Return to Transcripts main page

CNN Newsroom

Pennsylvania Push: Clinton Makes Economic Speech; Iraq's Grim Milestone: U.S. Death Toll Reaches 4,000; 12-Count Complaint Filed Against Detroit Mayor

Aired March 24, 2008 - 11:00   ET

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

TONY HARRIS, CNN ANCHOR: Good morning again, everyone. Welcome back to the CNN NEWSROOM.
I'm Tony Harris.

HEIDI COLLINS, CNN ANCHOR: Hi there, everybody. I'm Heidi Collins.

Developments keep coming in to the CNN NEWSROOM on this Monday, March 24. Here's what's on the rundown.

Gas prices draining your wallet while the stock market feeds it. We'll break down all your money matters.

HARRIS: The economy is issue No. 1 and at the top of Hillary Clinton's agenda this morning. She's giving a key policy speech in Philadelphia.

COLLINS: And big runoff problems. Floodwaters rolling down rivers to the Gulf of Mexico -- in the NEWSROOM.

Our top story this morning, "Issue #1," your money. Wall Street surging after a long holiday weekend, up more than 200 points about 90 minutes into the trading day. A couple of things boosting investor optimism. First, a better price in the works for investment bank Bear Stearns. In fact, five times better.

JPMorgan Chase confirming this morning it is sweetening its offer. The change aimed at calming Bear Stearns investors while keeping the government's blessing for the buyout.

And last hour, surprising new numbers out of the housing market. You heard it from Susan Lisovicz. Sales of previously owned homes up almost 3 percent last month. That's first increase after six months of declines.

Analysts say aggressive price cutting may have boosted the sales. The median price for a home fell just below $196,000.

And the latest on gas prices. AAA putting the cost of a gallon of regular at $3.26 this morning. That's down about a half cent, just a little half-cent, but down since yesterday. The Lundberg Survey reports the same number. It says the price of gas jumped seven cents over the last two weeks. And checking the latest numbers on Wall Street now. Look at this. The Dow Jones Industrial Average is up nearly 212 points as we look at it -- 12,573 or so.

We'll watch those numbers for you. We understand the Nasdaq is up a pretty hefty bit as well.

HARRIS: Boy, you get a good housing number and look what happens. Man! All right.

Senator Hillary Clinton making a push for Pennsylvania. She is speaking this hour about the economy.

CNN's Dan Lothian is in Philadelphia, where Senator Clinton, I believe -- I'm wondering, Dan, has she wrapped up her remarks yet?

DAN LOTHIAN, CNN CORRESPONDENT: She has not wrapped up, a least the last couple of minutes. I was just inside listening to her speech and just came out here, Tony. But you know, as you mentioned, that good news on the economy tends to get people feeling good about, you know, what's happening in their economic lives.

What Senator Clinton is laying out though here is that a lot of Americans are still suffering. Not only here in Pennsylvania, but across the country, and certainly in those markets where we saw the mortgage crisis really intensify where there was a lot of speculation and subprime lending that led to this crisis. And what she is proposing is essentially a lot of the same issues that we have seen out there, that she's been putting out there certainly for the last few weeks.

But in particular, she's calling on the Bush administration to form what she called an emergency working group. And this would be made up of some key financial experts from Wall Street, on out across the country, who can advise and then come back with a plan, because she points out that for a lot of Americans, they've simply lost confidence in the economy.

(BEGIN VIDEO CLIP)

SEN. HILLARY RODHAM CLINTON (D-NY), PRESIDENTIAL CANDIDATE: Our housing crisis is at heart an American dream crisis. Your home isn't just your greatest asset, your greatest source of wealth, it's your greatest source of security. It's what anchors you to your neighborhood and your community. It's the center of your family.

For the past seven years we've had a president who stands up for the special interests, for the insurance companies and the mortgage companies and Wall Street. Now it's time for a president who stands up for American families.

(END VIDEO CLIP)

LOTHIAN: And Tony, that reference "standing up for Wall Street," she did reference Bear Stearns and the JPMorgan deal and how $30 billion was sort of infused in order to help Wall Street. And what she is calling for now is sort of an infusion into the economy, another $30 billion to be given to cities, to states, to communities that have been hard hit. And this will be money that could be used for many different things, including helping to buy back some of these properties that are in foreclosure, to assist these homeowners who are going through a very difficult time -- Tony.

HARRIS: Boy, Dan, it sounds like the old Block Grant Program. Don't even know if that's still around anymore, but that is what that sounds like.

Dan Lothian in Philadelphia for us.

Dan, good to see you. Thanks, man.

LOTHIAN: OK.

COLLINS: Iraq, a somber milestone. The U.S. death toll has reached 4,000 and big questions remain unanswered.

CNN Pentagon Correspondent Barbara Starr is joining us now.

So, Barbara, what is the Pentagon saying about the troop deaths?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, you know, Heidi, here at the Pentagon they are calling it an individual tragedy for every family who has lost a loved one in the war. This 4,000 death toll includes eight, in fact, Defense Department civilians who over the years also have lost their lives in Iraq. Many contractors have lost their lives and, of course, thousands upon thousands of Iraqis having lost their lives in this conflict now more than five years old.

But this all comes, of course, at a time when a lot of focus in the presidential campaign is on Iraq. General David Petraeus briefing the president at some point today, we are told, on his recommendations for the way forward, when the next troop cuts may be able to be announced. General Petraeus expected here in Washington in early April.

No one is saying there will be additional troop cuts anytime soon. It may not be until later in the year actually.

One piece of good news perhaps, the Army is ready to tell the president that they believe they can cut that grueling 15-month tour of duty on the ground in Iraq back to at least 12 months for almost all of the troops. That will be, of course, welcome news. More time at home, more time with their families.

But today, a day to just pause and remember that 4,000 American families have gotten that dreadful knock on the door telling them the worst possible news, that their loved one has been lost in Iraq -- Heidi.

COLLINS: Absolutely. And we will do that here certainly.

CNN's Pentagon correspondent, Barbara Starr. Thanks, Barbara.

HARRIS: The political future of Detroit Mayor Kwame Kilpatrick could be decided this hour. At this moment, as a matter of fact, any minute now. Wayne County prosecutor Kim Worthy is expected to announce whether Kilpatrick and a former female chief aide will face perjury charges. The two are accused of lying under oath about an alleged sexual relationship.

I believe the news conference is under way with Wayne County prosecutor Kim Worthy. Let's take you there now.

(JOINED IN PROGRESS)

KIM WORTHY, WAYNE COUNTY, MICHIGAN, PROSECUTOR: ... potential defendants. So we will continue our investigation into their activities.

Let me be very, very clear. This was not an investigation focused on lying about sex. Gary Brown, Harold Nelthrope and Walter Harris, their lives were forever changed. They were ruined financially and their reputations were completely destroyed because they chose to be dutiful police officers. The public trust was violated.

This investigation is whether public dollars were used unlawfully and much, much more. This investigation started, as you know, because of a "Detroit Free Press" article about text messages. The importance of an independent press is vitally important to our society, but prosecutors are unique and our duties are unique.

We have to examine potential evidence from every perspective -- upside down, inside out, and sideways. We are the ones that have to walk into court and prove all charged cases beyond a reasonable doubt. And in addition to that, we have to make sure that every defendant receives due process.

In my view, the American system of justice is the best in the world. It's certainly not perfect, we know that, because people within the justice system are not perfect. But we try very hard every day to make the justice system work.

We ask a lot of all our participants in the justice system. We ask a lot of our judges, our jurors, our defense attorneys, the police, certainly the prosecutors, courtroom personnel, but especially our witnesses.

It doesn't matter if it's a criminal trial or a civil trial. Witnesses are the backbone, heart, soul, core and center of the justice system. Without witnesses, the American system of justice would totally and completely collapse. Without witnesses, we have nothing, justice means nothing, and we can do nothing for anyone. Crime would be rampant, as no one would ever be responsible for anything, and no civil suit of any kind would stand resolved.

But here's the thing -- witnesses must give truthful testimony. And we have to demand that they do. That is why they take an oath.

There are variations on courtroom oaths, but basically an oath says, "I do solemnly swear or affirm that the testimony that we are about to give in this case will be truth, the whole truth, and nothing but the truth." The oath does not say, "I do solemnly swear or affirm that the testimony I'm about to give in this matter will be some of the truth, some of the time, when it suits me, and anything but the whole truth."

Oaths mean something. They're critically important. They matter.

They matter when jurors take their oath. They matter when lawyers, judges and other public officials take their oath. They matter when new citizens take the oath of citizenship. They matter whey doctors take the Hippocratic Oath. They matter when anyone swears before a notary public.

They must matter, and that's why witnesses take them. Every witness in every case. And it's so important, it is perjury if there is lying. And perjury is a crime.

You know, the fundamental principles of the justice system are fairly simple. We learned them as children. They aren't hard -- tell the truth, take responsibility for your actions, admit when you're wrong, play fair and be fair, don't take or use things that aren't use. And there are consequences for bad behavior. Even children understand that lying is wrong.

If a witness lies, innocent people can go to jail or prison, people can literally get away with murder, civil litigants who deserve money may not get it, or may get money that they don't deserve. And lying cannot be tolerated even if a judge or a jury sees through it and doesn't buy the lie.

We ask witnesses to come in and risk their lives in drive-by shootings and then return to the neighborhoods that they came from. We ask witnesses to testify against multinational corporations. We ask witnesses to do all kinds of things to support our cases.

How can we look another witness in the eye and ask them to come in and do these things if we don't follow the law for witnesses who lie under oath? Even if they are party to a lawsuit, we must demand that these witnesses follow the law and give truthful testimony, no matter what a particular witness' pedigree may be.

Some have suggested that the issues in this investigation are personal or private. Our investigation has clearly shown that public dollars were used, people's lives were ruined, the justice system was severely mocked, and the public trust trampled on. This case is about as far from being a private matter as one can get.

Honesty and integrity in the justice system is everything. That is what this case is about. Just when did honesty and integrity, truth and honor become traits to be mocked, downplayed, ignored, laughed at, or excuses made for them? When did telling the truth become a supporting player to everything else?

The Roman goddess of justice, or Lady Justice, is the personification of the moral force that underlies the justice system. She is most often depicted with a set of weighing scales typically suspended from her left hand, upon which she measures the strength of a case's support and opposition.

She is also often seen carrying a double-edged sword in her right hand, symbolizing the power of reason and justice which may be wielded either for or against one party or another. She is almost always draped in flowing robes symbolizing the fair and equal administration of the law, without corruption, avarice, prejudice or favor.

The blindfold that she wears does not mean that we turn a blind eye or give a wink and a nod no matter how inconsequential that some may think it may be to crimes committed by a person who has means, political power, and name or influence. If that is done, the process is not fair or impartial. She wears a blindfold to indicate that justice is or should be meted out objectively, without fear of favor, regardless of the identity, power or weakness of the accused.

President Theodore Roosevelt once said, "No man is above the law and no man is below it." Nor do we ask any man's permission when we require him to obey it. Obedience to the law is demanded as a right, not asked as a favor.

In this case we asked, number one, can we charge perjury? Yes.

Two, are there other crimes and offenses that we can charge other than perjury? Yes.

Should we charge? Yes.

Today we have filed a 12-count criminal information that contains charges against Mayor Kwame Kilpatrick and Christine Beatty. In count one we charge both of them with conspiracy to obstruct justice, a five-year felony. That count states that they did unlawfully conspire, combine, confederate and agree together with each other and others to commit the following listed offense: obstruction of justice.

Count two, we charged both Mayor Kilpatrick and Christine Beatty with obstruction of justice. This -- a five-year felony. This count reads that they did commit the crime of obstruction of justice by firing Gary Brown to willfully and corruptly hamper, obstruct and/or interfere with a criminal investigation and/or commit perjury to hide the firing of Jerry Brown (sic) -- Gary Brown, and/or the relationship between Christine Beatty and the mayor.

In count three we charged Kwame Kilpatrick only with -- I'm sorry, we charged both defendants -- both defendants of count three with misconduct in office. This count states that they did commit misconduct in office, an indictable offense at common law by firing Gary Brown, to willfully and corruptly hamper, obstruct and/or interfere with a criminal investigation of the mayor's personal conduct and/or the executive protective unit, conduct and/or committing perjury to hide the hide the firing and the true nature of their relationship.

We charged Mayor Kilpatrick only in count four with misconduct in office. This count states that he did commit misconduct in office, an indictable offense at common law as the mayor for the city of Detroit, authorize the city of Detroit to enter into an $8.4 million settlement of the Gary Brown, Harold Nelthrope and Harris litigations with the correct motive of preventing the release of text messages or other information evidencing that Mayor Kilpatrick and his chief of staff, Christine Beatty, lied under oath.

In count five we charged Kwame Kilpatrick only with perjury in a court proceeding, a 15-year felony. This count states that he did, being lawfully required to depose the truth as a witness in a jury trial, a court proceeding in the case of Gary Brown and Harold Nelthrope, versus Kwame Kilpatrick and the city of Detroit, case number 03-317557-NZ.

The case being a civil lawsuit before the honorable Michael J. Callahan (ph) for the Third Circuit Court for Wayne County on August the 29, 2007, committing perjury by testify that he did not fire Gary Brown and/or testify that he did not know Gary Brown was investigating him or the Manoogian Mansion party prior to his "unappointment," and/or testifying falsely as to other circumstances surrounding the termination of Gary Brown, including the reasons for the termination and how and why the decision was made.

Count six as to Kwame Kilpatrick only, perjury in a court proceeding, a 15-year felony. Count six states that the defendant did, being lawfully required to depose the truth as a witness in a jury trial in the court preceding that I mentioned just a few moments ago, did on August the 29th, 2007, commit perjury by testifying that he did not have a romantic or sexual relationship with Christine Beatty.

Count seven goes to Christine Beatty only -- perjury during a court proceeding. A 15-year felony.

This count states that she did, being lawfully required to depose the truth as a witness in a jury trial, a court proceeding in the case of Gary Brown and Harold Nelthrope versus Kwame Kilpatrick and the city of Detroit, the case being a civil lawsuit before the honorable Michael J. Callahan for the Third Circuit Court for Wayne County on August the 28th, 2007, commit perjury by testifying Gary Brown was not fired and/or testifying that she did not know Gary Brown was investigating the mayor or the Manoogian Mansion party prior to his "unappointment" and/or testifying falsely as to other circumstances surrounding the termination of Gary Brown, including the reasons for the termination and how and why the decision was made.

Count eight goes to Christine Beatty only, perjury in a court proceeding, a 15-year felony. This count states that she did, being lawfully required to depose the truth as a witness in the jury trial that I had mentioned earlier, that she did on August the 28th, 2007, commit perjury by falsely -- strike that -- commit perjury by testifying that she did not have a romantic or sexual relationship with Mayor Kilpatrick and she did not use her side tail (ph) communications device to send or receive messages of a personal or sexual nature.

Count nine goes to Kwame Kilpatrick only -- perjury other than a court proceeding, a 15-year felony. This count states that he did, being a person of whom an oath was required by law, willfully swear falsely before Sheila D. Rice (ph), a notary public within the county of Wayne, on June the 26th, 2003, as to circumstances surrounding the "unappointment" of Gary Brown.

Count 10, as to Kwame Kilpatrick only, perjury other than a court proceeding, a 15-year felony. This count states that he did, being a person of whom an oath was required by law, willfully swear falsely before Sheila D. Rice, a notary public, within the county of Wayne, on October 11th, 2004, as to the circumstances surrounding the "unappointment" of Gary Brown.

The last two counts have to do with Ms. Beatty only. Count 11, perjury other than a court proceeding. This count -- a 15-year felony.

This count states that she did, being a person of whom an oath was required by law, willfully swear falsely before Sheila D. Rice, a notary public, within the county of Wayne on December the 9th, 2003, that she did not know Gary Brown was investigating the Manoogian Mansion party prior to his "unappointment" and/or other circumstances surrounding the termination of Gary Brown.

And our final count, count 12, perjury other than a court proceeding, a 15-year felony. And as I said, this goes to Christine Beatty only. This count states that she did, being a person of whom an oath was required by law, willfully swear falsely before Sheila D. Rice, a notary public within the county of Wayne, on December 9th, 2003. She was not -- testified that she was not aware of the mayor's philandering.

I want to take a moment before I take any questions to introduce the prosecution team on this case. They are all seasoned lawyers, and in my opinion all brilliant trial strategists and brilliant trial attorneys.

I want to first introduce Robert Moran (ph), who is the principal attorney in charge of my homicide unit. He has been trying cases in this office for 15 years.

Athena Suringas (ph) is a member of the homicide unit as well. She has tried civil and criminal cases for 17 years in a firm outside this office, and within the office she's been trying criminal cases for an additional seven years.

Lisa Lindsey (ph) -- if you an step to this side...

HARRIS: All right. There you have it, Wayne County prosecutor Kim Worthy taking her time in getting to the real point of the news conference this morning, giving us a bit of a civics lesson, but finally getting to the point of the news conference, announcing a multi-count indictment against Detroit's mayor, Kwame Kilpatrick, and also his one-time chief of staff, Christine Beatty. Some of the charges Kwame Kilpatrick will face alone, and other charges go directly to the former chief of staff, Christine Beatty. But we're talking at a 12-count indictment right now.

The Wayne County prosecutor had been investigating claims that they lied under oath during a recent whistle-blower's trial actually taking place last summer when both denied having a romantic relationship. They both testified that they were not having and had never had a romantic relationship.

During that trial, "The Detroit Free Press" went to work and conducted its own investigation and uncovered sexually explicit text messages, along the order of 1,400 -- or maybe it's 14,000. Just a huge number of text messages that were left on Beatty's city-issued pager in 2002 and 2003 that appeared to contradict their testimony. And more specifically, text messages indicating the two had, in fact, had a sexual affair.

So this morning, a 12-count indictment against the mayor of Detroit, Kwame Kilpatrick. Also named in the indictment, the chief of staff, Christine Beatty, for not telling the truth. A list of obstruction of justice charges and misconduct in office.

So what now for this one-time star in Detroit, Kwame Kilpatrick? A conviction for lying under oath can bring up to 15 years in prison, and Detroit's charter calls for a mayor to be removed from office if convicted of a felony.

We will of course be following developments in this case and bring you the very latest right here in the NEWSROOM.

COLLINS: Buying a new car -- rising gas prices making the decision for some people.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: If it hits like $4.50, $5, I will definitely get rid of the truck no matter what. And I'll just take whatever -- whatever I can afford at the time that gets the best gas mileage.

(END VIDEO CLIP)

COLLINS: Going small. We'll talk about it next.

(COMMERCIAL BREAK)

HARRIS: And here we go. Coming up on the half hour.

Welcome back, everyone, to the CNN NEWSROOM.

I'm Tony Harris.

HOLMES: Hi there, everybody. I'm Heidi Collins.

Hey, let's go ahead and look at the Big Board, because it's good. I wish we could only show it to you when it's good and not when it's bad, but that wouldn't be fair, I guess -- 214 points to the positive, Dow Jones Industrial Average is now at 12,575.

Nasdaq up by, I think, about 50. We'll see it there on the bottom right on your screen, 60. Lots of green if you know what I mean today, that's a good thing. However, some people are downsizing in their driveways. Many people now looking to go small in an effort to combat gas prices.

CNN's Allan Chernoff has more now from the New York Auto Show.

(BEGIN VIDEOTAPE)

ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT (voice-over): Jim McQuade is looking to economize his ride. He is checking out hybrid SUVs that are more fuel efficient than his thirsty Toyota Sequoia. It's a growing concern with gas prices well above $3 a gallon and rising.

JIM MCQUADE, CAR SHOPPER: If it hits like $4.50, $5, I'll definitely get rid of the truck no, matter what. And I'll just take whatever I can afford at the time that gets the best gas mileage.

CHERNOFF: The comforts of a virtual living room on wheels are still appealing. But for many Americans, it's time to get real, soaring gas prices and an unstable economy is a toxic mix for the wallet.

KEVIN SMITH, EDMUNDS.COM: It's become real easy for consumers to say, I really need a smaller car, something more efficient. I can get along in something not quite as big as I use to have.

CHERNOFF: At the New York Auto Show fuel efficiency is making cars nearly as sexy as the eight seaters that ruled the road in the days of $2 gas. Automakers are well aware that Americans are moving away from gas guzzlers towards plain old vehicles but Detroit has a bit of a problem with that.

You see there's not a lot of profit in a $20,000 car. So automakers still offer plenty of big vehicles and lots of luxury for which they can charge premium prices. The fact is, America remains a truck-loving nation, like trucks and SUVs, still out sell cars according to Edmunds.com but it's the smaller trucks and SUVs that increasingly are in demand.

DAVID CHAMPION, "CONSUMER REPORTS": In used vehicles, there's going to be a gulch (ph) of these large, very thirsty SUVs on the marketplace that are going to be worth nothing.

CHERNOFF: In two vehicle families it's often the SUVs that collect dust in the garage.

MILDRED JIMENEZ, CAR SHOPPER: It takes almost $50 to fill up the tank. So that -- that's becoming heavy on my pocket.

CHERNOFF: Which means the old reliable car is often becoming the workhorse for families trying to save in this tough economy.

Allan Chernoff, CNN, New York.

(END VIDEOTAPE)

COLLINS: Keep watching CNN, our money team has your covered, whether its jobs, debt, housing, savings, or those gas prices. Just join us for our special report all week long called "ISSUE #1: THE ECONOMY," noon Eastern, only on CNN.

HARRIS: In Pakistan, former aide to assassinated opposition leader Benazir Bhutto will take over as prime minister. Yousaf Raza Gilani will be sworn in tomorrow. President Pervez Musharraf will issue the oath of office. His party's candidate for prime minister lost in a landslide.

COLLINS: The Olympic torch is lit. A controversy smolders at today's lighting ceremony in Greece. Two demonstrators ran on to the field. One managed to run behind an organizer of Beijing's upcoming summer games. The Human Rights Group reporters without borders were protesting China's human rights record and specifically its iron system rule of Tibet.

Once the torch was lit, protesters again popped up along the route that begins the journey to Beijing. Protesters chanted, free Tibet and shame on China. China hopes to prevent similar embarrassments when the torch arrives there.

HARRIS: Battered by Katrina, now nearly three years later a New Orleans church congregation slowly getting back on its feet. That story is still ahead.

COLLINS: But first, dreaming about walking away from your job and doing whatever you want?

Yes, Christine Romans is right on your money with advice on retiring early.

(BEGIN VIDEOTAPE)

CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): Allen Castro enjoys his vegetable garden. It's a passion in his early retirement.

ALLEN CASTRO, RETIRED IN HIS 40'S: Only have to cook them. They're good.

ROMANS: While in college, Castro and a friend cooked up a business reselling textbooks.

CASTRO: Books were going into landfills. We were taking those books away from the landfill and reselling those. We started basically growing whole industry from that.

ROMANS: The Company grew and last year a competitor bought it, allowing Castro to retire at age 44. He says the business tapped into a niche as a one-stop shop for educators.

CASTRO: It was getting them to think like a college student to buy a used book first.

ROMANS: He also gave back, traveling to the Philippines and Kenya, donating books to villagers and helping fund a school. Giving back is one of the keys to his success. Castro says being practical and down to earth.

CASTRO: Have a good accountant. Know where you stand on paper. Don't fool yourself. Always try to do things that humble yourself.

ROMANS: Castro says if you're trying to build wealth, don't put all our eggs in one basket.

CASTRO: It's all a risk. Every time you make a dollar, you are going to invest another dollar and learning how to be disciplined not to take anything out.

ROMANS: For Castro his next chapter is still being written but he's willing to take risks to keep growing.

CASTRO: When I'm gardening, that's when my next idea will come, when I'm outside.

ROMANS: Christine Romans, CNN.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

HARRIS: Yes, time to take a look now at some of the most-clicked on videos on CNN.com. Grammy winner Tejano singer Emilio Navaira is in critical season after a blood clot removed from his brain. He was injured Sunday when his band's bus crashed near Houston, Texas.

Police still do not have a motive or suspect in the murder of a 75-year-old woman. Jane Carroll Britt was found beaten and strangled in the trunk of her car in Federal Way, Washington.

A funeral procession in Boston, Massachusetts turned into a terrifying moment when a limo in the procession crashed into a tree. At least six people were injured.

Now for more of your -- I don't want to call it favorite video. Most interesting stories and interesting pictures just go to CNN.com/mostpopular. And of course, don't forget to take us with you anywhere on your iPod.

The CNN daily "Newsroom" pod cast. See the stories that will have you talking. The "CNN Newsroom" pod cast available to you 24/7 isn't that nice and fancy on your ipod.

COLLINS: New signs of progress in hurricane-battered New Orleans. For the first time since Katrina hit, the city two-and-a-half years ago worshippers scattered by the storm came together for Easter services at their damaged church.

Jennifer Van Vrancken, of our affiliate WVUE, reports. (BEGIN VIDEOTAPE)

JENNIFER VAN VRANCKEN, WVUE CORRESPONDENT (voice-over): Church members at Union Bethel A.M.E. sang out with double the joy at Easter Sunday services.

BARBARA ANN RILEY, CHURCH MEMBER: This is such a wonderful, glorious day. It's a day of the resurrection of our lord Jesus Christ. Not only is that, it's such a significant meaning to me personally because I'm in the church of my birth.

VAN VRANCKEN: It is a rebirth for this church. Batter so brutally by hurricane Katrina, its members scattered to the wind.

CATHERINE BROWN, CHURCH MEMBER: I am now living in Franklin, Louisiana, it is about 70 miles on the north shore of Lake Ponchartrain.

VAN VRANCKEN: This is the first time Catherine Brown and others who used to attend services here have gathered since the storm.

BROWN: You know the churches in the heart and all churches are god's churches. So, you know, it doesn't really make that much difference what structure you worship in. But I've been a member of this church for over 40 years and I miss my church.

VAN VRANCKEN: Since the structure doesn't matter, church members didn't let it dim their spirits that they had to worship by dim lighting. Thieves who stole copper from the fellowship hall also wreaked havoc on the lighting system.

REV. THOMAS BROWN JR, UNION BETHEL A.M.E. CHURCH: We have a generator and all of the cords and the electricity that goes with it, lighting it, you know, that's how we're getting our light. Plus, the god-given light. We decided that we weren't going to let the devil beat us to the punch.

VAN VRANCKEN: Pastor Thomas Brown, like so many in his flock, travels back and forth to New Orleans from Baton Rouge. He knows it may take time to find the $5 million needed to fix the sanctuary still in disrepair, but he also knows that is what faith is all about.

T. BROWN: We are operating in the spirit of faith, believing that nothing is impossible with god, that all things are possible. So today is a special day for us. It does, you know, on this Easter Sunday, resurrection.

VAN VRANCKEN: Resurrection, restoration, and new life.

(END VIDEOTAPE)

COLLINS: The pastor says the church had $3 million in insurance coverage but he never imagined they would have a catastrophe that would exceed that amount.

HARRIS: More pain at the pump but investors smiling this morning. A decent housing number to report. Your money, it is issue No. 1 in the NEWSROOM.

(COMMERCIAL BREAK)

COLLINS: The next frontier in the housing slump may be the condominium market. Susan Lisovicz is at the New York Stock Exchange with details on this.

Susan, there's more?

SUSAN LISOVICZ, CNN CORRESPONDENT: Oh, there's more.

It's a big story. We're going tell it to you every single day, Heidi. We told you about an encouraging report on existing home sells. The biggest part of the housing market which rose for the first time in seven months. That's just very encouraging news. But there are still signs of trouble if you dig beneath the surface.

First month sales increased. Prices dropped eight percent from a year earlier. That's the biggest drop on record. So people are lowering the sale price until homes move. There's no telling how far prices will fall to move the inventory on the market.

Another issue is a looming condo glut. At the height of the housing boom, developers started construction of condos at a great pace. Everyone wanted a piece of the action. Some of those projects will soon be completed despite a glut of unsold condos already on the market. They're expected to be 4,000 new units in both Atlanta and Phoenix this year. And 10,000 in Miami and Ft. Lauderdale, in Florida, as we all know already has a huge problem with a glut of condos.

The "Wall Street Journal" says this could be bad news for cities that avoided the housing bust like Atlanta and Dallas. Builders are financed by regional banks which puts pressure on them, too. So don't uncork the champagne just yet.

COLLINS: I don't think anybody is doing that quite yet. I wish we could. Investors have to be very happy with these home sales numbers it is a pretty big surprise.

LISOVICZ: That's right. They were better than expected. And so, you know, we'd like to see, I think everybody would like to see more consistency in that.

But the other headline of the day is a reworked deal for Bear Stearns. JPMorgan boosted its bid for Bear to $10 a share. That's way up from the $2 a share fire sell price announced last week. Bear Stearns shares right now are soaring 124 percent. Trading at $13.31 which is above the price that JPMorgan said it would up the bid to.

And that's helping the financials, check out the Dow, 231. Let's make it 241 point increase. The Nasdaq is up 2.8 percent. Dow is up two percent. S&P is up two percent. Go have a big lavish lunch, Heidi. And Tony, a treat Tony today. Go treat Tony, live large.

COLLINS: He's buying the champagne though.

LISOVICZ: All right.

COLLINS: Susan Lisovicz, sparkling water.

LISOVICZ: That, too.

COLLINS: Thanks, Susan.

HARRIS: We want to get to our senior legal analyst Jeffrey Toobin. He is on the line with us right now to talk about the indictment, the 12-count complaint filed today by the Wayne County prosecutor against Detroit's Mayor Kwame Kilpatrick.

And Jeffrey, that is quite a sweeping indictment. Some of the charges to be faced by Kwame Kilpatrick alone. Others to be faced by the woman he had this relationship at one time, chief of staff Christine Beatty. Boy, a lot of counts here of obstruction of justice and the one thing we certainly know at this point from the Scooter Libby trial, boy, the legal system takes a dim view of lying on the witness stand.

VOICE OF JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: I'll say. And just viewers may be a little confused because there have been so many sex scandals lately. This one is filed under "K" for Kilpatrick.

HARRIS: Very good Jeffrey, very good.

TOOBIN: Because it's hard to keep them straight. The gist here is that this is more simply than just lying about a sexual relationship that is pretty clearly indicated from text messages between the mayor and his former chief of staff. The reason this case is so important is that these text messages came to light in the course of a lawsuit against the city by some whistle-blowers.

Rather than disclose the text messages, the city paid millions of dollars in damages to these whistle-blowers so the accusation is they used taxpayer money to keep their affair secret by paying off these plaintiffs. That's why this case transcends simply unsavory relationship between a subordinate and a superior. This is a relationship according to the charges that cost taxpayers of Detroit a great deal of money.

HARRIS: Because the other interesting point in this is that the two whistle-blowers are former police officers there in Detroit. And part of what they were alleging is that there was some collusion, some work going on here to get them ousted from their positions and there was at least some indication in the text messages, maybe not that the chief of staff and Kwame Kilpatrick had worked together to force the ouster of these police officers, but at least had talked about the subject.

TOOBIN: Certainly. And again, it is the intersection of the sexual relationship which is, of course, what everyone focuses on because we're all human and that's interesting to us. But it is the intersection of that relationship with the lawsuit that really elevates this case beyond a simply embarrassing matter for these people and their families. And why the "Detroit Free Press" which has been the initiator of all of the requests for these text messages has pushed it so hard and why they keep winning. And this isn't even the end potentially of Kwame Kilpatrick's problems because he is under investigation for other financial improprieties by both the Wayne County prosecutor who filed this case as well as the U.S. Attorney's office in Detroit which has its own investigation.

HARRIS: And one point on this, Jeffrey, if it was just about lying on the witness stand about the sexual relationship, what do you think, would we be where we are today or is it the fact that they seem to be lying about what you are getting to, which is a material fact bearing on the case itself?

TOOBIN: Well, I think Kilpatrick would be in terrific political trouble alone if it was simply about lying about having a relationship with his former chief of staff. That's a big deal.

HARRIS: Which means he's in trouble. He was in trouble anyway.

TOOBIN: Right. I think the fact that it has a significant financial dimension makes it a clearly criminal problem, as well as a political problem. And I think it's going to be very tough for Kilpatrick to survive in office even though he hasn't been convicted yet. Standing accused of these very serious crimes, being under indictment, that's hard to stay as mayor of a big city.

HARRIS: Well it is a sweeping indictment, 12 counts in all. Jeffrey Toobin on the line with us, Jeffrey as always great to talk to you.

TOOBIN: Thanks Tony.

HARRIS: I should mention now that Kwame Kilpatrick, the mayor of Detroit has scheduled a news conference at the top of the hour. We will, of course, monitor that news conference for you.

COLLINS: Keep watching CNN for another story. In fact our money team has you covered, whether it's jobs, debt, housing or savings you can join us for a special report. We did this last week, got some great response. We want to do it again this week for you called "ISSUE #1: THE ECONOMY." Coming your way top of the hour.

(COMMERCIAL BREAK)

COLLINS: Vice President Dick Cheney halfway around the world trying to build diplomatic bridges with Washington. This morning he arrived in Turkey to shore up White House relations with a key U.S. ally. His trip comes amid heightened attentions. Turkey has been striking at Kurdish rebels across the border in northern Iraq. Some in Washington fear that could destabilize Baghdad, U.S.-backed government.

Over the past couple of days the vice president met separately with Israeli and Palestinian leaders. He says the militant group Hamas is trying to torpedo a lasting peace between the two groups. We'll keep our eye on the vice president's trip for you there.

CNN NEWSROOM continues one hour from now.

HARRIS: "ISSUE #1" is next with Ali Velshi and Gerri Willis.

I'm Tony Harris.

COLLINS: I'm Heidi Collins. Have a good Monday everybody.

(COMMERCIAL BREAK)

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