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American Morning

Hillary Clinton in Egypt; Banks Eye New Fees; TEPCO's Pattern of Deception; Exodus in Tokyo; Radiation Level Check; Violence in the Middle East

Aired March 16, 2011 - 07:00   ET

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

KIRAN CHETRY, CNN ANCHOR: The crisis in Japan growing worse overnight, a new fire at the crippled nuclear plant. And now, report this morning that Japan may be asking the United States military for some help. The question today, is it safe for our soldiers to move in on this AMERICAN MORNING.

Glad you're with us. It's 7:00 a.m. in New York this morning on this Wednesday, March 16th. Welcome to AMERICAN MORNING. I'm Kiran Chetry.

CHRISTINE ROMANS, CNN ANCHOR: And I'm Christine Romans. Let's chip (ph) the speed on what's happening this hour.

It's going to get more expensive to go to the ATM. We'll tell you which banks are raising their fees, some charging you $5 to take out your own cash. We're minding your business in about 20 minutes.

CHETRY: That's ridiculous.

Prevention or panic? Iodine pills used to fight health problems caused by radiation exposure flying off the shelves this morning in America, stores selling out of them. We're going to tell you if you need to be worried about stockpiling these pills for your family.

ROMANS: We begin this hour in Japan and breaking develops overnight. Choppers flying over reactor number three at the crippled Daiichi power station. The hope is they can drop enough water into the cooling pond to stop a nuclear meltdown.

Also, there has been another fire at reactor number four. A cloud of white smoke is rising over that facility. And the last 50 workers at the Daiichi plant were ordered to evacuate when radiation levels began to spike. Those levels are down now. Those workers have been allowed to return to work.

CHETRY: So Japanese officials are really scrambling at this point trying to head off a disaster. But some people are wondering why no one has seen or heard from the International Atomic Energy Agency.

ROMANS: The IAEA answers to the U.N. and its mission is to promote the peaceful use of nuclear energy.

CHETRY: CNN contributor Jim Walsh is a research associate at the Massachusetts Institute of Technology. He joins us from Boston. Yesterday you were on critical on the air about the fact that you have 50 people likely sacrificing their own lives trying to take care of what's going on at this plant and there's really no international oversight. What role should the IAEA be playing in this situation unfolding in Japan?

JIM WALSH, CNN CONTRIBUTOR: Yes, I was pretty emotional last night because I really do feel for these workers, and I feel frustrated that the problems are growing and they're sort of the ones left holding the bag. And where is everyone else? Why are we just sitting here and watching this on TV rather than on the ground?

Now, the IAEA does not have a large cadre of people it can automatically send in. Essentially it relies on the member countries, the U.S., France, all the countries that are members of the IAEA to supply personnel that then could be sent to Japan. It can act in a coordinating role, although it has some staff on its own.

But I would like to see them more proactive here. There's a lot of sensitivity about these issues because of national sovereignty. States, countries, governments should be able to manage their own affairs. And if they don't want help, then they shouldn't -- help shouldn't be forced upon them.

But Japan has as of yesterday has requested help in measuring environmental radiation with some radiation experts. But I think we need to move beyond that.

ROMANS: Even a few hours after the original earthquake and tsunami, the IAEA had a blog, referring to reporters like me to a blog. Well, we know that four reactors were not safely shut down and we know have a problem still in this country. In a way, are they just reacting to what the government is telling them? And is there a bigger problem with confusing information from Tokyo Electric Power and the government industries who at sometimes are at odds with each other?

WALSH: Yes, I think all of that is absolutely right, Christine. And I'm a big friend of the IAEA. For ten years I've called for bigger budgets and more support. I think they are a critical institution. But this is a critical time. And they need to be calling and organizing the member states and that includes the U.S. government, France, all the big nuclear states to be able to talk to Japan, because this has international implications.

Let's say bad things happen over the next couple of days and the wind goes west not east. Well, that means you'll have radioactivity into Korea, China, Southeast Asia. This has implications for that entire region. This is turning into an international issue, and it can't simply be managed by the local utility anymore. Yes, they have the local expertise, but others need to be supporting them.

CHETRY: Yes, I think a lot of people not short of expecting the IAEA to go in there, I think it's about information flow, as well, because it concerns every country in the world. Jim Walsh, thanks so much for joining us.

The Japanese government is reportedly preparing to ask the United States for some military help. Pentagon Correspondent Chris Lawrence joins us live from Washington this morning. You had said that the United States -- or at least the sources told you they hadn't received a formal request. What kind of help is Japan looking for in this situation?

CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT: The U.S. military has a lot of experience in the nuclear realm. Again, the officials said everything has to come from Japan. They're purely there to support the Japanese forces, So they've got to get that request first.

Let's take a look at the map. We can show you some of what the U.S. military's dealing with. There's The Fukushima nuclear plant. There are several ships off to the side. Those were closer to the shore, but they have moved north and further offshore because they were starting to pick up some of that radiation downwind.

But they are still flying helicopter missions, search and rescue, humanitarian relief missions into this general area. Helicopter crews came back with small levels of contamination by radiation. They had to be soaped down with soap and water, their clothes destroyed, and they were found to be clean.

But as a precaution, American helicopter crews now flying in that area are being told keep your sleeves rolled down, keep the windows closed on the helicopter. And some of them are even being given potassium iodine pills to fight off some of the effects of radiation.

Further down, you've got U.S. bases. No real danger there yet. But there have been some small, small amounts of radiation detected even there. And so as a precaution, the tens of thousands of American troops, civilians and their families that live there, have been told to stay indoors as much as possible and also to keep their ventilation systems closed.

And as we wrap up, we can show you one more map. Also as a precaution, ships headed to the pacific side near the plant have now been detoured. Instead, they're going to operate out of the Sea of Japan. Kiran?

CHETRY: Chris Lawrence for us, keeping an eye on everything as it concerns our military. Thanks so much.

LAWRENCE: Yes.

ROMANS: Meantime, Americans along the west coast are racing into stores to buy iodine pills worried about possible radiation exposure coming from Japan. And they believe potassium iodine could help fight potential health threats from radiation exposure. A ruptured nuclear reactor released radioactive streams from a Japanese plant.

But U.S. health officials say there is no increased risk of radiation exposure in the United States, saying residents who ingest potassium iodine out of concern of possible exposure from this situation are doing something which is not only ineffective but could also cause side effects. Now as experts point out, we are exposed to radiation every day, different kinds. You take in small doses when you watch television, get x-rayed, fly in an airplane. Is this constant exposure dangerous? At 7:30, our Deb Feyerick tells us how every day radiation is affecting us. And we'll talk more about those iodine pills.

(WEATHER BREAK)

ROMANS: Airport body scanners exposed, the body scanners exposed. The TSA made a big mistake. We're going to tell you what that mistake is in a few minutes.

CHETRY: Also ahead, you know we always talk about how annoying it is to have to pay money to take out your own money. That situation could be getting much worse if banks and credit card companies have their way. It's nine minutes past the hour.

(COMMERCIAL BREAK)

CHETRY: Welcome back to "American Morning," 12 minutes past the hour. The TSA this morning is admitting to bungling those airport body scanners. It turns out the x-ray machines do have high levels of radiation. The TSA is re-examining them after recent tests showed that levels were ten times higher than what they had expected.

Apparently there were a few, quote, "miscalculations" in the initial studies. The TSA says the scanners will stay in place, that they meet all other safety standards. More than 500 are in use across the country.

ROMANS: Protesters linking arms and protesters barging into a Senate meeting at the capitol.

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ROMANS: These union supporters are rallying for workers' rights that came only one day after the release of the state budget. The protesters clashed with police, refusing to leave the building, some even wrapping their legs around furniture to hold their ground. Seven people were arrested.

CHETRY: Sarah Palin's political popularity among her own group is at an all-time low at 58 percent. This could affect the former Alaska governor's decision on whether to run for president in 2012. According to a new "Washington Post" ABC News poll, fewer than six in 10 Republicans approve of her, which is a pretty big drop. She had a 70 percent approval rating among Republicans in October.

Now, for potential Republican candidates, Mike Huckabee still tops the list at 61 percent right behind him Mitt Romney following close behind with 60 percent. There you again see Sarah Palin 58 percent, and Newt Gingrich at 55 percent. ROMANS: Secretary of State Hillary Clinton made a surprise visit to Tahrir Square in Cairo. You'll remember that was ground zero for the popular uprising that toppled long time president Hosni Mubarak. She also urged Egyptians to seize this opportunity and move forward as an Arab democracy.

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HILLARY CLINTON, U.S. SECRETARY OF STATE: This moment of history belongs to you. This is your achievement, and you broke barriers and overcame obstacles to pursue the dream of democracy and the United States and president Obama and I will stand with you as you make this journey.

(END VIDEO CLIP)

ROMANS: Our very own Wolf Blitzer is traveling with the secretary of state. Wolf joins us now on the phone from Cairo. Hi there, Wolf.

WOLF BLITZER, CNN HOST, "THE SITUATION ROOM": Hi, Christine.

ROMANS: What's the latest from the trip with the secretary of state? Clearly a surprise visit to Tahrir Square. Was her message well received?

WOLF BLITZER, CNN ANCHOR (via telephone): Yes, her message was well- received. I walked through Tahrir Square with her, and, you know, she was greeted by everybody who was there, a lot of Egyptians who were there. And uniformly, everybody was smiling, were happy to see her. They were just thrilled that she had decided to make this gesture and walk through the square. It's a lot different obviously than it was only a few weeks ago when they were protesting against President Mubarak. It's much different, although it's by no means a done deal here in Egypt. There's still enormous problems, great challenges before the democracy movement really takes toll. They've scheduled elections for later in the year. But until then, it's going to be a work in progress.

We did go from the Tahrir Square. She met with the prime minister of Egypt and then she met with -- went over to the ministry of defense to meet with General Tantawi. Really effectively the military's in control -- elections so -- and she -- you know, she told them what the U.S. -- hovering over all of the stuff here in Egypt I have to tell you, deep concern over what's going on in Libya right now, the prospect, very real prospect that Gadhafi is going to win, and in the process could slaughter a lot of Libyans. And if he moves on Benghazi, the second largest city in Libya which he's expected to do, there'll be a lot of dead people there.

Certainly this weighs heavily on Secretary Clinton's mind. And also hovering over everything is what's going on in Bahrain right now. Like the Saudis -- to help this king of Bahrain in the face of the enormous demonstrations in Bahrain, the home of the U.S. Navy -- everything else that's going on in the world, especially Japan. So she doesn't have it easy, I've got to tell you. ROMANS: Yes, I know Libyan rebel army commander reported this morning to have said that on the advancing of pro-Gadhafi troops in Libya that the international community has failed us. So clearly, the secretary of state will be asked about that and just what the stance is of the United States on Libya and no-fly zones and alike. We'll continue to monitor that.

Wolf, thank you so much. Wolf Blitzer in Egypt with the secretary of state. Wolf is an anchor of "THE SITUATION ROOM" live from Tunisia today, beginning at 5:00 p.m. Eastern. He gets a lot of miles.

CHETRY: Oh, yes. Well, we'll be watching for sure. He mentioned Hillary Clinton's job is not easy right now. A lot of very, very difficult situations to try to navigate. But, of course, that didn't stop the late nights from having a little fun with Secretary of State Hillary Clinton when she was in Paris, where according to Jay Leno she got quite the greeting from French President Nicolas Sarkozy. Here's a look.

(BEGIN VIDEO CLIP)

JAY LENO, HOST, "THE TONIGHT SHOW WITH JAY LENO": Hillary Clinton arrived in Paris yesterday to meet with the French president, Nicolas Sarkozy. You know, God bless her, she is so good at her job. She knows how to work with the French. You know, she's very -- it's subtle, but you'll see it here. Watch. Watch what she does with the French president.

OK. Now, look, he greets her. OK, very French-style greeting, the kiss on the cheek. Now watch what Hillary does here. Look at this a little bit. Hey, how are you sailor? Nice to see you. But no, no, no -- you see now, you see now.

Now, watch -- now, watch what he does. Watch what he does.

Look at that! Look at that! Look at that! Hey! Whoa!

(END VIDEO CLIP)

CHETRY: What did she do?

ROMANS: She had -- they mocked up her leg and her leg was sort of going up and down the side of Sarkozy. You couldn't see it because we had our banner. Sorry, guys.

CHETRY: Well, that's good. You know, the kids are watching, it's 7:18.

ROMANS: He gets more and more clever with those every day.

CHETRY: Yes, he does.

ROMANS: All right. Ahead, an exclusive CNN investigation reveals what some are calling simply a pattern of cover-ups involving the operator of Japan's crippled Daiichi nuclear plant. Drew Griffin will bring us that story. CHETRY: Also, the threat of radiation exposure in Japan causing some concern here in the U.S. But is it just panic? Experts say that we're exposed to some radiation each and every day. But just how much? What are the things that expose us to more? What are the things that are safe? And what should we be looking out for?

Nineteen minutes past the hour.

(COMMERCIAL BREAK)

CHETRY: Probably you could call it a swipeout, I guess. The big banks looking for ways to get more money from you because of rules, new rules that limit how much money they can get from you. Thinking about limiting debit card purchases and also putting higher fees if you use an ATM. Carmen Wong Ulrich is "Minding Your Business."

We've been saying now for more than a year that, look, $28 billion or something of fee revenue goes away because of credit card reform. They're going to find new ways to get that money.

CARMEN WONG ULRICH, CNN BUSINESS CORRESPONDENT: They are going to. Though they're doing well in other areas, the banks, so I think I'm not so concerned about that, but the debit card dust-up continues. The saga continues.

Listen, what is this all about? This is all about the swipe fees. Every time you go to a retailer or small business, they pay 1.5 percent to three percent every time you swipe your debit card no matter how much you pay. Now this is a $16 billion a year business. But what the Federal Reserve is looking to do and after the card act protecting consumers on that end of the transaction, they're looking to protect vendors and retailers by capping fees at 12 cents. The average right now is about 44 cents. So last week in response, JPMorgan Chase said that they may cap debit transactions to a maximum of $100 or even $50 no matter if you press credit or debit. And they're already testing monthly fees of $3 to $15 on checking and debit accounts.

Today, Chase has decided to test higher ATM fees of $4 and $5. Listen up if you're in Illinois and Texas and you're a non-customer and you go to the ATM, it's going to cost you $4 to $5 at those banks.

CHETRY: I have a question. If they cap it, you can't buy anything with plastic above $100.

ULRICH: Exactly.

CHETRY: So wouldn't that hurt businesses in general?

ULRICH: It absolutely will hurt businesses. And this is the thing. In the business of interest they're trying to limit these fees because if you swipe, say you're buying a coffee, that's a really hefty price that they're paying. So they don't want this to go through. However, the banks are saying, well, it costs us. On our end, we're going to lose that $16 billion. All right. Now for a quick market check on what happened yesterday, a segue. And the Dow recovered quite a bit. It opened way down in response to what's happening in the Nikkei in Japan, but it recovered quite a bit. Down about one percent, 137 points. And the Nasdaq down 33, 34 points and the S&P 15.

ROMANS: Interesting. And a quick business aside, one American company, Google, is doing something interesting in Japan, you guys. Google in Japan is telling people to take cell phone pictures in the shelters of the lists of people who are in the shelters and those posters that are there that are saying, you know, I'm here, I'm looking for whoever, and they're going to actually put all of that together so you'll be able to search easily to find out where people are. Well, go to CNN.com/am and put their address on there. They're asking people to do this. But a searchable way to use technology to help find people.

CHETRY: No, it's smart. I mean, imagine how many people use Google and how easy it is for them to sort of harness that.

ULRICH: And on their phone.

ROMANS: And you see all these people on their phones, you know, in Japan, so a way to try to maybe connect everyone through technology. So we'll get that out there. We'll tweet that out so the people can see where they can look themselves.

CHETRY: Pretty cool.

All right. Still ahead, coming up on AMERICAN MORNING, Democratic lawmakers are gearing up for a big announcement today that could change the way that government views marriage. We'll have more on that.

ROMANS: Plus violence is spreading rapidly to the Middle East. Protesters -- and protests, rather, turning more dangerous. Will the West step in? And what does it mean for the region?

(COMMERCIAL BREAK)

CHETRY: Twenty-eight minutes past the hour right now. A look at our top stories. A government shutdown averted at least for another two weeks, right?

ROMANS: For now.

CHETRY: A deeply divided House agreed to provide enough federal funding to keep the U.S. government open for three more weeks. They call this the continuing resolution. This extension now heads to the Senate where it is expected to pass. This will give the House and the Senate some extra time to try to hammer out the more long-term budget plan for this fiscal year.

ROMANS: House Democrats are taking steps to overturn a federal marriage law. They're planning to bring back the Respect for Marriage Act, legislation that would repeal the Defense of Marriage Act or DOMA. DOMA outlaws gay marriage. It's been in place since 1996. Dems are set to announce a continuing legislation later today.

CHETRY: Also, President Obama is speaking out on Tuesday about the recent nuclear crisis. He is still supporting a strong -- a strong supporter of nuclear programs. But he says he is taking steps to ensure safety right here at home. And he's calling for a total review of all U.S. nuclear facilities.

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BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I've asked the Nuclear Regulatory Commission, our independent agency that oversees the nuclear facilities here in the United States to figure out what lessons had been learned. In case there's an earthquake, in case there's a major natural disaster that knocks out power, what kind of backup systems do we have in place? And that's something that I think people are going to be looking at very closely.

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CHETRY: Meanwhile, President Obama is set to meet with top humanitarian aid officials where they're going to be discussing more recovery efforts for Japan.

ROMANS: A CNN exclusive now as the nuclear horror unfolds in Japan. There are new questions being raised about the operator of the crippled Daiichi nuclear plant, the Tokyo Electric Power Company. A check of the records reveals a pattern of what critics call cover-ups when it comes to releasing facts. Here's Drew Griffin from CNN's special investigations unit.

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DREW GRIFFIN, CNN SPECIAL INVESTIGATIONS UNIT CORRESPONDENT (voice- over): Three reactors at the Fukushima Daiichi nuclear plant are now almost certainly dead. Never to be used again. The question is, can the danger inside be contained? Can the nuclear material be continuously cooled? And can the potential for a dangerous radiation leak into the environment be averted?

The Tokyo Electric Power Company, TEPCO, is preaching calm, that a catastrophic radiation leak can be averted. But they've said that before.

ARJUN MAHKIJANI, INSTITUTE FOR ENERGY AND ENVIRONMENTAL RESEARCH: The history of the Japanese nuclear industry and the government that is very closely tight with the industry is less than glorious in regards to public information and full disclosure. And what is going on now is actually an illustration of that.

GRIFFIN: Arjun Mahkijani is an anti-nuclear activist and is extremely concerned that this crisis seemingly under some control may not be under control at all. Both Japanese government officials and the private owners of nuclear power plants deny that. But TEPCO doesn't have a history to inspire confidence.

In 2002, the president of the power company and four executives resigned after it was discovered repair and inspection records were falsified. Dishonest practices the company admitted later.

PHILLIP WHITE, CITIZENS NUCLEAR INFORMATION CENTER: It was discovered that TEPCO, Tokyo Electric Power Company had covered up incidents of cracking in one of the important pieces of equipment within the reactor vessels, all its reactors. And as a result, they were forced to close down all 17 of their reactors.

GRIFFIN: And the plant with the worst record, Fukushima Daiichi, the plant now in trouble.

WHITE: There's a pattern that emerged that TEPCO isn't frank and deliberately covers up to protect its own interest.

GRIFFIN: Despite promises to regain public confidence, TEPCO's honesty was questioned again in 2007 when a 6.8 earthquake struck western Japan, shaking the Kashiwazaki-Kariwa Nuclear Plant. TEPCO reported only a minor fire at the plant and less than a gallon of water leakage. Later the public learned the fire burned for two hours and hundreds of gallons of radioactive water had leaked into the sea.

The plant that is now in trouble survived the most recent quake. A quake stronger than it was designed for. By design, the reactors immediately shut themselves down. Good news according to the spokesperson for the group that lobbies the U.S. Congress on pro- nuclear power issues.

TONY PETRANGELO, NUCLEAR ENERGY INSTITUTE: I think as we've seen in Japan, despite the magnitude of that earthquake, they hold up quite well.

GRIFFIN: But it turns out surviving the quake was not the end of the crisis. At Fukushima Daiichi, the backup power supply, 13 diesel electric generators ran for a while, then failed. When the generators failed, so did the water pumps that cooled the reactors.

WHITE: You have in total six reactors that have been under great stress with problems cooling the core. And just as you think you might have gotten under control of one, then another one goes.

GRIFFIN: Unlike the shattering moments of an earthquake or the powerful surge of the tsunami, this disaster will linger for months, if not longer. As Japanese nuclear workers try to cool the reactors whose heat has helped to power Japan for more than 40 years and now threatens it.

Drew Griffin, CNN, Atlanta.

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ROMANS: Japan's Prime Minister Naoto Kan is now publicly slamming the Tokyo Electric Company. He's demanding to know why they're taking so long to notify him about new developments in the crisis and he showed up at their Tokyo headquarters yesterday demanding answers.

CHETRY: In the meantime, there are growing concerns about radiation leaks and fears of perhaps another earthquake that's triggered an exodus from Tokyo.

Tokyo airports jammed as dozens of multi-national companies are scrambling to relocate their employees, tourists and even residents are also choosing to leave, not only on planes but on bullet trains as well.

ROMANS: A lot of bankers working in Tokyo moved their families to other countries and other places. The threat of radiation exposure in Japan is causing concern right here in the U.S.. But how much radiation is too much? Experts say, you know, we're exposed to some type of radiation every day.

Deb Feyerick is here to tell us how we're getting it and if it could be harmful. Hi, Deb.

DEB FEYERICK, CNN CORRESPONDENT: Hey there, Christine. Hi, Kiran. Well, you know, radiation is all around us. We're exposed to it every single day, in very small doses. It's in the air, in rocks, soil, cigarettes, secondhand smoke, fertilizers, TV sets, that we have all around us and yes, of course, x-rays.

Even when you fly, you're exposed to some small amount of radiation. A flight, for example, from New York to Los Angeles is about half the amount in the chest x-ray, which is still pretty small. Now the body has learned to absorb process and in fact neutralize background radiation. So the amount of radiation that you and I absorb every year registers at an average level of about 6.2, that's a safe level. That's what we're talking from background. If you have an x-ray, that's about half that number.

Nuclear plant workers are allowed a maximum exposure of 50. That is their safe level. But readings at the facility in Japan are now registering 400. And your body would absorb that amount in just 2 1/2 hours, that's deadly.

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DR. JAMES THRALL, PRESIDENT OF THE AMERICAN COLLEGE OF RADIOLOGY: This is not like resting on the sidelines of a football game. Once you've had that amount of radiation and you've reached the limit, it's a cumulative effect. So just imagine you were in the sun and you realized you had a horrible sunburn so you came into the shade. Well, you would be very foolish to go right back out into the sun.

(END VIDEO CLIP)

FEYERICK: Now, chances of any dangerous levels of radiation coming to the U.S. are very slim, experts say, but for those in Japan, the lasting danger is not in the air, it's the nuclear fallout on the ground. At Chernobyl, people got sick because of radioactive particles in the food chain. Cows consumed contaminated grass and water, and then thousands of children drank the milk, they came down with thyroid cancer. Something else to keep in mind, in terms of the overall exposure and the explosions, Dr. James Thrall, points out that the explosions were not atomic explosions.

(BEGIN VIDEO CLIP)

THRALL: Nuclear reactors are not designed so that they can even explode the way a bomb does. They are deliberately built with a lower level of radioactive materials and it could never reach a critical mass and explode the way an atomic bomb does.

(END VIDEO CLIP)

FEYERICK: So clearly the kind of exposure's going to be very different, the way it's delivered, the way it's spread. The area around the plant is now a hot zone. And it's going to take years, as many as five to 10, to clean up the radioactive isotopes in the soil. If there's a lot of radioactive cesium, cleaning up the area and restoring the area is going to take even longer. So this expert you just heard from, he said that there was talk in the community that experts should come in, they should rotate in for 2 1/2 hour chunks of time to get people out.

But once you're out, you cannot come back in. And that's why some of these workers really made the choice to stay where they are and at least try to contain it.

CHETRY: And the other important thing that you bring up also is at least they're explaining this to people. I mean, we were talking about with some of the experts is that in Chernobyl, they had no idea. And so that's why they continued eating, you know, the food and drinking the milk.

FEYERICK: Exactly. Exactly. But this area that you're looking at, the cleanup is going to be massive if they're able to do it.

ROMANS: Deb Feyerick. Thanks, Deb.

FEYERICK: Of course.

ROMANS: Still to come. Terror and turmoil in Bahrain. The clashes between protestors and police are escalating there. We're going to get you the latest on all of these new unrest.

CHETRY: Also, severe storms hammering the northeast this morning. Areas already flooded out from last week's storm. Jennifer Delgado will be here with your complete forecast in 10 minutes. You're watching "American Morning."

(COMMERCIAL BREAK)

ROMANS: New unrest in the Middle East, violence sweeping through the Arab world. Tensions escalating in Bahrain. And security forces launched an attack on pro-democracy protesters in the capital there. They were armed with rubber bullets, batons, and tear gas.

We're joined now by Ian Bremmer, the president of the Eurasia Group, a political risk research consulting firm. Ian, good morning. You told me several weeks ago to really watch Bahrain because this was a different kind of conflict than we have seen elsewhere in the Middle East where it was people rising up against a repressive regime. This has the markings of a sectarian conflict, doesn't it?

IAN BREMMER, PRESIDENT, EURASIA GROUP: Without any question, I mean, although the demonstrators have not framed it as such. I mean, pretty much everyone that's demonstrating is Shia, a majority of the population in Bahrain, but 30 percent of the population is Sunni, and that includes the monarchy. While it's a wealthy country, it's about $25,000 per capita, very, very different from Egypt and Libya. It's also a country where the vast majority of the resources go towards the Sunni. And not only does that play out on the ground in Bahrain, but it's also playing out with the Saudis who have decided to provide direct military support to that monarchy.

ROMANS: And they say they're peace keeping. They're helping in a peace keeping fashion. But you say you do not think the Saudis are listening to American advice on this.

BREMMER: Well, I think one of the most interesting and maybe long- term implications of everything we've seen in the Middle East so far is that the special relationship between the U.S. and Saudi Arabia which has been very close for a very long time is showing some serious fragmentation. The United States very clearly wants the Bahraini government to negotiate and to reform and to provide more input in the government for the Shia.

The Saudis are not interested in that at all and they really want to make sure that this monarchy stays as strong and as cohesive as possible. Between the two, there's not a lot of space right now and there's not a lot of discussion. And frankly, we could end up in a situation. The United States not doing much in the Middle East right now. Really a taker, not a maker of foreign policy. The likely outcome is that the Saudis are going to have a leadership of a much more cohesive gulf cooperation council and the United States is going to find itself a little bit on the sidelines.

ROMANS: Meanwhile, Secretary of State Hillary Clinton making a surprise visit to Tahrir Square in Egypt saying "this is your moment, not ours." Even as in Libya it looks as though Gadhafi is gaining ground. In fact, a rebel army commander this morning reportedly saying as pro-Gadhafi troops are pushing them back, the international community has failed us. What are the U.S.'s options here?

BREMMER: Well, the United States I think understands. They're very risk averse on this. They want to see how it plays out. They'd like it to move in the same direction as Egypt, but they're not prepared to move it there very far. In part, because I think they understand as soon as you have something like a no fly zone or a no-drive zone, as soon as the American military engages, the United States has effectively bought this conflict. They're going to own a lot of what ends up happening in Libya. And there's no appetite for that in the White House. There's not a lot of appetite for it in Congress.

I mean, we're two years into the Obama administration. There's still no Obama doctrine. The last time you could say that about a presidency was President Ford. Now, we don't compare those two presidents very often, but overwhelmingly, the U.S. is focused domestically keeping the government running, unemployment, economics, another engagement on the ground in the region is low and there's not much coordination with American allies in Europe. So we're not going to see very much in terms of coordinated international response here.

ROMANS: Gadhafi says that this will all be over in 24 hours. Do you think that's true?

BREMMER: No. I certainly don't. But that doesn't mean that Gadhafi's going to be easy to be displaced. At the very least, I think, we're going to continue to see oil off the market from Libya for a very long time because there aren't strong governing institutions in Libya. And so just getting things back up and running, getting the ex-pats back in that country. This is not a short-term conflict.

ROMANS: Let me ask you quickly, I want to close again with Bahrain, because these are the new pictures we're seeing. The government says it has things under control. But you're hearing reports and our reporters are there and hearing from eyewitness and people involved in the protests saying that no, it is deadly, violent, that it is happening and it is actually escalating, essentially a kingdom in chaos.

What is the next step for Bahrain? Is the next step civil war?

BREMMER: I don't think it's civil war because I don't think a lot of protesters are going to take up direct arms against sort of very well coordinated and mobilized Gulf coordination council -- cooperation council forces. But you're going to see a standoff for a while unless the King Khalifa is prepared to really start opening negotiations with the Shia. And thus far, he's been unwilling to do that.

One final point, al Jazeera, of course, comes out of Qatar. They're part of the GCC and they don't want to see this escalate either. So you may start to see al Jazeera playing less of a role in Bahrain than they've played in places like Tunisia and Egypt.

ROMANS: And watch the two big players, of course, Saudi Arabia and Iran --

BREMMER: Very much so.

ROMANS: -- as the conflict continues.

All right. Ian Bremmer. Thank you so much from the Eurasia Group. Thanks, Ian.

BREMMER: My pleasure. Sure.

CHETRY: Still to come on AMERICAN MORNING, fallout from joking about the situation in Japan. Joan Rivers speaking out this morning after Gilbert Gottfried was fired from his job at Aflac for joking about the earthquake. We'll tell you what she had to say.

Also a stormy start to your Wednesday from parts of the northeast. Jennifer Delgado will join us. She has the travel forecast, coming up right after the break. It's 46 minutes past the hour. (COMMERCIAL BREAK)

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ROMANS: Still to come on AMERICAN MORNING, rising gas prices got you down? Well, we're going to talk to the man who correctly predicted this price spike and he's going to tell us exactly where the price of gas might be headed, next.

CHETRY: Also a mother of a four-year-old is suing her daughter's preschool. Why? Well, she was supposed to be getting Ivy League prep and instead she got lumped in with a bunch of two-year-olds. Fifty- one minutes past the hour.

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CHETRY: Welcome back to AMERICAN MORNING. We talked about yesterday how Gilbert Gottfried got the axe from Aflac because of some jokes that he made in the wake of the disaster. Well now, he's getting some defenders.

Joan Rivers came to his defense Tweeting, "Come on, people, this is just outrageous. This is what comedians do. We react to tragedy by making jokes to help people feel better in rough times through laughter."

Then Gottfried returned a Twitter yesterday, saying that he apologizes to anyone who was offended by his attempt at humor regarding the tragedy in Japan.

ROMANS: Well, he's employed by a company that makes a good deal of its revenue from Japan.

CHETRY: Right.

ROMANS: So it's not just he was randomly doing it. I mean --

CHETRY: Right. Plus, I mean, and -- it's up to the company to decide what they want to do and they haven't changed their mind.

ROMANS: You serve at the pleasure at the guys writing the checks.

(CROSSTALK)

ROMANS: All right. Speaking of writing checks. Bon Jovi apparently has a bone to pick with apple's CEO Steve Jobs. In a recent interview with the "Sunday Times" magazine the New Jersey rocker said kids have no idea what it's like when back in the day you bought an album without knowing what the songs were like. Adding kids who miss the experience of putting the headphones on, turning it up to 10, holding the jacket, closing their eyes, getting lost in an album. Steve Jobs is personally responsible for killing the music business.

CHETRY: It's interesting. I mean, you could argue it both ways or is music available to so many more people?

ROMANS: And so many more bands. Instead of buying 13 tracks you can buy 13 different artists and so you have much more scope and range.

(CROSSTALK)

CHETRY: Well, usually when a couple gets married the bride's family picks up the tab but that's not the case when it's a reported $10 million royal wedding. According to "Vanity Fair" though, Kate Middleton's parents will be pitching in. They've reportedly contributed six figure sum to the royal wedding. It's something a senior aide says that they absolutely wanted to do.

ROMANS: And they are wealthy business owners. It's probably the right thing to take some of that off the backs of the royal family and the taxpayers.

All right. AMERICAN MORNING is going to be live from London for the royal wedding also, which is set for April 29th.

CHETRY: Very excited about that.

ROMANS: Top stories are coming up your way right after a quick break. Three minutes until the top of the hour.

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