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CNN Newsnight Aaron Brown

A Look at the Situation in Fallujah; Judge Declares Mistrial in Tyco Case

Aired April 02, 2004 - 22:00   ET

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

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


AARON BROWN, CNN ANCHOR: Good evening again everyone.
This has been the sort of week and March was the sort of month that makes you lose sight of the fact that Iraq is neither black nor white. A year after the invasion it remains (AUDIO GAP) next week that are rich with gray.

The Iraqi police major a friend to the Americans in many ways, important to the Americans in many ways and angry at the Americans that his men have no equipment and no protection.

In the north of the country, a Kurdish moderate, not a rabble rouser at all, who makes it quite plain that he is a Kurd first and an Iraqi second and he doesn't really care if he's an Iraqi at all. To the south there is the Shia cleric who seems to want the Americans to stay in the country only long enough for the Shia majority to gain power.

There is plenty of blame for this desire to see gray as either black or white. The administration oversimplifies. Opponents of the war ignore too much. The soldiers on the ground seem to get it best and you'll hear from some of them tonight.

But we begin the whip in Baghdad and CNN's Walter Rodgers with the duty, Walter a headline from you.

WALTER RODGERS, CNN SR. INTERNATIONAL CORRESPONDENT: Hello, Aaron. In Fallujah they're seeing more defiance of the United States than any contrition for the killing of those four American civilian contractors on Wednesday and, in Baghdad, there was a defiant demonstration as well -- Aaron.

BROWN: Walt, thank you.

Next to Tyco, the trial and the mistrial, just the latest in a case that's had everything but a verdict it seems, Allan Chernoff with us tonight, Allan the headline.

ALLAN CHERNOFF, CNN FINANCIAL CORRESPONDENT: The atmosphere in the jury room had been poisonous. Jurors had been fighting with one another but they were able to work through their problems and were actually very close to a conviction until a letter came in one of the juror's mailbox. It led to a mistrial -- Aaron.

BROWN: Allan, we'll get the details.

And finally to the White House and some good news, it seems, for the current resident. CNN's Dana Bash has the watch tonight, so Dana a headline from you.

DANA BASH, CNN WHITE HOUSE CORRESPONDENT: Well, Aaron, one senior aide described the atmosphere here today as if the Bush team had scored a 60-yard field goal, 300,000 new jobs last month. They're hoping that Senator Kerry will lose one of his top issues against the president. That's job loss on his watch -- Aaron.

BROWN: Dana, thank you. We'll get back to you and the rest in a moment.

Also on the program on this Friday night, one week and five new ads, the election is seven months away. It is going to be a very long campaign season enough perhaps to make you drink and we can help there too.

We'll take you to McSorley's an old-fashioned ale house. The taps have been flowing freely since the Civil War.

And it's Friday and you know what that means. The rooster brings along the weekly tabloids along with the morning papers and the tabs are particularly disgusting I must say, all that and more in the hour ahead.

We begin again tonight in Iraq at the end of a horrible week with Marines on the brink of doing something in Fallujah, just what we don't yet know. Tension in the Sunni Triangle is quite high.

Today, Friday, is traditionally a day of reflection in the Arab world but across Iraq in the mosques and in the streets there was precious little of that to be heard. And, in Fallujah today, the message amounted to mutilation is wrong, murder is not.

Here again, CNN's Walter Rodgers.

(BEGIN VIDEOTAPE)

RODGERS (voice-over): At Friday prayers in Fallujah, the Muslim faithful gathered three days after masked men in their town gunned down four American civilians and a mob mutilated the charred bodies.

A sheikh condemned the mutilation. He did not, however, condemn the murders. Indeed, he warned there will be yet more bloodshed here if U.S. forces crack down on Fallujah. In the city itself defiance, Iraqis promising Fallujah will become a graveyard of Americans.

In Baghdad, tens of thousands of Shiite Muslims marched through the streets shouting America and its governing council are infidels, people against Islam. Muktata al-Sadr (ph) an influential Shiite cleric said this is the start of the intifada, the resistance against the Americans.

Imam Hizam al-Alaraji (ph) another Iraqi cleric said America is the ugly face called the great Satan. Shiites are 60 percent of Iraq's population.

And, it seems increasingly clear the United States is now collecting powerful enemies in Iraq. When this imam told the faithful it is America that is detonating the car bombs in this country killing Muslims, no one here seemed to question it.

(END VIDEOTAPE)

RODGERS: Recently, the U.S. Administrator in Iraq Paul Bremer acknowledged he's had a difficult time getting his message across to the Iraqi people. This week selling that American message seems to have become even harder -- Aaron.

BROWN: Walter, thank you, Walter Rodgers in Baghdad.

More is becoming known tonight about the circumstances of the attack in Fallujah, more about who did it and more about how.

From the Pentagon CNN's Barbara Starr.

(BEGIN VIDEOTAPE)

BARBARA STARR, CNN PENTAGON CORRESPONDENT (voice-over): Military officials tell CNN they are investigating whether the attacks in Fallujah were planned in advance.

Initial reports, they say, indicate that just before the attacks normally busy streets were empty, shops closed up, a number of local Iraqi media were in the area. Marines now expected to reenter the town and take control.

RICHARD ARMITAGE, DEPUTY SECRETARY OF STATE: There will be a price extracted. There will be a response and it will be obvious to all.

STARR: Officials say there is no indication townspeople knew what was being planned but there was talk on the street that trouble might erupt. Military investigators also are looking for any evidence that Abu Musab al-Zarqawi, an associate of al Qaeda, who has called for driving the U.S. out of Iraq was involved.

U.S. officials are trying to isolate individual faces from news media footage, identify perpetrators and possibly offer reward money for their capture but those who committed the murders reportedly covered their faces and may have been long gone by the time the mob formed that desecrated the bodies.

Michael Teague a 12-year veteran of Army Special Operations served in Afghanistan.

SGT. JOHNNY RATLIFF, FRIEND OF MICHAEL TEAGUE: Mike was the kind of guy that always wanted to help someone. He -- on the mission that he was on right now he was going beyond the call of duty. He was helping other people.

STARR: Jerry Zovko also served in Army Special Operations. TOM ZOVKO, BROTHER OF MURDERED CONTRACTOR: You know he was for freedom and, you know, for human rights for everybody, equality for everybody.

STARR (on camera): Details about what exactly happened remains sketchy. The four contractors from Blackwater USA were apparently escorting trucks carrying food into the town but those trucks apparently rapidly escaped the ambush.

Barbara Starr, CNN, the Pentagon.

(END VIDEOTAPE)

BROWN: Well, more on Iraq a little bit later in the program, other news first.

The Tyco trial and what one of the lawyers said today after the judge called the whole thing off. "In all my years" he said, "I ain't seen nothing like this yet." Six months of testimony, 11 days of jury deliberation, a holdout juror, a threatening letter, at the center of it all a chief executive accused of living like a king on company cash.

The rest of the story and there's plenty of it from CNN's Allan Chernoff.

(BEGIN VIDEOTAPE)

CHERNOFF (voice-over): Dennis Kozlowski and Mark Swartz appear to have dodged a conviction. Jurors tell CNN they were close to finding both defendants guilty of grand larceny, which carries a maximum prison term of 25 yeas.

PETER MCENTEGART, JUROR: I personally feel the evidence is very clear on some of the specific charges and that we didn't get a chance to deliver the verdict that I believe we should have given is very upsetting to me.

ADRIENNE MCWILLLIAMS, JUROR: We were very, very close except for on one point and that one point was pretty much resolved this morning.

CHERNOFF: But Judge Michael Obus announced to a stunned courtroom he had no choice but to grant a mistrial because of efforts to pressure the jury. A person who observed closed door proceedings in the judge's chambers tells CNN a coercive letter had been sent to Juror No. 4, the apparent holdout.

Judge Obus questioned the jury and based on her answers declared a mistrial. The "New York Post" and "Wall Street Journal" had revealed Juror 4's identity after she appeared to signal the defense with an OK sign. Kozlowski and Swartz were charged with stealing $600 million from Tyco through unapproved bonuses, forgiven loans and stock sales.

Manhattan District Attorney Robert Morgenthau said the mistrial was unfortunate and said he intends at the earliest opportunity to seek a retrial. Defense attorneys say they'll be ready.

CHARLES STILLMAN, ATTORNEY FOR MARK SWARTZ: I've been doing this 40 years. I will tell you if I piled up all the experiences top to bottom, I ain't seen nothing like this yet.

(END VIDEOTAPE)

CHERNOFF: Not many people have. Judge Obus has scheduled a hearing for May 7th to discuss a new trial -- Aaron.

BROWN: In conversations with the jurors they seemed -- they talked about the experience in the jury room. It was pretty harrowing for many of them.

CHERNOFF: Absolutely. A week ago today there were notes out saying that the atmosphere was poisonous, that there were accusations being thrown back and forth. The judge seemed to handle it very well. He gave them an early recess last Friday. They had a nice long weekend.

And all of a sudden Monday they were back to work and incredibly it seemed that they were really close to resolving this case just taking it from the brink of being a mistrial and then all of a sudden back to mistrial.

BROWN: Allan, thank you, Allan Chernoff.

John Coffee is with us tonight. He teaches criminal and securities law up at Columbia University. It's good to see you again. I have a question about the judge, did the judge do a good job in all this?

JOHN COFFEE, COLUMBIA UNIVERSITY: I think the judge has to make a discretionary decision. He's got to balance the defendants' rights and the defendant here is in a very difficult position. When you know there's only one juror holding out, you identify that juror and that juror, a 79-year-old woman is subject to intense pressure and threatening letters. It's hard to have confidence in her being able to reach an unbiased decision.

BROWN: Absolutely. I mean if the point that she gets, assuming this letter was as it is portrayed, once she gets that it's really game, set, match.

COFFEE: He could have done it even earlier and probably been upheld.

BROWN: Yes.

COFFEE: This was the point where it's hard to see him not doing it.

BROWN: Does the "Wall Street Journal" and the "New York Post" bear some responsibility here?

COFFEE: I think they made an error in judgment. They did not foresee how this was going to play out but tonight we know that juries in high profile cases are extremely vulnerable, extremely exposed, and once the jury begins to deliberate you can't identify how individual jurors are voting. They're just making them targets for all kinds of crackpots.

BROWN: Yes, I mean they didn't set out to make her a target but it is one of those gray -- it's not a legal question. It's an ethical question it seems to me and whether they crossed an ethical line there.

COFFEE: Well, there's a legal line here too. The judge had he known it was going to happen could have barred any identification or publication of a juror's name. The courts do balance the First Amendment, the right to free press, and the right to a free, fair trial under the Sixth Amendment and it's a very difficult balancing question.

BROWN: Who gains from the mistrial? Who learns the most?

COFFEE: You know it's very strange. Usually the defendants gain a lot. The defendants here dodged the bullet but a millimeter.

BROWN: Yes.

COFFEE: But I think they still face an eventual date with a sentencing judge and when they debrief these jurors and see that they were ready to convict on multiple counts, I believe that sophisticated defense counsel are going to start seeking a plea bargain.

They're going to start trading off the delay, the year more of effort and money and say we'll accept a plea to a couple of counts. That's a lot better than facing 25 years.

BROWN: Let me come back to that for a second. What happens when these cases end is both sides get to meet with the jury pool, right, or the jurors?

COFFEE: They usually get to interview the jurors, yes.

BROWN: And they have a pretty fair idea of what went well and what didn't. I mean there were what 30-some counts here?

COFFEE: Thirty-three.

BROWN: So, both sides will know where their strengths and where their weaknesses were, right?

COFFEE: I think that's what helps the prosecution. They had a very, very excessive, overly long, confusing case. I think they'll learn from it, put their case on a diet and compress it.

BROWN: Now, let's go back to the question of plea. If you're the state here, if you're the government, what can you accept knowing that you were -- it sounds like from the one juror you're going to get at least a grand larceny conviction out of the deal. COFFEE: I think the people have indicated today, who were jurors, that there were multiple counts. They didn't say which but multiple counts. Thus, I think the prosecution can normally give a discount after a mistrial but I think they'd want to plea to several felony counts and maybe a maximum sentence in the range of ten years or more.

BROWN: Ten years for this?

COFFEE: That's state time. I want to be clear. There are not sentencing guidelines here and ten years in state prison may let you out after three or four years.

BROWN: Yes, but there aren't many really nice state prisons in this state.

COFFEE: That's certainly true but there really aren't any club feds anymore either.

BROWN: Do you expect it to plea out, plead out?

COFFEE: I think it's more likely than not. It's the defendants' decision but if the defendants go forward they could get 25 years.

BROWN: A truly bizarre day. Thank you. Good to see you again.

COFFEE: OK.

BROWN: Have a good weekend. Thank you, John Coffee.

Ahead on the program tonight, seven months to go before the election a new batch of ads make air this weekend.

And a new warning on terrorism on trains and busses this summer, we'll keep you awake.

This is NEWSNIGHT from New York.

(COMMERCIAL BREAK)

BROWN: Well, here's a lead we haven't been able to write for a while. Today, the Labor Department delivered good news, better news than expected on employment, 308,000 jobs were created last month.

That's the biggest jump in nearly four years, far more than Wall Street had expected. Some economists are saying it is the turnaround everyone has been hoping for and waiting months for. Others caution one month does not a trend make.

The president, to no one's surprise, is taking the credit. The economy is always a political story, especially so in an election year.

From the White House for us tonight CNN's Dana Bash.

(BEGIN VIDEOTAPE) BASH (voice-over): A thumbs-up from a president with a little more bounce in his step after getting the robust jobs report he'd been waiting months for, 308,000 new jobs created in March, the fastest pace in four years. January and February's job numbers were revised to 205,000, up from 118,000, and for the first time in 44 months, no jobs lost in manufacturing.

In West Virginia, a traditionally Democratic state, the president won in the last election and thousands of lost jobs since, he hailed the news and took credit.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The tax relief we passed is working. It's making a difference for this economy.

BASH: As job recovery lagged, Mr. Bush has campaigned on other positive economic signs like the rise in home ownership and the stock market but knowing nothing rivals the political importance of jobs, the president's team was out in full force.

JOHN SNOW, TREASURY SECRETARY: I think it will be sustainable and I'm encouraged by that number.

JOSH BOLTEN, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET: It confirms that the economy is in solid shape, is growing, and it's a growing economy.

KAREN HUGHES, PRESIDENTIAL ADVISER: I think what that says is we're finally back.

BASH: Big job growth is tough political news for Senator John Kerry, campaigning on the nearly two million jobs lost on the president's watch. At a photo op with his own economic team he argued one positive report doesn't change three down years.

SEN. JOHN KERRY (D), PRESIDENTIAL CANDIDATE: The fact is that the deficits, which go out as far as the eye can see, the lack of any one single manufacturing job in those jobs and the huge numbers of jobs that are leaving for overseas tells the real story of the economy of our country.

BASH: And from allies on Capitol Hill, a history lesson.

SEN. JOHN CORZINE (D), NEW JERSEY: We still have the worst job performance record of any president since Herbert Hoover and that's the facts.

(END VIDEOTAPE)

BASH: Now, Bush aides are trying to be cautious saying that they're still not satisfied and while it's still unclear whether this report is the beginning of a trend some Democrats privately worry a few more months like this and the president could be a lot harder to beat -- Aaron.

BROWN: Dana, thank you, Dana Bash. She's at the White House tonight. The new employment numbers, as Dana indicated, arrived just as the John Kerry campaign was getting back on track, beginning to air new ads today as the focus on U.S. jobs lost overseas, it is fair to say that today's jobs report wasn't the backdrop that Mr. Kerry had anticipated.

The new Kerry ad is just the latest in a campaign ad blitz on track to make this the most expensive presidential election campaign ever, unprecedented in other ways as well.

Again tonight CNN's Kelly Wallace.

(BEGIN VIDEOTAPE)

ANNOUNCER: George Bush says sending jobs overseas makes sense for America.

ANNOUNCER: John Kerry's record on the economy, troubling.

ANNOUNCER: George Bush shamelessly exploited 9/11.

KELLY WALLACE, CNN NATIONAL CORRESPONDENT (voice-over): An unprecedented ad war with the election still seven months away.

EVAN TRACEY: We probably are somewhere now approaching $40 million total that will be spent in the month of March alone.

WALLACE: Issue groups like moveon.org, critical of President Bush, are spending millions on ads like this controversial one.

RICHARD CLARKE: He ignored terrorism for months.

WALLACE: Featuring the president's former counterterrorism chief Richard Clarke. A look at last month's advertising in key cities in the 18 battleground states reveal something surprising.

For instance, in Tampa, the Bush team spent more than $800,000, Kerry's campaign $215,000, but when you include issue ads critical of the White House it adds up to $937,000 topping the Bush ad buy. The same holds true for other swing markets like Phoenix, St. Louis, Columbus, Ohio, and Charleston, West Virginia.

TRACEY: These groups have become the great equalizer in this for John Kerry. Without these groups, Kerry's getting steamrolled.

WALLACE: And Republicans say it's against the law. They filed a complaint with the Federal Election Commission accusing the groups of pouring illegal, unregulated contributions into the campaign. The Bush and Kerry campaign chairs argued about that Thursday on CNN's "INSIDE POLITICS."

JEANNE SHAHEEN, KERRY CAMPAIGN CHAIRMAN: The fact is there is no connection between these groups and the Kerry campaign.

UNIDENTIFIED MALE: We have what we believe to be overwhelming proof of that fact. You've got your former campaign manager who is guiding and directing one of these particular entities.

WALLACE (on camera): It's not clear when the Federal Elections Commission will rule on those issue ads but one thing is clear. This promises to be the most expensive advertising blitz in presidential election history.

Kelly Wallace, CNN, New York.

(END VIDEOTAPE)

BROWN: Coming up on the program tonight, the 82nd Airborne home from Iraq, home from Fallujah and not without stars, a break first.

This is NEWSNIGHT.

(COMMERCIAL BREAK)

BROWN: When action is taken in Fallujah, whenever and whatever it is, Marines from the 1st Expeditionary Unit will be carrying it out. They took over a short time ago from the Army's 82nd Airborne, which had a very rough time of it almost from the beginning. They'd been there a long time when we saw them leaving a couple of weeks back.

Last April, 13 locals were shot dead by members of the 82nd in a protest that got out of hand. That incident may have laid some of the groundwork for the trouble that's happened since.

The 82nd is back home now, buried reminders of it all, and from Fort Bragg, North Carolina tonight here's CNN's David Mattingly.

(BEGIN VIDEOTAPE)

DAVID MATTINGLY, CNN CORRESPONDENT (voice-over): His limp is so slight it's hard to notice but it is the only outward sign that combat medic Sergeant Chris Drolette carried two pieces of shrapnel in his left leg, painful reminders of his hazardous duty in the Iraqi town of Fallujah.

SGT. CHRISTOPHER DROLETTE, U.S. ARMY, 82ND AIRBORNE: Long period of boredom followed by short periods of terror.

MATTINGLY: Drolette and others from the Army's 82nd Airborne just returned home from Fallujah only to find the dangers they left behind again making headlines.

STAFF SGT. JOHN YOUNG, U.S. ARMY 82ND AIRBORNE: You hate that another person had to die like that, you know, just trying to do their job.

MATTINGLY: The soldiers describe Fallujah as a place so dangerous that convoys drive through town at breakneck speeds. You never venture out except in large groups and you never, never close your eyes.

PFC TOBY WHITNEY, U.S. ARMY 82ND AIRBORNE: You're looking at the ground. You're looking at the buildings. You're looking for people that just make you feel uncomfortable.

MATTINGLY: Contact with Iraqi civilians is frequent and soldiers say almost always pleasant but the sporadic and unpredictable attacks make true friendships difficult and unwise.

Do you know who to trust while you're there?

DROLETTE: You trust the ones wearing American uniforms.

MATTINGLY: But despite the unrelenting tension, these photographs are among the memories they bring home, waving children, busy markets and lines at local gas stations, signs of a nation struggling to recover.

(on camera): From what they could see, soldiers from North Carolina's Fort Bragg say that life for Iraqis in Fallujah seems to be getting better. The same could not be said, however, for American troops still there. Despite their best efforts, soldiers returning home say that for American soldiers, Fallujah is not getting any safer.

(voice-over): Three of these soldiers are combat medics. In their line of work they say Fallujah remains the busiest place in Iraq.

WHITNEY: The unknown, you just kind of become -- you expect the unexpected. You just wait for something to happen.

MATTINGLY: And the months of stress have taken a toll. Loud noises, even thunder takes them back to the front lines.

DROLETTE: I'd hear thunder and my adrenalin I can feel the butterflies and the adrenalin started happening.

MATTINGLY: The future of Fallujah will now be in the hands of U.S. Marines who are taking over the mission as the Army rotates out. The departing soldiers leave with this simple advice. Never let down your guard.

David Mattingly, CNN, Fort Bragg, North Carolina.

(END VIDEOTAPE)

BROWN: A few other stories that made news today around the world.

First, Nepal, pro-democracy protesters there tried to march on the royal palace. Rocks were thrown. Police batons swung. When it was over, 32 people were hospitalized, many of them with head injuries.

Nepal has been without an elected government since the king dissolved parliament a year and half ago.

In Spain, railroad inspectors today discovered a bomb hidden in a bag on a high-speed rail line. They immediately stopped a half a dozen bullet trains from using the rails. They also said the bomb may contain the same batch of dynamite used in the railroad bombings last month in Madrid.

The federal government today said it will expand its program of fingerprinting foreign visitors to include those who don't need a visa to get into the U.S., people from places like France, Britain, Japan and 24 other American allies, described as a stopgap measure until those other countries adopt harder to counterfeit passports.

Still to come tonight, growing concern about terrorism in the United States this summer. That and more as NEWSNIGHT continues from New York.

(COMMERCIAL BREAK)

BROWN: At the end of a week that has seen the unspeakable, add this to the new normal.

The FBI and the Department of Homeland Security have issued a new warning, that terrorists may try to bomb buses and railways in U.S. cities this summer. They stress, again, that these alleged plots are uncorroborated and lack specifics. They always seem to. It is harrowing nevertheless.

Here's CNN Kelli arena.

(BEGIN VIDEOTAPE)

KELLI ARENA, CNN CORRESPONDENT (voice-over): From Los Angeles to New York, to Washington, transportation officials are reacting to the latest warning about a possible terror attack.

CAPT. TIMOTHY GRONAU, D.C. METRO POLICE: We've always been concerned, and prepared. We're just continuing our pro-active efforts to try and prevent anything of this magnitude occurring in our system.

ARENA: The warning about trains and buses went out to law enforcement officials nationwide. It says terrorists may try to hide explosives in luggage or carry on bags like backpacks.

ASA HUTCHINSON, HOMELAND SECURITY UNDERSECRETARY: This is an area of concern. We're working with our transit authorities to enhance that security, put the appropriate protective measures in place.

ARENA: The advisory clearly states the intelligence is uncorroborated. It does not name specific U.S. cities and only offers summer as a time frame.

UNIDENTIFIED MALE: I'm just hoping that the people who do their job in security, they'll do their job. And hopefully we learned a lesson from Spain and they will carry it over here.

ARENA: Industry officials say they were paying close attention and admit the Madrid bombings prompted change. GRONAU: We've increased our patrols. We've reassigned some of our administrative people back into the rail system during heightened hours. We've altered our sweep teams.

ARENA: Earlier today, Spanish police found another bomb under high-speed rail tracks between Madrid and Seville.

And in London this week, authorities seized 1,000 pounds of ammonium nitrate as part of a terror investigation. That's the very same substance the FBI advisory says could be used in attacks against the United States.

(on camera) Officials say there is no connection between those events and the new warning, but when pieced together, offer good reason to worry.

Kelli Arena, CNN, Washington.

(END VIDEOTAPE)

BROWN: A few business items to report tonight, starting with a feud of epic portions in the computer business between Microsoft and the computer maker Sun.

They've been at it in court hammer and nail for years over Sun's Java software and Microsoft's version of it and who owns what and how much so-and-so should pay.

Today, they buried the hatchet and all litigation, in exchange for Microsoft paying Sun nearly $2 billion in all. Wow.

Said one industry watcher, "I had to check my calendar. I also had to check to make sure that Hell didn't freeze over." There you go. A good night for quotes, isn't it?

Donald Trump paved the way, Richard Branson could take it higher. The reports are that Fox entertainment -- I'll control myself here -- has signed the daredevil businessman to star in his own reality show. It will be lighter on the business than the Donald's big program and heavier on the derring-do.

There you go.

Markets, meantime, had a gonzo day, the job report and other factors contributing for gains pretty much across the board. A huge day for the NASDAQ at the end of a pretty good week by and large for the market, if I remember it well.

Ahead on NEWSNIGHT, she'll testify in less than a week. Up next, 9/11 commission member Tim Roemer, the former congressman from Indiana, tells us what he wants to hear from Condoleezza Rice.

Around the world, this is NEWSNIGHT.

(COMMERCIAL BREAK) BROWN: The week began with a dust up of major proportions between the White House and the 9/11 commission. It ends with another dust up, though we suspect smaller and we know easier to resolve.

At issue: thousands of pages of documents from the Clinton years that the Bush White House was not sending on to the commission. That was the headline this morning. By the time we talked with commission member Tim Roemer this afternoon, the headline had changed.

(BEGIN VIDEOTAPE)

BROWN: Congressman, has this issue with the Clinton era papers been sitting out there for awhile or did you just learn about it?

TIMOTHY ROEMER, 9/11 COMMISSIONER: I just learned about it in the last 36 hours. And hopefully we have worked directly and efficiently to address it and resolve it.

We found out -- I found out in the last day or so that about 75 percent of the Clinton archival documents that we had requested might not have been passed on to the commission. We have sat down with the staff of the White House and negotiated a review of these documents, so that we can see them and have our staff have eyes on.

And then hopefully, the next step, Aaron, is to make sure that, once we target those papers that we think meet our requests, then we can get our hands on them, and take them back with us and review them.

BROWN: So presumably, we are, as we sit here tonight, at least, headed for an amicable resolution?

ROEMER: So far so good, Aaron. We're headed for an amicable resolution at this point, although it's not complete.

We still need to make sure that once we identify those papers that meet our request, we have to convince these lawyers down at the White House, who may have been overzealous in the first place to not let us have those papers, that we need them now. And then that has to be resolved, that we actually get them.

BROWN: Obviously, the sort of main event of next week will be Dr. Rice's testimony. And I'm sure you've thought a fair amount about what you want to know. What is it you most want to know from her?

ROEMER: We need to ask Dr. Rice some serious questions about the speed of this process. Mr. Clarke has said it worked entirely too slowly for him. Mr. Armitage at the State Department has said that it worked slowly. Even Mr. McLaughlin at the CIA has said it worked slowly.

Dr. Rice has said it worked fairly quickly. Why the differences there? But more importantly than the differences, how did this affect the policy of counter terrorism, fighting al Qaeda for the first seven or eight months of the administration? That's one important question.

Another important question, Aaron, is to look at how were we communicating outside the National Security Council with agencies like the FBI and the CIA during the critical months of the spring and the summer of 2001?

BROWN: But Congressman, don't we know that we weren't communicating especially well with those agencies? That they weren't talking to each other, and that -- I mean, isn't that one of the lessons already learned?

ROEMER: Well, we've learned it, Aaron, in that the joint inquiry pointed it out. But we've also heard from Mr. Clarke that the exception to the rule, for instance, was that the FBI did work closely with the National Security Council in the millennium. They were sharing information, pushing it down into the bureaucracy, getting it back up.

Why couldn't we do that during the spring and the summer of 2001, right before this horrific terrorist attack? Why couldn't the FBI do this on a more consistent basis? You're absolutely right.

BROWN: Congressman, a quick final question. Do you have any concern that there's so much build-up to next week, and Dr. Rice's testimony, that essentially people's view of your work will come down to two witnesses, and not the large body and all the documents that has gone on now since you started working?

ROEMER: I do have that concern. One of the big surprises, Aaron, in all of this is that these five Republicans and five Democrats on this 9/11 commission do take their work seriously, are not partisan about it and are really digging hard to get at the facts.

And we're going to do all we can to not make this a circus and a he said-she said. We are going to continue to keep our eyes on the prize, so to speak. And the prize is trying to get legislation that will make the country safer and that can pass the House and the Senate, be signed by the president, that puts forward this new paradigm of fighting a transnational Jihadist threat we're going to be facing for a long time.

BROWN: Congressman, good to talk to you. We appreciate your work on the commission. Thank you and have a good weekend.

ROEMER: Pleasure to be with you, Aaron.

(END VIDEOTAPE)

BROWN: Tim Roemer, former congressman from the state of Indiana, Democrat.

A few other stories that made news today around the country in California. A judge scheduled a April 30 -- an April 30 hearing date to determine if there's enough evidence to try Michael Jackson on charges of child molestation.

This as a grand jury continued to hear testimony in secret about the case. If it decides to hand up an indictment, April 30 could become the day for Mr. Jackson's arraignment. That will be something. In Madison, Wisconsin, police said a college student's claim that she had been abducted at knifepoint was bogus. Hundreds of people have spent four days searching for the 20-year-old honors student. She was found Wednesday in the afternoon in a marsh. Police now say there is evidence she planned her disappearance.

And just to prove we can't make this stuff up. In Orlando, Florida, Walt Disney World, a man dressed as the character Tigger was arrested today on molestation charges after he allegedly fondled a woman and her 13-year-old daughter in February while the three were posing for a photograph in the theme park.

That was not a happy looking guy there, was it?

Still ahead tonight, a place where the ale has been flowing for 150 years. Finally, a break on the program. The company is never dull, a step back in time.

This is NEWSNIGHT.

(COMMERCIAL BREAK)

BROWN: You're going to like this.

We talk a lot about the new normal these days, more than we would like to, in truth. Which is one reason we like this story so much. That and the fact that a pub seemed to be a perfect place to end this week.

McSorley's Old Alehouse is a New York City institution: 150 years old. It is tiny and it is loved.

A devoted patron and historian wrote of it, "Time does not stand still within these two rooms, but it slows considerably."

(BEGIN VIDEOTAPE)

MATTY MAHER, OWNER SINCE 1977: Fifty years is something to celebrate in bar business. A hundred years is phenomenal, 150, it never happened in bar business existence, especially this type of operation. You know, small place in the city of New York.

Old John, he was a brew master back in Ireland. And when he came here, he used to brew for the southern cavalry. It developed into an old alehouse.

GEOFFREY "BART" BARTHOLOMEW, BARTENDER: When I first walked in the doors, in the first night in New York, I came in here in 1967. And it was like walking back into another century. And it still is.

It's good conversation; it's good ale. It's all the normal things you think of in an alehouse. Plus, it is a museum.

TERESA MAHER DE LA HABA, FIRST FEMALE BARTENDER: It's whatever was going on at that time when this place was started. Things were put up on the wall. We still add things once in awhile but not as much as, you know, they did back then.

These are the original taps. Like, people are amazed, but you know, they haven't been used in 80 years.

That's the original stove from the beginning.

The wishbones were put up during World War I by regulars before they went off to war. And supposedly the guys that made it back took a wishbone off, so the ones that are still hanging there are in reminiscence of the guys that never made it back.

PEPE ZWARYZUK, BARTENDER: A lot of fellows never made it back and their chandeliers are left to commemorate their valor for our country.

Everything on these walls has some sort of story attached to it. And we may not necessarily know them all.

GENE CARLSON, PATRON: McSorley's is unique. The intimacy, it's like a small church, the intimacy of the table.

ZWARYZUK: Even though everyday may seem the same, it's always a little different. Always a little different. This time of day, it's still pretty quiet and mellow. And nice.

As the day goes on, it gets busier. It gets a little bit louder. And it sort of builds to a crescendo just about every night.

I've always thought of it as a microcosm of democracy. Because you've got stock brokers, artists, grad students, sanitation men, plumbers, electricians, lawyers. And they're all mixed in the one small place.

MAHER: No one knows why it has existed. We just sell ale, nothing else. We don't have any registers, any television, any jukebox, nothing. Nothing. Only a good pub.

You know, McSorley's has to roll with the times, roll with the times. In Prohibition, during the Civil War we had to roll with the times when the draft rights were out there.

UNIDENTIFIED MALE: And there's Frank McKenna, who worked at McSorley's, handing an ale out the door to the woman. The woman is the owner. She didn't set foot in her own bar.

MAHER: Things change. Time moves on. The more it changes, the more it remains the same.

(END VIDEOTAPE)

BROWN: For a Friday.

Morning papers and the tabloids after the break.

(COMMERCIAL BREAK)

BROWN: Okie-dokie, time to check morning papers from around the country.

It's Friday, we'll throw in a tabloid or two. But the tabloid is particularly disgusting, OK? I'm just warning you now. The Batboy makes a return appearance.

"International Herald Tribune," published by "The New York Times" in Paris. It's in color now. Used to be in -- We've actually witnessed this transition right here on the program.

"Marines defending decision on Fallujah. Smart play was to let this thing fade." Written by Jeffrey Gettleman (ph), who has just done fabulous work there. That is a dangerous and difficult task. Nice work by "New York Times" man in Fallujah.

The "Miami Herald" leads with "Smoke in the sky." Brush fire leads local and localized the visa story reported about earlier. "Visitor rules worry Florida."

This is the story that caught my eye. Up front, it's called, Miami-Dade College. "Underdog chess mates beating the odds again." It's a story about the chess team at Miami-Dade College. Chess doesn't get enough attention. The -- It's a wonderful spectator sport, really.

"The Chattanooga Times Free Press" leads local, "Tennessee trash on roads. Transportation department busting budget to clean up highway debris."

How are we doing on time? 1:10.

"The Boston Herald": "What were they thinking? Indoor fireworks sparked ballroom fire at Sheraton bash." This is in Boston. You remember up in Providence last year they had that terrible fire at the nightclub with pyrotechnics and all.

"The Philadelphia Inquirer" leads baseball. They're opening their baseball stadium in Philadelphia. Citizen's Bank Park. Doesn't that have a nice ring? Opens this weekend, "baseball bonanza."

OK. On to the tabloids, "The Weekly World News." How much time do I got? That's just plenty.

"On TV's new 'Bachelorette,' a 500 super pound model. Will reality show help queen size lovely find man of her dreams?" Come on, that's not nice. That's not nice.

And 30? I've got a couple others here I like.

I mentioned Batboy. You can't really mention Batboy enough. We should call him Sir Batboy now, because Batboy is going to be knighted. There's a picture. Batboy with the queen. That is the queen. And that is Batboy. I got them in the right order there.

So that -- We're pretty proud of Batboy. We think of him as our own.

The weather tomorrow in Chicago is "whee!" by the way, as in excited. Here's Bill Hemmer a look at Monday's "AMERICAN MORNING."

(BEGIN VIDEO CLIP)

BILL HEMMER, "AMERICAN MORNING" HOST: Aaron, thank you.

Monday morning and "AMERICAN MORNING," baseball season getting under way, and the tremendous controversy over steroids. An overwhelming majority of Americans polled say they want performance enhancing drugs out of the game completely. But between the players, the owners and the fans, who ends up winning this war?

We'll check it out Monday morning: 7 a.m. Eastern Time, when we play ball (ph).

Back to you, Aaron.

(END VIDEO CLIP)

BROWN: Think he knew he followed Batboy?

We'll see you next week. Have a wonderful weekend. Good night for all of us.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com


Aired April 2, 2004 - 22:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
AARON BROWN, CNN ANCHOR: Good evening again everyone.
This has been the sort of week and March was the sort of month that makes you lose sight of the fact that Iraq is neither black nor white. A year after the invasion it remains (AUDIO GAP) next week that are rich with gray.

The Iraqi police major a friend to the Americans in many ways, important to the Americans in many ways and angry at the Americans that his men have no equipment and no protection.

In the north of the country, a Kurdish moderate, not a rabble rouser at all, who makes it quite plain that he is a Kurd first and an Iraqi second and he doesn't really care if he's an Iraqi at all. To the south there is the Shia cleric who seems to want the Americans to stay in the country only long enough for the Shia majority to gain power.

There is plenty of blame for this desire to see gray as either black or white. The administration oversimplifies. Opponents of the war ignore too much. The soldiers on the ground seem to get it best and you'll hear from some of them tonight.

But we begin the whip in Baghdad and CNN's Walter Rodgers with the duty, Walter a headline from you.

WALTER RODGERS, CNN SR. INTERNATIONAL CORRESPONDENT: Hello, Aaron. In Fallujah they're seeing more defiance of the United States than any contrition for the killing of those four American civilian contractors on Wednesday and, in Baghdad, there was a defiant demonstration as well -- Aaron.

BROWN: Walt, thank you.

Next to Tyco, the trial and the mistrial, just the latest in a case that's had everything but a verdict it seems, Allan Chernoff with us tonight, Allan the headline.

ALLAN CHERNOFF, CNN FINANCIAL CORRESPONDENT: The atmosphere in the jury room had been poisonous. Jurors had been fighting with one another but they were able to work through their problems and were actually very close to a conviction until a letter came in one of the juror's mailbox. It led to a mistrial -- Aaron.

BROWN: Allan, we'll get the details.

And finally to the White House and some good news, it seems, for the current resident. CNN's Dana Bash has the watch tonight, so Dana a headline from you.

DANA BASH, CNN WHITE HOUSE CORRESPONDENT: Well, Aaron, one senior aide described the atmosphere here today as if the Bush team had scored a 60-yard field goal, 300,000 new jobs last month. They're hoping that Senator Kerry will lose one of his top issues against the president. That's job loss on his watch -- Aaron.

BROWN: Dana, thank you. We'll get back to you and the rest in a moment.

Also on the program on this Friday night, one week and five new ads, the election is seven months away. It is going to be a very long campaign season enough perhaps to make you drink and we can help there too.

We'll take you to McSorley's an old-fashioned ale house. The taps have been flowing freely since the Civil War.

And it's Friday and you know what that means. The rooster brings along the weekly tabloids along with the morning papers and the tabs are particularly disgusting I must say, all that and more in the hour ahead.

We begin again tonight in Iraq at the end of a horrible week with Marines on the brink of doing something in Fallujah, just what we don't yet know. Tension in the Sunni Triangle is quite high.

Today, Friday, is traditionally a day of reflection in the Arab world but across Iraq in the mosques and in the streets there was precious little of that to be heard. And, in Fallujah today, the message amounted to mutilation is wrong, murder is not.

Here again, CNN's Walter Rodgers.

(BEGIN VIDEOTAPE)

RODGERS (voice-over): At Friday prayers in Fallujah, the Muslim faithful gathered three days after masked men in their town gunned down four American civilians and a mob mutilated the charred bodies.

A sheikh condemned the mutilation. He did not, however, condemn the murders. Indeed, he warned there will be yet more bloodshed here if U.S. forces crack down on Fallujah. In the city itself defiance, Iraqis promising Fallujah will become a graveyard of Americans.

In Baghdad, tens of thousands of Shiite Muslims marched through the streets shouting America and its governing council are infidels, people against Islam. Muktata al-Sadr (ph) an influential Shiite cleric said this is the start of the intifada, the resistance against the Americans.

Imam Hizam al-Alaraji (ph) another Iraqi cleric said America is the ugly face called the great Satan. Shiites are 60 percent of Iraq's population.

And, it seems increasingly clear the United States is now collecting powerful enemies in Iraq. When this imam told the faithful it is America that is detonating the car bombs in this country killing Muslims, no one here seemed to question it.

(END VIDEOTAPE)

RODGERS: Recently, the U.S. Administrator in Iraq Paul Bremer acknowledged he's had a difficult time getting his message across to the Iraqi people. This week selling that American message seems to have become even harder -- Aaron.

BROWN: Walter, thank you, Walter Rodgers in Baghdad.

More is becoming known tonight about the circumstances of the attack in Fallujah, more about who did it and more about how.

From the Pentagon CNN's Barbara Starr.

(BEGIN VIDEOTAPE)

BARBARA STARR, CNN PENTAGON CORRESPONDENT (voice-over): Military officials tell CNN they are investigating whether the attacks in Fallujah were planned in advance.

Initial reports, they say, indicate that just before the attacks normally busy streets were empty, shops closed up, a number of local Iraqi media were in the area. Marines now expected to reenter the town and take control.

RICHARD ARMITAGE, DEPUTY SECRETARY OF STATE: There will be a price extracted. There will be a response and it will be obvious to all.

STARR: Officials say there is no indication townspeople knew what was being planned but there was talk on the street that trouble might erupt. Military investigators also are looking for any evidence that Abu Musab al-Zarqawi, an associate of al Qaeda, who has called for driving the U.S. out of Iraq was involved.

U.S. officials are trying to isolate individual faces from news media footage, identify perpetrators and possibly offer reward money for their capture but those who committed the murders reportedly covered their faces and may have been long gone by the time the mob formed that desecrated the bodies.

Michael Teague a 12-year veteran of Army Special Operations served in Afghanistan.

SGT. JOHNNY RATLIFF, FRIEND OF MICHAEL TEAGUE: Mike was the kind of guy that always wanted to help someone. He -- on the mission that he was on right now he was going beyond the call of duty. He was helping other people.

STARR: Jerry Zovko also served in Army Special Operations. TOM ZOVKO, BROTHER OF MURDERED CONTRACTOR: You know he was for freedom and, you know, for human rights for everybody, equality for everybody.

STARR (on camera): Details about what exactly happened remains sketchy. The four contractors from Blackwater USA were apparently escorting trucks carrying food into the town but those trucks apparently rapidly escaped the ambush.

Barbara Starr, CNN, the Pentagon.

(END VIDEOTAPE)

BROWN: Well, more on Iraq a little bit later in the program, other news first.

The Tyco trial and what one of the lawyers said today after the judge called the whole thing off. "In all my years" he said, "I ain't seen nothing like this yet." Six months of testimony, 11 days of jury deliberation, a holdout juror, a threatening letter, at the center of it all a chief executive accused of living like a king on company cash.

The rest of the story and there's plenty of it from CNN's Allan Chernoff.

(BEGIN VIDEOTAPE)

CHERNOFF (voice-over): Dennis Kozlowski and Mark Swartz appear to have dodged a conviction. Jurors tell CNN they were close to finding both defendants guilty of grand larceny, which carries a maximum prison term of 25 yeas.

PETER MCENTEGART, JUROR: I personally feel the evidence is very clear on some of the specific charges and that we didn't get a chance to deliver the verdict that I believe we should have given is very upsetting to me.

ADRIENNE MCWILLLIAMS, JUROR: We were very, very close except for on one point and that one point was pretty much resolved this morning.

CHERNOFF: But Judge Michael Obus announced to a stunned courtroom he had no choice but to grant a mistrial because of efforts to pressure the jury. A person who observed closed door proceedings in the judge's chambers tells CNN a coercive letter had been sent to Juror No. 4, the apparent holdout.

Judge Obus questioned the jury and based on her answers declared a mistrial. The "New York Post" and "Wall Street Journal" had revealed Juror 4's identity after she appeared to signal the defense with an OK sign. Kozlowski and Swartz were charged with stealing $600 million from Tyco through unapproved bonuses, forgiven loans and stock sales.

Manhattan District Attorney Robert Morgenthau said the mistrial was unfortunate and said he intends at the earliest opportunity to seek a retrial. Defense attorneys say they'll be ready.

CHARLES STILLMAN, ATTORNEY FOR MARK SWARTZ: I've been doing this 40 years. I will tell you if I piled up all the experiences top to bottom, I ain't seen nothing like this yet.

(END VIDEOTAPE)

CHERNOFF: Not many people have. Judge Obus has scheduled a hearing for May 7th to discuss a new trial -- Aaron.

BROWN: In conversations with the jurors they seemed -- they talked about the experience in the jury room. It was pretty harrowing for many of them.

CHERNOFF: Absolutely. A week ago today there were notes out saying that the atmosphere was poisonous, that there were accusations being thrown back and forth. The judge seemed to handle it very well. He gave them an early recess last Friday. They had a nice long weekend.

And all of a sudden Monday they were back to work and incredibly it seemed that they were really close to resolving this case just taking it from the brink of being a mistrial and then all of a sudden back to mistrial.

BROWN: Allan, thank you, Allan Chernoff.

John Coffee is with us tonight. He teaches criminal and securities law up at Columbia University. It's good to see you again. I have a question about the judge, did the judge do a good job in all this?

JOHN COFFEE, COLUMBIA UNIVERSITY: I think the judge has to make a discretionary decision. He's got to balance the defendants' rights and the defendant here is in a very difficult position. When you know there's only one juror holding out, you identify that juror and that juror, a 79-year-old woman is subject to intense pressure and threatening letters. It's hard to have confidence in her being able to reach an unbiased decision.

BROWN: Absolutely. I mean if the point that she gets, assuming this letter was as it is portrayed, once she gets that it's really game, set, match.

COFFEE: He could have done it even earlier and probably been upheld.

BROWN: Yes.

COFFEE: This was the point where it's hard to see him not doing it.

BROWN: Does the "Wall Street Journal" and the "New York Post" bear some responsibility here?

COFFEE: I think they made an error in judgment. They did not foresee how this was going to play out but tonight we know that juries in high profile cases are extremely vulnerable, extremely exposed, and once the jury begins to deliberate you can't identify how individual jurors are voting. They're just making them targets for all kinds of crackpots.

BROWN: Yes, I mean they didn't set out to make her a target but it is one of those gray -- it's not a legal question. It's an ethical question it seems to me and whether they crossed an ethical line there.

COFFEE: Well, there's a legal line here too. The judge had he known it was going to happen could have barred any identification or publication of a juror's name. The courts do balance the First Amendment, the right to free press, and the right to a free, fair trial under the Sixth Amendment and it's a very difficult balancing question.

BROWN: Who gains from the mistrial? Who learns the most?

COFFEE: You know it's very strange. Usually the defendants gain a lot. The defendants here dodged the bullet but a millimeter.

BROWN: Yes.

COFFEE: But I think they still face an eventual date with a sentencing judge and when they debrief these jurors and see that they were ready to convict on multiple counts, I believe that sophisticated defense counsel are going to start seeking a plea bargain.

They're going to start trading off the delay, the year more of effort and money and say we'll accept a plea to a couple of counts. That's a lot better than facing 25 years.

BROWN: Let me come back to that for a second. What happens when these cases end is both sides get to meet with the jury pool, right, or the jurors?

COFFEE: They usually get to interview the jurors, yes.

BROWN: And they have a pretty fair idea of what went well and what didn't. I mean there were what 30-some counts here?

COFFEE: Thirty-three.

BROWN: So, both sides will know where their strengths and where their weaknesses were, right?

COFFEE: I think that's what helps the prosecution. They had a very, very excessive, overly long, confusing case. I think they'll learn from it, put their case on a diet and compress it.

BROWN: Now, let's go back to the question of plea. If you're the state here, if you're the government, what can you accept knowing that you were -- it sounds like from the one juror you're going to get at least a grand larceny conviction out of the deal. COFFEE: I think the people have indicated today, who were jurors, that there were multiple counts. They didn't say which but multiple counts. Thus, I think the prosecution can normally give a discount after a mistrial but I think they'd want to plea to several felony counts and maybe a maximum sentence in the range of ten years or more.

BROWN: Ten years for this?

COFFEE: That's state time. I want to be clear. There are not sentencing guidelines here and ten years in state prison may let you out after three or four years.

BROWN: Yes, but there aren't many really nice state prisons in this state.

COFFEE: That's certainly true but there really aren't any club feds anymore either.

BROWN: Do you expect it to plea out, plead out?

COFFEE: I think it's more likely than not. It's the defendants' decision but if the defendants go forward they could get 25 years.

BROWN: A truly bizarre day. Thank you. Good to see you again.

COFFEE: OK.

BROWN: Have a good weekend. Thank you, John Coffee.

Ahead on the program tonight, seven months to go before the election a new batch of ads make air this weekend.

And a new warning on terrorism on trains and busses this summer, we'll keep you awake.

This is NEWSNIGHT from New York.

(COMMERCIAL BREAK)

BROWN: Well, here's a lead we haven't been able to write for a while. Today, the Labor Department delivered good news, better news than expected on employment, 308,000 jobs were created last month.

That's the biggest jump in nearly four years, far more than Wall Street had expected. Some economists are saying it is the turnaround everyone has been hoping for and waiting months for. Others caution one month does not a trend make.

The president, to no one's surprise, is taking the credit. The economy is always a political story, especially so in an election year.

From the White House for us tonight CNN's Dana Bash.

(BEGIN VIDEOTAPE) BASH (voice-over): A thumbs-up from a president with a little more bounce in his step after getting the robust jobs report he'd been waiting months for, 308,000 new jobs created in March, the fastest pace in four years. January and February's job numbers were revised to 205,000, up from 118,000, and for the first time in 44 months, no jobs lost in manufacturing.

In West Virginia, a traditionally Democratic state, the president won in the last election and thousands of lost jobs since, he hailed the news and took credit.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The tax relief we passed is working. It's making a difference for this economy.

BASH: As job recovery lagged, Mr. Bush has campaigned on other positive economic signs like the rise in home ownership and the stock market but knowing nothing rivals the political importance of jobs, the president's team was out in full force.

JOHN SNOW, TREASURY SECRETARY: I think it will be sustainable and I'm encouraged by that number.

JOSH BOLTEN, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET: It confirms that the economy is in solid shape, is growing, and it's a growing economy.

KAREN HUGHES, PRESIDENTIAL ADVISER: I think what that says is we're finally back.

BASH: Big job growth is tough political news for Senator John Kerry, campaigning on the nearly two million jobs lost on the president's watch. At a photo op with his own economic team he argued one positive report doesn't change three down years.

SEN. JOHN KERRY (D), PRESIDENTIAL CANDIDATE: The fact is that the deficits, which go out as far as the eye can see, the lack of any one single manufacturing job in those jobs and the huge numbers of jobs that are leaving for overseas tells the real story of the economy of our country.

BASH: And from allies on Capitol Hill, a history lesson.

SEN. JOHN CORZINE (D), NEW JERSEY: We still have the worst job performance record of any president since Herbert Hoover and that's the facts.

(END VIDEOTAPE)

BASH: Now, Bush aides are trying to be cautious saying that they're still not satisfied and while it's still unclear whether this report is the beginning of a trend some Democrats privately worry a few more months like this and the president could be a lot harder to beat -- Aaron.

BROWN: Dana, thank you, Dana Bash. She's at the White House tonight. The new employment numbers, as Dana indicated, arrived just as the John Kerry campaign was getting back on track, beginning to air new ads today as the focus on U.S. jobs lost overseas, it is fair to say that today's jobs report wasn't the backdrop that Mr. Kerry had anticipated.

The new Kerry ad is just the latest in a campaign ad blitz on track to make this the most expensive presidential election campaign ever, unprecedented in other ways as well.

Again tonight CNN's Kelly Wallace.

(BEGIN VIDEOTAPE)

ANNOUNCER: George Bush says sending jobs overseas makes sense for America.

ANNOUNCER: John Kerry's record on the economy, troubling.

ANNOUNCER: George Bush shamelessly exploited 9/11.

KELLY WALLACE, CNN NATIONAL CORRESPONDENT (voice-over): An unprecedented ad war with the election still seven months away.

EVAN TRACEY: We probably are somewhere now approaching $40 million total that will be spent in the month of March alone.

WALLACE: Issue groups like moveon.org, critical of President Bush, are spending millions on ads like this controversial one.

RICHARD CLARKE: He ignored terrorism for months.

WALLACE: Featuring the president's former counterterrorism chief Richard Clarke. A look at last month's advertising in key cities in the 18 battleground states reveal something surprising.

For instance, in Tampa, the Bush team spent more than $800,000, Kerry's campaign $215,000, but when you include issue ads critical of the White House it adds up to $937,000 topping the Bush ad buy. The same holds true for other swing markets like Phoenix, St. Louis, Columbus, Ohio, and Charleston, West Virginia.

TRACEY: These groups have become the great equalizer in this for John Kerry. Without these groups, Kerry's getting steamrolled.

WALLACE: And Republicans say it's against the law. They filed a complaint with the Federal Election Commission accusing the groups of pouring illegal, unregulated contributions into the campaign. The Bush and Kerry campaign chairs argued about that Thursday on CNN's "INSIDE POLITICS."

JEANNE SHAHEEN, KERRY CAMPAIGN CHAIRMAN: The fact is there is no connection between these groups and the Kerry campaign.

UNIDENTIFIED MALE: We have what we believe to be overwhelming proof of that fact. You've got your former campaign manager who is guiding and directing one of these particular entities.

WALLACE (on camera): It's not clear when the Federal Elections Commission will rule on those issue ads but one thing is clear. This promises to be the most expensive advertising blitz in presidential election history.

Kelly Wallace, CNN, New York.

(END VIDEOTAPE)

BROWN: Coming up on the program tonight, the 82nd Airborne home from Iraq, home from Fallujah and not without stars, a break first.

This is NEWSNIGHT.

(COMMERCIAL BREAK)

BROWN: When action is taken in Fallujah, whenever and whatever it is, Marines from the 1st Expeditionary Unit will be carrying it out. They took over a short time ago from the Army's 82nd Airborne, which had a very rough time of it almost from the beginning. They'd been there a long time when we saw them leaving a couple of weeks back.

Last April, 13 locals were shot dead by members of the 82nd in a protest that got out of hand. That incident may have laid some of the groundwork for the trouble that's happened since.

The 82nd is back home now, buried reminders of it all, and from Fort Bragg, North Carolina tonight here's CNN's David Mattingly.

(BEGIN VIDEOTAPE)

DAVID MATTINGLY, CNN CORRESPONDENT (voice-over): His limp is so slight it's hard to notice but it is the only outward sign that combat medic Sergeant Chris Drolette carried two pieces of shrapnel in his left leg, painful reminders of his hazardous duty in the Iraqi town of Fallujah.

SGT. CHRISTOPHER DROLETTE, U.S. ARMY, 82ND AIRBORNE: Long period of boredom followed by short periods of terror.

MATTINGLY: Drolette and others from the Army's 82nd Airborne just returned home from Fallujah only to find the dangers they left behind again making headlines.

STAFF SGT. JOHN YOUNG, U.S. ARMY 82ND AIRBORNE: You hate that another person had to die like that, you know, just trying to do their job.

MATTINGLY: The soldiers describe Fallujah as a place so dangerous that convoys drive through town at breakneck speeds. You never venture out except in large groups and you never, never close your eyes.

PFC TOBY WHITNEY, U.S. ARMY 82ND AIRBORNE: You're looking at the ground. You're looking at the buildings. You're looking for people that just make you feel uncomfortable.

MATTINGLY: Contact with Iraqi civilians is frequent and soldiers say almost always pleasant but the sporadic and unpredictable attacks make true friendships difficult and unwise.

Do you know who to trust while you're there?

DROLETTE: You trust the ones wearing American uniforms.

MATTINGLY: But despite the unrelenting tension, these photographs are among the memories they bring home, waving children, busy markets and lines at local gas stations, signs of a nation struggling to recover.

(on camera): From what they could see, soldiers from North Carolina's Fort Bragg say that life for Iraqis in Fallujah seems to be getting better. The same could not be said, however, for American troops still there. Despite their best efforts, soldiers returning home say that for American soldiers, Fallujah is not getting any safer.

(voice-over): Three of these soldiers are combat medics. In their line of work they say Fallujah remains the busiest place in Iraq.

WHITNEY: The unknown, you just kind of become -- you expect the unexpected. You just wait for something to happen.

MATTINGLY: And the months of stress have taken a toll. Loud noises, even thunder takes them back to the front lines.

DROLETTE: I'd hear thunder and my adrenalin I can feel the butterflies and the adrenalin started happening.

MATTINGLY: The future of Fallujah will now be in the hands of U.S. Marines who are taking over the mission as the Army rotates out. The departing soldiers leave with this simple advice. Never let down your guard.

David Mattingly, CNN, Fort Bragg, North Carolina.

(END VIDEOTAPE)

BROWN: A few other stories that made news today around the world.

First, Nepal, pro-democracy protesters there tried to march on the royal palace. Rocks were thrown. Police batons swung. When it was over, 32 people were hospitalized, many of them with head injuries.

Nepal has been without an elected government since the king dissolved parliament a year and half ago.

In Spain, railroad inspectors today discovered a bomb hidden in a bag on a high-speed rail line. They immediately stopped a half a dozen bullet trains from using the rails. They also said the bomb may contain the same batch of dynamite used in the railroad bombings last month in Madrid.

The federal government today said it will expand its program of fingerprinting foreign visitors to include those who don't need a visa to get into the U.S., people from places like France, Britain, Japan and 24 other American allies, described as a stopgap measure until those other countries adopt harder to counterfeit passports.

Still to come tonight, growing concern about terrorism in the United States this summer. That and more as NEWSNIGHT continues from New York.

(COMMERCIAL BREAK)

BROWN: At the end of a week that has seen the unspeakable, add this to the new normal.

The FBI and the Department of Homeland Security have issued a new warning, that terrorists may try to bomb buses and railways in U.S. cities this summer. They stress, again, that these alleged plots are uncorroborated and lack specifics. They always seem to. It is harrowing nevertheless.

Here's CNN Kelli arena.

(BEGIN VIDEOTAPE)

KELLI ARENA, CNN CORRESPONDENT (voice-over): From Los Angeles to New York, to Washington, transportation officials are reacting to the latest warning about a possible terror attack.

CAPT. TIMOTHY GRONAU, D.C. METRO POLICE: We've always been concerned, and prepared. We're just continuing our pro-active efforts to try and prevent anything of this magnitude occurring in our system.

ARENA: The warning about trains and buses went out to law enforcement officials nationwide. It says terrorists may try to hide explosives in luggage or carry on bags like backpacks.

ASA HUTCHINSON, HOMELAND SECURITY UNDERSECRETARY: This is an area of concern. We're working with our transit authorities to enhance that security, put the appropriate protective measures in place.

ARENA: The advisory clearly states the intelligence is uncorroborated. It does not name specific U.S. cities and only offers summer as a time frame.

UNIDENTIFIED MALE: I'm just hoping that the people who do their job in security, they'll do their job. And hopefully we learned a lesson from Spain and they will carry it over here.

ARENA: Industry officials say they were paying close attention and admit the Madrid bombings prompted change. GRONAU: We've increased our patrols. We've reassigned some of our administrative people back into the rail system during heightened hours. We've altered our sweep teams.

ARENA: Earlier today, Spanish police found another bomb under high-speed rail tracks between Madrid and Seville.

And in London this week, authorities seized 1,000 pounds of ammonium nitrate as part of a terror investigation. That's the very same substance the FBI advisory says could be used in attacks against the United States.

(on camera) Officials say there is no connection between those events and the new warning, but when pieced together, offer good reason to worry.

Kelli Arena, CNN, Washington.

(END VIDEOTAPE)

BROWN: A few business items to report tonight, starting with a feud of epic portions in the computer business between Microsoft and the computer maker Sun.

They've been at it in court hammer and nail for years over Sun's Java software and Microsoft's version of it and who owns what and how much so-and-so should pay.

Today, they buried the hatchet and all litigation, in exchange for Microsoft paying Sun nearly $2 billion in all. Wow.

Said one industry watcher, "I had to check my calendar. I also had to check to make sure that Hell didn't freeze over." There you go. A good night for quotes, isn't it?

Donald Trump paved the way, Richard Branson could take it higher. The reports are that Fox entertainment -- I'll control myself here -- has signed the daredevil businessman to star in his own reality show. It will be lighter on the business than the Donald's big program and heavier on the derring-do.

There you go.

Markets, meantime, had a gonzo day, the job report and other factors contributing for gains pretty much across the board. A huge day for the NASDAQ at the end of a pretty good week by and large for the market, if I remember it well.

Ahead on NEWSNIGHT, she'll testify in less than a week. Up next, 9/11 commission member Tim Roemer, the former congressman from Indiana, tells us what he wants to hear from Condoleezza Rice.

Around the world, this is NEWSNIGHT.

(COMMERCIAL BREAK) BROWN: The week began with a dust up of major proportions between the White House and the 9/11 commission. It ends with another dust up, though we suspect smaller and we know easier to resolve.

At issue: thousands of pages of documents from the Clinton years that the Bush White House was not sending on to the commission. That was the headline this morning. By the time we talked with commission member Tim Roemer this afternoon, the headline had changed.

(BEGIN VIDEOTAPE)

BROWN: Congressman, has this issue with the Clinton era papers been sitting out there for awhile or did you just learn about it?

TIMOTHY ROEMER, 9/11 COMMISSIONER: I just learned about it in the last 36 hours. And hopefully we have worked directly and efficiently to address it and resolve it.

We found out -- I found out in the last day or so that about 75 percent of the Clinton archival documents that we had requested might not have been passed on to the commission. We have sat down with the staff of the White House and negotiated a review of these documents, so that we can see them and have our staff have eyes on.

And then hopefully, the next step, Aaron, is to make sure that, once we target those papers that we think meet our requests, then we can get our hands on them, and take them back with us and review them.

BROWN: So presumably, we are, as we sit here tonight, at least, headed for an amicable resolution?

ROEMER: So far so good, Aaron. We're headed for an amicable resolution at this point, although it's not complete.

We still need to make sure that once we identify those papers that meet our request, we have to convince these lawyers down at the White House, who may have been overzealous in the first place to not let us have those papers, that we need them now. And then that has to be resolved, that we actually get them.

BROWN: Obviously, the sort of main event of next week will be Dr. Rice's testimony. And I'm sure you've thought a fair amount about what you want to know. What is it you most want to know from her?

ROEMER: We need to ask Dr. Rice some serious questions about the speed of this process. Mr. Clarke has said it worked entirely too slowly for him. Mr. Armitage at the State Department has said that it worked slowly. Even Mr. McLaughlin at the CIA has said it worked slowly.

Dr. Rice has said it worked fairly quickly. Why the differences there? But more importantly than the differences, how did this affect the policy of counter terrorism, fighting al Qaeda for the first seven or eight months of the administration? That's one important question.

Another important question, Aaron, is to look at how were we communicating outside the National Security Council with agencies like the FBI and the CIA during the critical months of the spring and the summer of 2001?

BROWN: But Congressman, don't we know that we weren't communicating especially well with those agencies? That they weren't talking to each other, and that -- I mean, isn't that one of the lessons already learned?

ROEMER: Well, we've learned it, Aaron, in that the joint inquiry pointed it out. But we've also heard from Mr. Clarke that the exception to the rule, for instance, was that the FBI did work closely with the National Security Council in the millennium. They were sharing information, pushing it down into the bureaucracy, getting it back up.

Why couldn't we do that during the spring and the summer of 2001, right before this horrific terrorist attack? Why couldn't the FBI do this on a more consistent basis? You're absolutely right.

BROWN: Congressman, a quick final question. Do you have any concern that there's so much build-up to next week, and Dr. Rice's testimony, that essentially people's view of your work will come down to two witnesses, and not the large body and all the documents that has gone on now since you started working?

ROEMER: I do have that concern. One of the big surprises, Aaron, in all of this is that these five Republicans and five Democrats on this 9/11 commission do take their work seriously, are not partisan about it and are really digging hard to get at the facts.

And we're going to do all we can to not make this a circus and a he said-she said. We are going to continue to keep our eyes on the prize, so to speak. And the prize is trying to get legislation that will make the country safer and that can pass the House and the Senate, be signed by the president, that puts forward this new paradigm of fighting a transnational Jihadist threat we're going to be facing for a long time.

BROWN: Congressman, good to talk to you. We appreciate your work on the commission. Thank you and have a good weekend.

ROEMER: Pleasure to be with you, Aaron.

(END VIDEOTAPE)

BROWN: Tim Roemer, former congressman from the state of Indiana, Democrat.

A few other stories that made news today around the country in California. A judge scheduled a April 30 -- an April 30 hearing date to determine if there's enough evidence to try Michael Jackson on charges of child molestation.

This as a grand jury continued to hear testimony in secret about the case. If it decides to hand up an indictment, April 30 could become the day for Mr. Jackson's arraignment. That will be something. In Madison, Wisconsin, police said a college student's claim that she had been abducted at knifepoint was bogus. Hundreds of people have spent four days searching for the 20-year-old honors student. She was found Wednesday in the afternoon in a marsh. Police now say there is evidence she planned her disappearance.

And just to prove we can't make this stuff up. In Orlando, Florida, Walt Disney World, a man dressed as the character Tigger was arrested today on molestation charges after he allegedly fondled a woman and her 13-year-old daughter in February while the three were posing for a photograph in the theme park.

That was not a happy looking guy there, was it?

Still ahead tonight, a place where the ale has been flowing for 150 years. Finally, a break on the program. The company is never dull, a step back in time.

This is NEWSNIGHT.

(COMMERCIAL BREAK)

BROWN: You're going to like this.

We talk a lot about the new normal these days, more than we would like to, in truth. Which is one reason we like this story so much. That and the fact that a pub seemed to be a perfect place to end this week.

McSorley's Old Alehouse is a New York City institution: 150 years old. It is tiny and it is loved.

A devoted patron and historian wrote of it, "Time does not stand still within these two rooms, but it slows considerably."

(BEGIN VIDEOTAPE)

MATTY MAHER, OWNER SINCE 1977: Fifty years is something to celebrate in bar business. A hundred years is phenomenal, 150, it never happened in bar business existence, especially this type of operation. You know, small place in the city of New York.

Old John, he was a brew master back in Ireland. And when he came here, he used to brew for the southern cavalry. It developed into an old alehouse.

GEOFFREY "BART" BARTHOLOMEW, BARTENDER: When I first walked in the doors, in the first night in New York, I came in here in 1967. And it was like walking back into another century. And it still is.

It's good conversation; it's good ale. It's all the normal things you think of in an alehouse. Plus, it is a museum.

TERESA MAHER DE LA HABA, FIRST FEMALE BARTENDER: It's whatever was going on at that time when this place was started. Things were put up on the wall. We still add things once in awhile but not as much as, you know, they did back then.

These are the original taps. Like, people are amazed, but you know, they haven't been used in 80 years.

That's the original stove from the beginning.

The wishbones were put up during World War I by regulars before they went off to war. And supposedly the guys that made it back took a wishbone off, so the ones that are still hanging there are in reminiscence of the guys that never made it back.

PEPE ZWARYZUK, BARTENDER: A lot of fellows never made it back and their chandeliers are left to commemorate their valor for our country.

Everything on these walls has some sort of story attached to it. And we may not necessarily know them all.

GENE CARLSON, PATRON: McSorley's is unique. The intimacy, it's like a small church, the intimacy of the table.

ZWARYZUK: Even though everyday may seem the same, it's always a little different. Always a little different. This time of day, it's still pretty quiet and mellow. And nice.

As the day goes on, it gets busier. It gets a little bit louder. And it sort of builds to a crescendo just about every night.

I've always thought of it as a microcosm of democracy. Because you've got stock brokers, artists, grad students, sanitation men, plumbers, electricians, lawyers. And they're all mixed in the one small place.

MAHER: No one knows why it has existed. We just sell ale, nothing else. We don't have any registers, any television, any jukebox, nothing. Nothing. Only a good pub.

You know, McSorley's has to roll with the times, roll with the times. In Prohibition, during the Civil War we had to roll with the times when the draft rights were out there.

UNIDENTIFIED MALE: And there's Frank McKenna, who worked at McSorley's, handing an ale out the door to the woman. The woman is the owner. She didn't set foot in her own bar.

MAHER: Things change. Time moves on. The more it changes, the more it remains the same.

(END VIDEOTAPE)

BROWN: For a Friday.

Morning papers and the tabloids after the break.

(COMMERCIAL BREAK)

BROWN: Okie-dokie, time to check morning papers from around the country.

It's Friday, we'll throw in a tabloid or two. But the tabloid is particularly disgusting, OK? I'm just warning you now. The Batboy makes a return appearance.

"International Herald Tribune," published by "The New York Times" in Paris. It's in color now. Used to be in -- We've actually witnessed this transition right here on the program.

"Marines defending decision on Fallujah. Smart play was to let this thing fade." Written by Jeffrey Gettleman (ph), who has just done fabulous work there. That is a dangerous and difficult task. Nice work by "New York Times" man in Fallujah.

The "Miami Herald" leads with "Smoke in the sky." Brush fire leads local and localized the visa story reported about earlier. "Visitor rules worry Florida."

This is the story that caught my eye. Up front, it's called, Miami-Dade College. "Underdog chess mates beating the odds again." It's a story about the chess team at Miami-Dade College. Chess doesn't get enough attention. The -- It's a wonderful spectator sport, really.

"The Chattanooga Times Free Press" leads local, "Tennessee trash on roads. Transportation department busting budget to clean up highway debris."

How are we doing on time? 1:10.

"The Boston Herald": "What were they thinking? Indoor fireworks sparked ballroom fire at Sheraton bash." This is in Boston. You remember up in Providence last year they had that terrible fire at the nightclub with pyrotechnics and all.

"The Philadelphia Inquirer" leads baseball. They're opening their baseball stadium in Philadelphia. Citizen's Bank Park. Doesn't that have a nice ring? Opens this weekend, "baseball bonanza."

OK. On to the tabloids, "The Weekly World News." How much time do I got? That's just plenty.

"On TV's new 'Bachelorette,' a 500 super pound model. Will reality show help queen size lovely find man of her dreams?" Come on, that's not nice. That's not nice.

And 30? I've got a couple others here I like.

I mentioned Batboy. You can't really mention Batboy enough. We should call him Sir Batboy now, because Batboy is going to be knighted. There's a picture. Batboy with the queen. That is the queen. And that is Batboy. I got them in the right order there.

So that -- We're pretty proud of Batboy. We think of him as our own.

The weather tomorrow in Chicago is "whee!" by the way, as in excited. Here's Bill Hemmer a look at Monday's "AMERICAN MORNING."

(BEGIN VIDEO CLIP)

BILL HEMMER, "AMERICAN MORNING" HOST: Aaron, thank you.

Monday morning and "AMERICAN MORNING," baseball season getting under way, and the tremendous controversy over steroids. An overwhelming majority of Americans polled say they want performance enhancing drugs out of the game completely. But between the players, the owners and the fans, who ends up winning this war?

We'll check it out Monday morning: 7 a.m. Eastern Time, when we play ball (ph).

Back to you, Aaron.

(END VIDEO CLIP)

BROWN: Think he knew he followed Batboy?

We'll see you next week. Have a wonderful weekend. Good night for all of us.

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