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CNN Live Saturday

Atlantis Set for Liftoff Tomorrow; Dangers on Road to Democracy in Iraq; Tropical Storm Ernesto May Turn Into Hurricane; Kidnapped FOX News Journalists Update; Fight over John Karr Evidence; Chad's President ordered Foreign Oil Firms Out of Country; Spike Lee's Hurricane Katrina Documentary

Aired August 26, 2006 - 12:00   ET

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

SUZANNE MALVEAUX, CNN ANCHOR: "Now in the News," tropical storm Ernesto gathering steam in the Caribbean. It's expected to morph into a hurricane by Monday and threaten Gulf states as early as Tuesday. In just a minute, we'll go to the CNN Weather Center for the latest on this storm.
Palestinian official predict good news about two FOX News journalists kidnapped in Gaza. Word could come within days. Correspondent Steve Centanni and cameraman Olaf Wiig have been held hostage since August 14.

Two French soldiers have been killed in fighting with Taliban forces in Eastern Afghanistan, they died in clashes yesterday. Also the U.S. military reports a coalition airstrike yesterday killed a local Taliban commander and 15 other militants in the South.

No indication of terrorism but investigators say an American student faces serious charges after packing a stick of dynamite in his luggage on a flight from Argentina to Texas. His dad says it was a stupid mistake. It was one of seven incidents that disrupted U.S. flights on Friday.

And back to Neverland, a brushfire at Michael Jackson's California ranch is fully contained. More than 30 acres were destroyed. However fire officials say buildings and amusement park rides are OK. Jackson is not there, he has been living in the Middle East country of Bahrain for the past year.

We update the top stories every 15 minutes on CNN live Saturday. Your next update is coming up at 12:15 Eastern.

And straight ahead at this hour, what is the state of democracy in Iraq? You'll hear what those on the ground are saying about its chances.

Also, Spike Lee touches off a new storm of controversy with the documentary that examines the government's response to Katrina.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Why would they do it? Why would the government blow up the levees? It sounds crazy. SPIKE LEE, ENTERTAINER: Why would the government give syphilis to Negros in the '40s untreated and see what the effect would be on them?

(END VIDEOTAPE)

MALVEAUX; And how would you like save 50 percent off everything you buy? We'll get some tips ahead on CNN LIVE SATURDAY.

From the CNN Center in Atlanta I'm Suzanne Malveaux, welcome to CNN LIVE Saturday.

(BEGIN VIDEOTAPE)

ANNOUNCER: CNN, your hurricane headquarters.

(END VIDEOTAPE)

MALVEAUX: Just three days ahead of Hurricane Katrina's first anniversary, an ominous sign. Tropical Storm Ernesto is now swirling in the warm waters of the Caribbean between Puerto Rico and Venezuela. Forecasters say it could be the season's first hurricane by early next week. Bonnie Schneider, of course, joining us at the Weather Center to gives the very latest.

A lot of people worried about this, Bonnie. What do we know so far?

BONNIE SCHNEIDER, CNN METEOROLOGIST: With good reason. Any time you have a tropical storm in the Caribbean, it's something you need to watch, but since the movement has been steady, but slow, to the West/Northwest, that really puts us in a general area of concern. You can see the storm to the South there on the screen, and as we put this map into motion, you can actually see the track it's been taking, steadily, slowly but surely, moving to the West/Northwest now at 14 miles-per-hour. That has slowed down since what we saw earlier this morning.

Most of the convection has been on the Eastern side of the storm. Notice the shape up here of the convection, you can see kind of a round here on this side on the Eastern side and then straight line down here through the West. That's because the winds are coming right from the Southwest and they're sheering the storm to some degree but not sheering it enough to break it apart.

Ernesto is holding on and as it comes over areas with lighter wind sheer, deeper, warmer waters, especially over the Yucatan channel and into the Gulf, we're definitely looking at the chance for this storm to potentially intensify and grow in size and grow in strength.

You're looking at the latest forecast track now. Maximum winds are at 50 miles-per-hour. And watch what happens Sunday into Monday, we're likely to see the winds increase to hurricane strength and that could happen as early as Sunday night into Monday morning taking it up to Category 1 status. Now as we look towards the future, towards Wednesday, we're watching very closely because what we're looking at here is a little more detailed track, it'll take you over the next few days. You'll notice that cone of uncertainty widen as we work our way through the beginning and center, the middle of the week because what we're looking at right now is the cone of uncertain, the maximum winds and you can see Category 1 with maximum winds, 80 miles-per-hour at 2:00 a.m. Monday.

But what's important to note here, even as we stretch towards Tuesday you can see the widening of the cone, that indicates a wide margin for error in the forecast days ahead. In the immediate future though, there is a hurricane watch now posted for Jamaica and the Cayman Islands, so that's the area that is under threat for some torrential downpours right now -- Suzanne.

MALVEAUX: Bonnie, thanks so much, we'll be keeping a close eye on those developments later today.

Now New Orleans, the Mississippi Gulf Coast, and parts of South Alabama, they are all still reeling from Hurricane Katrina. President Bush will head to the region on Monday, his first stop, the devastated Mississippi Coast. And then it's on to New Orleans. Today both Mr. Bush and Democrats are focusing on the federal government's ongoing efforts to get the region back on its feet.

(BEGIN AUDIO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Fortunately, Katrina also revealed that federal, state and local governments were unprepared to respond to such an extraordinary disaster and the floodwaters exposed a deep seated poverty that has cut people off from the opportunities of our country.

The federal government has conducted a thorough review of response to natural disasters and we're making reforms that will improve our response to future emergencies. With help from Congress, we've committed $110 billion to the recovery effort and we're playing a vital role in helping people clear debris, repair, and rebuild their homes, reopen their businesses and schools and put their lives back together.

SEN. MARY LANDRIEU (D), LOUISIANA: Countless neighborhoods appear as if the hurricanes were just yesterday. And they serve as harsh reminders of how our nation was so unprepared. Unfortunately, our nation in many ways remains unprepared for major disasters, Whether they be hurricanes, earthquakes, or terrorist attacks. Too often federal agencies are slow to move and encumbered by red tape.

(END AUDIO CLIP)

MALVEAUX: We have a lot more on Katrina anniversary coverage straight ahead, but first at the half hour, a look at filmmaker Spike Lee's documentary, "When the Levees Broke" it condemns what Lee says is a lack of a competitive rebuilding plan. Plus we'll hear from CNN contributor, Donna Brazil. Katrina had a major impact on the New Orleans native and her family and now she is trying to help her hometown recover.

One year after the storm of a lifetime, CNN remains in the Gulf region, beginning Monday, we'll take you back to the scene of the destruction with a look at the people whose lives were affected. Are they prepared for the next big storm? CNN's coverage of Katrina one year later begins Monday.

And all week long, CNN's Anderson Cooper reports from New Orleans and other hard-hit areas of the Gulf Coast.

Shuttle managers are keeping a wary eye on the sky.

(BEGIN VIDEO CLIP)

KATHY WINTERS, SHUTTLE WEATHER OFFICER: We did increase our number today from a 40 percent of KSC weather prohibiting launch to a 60 percent chance of KSC weather prohibiting launch.

(END VIDEO CLIP)

MALVEAUX: Atlantis is set for liftoff tomorrow afternoon. Today engineers are checking to see if a lightning strike on Friday damaged the launch pad. If thunderstorms keep the shuttle ground, NASA says Monday and Tuesday look sunnier. The Atlantis crew will restart construction on the International Space Center (SIC).

If Atlantis goes up, you'll see it here live on CNN. Join us for a special report at 4:30 Eastern, 1:30 on the West Coast.

And this just in to CNN, Chad's president has just ordered foreign oil firm Chevron and Petronus to leave the country for nonpayment of taxes, the surprise move follow Chad's decision to create a new national oil company which it said should become a partner in the country's oil producing consortium led by U.S. major Exxon Mobile and Chevron, was well as others. We are tracking down more details on this story and will bring them as soon as we get them.

Now, on to the Middle East, hope for two journalists kidnapped in Gaza. A Palestinian official says he expects good news about the FOX correspondent Steve Centanni and cameraman Olaf Wiig. Word could come within the next two days. The interior ministry spokesman says he's been told both men are in good health and have not been harmed. They have been held hostage since August 14.

In Iraq, a fledgling government struggles under what can best be described as a fragile democracy. Earlier today in Baghdad, Prime Minister Nouri al-Maliki urged tribal leaders to unite and end the bloody sectarian violence that threatens to plunge the country into civil war. Our Michael Ware explores the dangers on the road to democracy.

(BEGIN VIDEOTAPE) MICHAEL WARE, CNN CORRESPONDENT (voice-over): Car bombings, an ongoing guerilla war, sectarian slayings, and an ailing economy, the stakes couldn't be greater for the people of Iraq or for the Bush administration.

BUSH: A failed Iraq would make America less secure.

WARE: What's harder to see is the solution.

BUSH: The strategy is to help the Iraqi people achieve their objectives and their dreams which is a Democratic society.

UNIDENTIFIED MALE (through translator): No, there's no democracy at all because you can see the situation right now, from the killing, terrorism, looting.

WARE: If democracy is the answer, where is it at? According to America's closest political allies in Iraq, former Prime Minister Ayad Allawi, the new democracy was planted two quickly for it to take root.

AYAD ALLAWI, FORMER IRAQ PRIME MINISTER: No it's not a democracy.

Though Iraqis to the ballot box three times, once amid violence, twice with the insurgent's approval, Allawi insists the political process has stalled.

ALLAWI: Elections are not democracy. There are as lawlessness. There is no institutions, no -- even no judiciary institutions here that you can go and air your problems. Democracy is also about checks and balances, we don't have this at all.

WARE: He claims power is vested in shadowy groups in the government with Iranian links and militia connections. U.S. officials say it's too soon to pass judgment on a fledgling state mired in war.

COL. DANA PITTARD, U.S. ARMY: It is an Iraqi style democracy, no one expected to be an American style of democracy.

WARE: Death squads, terrorism and influence of neighboring Iran are hurdles U.S. military commanders and officials say, but the foundation stones are at least tentatively in place.

PITTARD: However for this new Iraqi government to be able to have credibility, Baghdad must be stabilized.

WARE: A massive joint American and Iraqi operation is underway in the capital. Twenty-two raids against death squads says a U.S. military spokesman and 28,000 buildings have been cleared with tens of thousands of troops entering one troubled district after another, curbing sectarian murders as they go.

A senior U.S. official says "Operation Together Forward" is the best way to help Iraq's new prime minister, a man without a militia of his own, counter the militias, many embedded within his government and undermining his authority. But Allawi, who worked on operations against Saddam for more than a decade, claims the U.S. plan will fail unless there's a major change of course. As more people lose faith as drift to the militias and the insurgency.

ALLAWI: Go and ask an Iraqi at 8:00 to go to a restaurant or go to a move to see a relative.

WARE: A U.S. military spokesman says the coming weeks will tell if the Baghdad operation is truly working. There's a lot riding on it. President Bush sees the spread of democracy in the region as the solution to terrorism.

BUSH: I believe it's the challenge of this -- the challenge for this generation.

WARE: Many will be hoping then, the nascent democracy in Iraq is better than it looks.

Michael Ware, CNN, Baghdad.

(END VIDEOTAPE)

MALVEAUX: Our Wolf Blitzer will have an exclusive interview with Iraqi Prime Minister Nouri al Maliki tomorrow morning on LATE EDITION at 11:00 a.m. Eastern.

The lawyer representing John Mark Karr is concerned about hand writing samples. We'll find out why just ahead.

And Spike Lee talks about his controversial new documentary on the events surrounding Hurricane Katrina.

(COMMERCIAL BREAK)

A quarter past the hour, here's was happening "Now in the News." Tropical Storm Ernesto is slowing working its way toward the Gulf of Mexico. Right now it's in the Caribbean moving toward Jamaica. Forecasters say it could become the first hurricane by the first of the week.

In the Middle East, Palestinian officials say they expect to have good news about two kidnapped FOX News journalists within the next two days. Correspondent Steve Centanni and cameraman Olaf Wiig were kidnapped in Gaza City nearly two weeks ago. Efforts to win their release continue. The two men appeared in a video on Wednesday, aired by a Palestinian news service.

Iran still shows no signs of rolling back its nuclear program. Earlier today the country's president inaugurated a plant designed to produce plutonium, an ingredient that could be used to make atomic warheads. He says the plant will be for civilian purposes. Iran faces a Thursday deadline set by the United Nations to stop its nuclear activities or face possible sanction.

We update the top stories every 15 minutes on CNN LIVE SATURDAY, your next update is coming up at 12:30 Eastern. John Karr, the suspect in the JonBenet Ramsey murder case is expected to make his first court appearance on Monday, but the fight over evidence has already begun.

CNN's Suzan Candiotti is in Boulder, Colorado.

(BEGIN VIDEOTAPE)

SUZAN CANDIOTTI, CNN CORRESPONDENT (voice-over): Seth Temin, a public defender, has already spent hours with his new client, and made his first legal maneuvers. He's asking to keep Karr's handwriting and any new documents under court seal, like this recent signature on his extradition papers, and now found on a new handwritten application to prove he can't pay for a private lawyer.

Legal experts say, the defense wants to force investigators to go to court to get more handwriting samples from Karr to compare with JonBenet Ramsey's ransom note.

Meanwhile, questions remain over whether Karr could have been in JonBenet Ramsey's neighborhood in December 1996. His family again said he was with them every Christmas.

Karr's father and brother told ABC's "Good Morning America," "From the time that John had children, he has never missed a Christmas with his family. And that's any Christmas," said his father.

His brother Nate added, "If he was away from his family during Christmas, it would have been a family scandal."

If Karr flew from home in Atlanta or Alabama and back again, with no one missing him, it would have been tough. CNN obtained Delta's 1996 flight schedule. To get to Denver to hide in the Ramsey house by 5:00 p.m., as he allegedly claims, Karr would have to, for example, leave Birmingham at 9:10 on Christmas Day, and arrive in Denver at 11:20 a.m. Karr would then have to drive at least another hour to Boulder.

Coming home after allegedly murdering the 6-year-old, Karr would have had to leave Denver at 6:40 a.m., change planes in Cincinnati, and get back to Alabama at 1:40 in the afternoon.

Overall, he would have been away if his family for about 30 (ph) hours, most of it on Christmas Day.

BOB GRANT, FORMER BOULDER ASST. D.A.: The answer in this case comes from the DNA. If the DNA is his DNA, then he was in that basement on that night, no matter what THE family says. If it's not his DNA, then the prosecution's going to have to explain why they believe he was in Boulder at that time.

CANDIOTTI: Again, whether Karr's DNA matches appears to be the key.

(on camera): The defense asked the court to prevent investigators from taking any new DNA samples from Karr without a court order, and to prevent investigators from using any previously taken DNA samples without legal permission, and all of the before Karr has been formally charged.

Susan Candiotti, CNN, Boulder, Colorado.

(END VIDEOTAPE)

MALVEAUX: New questions are being raised about U.S. built weapons that were used in recent fighting between Israel and Hezbollah. Find out who's asking right after this.

(COMMERCIAL BREAK)

MALVEAUX: And this just in to CNN, Chad's president has just ordered foreign oil firm Chevron and Petronus to leave the country for nonpayment of taxes. Now the surprise move followed Chad's decision to create a new national oil company which it said should become a partner in the country's oil producing consortium led by U.S. major Exxon Mobil and Chevron an Petronus.

Now, joining us live on the phone is oil expert Peter Beutel, he works with companies to help protect against these price moves, nationally and internationally. Peter joining us from New Canaan, Connecticut.

Peter, thank you so much. First and foremost, I supposed, people want to know, how is this going to impact U.S. gas prices? Are we going to see them go up, go down? How does this impact what we see at the pump?

PETER BEUTEL, OIL ANALYST: Well, I don't think it's going to have a huge impact at the pump, this is a very small amount of oil. We're talking about 170,000 barrels a day in a world that uses 85 million barrels a day.

MALVEAUX: Why should we care about what is happening in Chad? What is going to be the impact of our own markets -- oil markets?

BEUTEL: Well, it's interesting to see that a small country is deciding to nationalize its oil concerns. Obviously it's going to need a lot of foreign expertise and technology in order to get any oil up from the ground at all, so to see it make this kind of a move is kind of shocking and I think more than anything, that's really its impact.

MALVEAUX: Does Chevron or Petronus have any kind of recourse?

BEUTEL: Not really, if a country decides to nationalize your oil then basically you're out of luck. It is one of the political risks that oil companies do have, yes, so there really is very little recourse.

MALVEAUX: Why this move now?

BEUTEL: Well, because prices are so high, I think. I think that the leaders of Chad probably have no other income. We don't hear about Chad very often in the news. We heard about hanging Chad but certainly not the country, so I think that this may be there one way to get themselves some money to do something. It's a very poor country and they don't have any exports of any major commodities so to have oil now this maybe gives them a shot at doing something.

MALVEAUX: Peter Beutel, thank you so much for joining us, we're going to keep a close eye on that developing story. Thanks again, Peter.

BEUTEL: Thank you.

MALVEAUX: Now, where is Tropical Storm Ernesto headed? An update from your hurricane headquarters is just ahead.

And Spike Lee talks about the questions he's raised about the federal government's role in the disaster surrounding Hurricane Katrina.

(COMMERCIAL BREAK)

MALVEAUX: Half past the hour. Here's what's happening now in the news. We are keeping a close eye on Tropical Storm Ernesto. It's moving toward Jamaica and the Cayman Islands. Forecasters say the system could become a hurricane by tomorrow night or Monday morning.

Iran's nuclear plant now has two units working. Earlier today, President Mahmoud Ahmadinejad toured the plant and repeated that it would be used for peaceful purposes. The U.N. has given Iran until Thursday to suspend uranium enrichment or face possible sanctions.

The fate of two kidnapped journalists is still unknown. But there are encouraging signs, according to sources in Gaza. Fox reporters Steve Centanni and photographer Olaf Wiig were captured 12 days ago. A Palestinian spokesman says there are no direct talks but there are some communications to secure their release.

A shuttle countdown is underway. Atlantis is scheduled for liftoff tomorrow from the Kennedy Space Center in Florida. But NASA says there's a 60 percent chance bad weather conditions may force a delay. Six astronauts are preparing to resume construction on the International Space Center.

We update the top stories every 15 minutes on CNN LIVE SATURDAY. Your next update is coming up at 12:45 Eastern.

Three days before Hurricane Katrina's first anniversary, a big worry for people along the Gulf Coast. Tropical Storm Ernesto is now churning through the Caribbean. Forecasters say it could be a hurricane in the next couple of days. By that time, it's expected to have reached the Gulf of Mexico.

Bonnie Schneider, of course, joining us for the latest details. What do we know about Ernesto, Bonnie?

SCHNEIDER: Well, right now, Suzanne, I want to show everyone what we look at to help determine the forecast. Take a look at computer models. Each line represents a different computer model.

And if it looks like there's a lot of them, there definitely is. We have 15 different models here, and as you can see, most of them are taking Ernesto further off to the north, crossing over Cuba and then working its way into the Gulf of Mexico.

Some of them are taking it more to the south towards the Yucatan, which could be a little bit better because maybe it would break up the storm a little bit and lose some intensity.

But in any case, it looks like the storm is working its way steadily to the west/northwest. And that's important to note because of that slow movement with a storm, it has slowed down and allowed more of an opportunity to intensify and to strengthen.

This is a look at our satellite imagery, and it's important to note the shape of the storm that we're seeing right now. Notice, you can see, as we play this satellite loop over and over, watch as you see a little bit of a concave area here in the western half of the storm right there. That indicates the wind shear that's coming in from the southwest kind of trying, at least to break apart the storm.

It's not strong enough to break down Ernesto. Maximum winds with this storm are at 50 miles per hour. And even though we are seeing a good amount of wind shear, once again, we're expecting that to relax. And with the relaxing wind shear and with the storm passing over warmer waters of the Caribbean Sea and into the Yucatan, the forecast calls for Ernesto to gain strength to hurricane status as early as Monday.

And we're looking at that time, it could see winds at maximum as high as 80 miles per hour, and then eventually intensifying even further to 90 miles per hour winds on Tuesday. Something we'll be watching very closely, Suzanne.

MALVEAUX: Bonnie, thank you very much. We'll be keeping a close eye on that.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: This my daughter Serena (ph) who drowned in Hurricane Katrina. She was 5 years old. And I never got a chance to say goodbye.

(END VIDEO CLIP)

MALVEAUX: Coinciding with the first anniversary of Hurricane Katrina, Spike Lee's new documentary "When the Levees Broke: A Requiem in Four Acts" premiered this week on HBO and will air again. Some are calling it Lee's finest work in 20 years of filmmaking. Others say Lee took a few liberties along the way.

CNN's Randi Kaye sat down and spoke with Lee about his project.

(BEGIN VIDEOTAPE)

RANDI KAYE, CNN CORRESPONDENT (voice-over): Sit down for an interview with director Spike Lee, and get ready for an earful.

(on camera): Do you believe there was a conspiracy to wipe out the poor black population of New Orleans?

SPIKE LEE, DIRECTOR, "WHEN THE LEVEES BROKE": I don't put anything past this administration. It would not surprise me.

KAYE (voice-over): That pretty much captures the tone of HBO's Spike Lee documentary, "When the Levees Broke." It's a four-hour emotional roller coaster of a film.

UNIDENTIFIED FEMALE: This is my daughter Serena who drowned in Hurricane Katrina. She was 5 years old. And I never got a chance to say goodbye.

KAYE: The documentary centers on the failings of the Bush administration, some that can be documented like FEMA's fumbling effort to deliver trailers, and some that have the earmarks of urban legend, like the claim the levees were breached on purpose so poor folks would be flooded while the rich folks stayed dry. After all, it had happened once before in the 1927 flood.

(on camera): What did people tell you about their beliefs that there really may have been a conspiracy to blow up the levees?

LEE: Well, people didn't use the word conspiracy. What they told me, what you see in the film, is that they heard an explosion. More than one person said they heard an explosion.

KAYE: Why would they do it? Why would the government blow up the levees? It sounds crazy.

LEE: Why would the government give syphilis to Negros in the 40s untreated and see what would be the effect on them?

KAYE (voice-over): In his trademark style, subtle but with a bite, Lee suggests President Bush and his team were busy doing other things rather than focusing on Katrina.

LEE: Dick Cheney, fly fishing. Karl Rove, nowhere around. You have Chertoff going to Atlanta on a disease prevention kick. What was Dr. Condoleezza rice doing that looked very poorly? She was at Ferragamo's buying shoes.

KAYE: Spike Lee does not make the government's slow response a black/white issue, but an issue of class.

UNIDENTIFIED FEMALE: This not about low income, it's not about rich people, poor people. It's about people.

KAYE: He uses this clip of Barbara Bush touring the Houston Astrodome to make his point.

BARBARA BUSH, FORMER FIRST LADY OF THE UNITED STATES: And so many of the people in the arena here, you know, were underprivileged anyway. This is working very well for them. LEE: It was amazing that the president's mother said that, that somehow that by having this hurricane and the breach of the levees and losing their -- losing lives and losing their business and families, this is a form of social upheaval and they'll make out better.

KAYE: When Lee first started filming in New Orleans last November, he couldn't believe what he saw.

LEE: It looked like a movie set. It looked like a set on the back lot of an end of an end of the world, apocalyptic movie.

KAYE (on camera): Television didn't do it justice.

LEE: You can't.

KAYE (voice-over): And he's still surprised, he says, by what little in his opinion is being done to make New Orleans safe, such as rebuilding the levees to pre-Katrina status. He recalled one interview with the Army Corps of Engineers.

LEE: I looked at him like he was crazy. Pre-Katrina safety? It wasn't safe before Katrina. I'm like ...

KAYE: Members of the Bush administration turned down Lee's interview requests, but he would like to force them to watch his film which brought to mind a scene from one of his favorite movies, "Clockwork Orange."

LEE: I would like to do that. I would like to have a screening room, I'm going to have Bush, Cheney, Condoleezza, all them guys, they're handcuffed ...

KAYE (on camera): And their eyelids held open.

LEE: Yes, the eyelids and so if they can't want to fall asleep, they can't. They have to watch this for four hours.

KAYE (voice-over): Tough as is he is on the administration, Lee doesn't put all the blame on Washington.

(on camera): How do you think Mayor Ray Nagin did overall?

LEE: He dropped the ball overall, I would say the same thing with Governor Blanco.

KAYE (voice-over): Spike Lee says his goal in making the film is to get the Gulf Coast much-needed attention and strengthen the American spirit, which he says survived the storm.

LEE: Come with an open mind. Just as a citizen of the world, not even -- not even come as an American, just as a citizen of the world, being a human being, care for other human beings. That's the way I think you should approach.

KAYE: Randi Kaye, CNN, New Orleans.

(END VIDEOTAPE)

MALVEAUX: Last season's hurricane season certainly took a major toll on the central Gulf Coast, and among the facts, 200,000 people lost their jobs in the aftermath of Katrina and Rita. Katrina left behind about 22 million tons of debris. Eighty-five percent of the hotel rooms in the region are now open.

Now among the hundreds of thousands of people impacted by the storm, CNN contributor Donna Brazile. She is a native of New Orleans and she is with me now from Washington.

Donna, I'm so glad that you and I have a chance to talk about this. I know that both of us have family in New Orleans. We know this story intimately, but you're not here as a Democratic spokesman, you're here as someone who knows this inside and out.

Before we get to the politics of this and your work with the Bush administration, how's your family?

DONNA BRAZILE, CNN CONTRIBUTOR: Well, thank you for asking, Suzanne.

They're doing well. My dad, Lionel, is still in Baton Rouge where, after being evacuated to San Antonio, he's made peace with his decision to stay in Baton Rouge. He's 76 years old now. He has a cell phone, he's well aware of Ernesto in the Gulf. And he said this time around, he's not staying. He asked me if I had an extra bedroom, and I said absolutely, two bedrooms in fact.

My oldest sister Cheryl is back home. She's the only one of my siblings who resided in New Orleans pre-Katrina who's back in her house. My sister Lisa is in a trailer not far from the city of New Orleans. And two other sisters are in Baton Rouge with my dad and their families. And my brother Kevin, who at first escaped Katrina's wrath by, you know, going to Lake Charles, Louisiana, Hurricane Rita, which came three weeks later, he's now in South Carolina.

So overall, my family is doing well. Some of my aunts and uncles have rebuilt, they're moving back. Some are still stranded. It's a mixed blessing, as you well know.

MALVEAUX: Sure. And, Donna, tell me, you can been intimately involved in the behind the scenes discussion with the Bush administration, with the president, with Mayor Nagin. Many people involved here. Do we expect to hear anything new from these folks come the one year anniversary on Tuesday?

BRAZILE: Well, Governor Blanco appointed me to serve on the Louisiana Recovery Authority, and I have worked very closely with the Bush administration, the governor and the mayor's office.

I think the president on Tuesday is going to express not just a deep sorrow and regret for what happened a year ago, but also to reaffirm his commitment to rebuilding the Gulf, to assisting the state and parish governments in making sure that we can remove the debris, provide the housing, grant money is finally available to residents who are trying to return home to repair their houses.

We need the president's leadership to continue to build our infrastructure. Fifty-six schools have reopened. We still need money to ensure that our levees are secured as well as our coastal wetlands, so we're going to look to the president, to the governor and the mayor to continue to work together to ensure that every resident can return home soon.

MALVEAUX: And, Donna, I was just in New Orleans yesterday. And what really struck me is that there's so many people who are in limbo. There are people who are not coming back because there are not the jobs there or certainly not the living conditions to come back to their homes.

And then secondly, small businesses, they are fed up because of such confusion over various plans. In your experience with the administration, is the federal, the state, the local government, are they all working from the same page, the same plan now?

BRAZILE: Well, as you know, it took us months to get everybody on the same page. When I sat down with President Bush last year, I said Mr. President, light a fire under FEMA, light a fire under the Small Business Administration. We need those loans -- 81,000 businesses were impacted with Hurricane Katrina. We need assistance.

The federal government is making more loans available, more grants available to small business owners and as I mentioned, the Road Home Program, over 100,000 residents have applied for this amount of aid up to $150,000 in grants minus their FEMA insurance money, and that money will be given out to the residents.

So the checks have already been written. We have more housing centers being opened, but we need the federal and state and local governments to continue to work together.

MALVEAUX: And, Donna, I know we're running out of time, so I just have one last question for you here. We'll talk a little bit of politics. The people that I spoke with, I was rather surprised in New Orleans, they said they don't blame Bush anymore. This is no longer the black eye for the Bush administration.

They say he's turned over the money, $110 billion, it's stuck somewhere and they say it's really up to state and local authorities. What kind of impact do you think Katrina is going to have on November midterm elections for the Republicans?

BRAZILE: Well, there's no question Democrats are going to remind the American people about the slow response and also some of the half- hearted approaches that we faced. But with the support of the American people, the Congress, the Bush administration, the governor and the mayor, we're turning a corner.

Look, our ports are now coming back, the hotel industry, the tourism industry. We lost 203,000 jobs, 183,000 of those jobs are still lost. We're a long way from being back, but we're rebuilding, and we're going to come back. And I tell those residents who are frustrated, hang in there, the money is available, we're going to continue to lobby the Bush administration and the state government to work together to give us a resources so every resident who wants to return will return.

Suzanne, I know you know the city as intimate as I do. We want to make sure that those residents who lived in public housing, those residents who were renters, can also come home. This is not just about the home owners. I love the homeowners. I have an a lot of homes there, but I would love to see the renters to come back and I would love to see every American pulling with us so we can rebuild the Gulf Coast

MALVEAUX: Donna, you keep pushing now. We're counting on you.

BRAZILE: I will. Don't you worry. Thank you.

MALVEAUX: OK, thanks, Donna Brazile once again. Say hello to your family.

How would you like to save money every time you buy something? Well, we'll look at ways that you can save next on CNN SATURDAY.

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MALVEAUX: Forty-five minutes past the hour. Here's was happening now in the news.

A new alert from the Hurricane Center this hour. Tropical Storm Ernesto hasn't strengthened this morning, but its forward speed has slowed. Winds remain at 50 miles per hour. A hurricane watch is up for Jamaica and the Cayman Islands.

Sources in Gaza report encouraging signs in efforts to free two Fox News journalists being held hostage. The Palestinian interior minister says there are no direct talks, but some third parties may be getting involved in the effort to free Steve Centanni and Olaf Wiig. The militant group Holy Jihad Brigades is demanding the release of Muslim prisoners in U.S. jails.

President Bush is vowing to stay until the job is done, and he is not talking about Iraq, he is talking Katrina. In his radio address this morning, the president again pledged that the government will do its part to rebuild the Gulf Coast. He heads there on Monday.

We update the top stories every 15 minutes on CNN LIVE SATURDAY. Your next update is coming at the top of the hour, 1:00 Eastern.

Now how would you like it save 50 percent on everything? Our guest on today's "Dollars & Deals" says that you can actually do that. And he's not just talking about coupons at the grocery store. He has ways that you can save big bucks on everything. We're talking college tuition, to even a trip to the dentist.

Russell Pearlman of "SmartMoney" magazine is here with some tips. Russell, it's almost hard to believe that this is possible but you've written about it. Now explain to us, how do you do it? How do we save money on kind of like the everyday stuff like groceries and shoes?

RUSSELL PEARLMAN, "SMARTMONEY" MAGAZINE: Categories. First off, use the Internet, pretty extensively, go in prepared. There's a lot of Web sites out there that will either show you where prices are on sale or do price comparisons for you.

The second thing is develop a relationship with the people that you're doing business with, whether it's a salesperson at a clothing store or the doctor. These are ways to just, you know -- the more they get to know you, the more loyal you become or loyalty to show to them, the better chances are that you will get a deal.

And second is finally -- ask, ask, ask. You can negotiate almost anywhere on almost anything.

MALVEAUX: So you're saying just ask your doctor or -- I mean, how do you do that? How do you ask people can I get 50 percent of off of this?

PEARLMAN: When it comes to healthcare, most people aren't going to brag that, oh yes, I just saved 20 percent on my x-ray, but in reality, if you're paying your own way at the doctor's office, the doctor would much rather cut a deal with you where you might save hundreds or thousands of dollars up front if you're going pay up front. They would much rather cut you the deal than take the chance that you're going to be a deadbeat and they have to track you down with a collection agency.

So yes, if you're paying your own way -- this doesn't work for insurance, but if you're paying your own way, ask. And odds are they will cut a deal for you. Because when it comes right down to it, a doctor is a service just like a car mechanic. They have markups and if they're willing, if they need the business or want the business, they'll cut the price.

MALVEAUX: I am so sorry we've run out of time because I'm going to buy a car, I want to try your techniques and see if it works.

You can negotiate almost anywhere on almost anything.

So you're saying just ask your doctor or -- how do you do that? how do you ask people can I get 50 percent of off of this? when it comes to health care, most people aren't going to brag I just saved 20 percent on my x-ray, but in reality if you're paying your own way toe doctor's office, the doctor much rather cut a deal with you where you might save hundreds are thousands of dollars up front if you're going pay up front. They would much rather cut you the deal than take the chance that you're going to be a deadbeat and they have to track you down with a collection agency.

So yes, if you're paying your own way, this doesn't work for insurance, but if you're paying your own way, ask. And odds are they will cut a deal for you. Because when it comes right down to it, a doctor is a service just like a car mechanic. They have markups and if they're willing, if they need the business or want the business, they'll cut the price.

I am so sorry, we've run out of time because I'm going to car, I want to try your techniques and see if it works.

PEARLMAN: Edmonds.com for car buying.

MALVEAUX: All right, Russell Pearlman, thank you very much. Appreciate the tips.

And, of course, coming up, cheers, tears and a hero's welcome for a U.S. senator as he returns to his roots in Africa.

Also France and other European countries reluctantly up their troop commitment in Lebanon, but will it be enough to keep up the peace?

CNN LIVE SATURDAY continues in a moment.

(WEATHER REPORT)

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MALVEAUX: Going global. Cheers and more cheers as Kenyans welcome U.S. Senator Barak Obama. Thousands of people lined the streets of his father's hometown. The Democratic senator from Illinois used the occasion to encourage Africans to get tested for AIDS.

Troops and equipment leave a French ship after it docks in Beirut today. The new forces arrived the day after European countries agreed to add nearly 7,000 troops to the U.N. peacekeeping forces in southern Lebanon.

There's a security crackdown in Sri Lanka's capital, Colombo, today. That's because of concerns that Tamil rebels are planning attacks. Government troops are searching houses as well as setting up security checkpoints for bus and train passengers.

And just ahead, an update on Tropical Storm Ernesto.

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MALVEAUX: A look at our top stories in just a moment. Next is "IN THE MONEY" and here's a preview.

CHRISTINE ROMANS, CNN ANCHOR: Thanks, coming up on "IN THE MONEY," water damage. We'll check the economic health of the Gulf Coast one year after Katrina.

Plus, slow going as home sales drop. See if that market is heading for a deep freeze.

And buying college like you'd buy a car. See if the ranking system translates to a better education.

All that and more after a quick check of these headlines. TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com