. So we were just discussing the safest place in case something happens to the plane where we would, you know, where's the best place to sit. Should we sit by the wing? Should we sit at the back of the plane?

In doing that discussion, we were very careful not to use any of the -- what you call -- key words or buzzwords like bomb, or terrorist, or threats, or anything that would allude to us doing anything or being in a situation that would be volatile. And unfortunately, someone got from that, that we are taking over the plane or God knows what they thought --

KASHIF IRFAN: That conversation only involved a small portion of passengers that were in our group. It didn't involve most of us at all. And despite that, all of us were taken off the plane in two separate groups. And we were told not to reboard. We were also told that we couldn't rebook a flight with AirTran tomorrow of the next day or indefinitely or until this security issue had been resolved.

JOHNS: OK, and right here let's just sort of get in the meat of this statement from AirTran. They say, "AirTran Airways complied with all TSA, law enforcement and Homeland Security directives and had no discretion in the matter."

Did you get the sense that the airline had no discretion? Or that this was a very discretionary notion?

K. IRFAN: No, you know, the FBI agents actually spoke with the AirTran personnel at Washington Reagan Airport and encouraged them to let us fly again on the subsequent flights that were leaving towards Orlando that night or perhaps the next morning. AirTran refused despite the fact that we were cleared on any allegations of wrong doing.

So I believe it was really up to them to let us reboard or rebook. However, they clearly stated at the airport as well as from the call center, which I had called subsequently that they would not allow us to board or book a reservation anytime in the near future.

JOHNS: And so the question now is, why? Why was it that if this happened, did anybody give you a sense of as to why it happened?

K. IRFAN: Anybody from AirTran?

JOHNS: Right. Anybody from AirTran?

K. IRFAN: They just said that the security matter had not been resolved and that it needed to be clear to prior to them allowing us to book again. And that was all they had stated. They didn't offer any clarification other than that.

JOHNS: All right. I want to thank you both so much for coming in and talking to us here on AMERICAN MORNING, and I'm sure we' here at CNN will be keeping an eye on this case.

K. IRFAN: Thank you.

JOHNS: It is now 51 minutes past the hour.


CHETRY (voice-over): Miracle worker.

UNIDENTIFIED FEMALE: How can you not be awed and amazed?

CHETRY: A groundbreaking transplant that's changing lives. The final part of our series, "Baby Quest." You're watching the Most News in the Morning.



CHETRY: Welcome back to the Most News in the Morning. More and more, medical science is helping women overcome difficult odds on their way to mother hood. And today in our series, "Baby Quest," senior medical correspondent Elizabeth Cohen is looking at ovarian transplants.


ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT (voice-over): Three years ago, the Yarber family never would have imagined they have a scene like this.

STEPHANIE YARBER, MOTHER: When I think about my girls and how they got here and everything that led up to them getting here, of course, how can you not be awed and amazed?

COHEN: Stephanie Yarber suffered premature ovarian failure in her teens and was left infertile. But in 2004, a groundbreaking surgery changed her life.

It's a first of its kind procedure. Surgeons took a sliver of her twin sister's ovary and gave it to Yarber. About six months later, Stephanie Yarber was pregnant.

YARBER: It blows my mind and realized wow, you know, the magnitude of this is like a ripple effect.

COHEN: Other women have since followed. In 2007, Suzanne Butcher (ph) became the first to receive an entire ovary, also from her identical twin, and give birth. Her daughter, Maja (ph), was born in November. Some nine women have had some form of an ovarian transplant, all from their identical twin sisters.

Right now, this type of transplant is only available to women with a healthy twin, but Silber who engineered the technique says it could one day work for any woman with reproductive challenges who has a family with a reasonable match or even more for perfectly healthy women.

DR. SHERMAN SILBER, INFERTILITY CENTER OF ST. LOUIS: We could use this for women who are not ready to have children at an early age and need to put it off until they're 40 or 45.

COHEN: In this case, the woman would freeze her own ovarian tissue while young and use it later.

SILBER: They can just relax for the next 20 years and not worry about their biological clock ticking away.

COHEN: As for Yarber, she's grateful for this new technology. She's already had a second child and hopes to use more for frozen tissue to one day have a third.

YARBER: It's changed our lives. It's a miracle. It can work.

COHEN: Elizabeth Cohen, CNN reporting.


JOHNS: Coming up, a look at your weekend weather forecast. It's 56 minutes after the hour.


JOHNS: Taking a look at Lady Liberty, out of the water, and I got to tell you, she's probably a little cold today here in New York City. Reynolds Wolf, what's it look like out there?

REYNOLDS WOLF, CNN METEOROLOGIST: Well, Joe, it looks pretty good right now for New York. Again, as you mentioned, a bit on the cool side, a little breezy too but it's going to be the storm system moving across the Great Lakes is going to bring some scattered showers later on today for New York and even for Boston today.

But as you cross back the northern plains in the Pacific northwest, yet another storm system that will bring some rain into the valleys and along the coast and in high elevations as you can see several feet of snowfall. And fairly warm conditions in the Central and Southern plains with highs today in Dallas and back in Houston, mainly into the 70s. Well above normal on parts of the I-35 corridor.

In Denver, Mile High City, your high for the day will be 60s, 51 in Kansas City. 14 in Minneapolis and 53 in San Francisco. Now, for tomorrow, what we can anticipate is that storm systems move a little bit more to the east. The one that we're referring to back in the Pacific northwest as it moves across the central plains, boundaries that's going to interact with a lot of moisture coming in from the Gulf of Mexico.

We have a chance of dealing with some strong storms into the mid day and afternoon and even early evening hours for tomorrow, and into parts of the western Great Lakes, look for a combination of rain, sleet and snow, maybe even a bit of ice in parts of Wisconsin and Michigan and into northern Illinois.

All right. Back to you in New York.

CHETRY: All right. Reynolds, have a great weekend. Thanks so much. And it was great to work with you this week.

JOHNS: Absolutely. So much fun. You bet. I'm going to learn how to do that again.

CHETRY: Your new resolution for 2009.

JOHNS: You got it. Don't wake up at 2 in the morning. All right. So thanks so much for joining us on this AMERICAN MORNING. We will see you back here on Monday, minus me.

CHETRY: That's right. Right now, here's "CNN NEWSROOM" with Heidi Collins.