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United States Hopes For Mideast Resolution Vote Today; Airline Fare Changes?; U.S. Travelers Face Airport Delays

Aired August 11, 2006 - 15:00   ET

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

KYRA PHILLIPS, CNN ANCHOR: It's the top of the hour.
And there's growing optimism at the United Nations about the prospects for a Mideast peace resolution vote later today. After nearly a week of discussions, things appear to be moving very quickly.

CNN senior U.N. correspondent Richard Roth has the latest.

The question is, Richard, how quickly?

RICHARD ROTH, CNN SENIOR U.N. CORRESPONDENT: Well, it -- there could be a vote in a matter of hours. The United States, Britain and France seem to say: Let's go. Let's put this resolution to the full council, and test Lebanon and Israel.

But a U.S. official has told CNN they believe that those two countries are ready to sign on to this agreement. Secretary of State Condoleezza Rice was here at the United Nations earlier, meeting with the United Nations secretary-general, Kofi Annan.

Annan has said the time for discussions has ended. Secretary Rice, walking into the building, said: We are working for a vote today.

U.S. officials believe now that this resolution is ready to be presented to the full council. The issue has always been -- one of the big holdout issues, the robustness of a U.N. peacekeeping mission, already there in a rather toothless format. Now the U.S. says it will be revamped and strengthened to work alongside the Lebanon army.

The Qatar foreign minister talked about the chances for a resolution, and he was optimistic there could be a vote -- Kyra.

PHILLIPS: Richard Roth, we will follow it. Thanks so much.

Britain's big terror busts sparking terror-related busts elsewhere in Europe. Here's what we know right now.

Italy's Interior Ministry has announced a nationwide security crackdown and the arrest of 40 people since the airplane bombing plot was foiled. The 40 are not directly linked to the plot and are charged with violating residency rules or committing property crimes.

Twenty-four people are in custody in London. We're told British police removed documents, computers and videotapes from their homes, and the Bank of England froze the assets of most of those arrested. And, then, there's the Pakistan connection. Britain's home secretary credits several recent arrests there as key to bringing the foiled bombing plan to light.

At any moment now, we are expecting Homeland Security Secretary Michael Chertoff to hold a news conference at Reagan National Airport in Washington. As soon as he steps up to the mike, we will bring it you live. He's been meeting with various TSA officials and employees there at the airport, since that terror plot was busted in the U.K.

Well, it's the official FAA acronym, LAX. But it absolutely does not apply to security standards today at one of the nation's busiest airports, Los Angeles International.

Our Kareen Wynter is there.

And, Kareen, you say it's a lot more calm than it was yesterday.

KAREEN WYNTER, CNN CORRESPONDENT: It is, Kyra.

And you will probably get me on this comment, because you have lived here for so long. But ghost town is hardly a word we have ever used to describe LAX. But this is really what it feels like all around us right now. It's so quiet here.

And we asked a couple of officials, and they say that's because passengers took the advice from security officials here very seriously. Not only did they get here several hours in advance of their flight, but they made sure that left those items that are now banned, anything involving a liquid or gels at home. And, so, they are cooperating here. And it's making this process a lot smoother.

I want to bring in first -- I have a few people here to talk to -- Randy Dasir (ph) and his family.

You said you are well aware of these new security restrictions. And not only did you get here early, but you made sure you either left them at home or you packed them in your -- in the bag you checked?

UNIDENTIFIED MALE: Correct. Correct.

What we did -- of course, we have been listening to the news. And we know what's going on. So, we also got a leaflet at the hotel, telling us what to bring and what not to bring in. So, we re-packed everything this morning. And we got here three hours early.

WYNTER: And you said, not only have you never, ever seen it this quiet here, but you rarely come that early for your flight, usually about an hour before. So...

WYNTER: For a domestic flight, an hour is the most I would budget. But three hours is what they want, so...

WYNTER: All right. Safe travels to you.

I also want to bring in, Kyra, Elizabeth Lavulo (ph). And she has an interesting story.

(LAUGHTER)

WYNTER: We saw you with your -- your secret deodorant in your hand.

(LAUGHTER)

WYNTER: Tell us what's going on there, Elizabeth.

UNIDENTIFIED FEMALE: Well, they told me that I had to remove my Secret deodorant. And I was just a little frustrated at the fact that it's a solid. It's not a liquid. You know what I mean?

And, so, I prepared to pack no liquids. I had to take my contact solution and all that out. But I wanted to take my deodorant. It's hot in Texas. I am not trying to go over there and -- and not -- you know, smell inappropriately.

And so, yes, they won't let me with my deodorant.

WYNTER: You're going to see how far you can get with that.

But do you think it's unrealistic here? When you talk about simple things, a water bottle, saline solution for those who wear contacts, deodorant, do you think it's going too far?

UNIDENTIFIED FEMALE: I think it is a little too extreme. I mean, this is a solid, you know. It's not a liquid. And, so, I'm trying to, you know, obey all the laws of the land. But, I mean, maybe they should, like, break it down a little bit and try to test each of the items.

You know, let me drink my bottled water. I also have my food here. You know, I have bottled water and I have food, because I know that security is going to take a long time. So, anyway, yes.

WYNTER: Well, Elizabeth, I hear your frustrations. There are a lot of passengers echoing it as well. Good luck to you and your travels.

And, so, Kyra, there you have it. A lot of the lines that we saw earlier, well, they have been diminished, but not the frustration from travelers trying to get used to these new restrictions.

One thing I also wanted to throw in, a new security measure implemented here just early this morning , the arrival of the California National Guard, hundreds of troops on the ground here. They are not behind us, and that's because there's -- they are placed strategically at boarding gates. So, they are assisting in a somewhat secondary role.

They are not armed, but they are there to make sure passengers, like Elizabeth, don't get on with that deodorant, just in case they get through those initial levels of security -- Kyra.

PHILLIPS: All right, Kareen Wynter, thanks so much.

Well, dots connected, plot foiled -- so far, police in Britain have arrested 24 people in the alleged scheme to blow up transatlantic jets. Nineteen of them have been named.

Here's one more unnerving detail. According to Britain's Channel 4, one of the jailed suspects worked at Heathrow Airport and had an all-area-access pass.

As the investigation continues, many in London's Muslim community are reacting with disbelief. They're even angry.

CNN's Jason Carroll has more.

(BEGIN VIDEOTAPE)

JASON CARROLL, CNN CORRESPONDENT: Here at Waheed Zaman's home, there is still police, as well as media activity.

He is one of 13 people arrested in East London now in custody. And like most of the suspects in custody, he is of Pakistani descent. Throughout the day, we have been out in the community, trying to get a sense of how they feel about what has happened here.

Many we spoke to simply do not believe in this terrorist plot. In fact, many of the people that we spoke to, we get, really, a sense of anger, a sense of resentment and concern that, because of what has happened, the entire Pakistani community will be seen as terrorists.

UNIDENTIFIED MALE: Check my passport. Check my underpants. Check what you want. Don't associate me to terrorism later on, because I am welcoming you to do that. You can't go around knocking on people's houses, smashing their doors down, you know, causing friction, upsetting people's families. It's not right. It's not right.

CARROLL: Do most of you not believe what has -- what has happened in, terms of the arrests on this block?

UNIDENTIFIED MALE: Do you believe...

(CROSSTALK)

CARROLL: Well, I'm try to find out. I'm trying to learn. What -- what do you believe?

UNIDENTIFIED MALE: Seriously, do you -- I'm asking you, do you believe what's happening? Now, you answer the question. Do you believe what's happening...

CARROLL: I believe...

UNIDENTIFIED MALE: ... from a non-Muslim perspective?

CARROLL: From a non-Muslim perspective.

(CROSSTALK)

UNIDENTIFIED MALE: Innocent until proven guilty.

The thing is, right, there's -- they will name all the people. They will name that we caught them. And then, three weeks later, you will find out they're all innocent, and, yet, we get a bad name. It's about their reputation as well. Twenty-one people, they will mention their name. Suddenly, every Muslim in the communities are, you know, assumed guilty as well.

CARROLL: The last man that you heard there, his name is Ali.

Ali told me that he actually knows two of the suspects. He says knows Ibrahim Savant. That is the man who converted to Islam, he says, a few years ago.

He said he played football with him. And he also says he knows why he's a man who, again, lives here. He says he studied biochemistry with him at university for about three years. He says, in talking to both of these men, he said both were men of peace.

He said he never sensed any anger from them. So, that's why it's so hard for him to understand how he -- how these two could have been two of those who were arrested. He said, at this point, he wants to wait for more facts to come in to try to guide him, in terms of what to believe.

But, in terms of what he believes now, he says he simply cannot believe that these two men, or any of these men, could have been involved in this type of terrorist plot.

Jason Carroll, CNN, East London.

(END VIDEOTAPE)

PHILLIPS: Well, Europe's busiest airport is a lot busier today than yesterday, but still not back to normal.

CNN's Becky Anderson has been watching the comings and goings at London Heathrow. She brings us up to date.

Hey, Becky.

BECKY ANDERSON, CNN CORRESPONDENT: That's right.

We have been speaking to the head of the British Airports Authority, that runs this airport here, Heathrow, behind me, 200,000 passengers, Kyra, a day going through this airport. You can imagine, yesterday, absolutely chaotic.

What he says today is, this -- and I quote him -- he says, this is a very challenging situation for the airport. And the flight schedules are being amended to try and take into account what has been going on.

He says, it's very busy, and there continue to be an awful lot of delays. He's thanking people for their cooperation and their patience, both the staff at the airport and, indeed, the passengers. And what he's saying is this, that the weekend will be extremely busy. He says that schedules are still being amended.

And he reminds people of two things. The first is that you shouldn't leave home without checking with your airline, particularly if it's a U.S.-bound airline, as to whether that flight has actually been canceled or not, or amended on its schedule. So, for anybody coming from the states to here, and then going back, that's something to remember.

And the other thing, of course, is that this lack of hand baggage this days -- you can't any hand baggage with you. Anything you take -- and it's very, very limited, what you can take on to the plane -- needs to be in a see-through plastic bag.

So, do be aware, anybody who is traveling this way, they are going to struggle at the airports in the U.S. And anybody coming from the U.K., U.S.-bound, it's an extremely difficult time. Expect severe delays, as they will continue to try and wipe up the sort of landing facilities here and get these amended schedules back on track. They say something like 48 hours before things are really back to normal -- Kyra.

PHILLIPS: All right, Becky Anderson, thanks so much, live from Heathrow.

And we are covering breaking news. Well, you're the eyes and ears of CNN as well. If you capture a great picture or video on your camera or cell phone, send it to us. Just log on to CNN.com or punch I-Report at CNN.com right there on your cell phone. We will air it.

And, any moment now, we are expecting Homeland Security Secretary Michael Chertoff to hold a news conference. It's going to be right here at Reagan National Airport in Washington. As soon as he steps up to the mike, we will bring it to you live.

Still want to know what you should do if you have airline tickets and don't want to fly? We are going to take a look at the policies -- more LIVE FROM straight ahead.

(COMMERCIAL BREAK)

PHILLIPS: We want to take you straight to Reagan National Airport -- Michael Chertoff, head of Homeland Security, speaking now on airport travel.

(JOINED IN PROGRESS)

MICHAEL CHERTOFF, HOMELAND SECURITY SECRETARY: ... 36 hours is the impact it's having on the traveling public.

Obviously, our principal concern is safety, but we also want to be as friendly as possible to the traveler. We want to make it convenient. We want to make sure people are still comfortable flying.

And, so, all of this is part of the design and the execution of this particular security enhancement.

What I'm pleased to say is that my general tracking of the flow of people at the airports, in terms of wait times, has been positive. We have been tracking it pretty regularly.

I know there have been -- there were certainly some long lines early yesterday. My understanding is, generally, it has gotten better during the course of yesterday and today. Here, certainly, today, it looks like things are moving well, and people seem to be in good spirits.

We understand this is an imposition and an inconvenience. On the other hand, I think everybody understands, and, certainly, the people I'm speaking to -- I will let the...

UNIDENTIFIED MALE: We have upped the number of these announcements (INAUDIBLE).

CHERTOFF: Certainly, the people I have gotten to speak to today walking around the airport seem to be understanding and even appreciative of the measures we're taking to protect them.

I can tell you, we are working -- and we started working yesterday -- on refinements we could make, in order to somewhat reduce any additional inconvenience.

And I think, in due course, TSA is going to announce some changes. I don't want to suggest that they're going to be earth- shattering, but we're going to move to try to make this as simple and as easy as possible, as quickly as possible.

What we need to do, in the somewhat longer term, is analyze the nature of the devices in question, look to see how we can calibrate our systems to take account of these developments, and, then, with that in mind, try to ultimately come back to a regime of security that will give the maximum amount of freedom to the travelers.

Again, I want to reiterate, flying is safe. It is safe precisely because of the measures we're taking here and are being taken elsewhere in the world. And the commitment of people at TSA is to keep it safe.

And I guess the last comment I would make, is I was -- what I said to the folks at TSA was this: This has really been a defining test for the organization. It was stood up in the wake of 9/11, and, clearly, as with any stand-up, it has had some big challenges.

But this was the first big test. And, in a remarkably short period of time -- less than six to eight hours -- we were able to implement and execute very significant changes internationally, so they could be in place by the morning yesterday.

And we have been able to do it, I think, in a way that has kept people's spirits up and that is understandable.

So, that's a very, very positive step by TSA, and a tribute to its leadership. And I want to express my personal thanks to Kip Hawley, who has -- we have spent a number of extremely long nights together recently, and he's great to work with.

Jeanne (ph)?

QUESTION: Have you changed your assessment since yesterday on whether or not there is an al Qaeda connection with this plot, or whether or not there is a U.S. connection?

CHERTOFF: With respect to the al Qaeda connection, while I think we do have our own views of this, because it's an ongoing investigation, there's a lot of material to be examined. And, also, you know, frankly, because of the rules that govern legal proceedings in Britain, I think we ought to withhold reaching a final conclusion, until we have got all the evidence in.

As I said yesterday -- and I haven't changed my opinion on this -- certainly, in terms of the complexity, the sophistication, the international dimension, and the number of people involved, this plot has the hallmarks of an al Qaeda-type plot.

And it is certainly reminiscent of what was the early 1990s plan to blow up a dozen airliners in the Pacific, which was directed by Khalid Sheikh Mohammed, who was, of course, a senior leader of al Qaeda.

QUESTION: What about the U.S.?

CHERTOFF: Regarding the U.S., as we get material from the investigation, our first priority is -- is to examine it for any connection to people in the United States or the possibility of an event within the United States itself.

Currently, we do not have evidence that there was, as part of this plot, any plan to initiate activity inside the United States or that the plotting was done in the United States.

However, there are other people out there who are terrorists or terrorist sympathizers. So, I'm not prepared to let my guard down. We want to make sure, first of all, that we have fully examined all the evidence. And that may take a little bit of time.

And, second, we want to make sure there are no copycats, no one who was inspired by this to think that we're somehow going to be -- have our attention diverted, and they're going to try to do something themselves.

So, we're going to be, obviously, very, very interested in tracking any possible U.S. leads. But, at this point, my prior statement, which is that we did not see any U.S. internal activity in this plot, remains still accurate.

QUESTION: Secretary Chertoff...

(CROSSTALK) QUESTION: Concerning the -- specifically about the arrest of Rashid Rauf who the Pakistanis are saying has al Qaeda ties, can you comment on that, sir?

CHERTOFF: You know, one of the commitments we made to the British, because they have court rules that are even more stringent than ours, was not to say anything that might be a grounds for having a legal problem with the prosecution of their cases.

And, so, anything about arrests, investigations, the specifics of the investigation from a -- you know, the -- I guess, the prosecution's standpoint, is something that I'm going to stay away from. I'm not going to comment on any of that.

What I want to focus on is that information which really affects our decision-making here about how we are going to be adjusting our own internal standards.

(CROSSTALK)

QUESTION: Several governors have called up the National Guard. And I'm just wondering if that means -- is that a sign that there aren't enough TSOs, enough screeners, to -- out there to go through and do all the...

PHILLIPS: Bottom line: Flying is safe. That's according to Homeland Security Secretary Michael Chertoff, saying that they are trying to figure out how to make refinements to reduce the inconvenience to those that are flying.

He said that the TSA will be announcing changes, nothing earth- shattering, he said, but it could improve the long lines, and the wait, and what you can carry on and not carry on. They're just trying to get the maximum security and also maximum freedom for travelers right now.

You can go to CNN.com/Pipeline, if you want to watch the rest of that news conference live.

Meanwhile, we will monitor it and bring you any updates about changes about air travel.

We are going to also go through some of those carry-on luggage changes in just a moment.

You are watching LIVE FROM. Stay with us.

(COMMERCIAL BREAK)

PHILLIPS: Well, the airlines had been raising their ticket prices all year, until earlier this week. So, will news of the terror plot force a new round of price cuts?

Susan Lisovicz is live from the New York Stock Exchange with some answers.

Hey, Susan.

SUSAN LISOVICZ, CNN CORRESPONDENT: Hey, Kyra.

Well, United bucked the recent upward trend earlier this week, when it announced a cut in some ticket prices. That came before yesterday's scare. Experts say the airlines' pricing strategy going forward will depend on how long the current threat lasts, and how both business and leisure travelers react to it.

The International Air Traffic Association is quick to point out that this situation can't possibly be compared to 9/11, which sent the airline industry already, which had already been weakened from a depressed economy, into a tailspin.

The airlines are just beginning to emerge from that slump and are enjoying their first profitable summer in six years. And, in contrast to 9/11, of course, there's no loss of life. And many analysts predict, the industry will not lose many customers.

They say most leisure travelers have already made their summer vacation reservations and are not likely to cancel. Business travelers, however, tend to book closer to their travel dates, and are more likely to change their plans if they get scared to fly, for instance, and don't want to bother with the inconvenience.

If that happens, it could put pressure on the airlines to cut fares, because business fares are generally much higher and much more lucrative -- Kyra.

PHILLIPS: Well, for people who just don't want to fly after what happened this week, are the airlines making any changes to the cancellation policies?

LISOVICZ: Yes.

They are being flexible. And we haven't seen that, right, Kyra, in a while.

PHILLIPS: That is true.

(LAUGHTER)

LISOVICZ: Many airlines are loosening their rules for re-booking and canceling flights. Some are waiving penalty fees for changes and easing restrictions on what would otherwise be non-refundable tickets.

For instance, American Airlines is allowing domestic passengers to change their travel date, up until September 1, or get a refund in the form of a travel voucher, good for one year.

For international travelers, most airlines are making even greater exceptions. Of course, you can call the airlines directly, or visit their Web sites for details on their changes and cancellation policies -- Kyra.

PHILLIPS: All right, we're closing in at the end of the trading week. How is the market looking?

LISOVICZ: And it has been a busy week. And the markets look exhausted right now.

Stocks have been quiet all day, in terms of volume. You can really tell this is a Friday in August. But we have been weaker today, after a strong July retail sales report, which prompted fears about another possible interest rate hike, just days after the Federal Reserve held steady for the first time in more than two years.

Right now, the Dow industrials still in the red -- they're off 57 points, or half-a-percent -- the NASDAQ composite, meanwhile, dropping 17, or about one percent.

And that is the latest from Wall Street. I will be back in about a half-an-hour with a roundup of the trading day.

LIVE FROM will be right back.

(COMMERCIAL BREAK)

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