Return to Transcripts main page

CNN Newsroom

Obama Meets with Top Officials in Iraq; Gas Prices Decline for Fourth Straight Day; Tropical Storm Dolly Picks up Strength

Aired July 21, 2008 - 10:00   ET


TONY HARRIS, CNN ANCHOR: Happening right now in Iraq, presidential candidate Barack Obama talking with top leaders about progress and plans for the country. He is part of a congressional delegation, but he is getting a lot of attention on this trip as potential president.
Our Morgan Neill is in Baghdad. Our Jessica Yellin is on the story for us from Washington.

And Morgan, let's start with you.

Has Senator Obama met with the CENTCOM commander, General David Petraeus, yet?

MORGAN NEILL, CNN CORRESPONDENT: We have not heard about that meeting yet, though it is one of the meetings we do expect to see take place.

The most recent we have seen is between Senator Obama and Iraqi Prime Minister Nuri al-Maliki. That just happened a short time ago. Surprisingly, though, Baghdad wasn't the first stop for Obama and the congressional delegation. That was in the southern city of Basra where Senator Obama met with Iraqi, British and U.S. military commanders.

Then he came here to Baghdad. He met with the Iraqi Prime Minister, a Shia. He has met with the Iraqi president, Talibani, a Kurd. We're hearing that he's meeting with the vice president al- Hashimi, a Sunni.

So covering all his bases, really, and we are also, like I say expecting him to meet with General David Petraeus and hear about security improvements throughout the country and he will also likely hear the mantra that those security improvements are fragile but reversible.

Now, as far as Iraqis, of course, Senator Obama and the other senators on this trip won't get a chance to meet with very many regular Iraqis. But they do have a divided opinion here as does the government at times. On one hand, they'd like to see a normalization of their country, which would mean the removal of foreign troops. On the other hand, they are very afraid that violence could return if that does happened too quickly -- Tony.

HARRIS: And Morgan, do we have any idea yet of the substance of the conversation between Obama and al-Maliki this morning? NEILL: Well, what we heard from the Prime Minister's office was that Senator Obama praised Prime Minister Maliki's leadership. He says that is he a supporter of the government of Iraq but he also said that the government needed to make more progress on some key legislative issues, prime among them, a law to govern the distribution of Iraq's oil wealth and a law governing upcoming elections -- Tony.

HARRIS: OK. Morgan Neill for us in Baghdad.

Morgan, thank you.

HEIDI COLLINS, CNN ANCHOR: He's not in charge but he sure wants to be. Barack Obama talking about what he will do in Iraq and Afghanistan and if he wins the White House. How's that playing in Washington?

Jessica Yellin has all the answers.

Jessica, it's obviously a politically important trip. The thoughts in Washington and House going so far?

JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: So far, so good. Even before Barack Obama got to Iraq, Prime Minister Nuri al- Maliki. You just saw him in that picture with Obama there.

Nuri al-Maliki gave an interview to a German magazine essentially endorsing Barack Obama's plan to get troops out of Iraq in 16 months. Now, this came while Obama was in Afghanistan meeting with Hamid Karzai. But I can tell you that quickly that the Obama campaign and others seen this or as a very helpful boost to his message. His intent over there which is to have this experience meeting with generals, listening to the people on the ground, and finding evidence to support his position.

Maliki has since had contact with the Bush administration and try to walk back his position a little bit. But the cat is out of the bag at this point. And it really does help to boost Barack Obama's credibility on this issue when there's support for it overseas.

This comes also as Obama, as you'll recall, Heidi, endorsed the idea of diplomatic talks with Iran and more troops in Afghanistan. Well, now the Bush administration has sent an envoy who just had talk with the multilateral contacts but with Iran. And there's talk of the need to send more troops to Afghanistan.

So, Barack Obama seems to be hitting all the right notes right at this very moment. The world events seem to be falling into place to support his message. It's going well for him, at least so far -- Heidi.

COLLINS: Yes. And there are critics though who, of course, will, I'm sure you're aware, will say one day what's he really going to see, what's he really going to learn about the troop contact of what's happening, particularly regarding the troop surge.

YELLIN: Absolutely. And the McCain campaign is hitting this note hard.

They are emphatic about the need for any withdrawal to be condition-based. That they say that the Obama campaign and reporters will be taking Maliki out of context. Nuri al-Maliki if they say that he endorsed Barack Obama's plan because he has since issued a sort of an amended statement and they say that Barack Obama really doesn't have the experience, the background to be making sort of the pronouncements that he has made so far and what he really needs to do is listen before he insists on sticking with these policy positions that he's been so emphatic about. So the McCain campaign pushing back hard saying they're glad it's over there but he needs to listen rather than make pronouncements.

COLLINS: All right. Jessica Yellin coming to us from Washington this morning.

Thank you, Jessica.

HARRIS: Well Barack Obama's Republican challenger says he is happy his opponent is in Iran, John McCain talking about it this morning, says the trip will give Obama a chance to assess the so- called troop surge.


SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: I'm glad that Senator Obama is getting a chance for the first time to sit down with General David Petraeus and understand what the surge was all about, why it succeeded and why we are winning the war and that is because we carried out a strategy, which has succeeded and Senator Obama rallied against, voted against, and used his opposition to the surge as a way of gaining the nomination of his party. I hope he will have a chance to admit that he badly misjudged the situation and he was wrong when he said that the surge wouldn't work.


COLLINS: Meanwhile, nuclear talks with Iran going nowhere. That is the reaction of Secretary of State Condoleezza Rice saying Iran's chief nuclear negotiator did not take weekend talks with the European Union seriously. For the first time, a U.S. diplomat was at the table.

Before those talks broke up, Rice told CNN's Wolf Blitzer that time is running out.


CONDOLEEZZA RICE, SECRETARY OF STATE: The world is sending Iran a message on both tracks. First of all, there are consequences for continuing to defy the will of the international community, continued economic isolation, continued isolation that is leading to an ever worsening economic situation in Iran and on the other hand, a pathway out, suspend and negotiate.

(END VIDEO CLIP) COLLINS: Rice says Iran has two weeks to respond to nuclear proposals put forth at that meeting.

HARRIS: Right now, Navy and Coast Guard teams are searching for the crew of a B-52 that crashed today at the Pacific Ocean, off Guam. The plane went down about 30 miles northeast of the island. A military spokesman said they've located an oil slick but so far the wreckage. The Air Force bomber and its six-member crew are based in Barksdale Air Force Base in Louisiana.

COLLINS: A first of its kind trial underway at Guantanamo Bay, Cuba. Salim Hamden pleading not guilty this morning. He is facing war crimes charges. The government says Hamden was a member of Al Qaeda and even served as Osama bin Laden's driver. He is the first Guantanamo detainee to be tried under new military commission rules. You may remember, the commission's parameters were changed after a 2006 ruling by the Supreme Court. Because of that ruling, detainees are now allowed to challenge the charges.

HARRIS: And just in to the CNN NEWSROOM, someone has apparently opened fire on emergency crews as they responded to a vehicle fire in suburban St. Louis. This all began around dawn in Maple Wood, Missouri. CNN affiliate KSDK says police have confirmed that at least three emergency workers are injured. The house is now ablaze and it is surrounded by police officers armed with rifles. We are trying to sort through the details and we will bring you the latest as we gather additional information.

COLLINS: A trio of storms, one a possible threat to land. Tropical Storm Dolly now moving over Mexico's Yucatan Peninsula and is headed into the Gulf of Mexico and could become a hurricane by tomorrow. It's now on track to make landfall later this week near the Texas-Mexico border. You can see the path there looping wide.

Tropical Storm Cristobal threatened the North Carolina coast yesterday but then turned away from land. Storm warnings for the Carolina coast were then lifted last night. And Hurricane Fausto in the Pacific, about 400 miles off Mexico, not a threat to land.

So at this point, I guess, Reynolds Wolf, two out of three is not so bad?

REYNOLDS WOLF, CNN METEOROLOGIST: We'll take whatever nature will give us.


WOLF: You know.

COLLINS: Because we have no choice.

WOLF: Absolutely. Anytime, just think positive to say to say about these storms like Fausto, no threat to land. It's always a key thing. With Dolly, it really stands out. As the sheer size of this storm, if you take a look at just the inflow to the west and also to the east, this thing is wider than the state of Texas and currently we have some of those scattered showers moving through downtown Havana in Cuba. Now, the center of the storm moving off of the Yucatan Peninsula and back into the Gulf of Mexico.

Currently the winds, with maximum sustained winds right around 50, gusting to 65. The storm is about 626 miles from Brownsville, Texas. The storm is expected to move deeper into the Gulf of Mexico over the next couple of hours. As it gets through the afternoon, winds are expected to increase to 60 miles an hour, then 65 miles per hour veering to the west-northwest by 2:00 a.m. on Tuesday. And by 2:00 p.m. Tuesday, winds at 75 as a category one storm.

Keep in mind, though very quickly, with these storm systems, they can be very, very fickle. In 2004, with Hurricane Charley that cross parts of Cuba made its way towards Tampa. All computer models were indicating that it would go right into Tampa Bay but it made a very quick and unexpected turn into Punta Gorda and then zipped right across parts of I-4 corridor. So these storms can wobble. They can move in a very unexpected direction.

In terms of intensity, I'll bring you back to 2005 with Hurricane Wilma. It gained incredible strength in less than 24 hours. So, this is the potential that even though the forecast calls for a category 1, the storm can get much stronger very quickly.

Right now, we've got some video for you. Out of Cancun, you see the wave action. Waves coming in sets of three, four times. It's coming in. A lot of white waters coming across the coast there. We're also going to take you a bit to the north, to the other side of the Gulf of Mexico back over to New Orleans.

Is there a chance that New Orleans could be affected by the storm? Right now, anything is possible. It's very early.

This shot compliments of WWL in New Orleans. You can see very hazy conditions there. The Superdome on the left-hand side of the screen. We're going to keep an eye on New Orleans as well as every community along the Gulf Coast. It's going to be an interesting time to watch as the storm ventures back down to the Gulf of Mexico.

The other storm we're keeping a sharp eye on will be this one. Cristobal. Whatever you want to call it, it's moving away. Right now, off of Cape Hatteras. It's going to bring some heavy surf action to many spots along the eastern seaboard, including the Jersey shoreline, even Long Island. Keep in mind, we're expecting intense heat for places like Philadelphia, for New York.

Many people may be seeking a little bit of comfort by going out to the coast and swimming. If you're not an experienced swimmer, not a strong swimmer, you might want to avoid getting to the water because these rip currents can knock you of your feet and pull you out into deep water. It's a place where you don't want to be with these rough surf conditions.

COLLINS: Yes, no question. All right. Reynolds, thank you.

WOLF: You bet, guys. HARRIS: You know, we've made the switch. Now, it is costing them less than five bucks to travel 300 miles. How these do it yourselfers did and maybe you'll want to do it, too.


HARRIS: Well, you know, we've been watching Barack Obama's visit to Iraq. What about John McCain's time there?

Here is CNN's Jonathan Mann.


JONATHAN MANN, CNN CORRESPONDENT (voice-over): This may have been John McCain's most famous visit to Iraq. A walk through Baghdad's Central Market on April 1st last year. McCain said that the stroll proved that Iraq was getting safer.

MCCAIN: I've been here many years, many times over the years. Never have I been able to drive from the airport. Never have I been able to go out into the city as I was today.

MANN: Some Iraqis and Americans suggested that he was able to go out because he was protected by more than 100 soldiers and attack helicopters patrolling overhead. From the outset, John McCain has consistently looked forward to victory in Iraq. The U.S. first invaded and even after the occupation turned bloody, he supported the Bush's administration's goals. He did not support the way it fought the war, openly calling for more troops long before the administration announced its troop surge.

Now McCain says the surge has succeeded and it's proved something.

MCCAIN: In wartime, judgment and experience matters. They matter. In time of war, the commander in chief doesn't get a learning curve. If I have that privilege, I will bring to the job many years of military and political experience, experience that gave me the judgment necessary to make the right call in Iraq a year and a half ago.

MANN: McCain says the right call now is to keep U.S. troops in Iraq until the Iraqi forces can safeguard the country themselves. He says it's best for the United States but something more as well. McCain says that it's a moral obligation.

Jonathan Mann, CNN, Atlanta.


HARRIS: You can check out all of our political news and ticker. It's right there for you at, your source for all things political.

COLLINS: Your money, issue No. 1 for you and for us. We are watching Wall Street, which rang in the new trading hour. Just last hour, we're still up some positive 30 points, Dow Industrial Averages. Well, how would investors follow Friday's volatile session? There's your live look as we just said.

Some good news is trickling out of the gas pump. AAA reports the national average price for gasoline at about at $4.07 a gallon this morning. That's a one-day drop of 0.08 of a cent. The fourth consecutive decline. Oil though is inching up again today after last week's steep slide of about $18 a barrel.

A mixed view of the economy from Treasury Secretary Henry Paulson. He says that hard times will last for months but the nation's banking system is safe.

HARRIS: Well, you go to meet some motorists here who don't need to shop around for the best gas prices. They've made the switch to electric.

CNN's Thelma Gutierrez reports.


THELMA GUTIERREZ, CNN CORRESPONDENT (voice-over): It was supposed to be the great electric hope.

UNIDENTIFIED FEMALE: The electric car is here.

GUTIERREZ: GM's EV1 that went away about as quickly as it came. If Detroit was going to build an electric car ...

UNIDENTIFIED MALE: It's just different components being used in the car.

GUTIERREZ: ... average Americans would, people like this Lefteris Padavos, a professional photographer, who converted his '71 9-14 (ph) Porsche, Daniel Talosi, an electric engineer whose Ford station wagon is now all electric, and Greg Connick (ph), a web designer who turned his '95 Honda Del Sol convertible into an electric sports car.

UNIDENTIFIED MALE: Oh, it's a blast to drive.

GUTIERREZ: They are do it your-selfers who basically taught themselves how to convert gas cars to all electric.

LEFTERIS PADAVOS, BUILT ELECTRIC CAR: This is not rocket science. What I tell people, what you see here is available, existing technology. This is off the shelf stuff.

GUTIERREZ: The cost, about $8,000. And you can forget any storage space. That goes to the battery.

PADAVOS: The first thing that needs to come out would be the gasoline engine, as well as the radiator and the muffler.

GUTIERREZ: He has eight batteries under the hood and 14 others in the trunk. The car's range, 70 miles between charges. It takes about three hours to charge the car.

PADAVOS: It's costing us about 1.6 cents per mile.

GUTIERREZ: When you add it up, Lefteris says that's about 300 miles for under 5 bucks. And he has no complaints about performance.

Each month, the Electric Vehicle Association of Southern California meets to compare cars and notes.

PAUL SCOTT, ELECTRIC VEHICLE ASSN. OF SO. CALIF.: It's the only way to drive. Electricity instead of oil, much better. It's all domestic. It's clean.

GUTIERREZ: With gas prices now above $4 a gallon, these drivers are trying to send that message to automakers scrambling to come up with fuel-efficient vehicles. For Leftaris, it's all about freedom.

(on camera): When is the last time that you actually cared about the price of gas?

PADAVOS: I can't remember. I don't look. In our group, we call it passing gas.

GUTIERREZ (voice-over): Thelma Gutierrez, CNN, Los Angeles.


COLLINS: I want to show you some cool pictures here, President Bush, the first event on his schedule today. With the United States Olympic team, how about this is happening in the Rose Garden. This is the team before they actually head to China, Beijing as you know, that's about 10:05, which means that that's already happened. I believe that would be eastern time. that means they have to fly to the east coast. So that has already happened on their way to the airport for the big games to begin on August 8th.

You can see familiar faces in that crowd, and wishing them all the very best of luck. Lots of gold medals.

COLLINS: Paper or plastic, how some people are saving a few bucks when they fill up at the gas station.


HARRIS: We're going to have another jumpy day for stocks today. We were just before hitting the air here, we were just up what marginally up. Eight and just like that up 26 points. Trying to figure out if we received the latest information that we were getting a report of leading economic indicators. That was supposed to hit at about 10:00 a.m. Eastern time. Maybe we have some result there. Maybe I'll send a note to Susan Lisovicz or talk to here in just a couple of minutes here.

Checking out the market's reaction as well to the second quarter earnings of the Bank of America but as you can see inside the first hour of the training days, we are up 25 points. COLLINS: Paper or plastic? No longer just a choice at the supermarket. You may face that question at your corner gas station.

CNN's Jim Acosta explains.


UNIDENTIFIED FEMALE: Regular, fill it up, cash.

JIM ACOSTA, CNN CORRESPONDENT (voice-over): Better stop at ATM before pulling into this gas station in New Jersey.

PAUL KELLY, SUNOCO GAS STATION OWNER: What we're trying to do now is give our customers a savings.

ACOSTA: That's because the owner, Paul Kelly, is offering a big 10 cents discount to drivers carrying cash. He's tired of being charged a fee by the credit card companies every time a customer pays with plastic.

KELLY: If we pay 3 percent on average, or even a little less than that on a credit card fee at $4 a gallon and I'm making $0.12 a gallon. That's my entire profit.

ACOSTA: On a gas purchase totaling $100, roughly $3 would go to the credit card company, depending on the card.

SAL RISALVATO, N.J. GAS CONVENIENCE & AUTO ASSN.: The world is fixated on the oil companies, the price of oil, the price of gasoline. And while everybody is fixated on that, the credit card companies are quietly laughing all the way to the bank.

ACOSTA: Sal Risalvato who represents gas stations across New Jersey says the so-called interchange fees can be crushing.

UNIDENTIFIED MALE: Many dealers cannot stay in business any longer.

ACOSTA (on-camera): According to one trade publication, nationwide, nearly 3,000 gas stations have closed in the last year. This one on the Jersey shore won't even reopen. The land is being offered up for townhouses.

(voice-over): The credit card company's response, don't blame us. In a statement, an industry spokesman says "the oil companies restrict what the gas station owners can charge per gallon. The oil companies are squeezing them." Still, late last month, Visa announced it was lowering its fees on fuel purchases.

(on camera): Every little bit helps these days?

UNIDENTIFIED MALE: You've got to save every dollar you can.

ACOSTA (voice-over): Back at the gas station, we found that cash discount got some customers revved up. But one man who didn't read the sign paid the price, as in the credit price. (on camera): You're now having to pay 10 cents more a gallon because you swiped your credit card.

UNIDENTIFIED MALE: Yes. I don't think that's fair. It's a matter of survival for us.

ACOSTA (voice-over): Last year alone, convenience stores paid $7.6 billion in credit card fees. So what's happening at the nation's gas stations may spread to other retailers, putting a whole new premium on plastic.

Jim Acosta, CNN, New Jersey.


HARRIS: And time to take a look at some of those clicked on videos at our Web site, What a sad story over the weekend. A mother's wedding day turns tragic when her 4-year-old son died after being left in an SUV. The boy was left in the car while the mother went into a salon to get her nails done, to get ready for the wedding and the initial reporting was that the mom -- the boy may have actually snuck into the car without the mom knowing it.

HARRIS: And many of you watched our interview with Director James Frost in how he created the new cutting-edge music video for the band Radiohead. The video for the song "House of Cards" was made without cameras.

And watch out for that deer. A 13-year-old boy out of New Jersey was hit not by a car but a deer. He was crossing the street when the deer ran into him. Now, for more of your favorite video, just go to popular. And of course, don't forget, you can take us with you anywhere with the CNN daily podcasts. Just go to and click on podcast.

COLLINS: Market momentum. Will the new week start off as well as the old one ended. We are watching Wall Street and oil prices.


COLLINS: Welcome back, everybody. I'm Heidi Collins.

HARRIS: And I'm Tony Harris.

Let's talk extreme weather for a bit here. And a potential hurricane brewing in the Caribbean, named Dolly. Residents of the south Texas coast preparing for the storm. Right now, Dolly is crossing Mexico's Yucatan Peninsula, as a tropical storm. But forecasters expect it to become a hurricane when it re-enters the Gulf of Mexico. As you can imagine, plywood flying off store shelves at do-it-yourself stores.


FRED BALLINGER, STORE MANAGER: And we were set up out front here, with our plywood. And we just had a big, long line. And people were coming in at the last minute. And we had plenty of plywood. But, like I said, eventually we got to close the store and board up just like anybody else.

RACHEL O'NEAL, PREPARING FOR DOLLY: We've just been ready. But mostly I think, the water and having gasoline and things like that are very important.


HARRIS: And right now, forecasters believe Dolly will make landfall Wednesday or Thursday.


COLLINS: Even though they are rising a bit today, oil prices are sharply lower than they were just one week ago. Who can you thank for the oil prices heading the south? Well, perhaps our neighbor to the south, Mexico.'s Poppy Harlow has our Energy Fix now, from New York.

Hi there, Poppy.

POPPY HARLOW, CNNMONEY.COM: Hey, there Heidi. Good morning.

Well, when you think of all of the countries that can affect the price of oil, Mexico is probably not the first country that pops into your head, right? But a story by our very own's Steve Hargreaves says, Mexico may have played a very big role in the recent decline in oil prices. That's because a source says Mexico, which is the world's fifth largest oil producer, hedged the sale price of oil. So, what does that mean?

You may have heard about airlines hedging on fuel prices or buying tomorrow's jet fuel at today's prices. They do it to protect against oil prices going up. Mexico's doing the same thing right now, but in reverse. They're locking in today's sales price just in case the price of oil goes down at a later date. Remember, the price of oil last week dropped $16 a barrel. In other words, Mexico probably thinks $140 oil was a good price, where it can make a lot of money. It decided to lock in that price just in case, Heidi, oil prices fall further down the road.

Pretty interesting, huh?

COLLINS: Yes. But I'm sure there are probably people wondering, how this all makes the price go down for us?

HARLOW: Yes, exactly. It's very complex. We wanted to break it down and explain all of the factors that go into it here.

Because Mexico had essentially placed a bet, the prices has peaked. That's what's going on. That news has raised some eyebrows. We've heard about speculators driving up the price of oil, but you have to remember they can just as easily drive the price of oil lower. And it has a bandwagon effect, really.

If Mexico thinks the price of oil has hit a peak, perhaps other oil-producing countries will as well. So far, we haven't seen any signs that large producers like, Saudi Arabia, are making a similar move. But, Heidi, if they do, you can bet you'll really see the price of oil fall and that would be a huge energy fix for all of us.

Of course, right now it's hard to celebrate oil. Right now we're just around $130 a barrel. It's hard to cheer about that. But at least it's a move in the right direction. And we have some good stuff on our site, some more Energy Fixes. If you want to beat $4 gas, we have a look at the 10 best places to beat the gas crunch.

So, a little bit of hope out there right now. But still around $130 bucks this morning -- Heidi.

COLLINS: Yes. 10 best and blessed. We'll take both.

All right. --'s Poppy Harlow. I'm going to get that right one of these times.

HARLOW: It's a mouthful, I know.

COLLINS: Thanks, Poppy.

HARRIS: You know, we found out about an hour ago that Barack Obama met this morning, with Iraq's prime minister. We're getting a new video right now of the senator's meeting with Iraqi President Jalal Talabani, earlier.

Obama also met with Prime Minister, Nuri al-Maliki. Obama praised al-Malaki's leadership but said that government needs to get election in oil revenue laws passed. Obama's on a trip to Iraq, Afghanistan and elsewhere. With the congressional delegation, he visited troops in Kuwait on Friday and had breakfast in mess hall in Afghanistan on Sunday. Obama will also visit Jordan, Israel, the West Bank and make a couple of stops in Europe, as well.

COLLINS: The money and the message. John McCain's focus this morning, in Maine. He is meeting with the president's father today in Kennebunkport. Besides talking with George H. W. Bush, McCain's got a couple of private receptions. He will also go to a picnic at the Marine Military Museum.

Well, he's a pal of a would-be president. And last night Rudy Giuliani was just hanging out with his friend, Senator John McCain. They took in a Yankee's game in New York. And Giuliani took the opportunity to share some of the reasons why he thinks McCain should win the White House.


RUDY GIULIANI (R), FORMER PRES. CANDIDATE: I think if you look at Senator McCain's record on Iraq, I don't see how you fail -- you don't fail to elect him president. I mean, he was right about Iraq when almost everybody else was wrong. It's turned out that if he had caved in the way that Barack Obama and the other press wanted him to do, we'd now have a defeat. American would have a defeat, rather than a possible victory. And I think the fact that Barack Obama is kind of making his first tour, in essence of the world, gives you an indication that John McCain is the man with the experience.


COLLINS: Giuliani also said he's not worried about speculation that he could be McCain's pick for running mate.

HARRIS: Planning for Iraq's future. The government buoyed by recent successes, now getting tougher with the U.S.

But as CNN's Frederik Pleitgen reports, there are still many holes to fill.


FREDERIK PLEITGEN, CNN CORRESPONDENT (voice-over): As Iraqi soldiers become more confident, their government is asking, does Iraq still need America? The Iraqi government says for now, it has decided against signing a long-term Status of Forces Agreement, or SOFA.

ALI DABBAGH, IRAQI GOVERNMENT SPOKESMAN: The SOFA creates lot of criticism against the government, as well as an objection from some of the political groups. Which it looks that it is very difficult to have a long-term presence of the military troops here in Iraq.

PLEITGEN: Now the Iraqi government says it wants a short-term deal that lays out a time line for American forces to withdraw. But what's behind the new hard line Prime Minister Nuri al-Maliki has taken in his dealings with Washington? Experts say the Iraqi government has found new confidence after military successes, combating militias in Basra and Baghdad.

PHEBE MARR, AUTHOR "MODERN HISTORY OF IRAQ": This has given, I think, the Prime Minister Maliki some popularity to draw on. But they still have a lot of problems ahead to get a cohesive, coordinated government.

PLEITGEN: Iraqi opposition leaders agree.

(on camera): How far do you think Iraq is away from being able to standing on its own two feet?

IYAD ALLAWI, IRAQ'S FORMER PRIME MINISTER: Quite, quite, quite a long way to go.

PLEITGEN (voice-over): Iyad Allawi, Iraq's former prime minister says, the Maliki government remains ineffective. And political in- fighting means important laws still have not been passed. Like legislation to distribute Iraq's oil revenues. Improving services like water and electricity. And measures aimed at reconciling warring Sunni and Shia factions.

ALLAWI: You know, after six years, we are almost at a standstill. Services at a standstill. (INAUDIBLE). Security relies heavily on the presence of the multinational forces and on the surge. Laws are not being passed.

PLEITGEN: And Allawi claims that Maliki is keeping Iraq's parliament in the dark on the negotiations with the United States. But the government says, its position is clear.

DABBAGH: Iraq (INAUDIBLE) in principles. Which is the sovereignty of the country, the high interest of the Iraqi people. This should be (INAUDIBLE).

PLEITGEN (on camera): With its increased confidence, the Iraqi's government's stubbornness is making it increasingly difficult for the U.S. to get its way, even on fundamental issues.

Fred Pleitgen, CNN, Baghdad.


COLLINS: Dealing with tough economic times for some, the answer is spending even more money.



COLLINS: Tough economic times pushing people to look for help. Not necessarily from financial experts.

CNN's Richard Roth reports.


RICHARD ROTH, CNN CORRESPONDENT: On a hot summer day, people trek to this 70-year-old grotto in the Bronx, New York, for the water. Traditionally, people believed that the water produced miracles. Now, more people are praying for peace and calm in turbulent economic times.

UNIDENTIFIED FEMALE: It's like a real drastic change with the gas prices.

ROTH: If you can't be led to these spiritual waters, more Americans are flocking to spirits themselves. Tarot card reader, Susan Levitt, in San Francisco, reports a surge in people looking for divine intervention.

SUSAN LEVITT, SPIRITUAL COUNSELOR: There are many more questions about property, real estate, do I quit my job in freelance.

ROTH: So, clients are not asking, will I ever get married?

LEVITT: Supposedly that when things are tough, the three biggest businesses are psychics, cosmetics, a woman will buy a lipstick to feel better. And luxury items, because the top three percent will still be buying their Bentley's. ROTH: Ah, Bentley's. Not everyone is suffering. If you can't afford to buy a car these days, just rent a Bentley for $3,000 a day from Beverly Hills Rent-A-Car. Showing off their exotic fleet for their new, New York agency.

GARY LERANIAN, LUXURY CAR RENTAL MANAGER: I think from a stress relaxation point, these are the toys you use when work goes bad anyway.

ROTH: For those down about the downed economy, the auction of singer James Brown's memorabilia may bitter scream, I feel good.

JEFF ALLEN, JAMES BROWN'S FORMER AGENT: All of these things have value and continue to grow in value. So, I just took my money out of the bank and reinvested it in James Brown.

ROTH: Collectibles may be the (INAUDIBLE) too.

ITSI ATKINS, AUCTION BIDDER: And anything that's great and associated with greatness will find its market. You know, it will do better than Bear Stearns.

ROTH: Richard Roth, CNN, New York.


HARRIS: Hollywood's Iraq's war. Believe it or not, it's helping American troops prepare for duty.


HARRIS: OK. We're just getting word into CNN that Zimbabwe's president, Robert Mugabe, and opposition leader, Morgan Tsvangirai, have signed an agreement -- this happening today. That paves the way for power-sharing talks. Again, this is news just into CNN, that an agreement has been signed that it is not an agreement on power- sharing, but an agreement to hold talks on power-sharing between President Mugabe and Morgan Tsvangirai's party, Movement for Democratic Change.

We are still gathering additional information on this. We'll bring an update on this story at the top of the hour right here in the CNN NEWSROOM.

COLLINS: A Baghdad neighborhood rocked by a car bomb. One Iraqi civilian was killed in the Saturday night attack, four others were wounded.

In northern Iraq, U.S. forces killed two men, both believed to be members of al Qaeda in Iraq. Another suspected terrorist was captured. Police say one of the men killed was the 16-year-old son of a local government official.

HARRIS: Getting ready to go to Iraq, soldiers training for dangerous duty with a little assist from Hollywood. CNN's Brooke Anderson has more. (BEGIN VIDEOTAPE)

BROOKE ANDERSON, CNN CORRESPONDENT (voice-over): Fierce fighting. Angry crowds.


UNIDENTIFIED GROUP: Down, down George Bush.

ANDERSON: This may look like the war in Iraq, but, in fact, these battles are being fought on U.S. soil orchestrated by the Army.

TONY GERBER, CO-DIRECTOR, "FULL BATTLE RATTLE": It seems too strange to be true that in the Mojave Desert in southern California, the Army had constructed a fake Iraq.

ANDERSON: The new documentary, "Full Battle Rattle," goes inside the National Training Center at Fort Irwin, California, where Hollywood-like sets have been erected, created faux Iraqi towns were simulated war is waged.

(on camera): The film was shot here, in the fake village of Modena Wasul (ph). Populated by Iraqi actors but real American soldiers. Put them together and you've got training meant to prepare the troops for the real thing.

(voice-over): Three-week cycles, 10 times a year, soldiers en route to Iraq live in this pretend world complete with a coffee shop, hotel, and marketplace.

(on camera): This village looks very realistic. Take this Sunni mosque, for example. But when you get a little closer, this hollow wall is one indication that not everything is as it seems.

UNIDENTIFIED MALE: It's like a big expensive army laser tag.

ANDERSON (voice-over): Lasers used instead of bullets, pyrotechnics versus real explosives, prosthetics and fake blood to resemble injuries.

GERBER: There's no amount of preparation that can prepare these young men and women for the actuality of battle, but maybe it mitigates some of the fear.

ANDERSON: The film follows not only the Americans' experiences, but the Iraqi natives who act out scenarios crafted by a team of writers.

UNIDENTIFIED MALE: Your occupation is going to be an Iraqi police officer.

ANDERSON: Nagi Moshi fled Iraq to live in America. He's been working at the training center for three years and sees the value of these exercises for soldiers.

NAGI MOSHI, IRAQI ACTOR: They make a mistake over here, they're (ph) not doing it over there because when they do it over there, they are going to cost them a lot.

ANDERSON: A sentiment shared by everyone in this simulated reality.


COLLINS: High waves, rough winds, a trio of storms. We're going to see what is threatening the U.S. mainland in just a moment.


COLLINS: Wednesday, CNN presents "Black in America," a four hour documentary examining the success and struggles 40 years after the assassination of Martin Luther King, Jr. And part of the story is told through the eyes of the Rand family.

Who are they? CNN's Soledad O'Brien has your introduction.


SOLEDAD O'BRIEN, CNN CORRESPONDENT (voice-over): It's just after midnight in Houston, Texas. And the Rand family sets out for a family reunion. At the same time, similar scenes in Dallas, New York, San Francisco, from all corners of the country.

UNIDENTIFIED FEMALE: Let's get it on the road because we are on our way to Atlanta, Georgia, for the Rand family reunion.

UNIDENTIFIED GROUP (singing): I'm going to be right on it --

O'BRIEN: Who are the Rands? They are mothers, fathers, aunts and uncles, and cousins. Theirs are stories of struggle and success.

UNIDENTIFIED MALE: When one person in this family succeeds, all of us succeed.

O'BRIEN: And when one dies, they all feel the pain.

UNIDENTIFIED FEMALE: I couldn't believe that I had lost another child.

O'BRIEN: Hundreds of miles later, they reach their final destination.


UNIDENTIFIED FEMALE: In the rain and all.

O'BRIEN: More than 300 Rands descend on the city of Atlanta.

Rain showers force the festivities inside. But it doesn't dampen their family spirit.

VALERIE CARPENTER, 4TH GENERATION RAND: I can't tell you how disappointed I am in the weather. But when God says it's going to rain, guess what? It's going to rain. O'BRIEN: Rand reunions are held every two years. It's an opportunity to celebrate and pass down a rich family heritage to the next generation.

DAVID BAXTER, 6TH GENERATION RAND: This is a manifestation of some of Dr. King's dreams happening, to be able to travel around the country, to be able to bring our kids together and show this proud, positive heritage.

UNIDENTIFIED FEMALE: We tell our children, when you have nobody, you have family.

UNIDENTIFIED MALE: (INAUDIBLE) ... and above forward. Taller people, please work your way in the back.

O'BRIEN: At every reunion, a tradition, the family portrait.

But there's a mystery surrounding the Rand family, a missing link that very few know about.


COLLINS: Examining what it's like to be black in America, CNN's Soledad O'Brien has more in an unparallel television event, Wednesday and Thursday night, 9:00 Eastern.