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New Version of Bailout Proposed; Approval Ratings of Government Leaders Reach New Lows; Piracy Flourishes Off African Coast

Aired October 01, 2008 - 13:00   ET


KYRA PHILLIPS, CNN ANCHOR: Will a new financial bailout make the grade? While Congress counts dollars and votes, we take stock of a deficit in voter confidence.
Twenty-first Century piracy. No peg legs or parrot: just rifles and speedboats, kidnappers and thieves. We've got video from the pirates themselves off the coast of Somalia.

And no, it's not Halloween, and impersonating a cow is not a crime. Rounding up the unusual suspects this hour.

Hello, everyone. I'm Kyra Phillips, live at the CNN World Headquarters in Atlanta, and you're live in the CNN NEWSROOM.

Well, if at first you don't succeed, point some fingers, twist some arms, make some changes and vote again. The banking system bailout is back, in slightly different form, and the Senate plans to vote on it sometime tonight.

Unlike the measure that flopped in the House on Monday, this one more than doubles the cap on government-insured bank deposits. It renews tax incentives for investment in renewable energy, and it shields more than 20 million households from the dreaded alternative minimum tax.

The two main presidential candidates, as well as Democratic V.P. candidate Joe Biden, plan to be on the Hill for that vote. The House reconvenes tomorrow.

And the heart of the bailout remains a bailout or a buyout or a rescue -- you just pick the term -- for institutions burdened with huge losses on mortgage-backed securities. And the price tag is still $700 billion. So will the Senate add-ons make it any easier to swallow?

CNN's Kate Bolduan is hearing all sorts of things in the hallways on Capitol Hill. She's going to tell us about the whispers.

Hey, Kate.


Well, the senators, especially Senate leaders, they seem confident. They are confident that they have the bipartisan support to push through this more -- and pass this new modified bailout bill. What we've been hearing from Senate leaders is that the vote could be between 8:30 and 9:00 tonight. That, of course, is always a fluid situation, but they really do believe that the additions, these new provisions that they've added on, really has finally allowed them to strike that very delicate balance that they think they need to get the support they want and push it through. Listen here.


SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: We will have demonstrated to the American people that we could deal with a crisis in the most difficult of times, right before an election, when the tendency to be the most partisan is the greatest.

We're in the process of setting that aside, rising to the challenge, both Democrats and Republicans, and doing what's right for the American people.

SEN. HARRY REID (D-NV), MAJORITY LEADER: I believe every part of this bill enjoys partisan support. Every part is aimed directly at the heart of our financial crisis. No one is happy about taking this dramatic and expensive step with the bailout. No one is glad we have reached this critical point.


BOLDUAN: While the Senate believes they are going to -- the senators are going to be able to pass this tonight, what we're also hearing off camera is that the Senate's decision to attach the tax provision that you talked about, Kyra, to this bailout deal, that does cause some problems for Democratic leadership in the House.

Majority Leader Steny Hoyer himself even said that he's not particularly happy about the tax provision. Why is that? Well, there is a voting bloc in the House that very strongly is against any tax bill that is not offset, that is not paid for, and this provision isn't. So it could be causing some heartburn and some troubles in the House when this goes through.

PHILLIPS: All right. Kate Bolduan on the Hill for us. Thanks so much.

Now, the banking system isn't the only thing in a very deep hole these days. Americans' opinions of their government leaders are just as low. Here's CNN special correspondent Fred Sesno.


FRANK SESNO, CNN SPECIAL CORRESPONDENT (voice-over): The crisis on Wall Street is matched only by the power vacuum in Washington. The president's voice has been ignored.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: For the financial security of every American, Congress must act.

SESNO: The treasury secretary, the Paul Revere of this crisis, has been rebuffed. He literally begged for votes.

HENRY PAULSON, TREASURY SECRETARY: I'm very disappointed in today's vote.

SESNO: Congressional leaders have failed.

UNIDENTIFIED FEMALE: The motion is not adopted.

SESNO: Republicans...

REP. JOHN BOEHNER (R-OH), MINORITY LEADER: We've put everything we had into getting the votes.

SESNO: ... and Democrats.


SESNO: But they haven't moved forward, and the presidential candidates, wanting to project leadership, have been on the sidelines.

The result: public anger, confusion and failing grades. Confidence in Congress, "F." Eighty-eight percent think Congress' bailout rejection could actually make the economy worse, according to a "Washington Post"/ABC poll.

The president's job approval, "F." Just 31 percent in the latest CNN poll think he's doing a good job.

Confidence in the economy, "F." Fifty-three percent are pessimistic.

If you've gotten grades like those, you would have gotten kicked out of school. They don't do that in Washington. They just come back for more.


PHILLIPS: Frank Sesno, I would have been grounded. No allowance for weeks.

So we've heard bailout, buyout, rescue plan. What the heck is it?

SESNO: Well, it's more than wallets (ph) in a word. It's the way they use language to frame this thing.

One of the reasons that there's so much anger and one of the reasons that I wrote that piece, Kyra, is because what leaders here in Washington have failed to do is explain clearly what this is, what's at stake and what's behind it. And so when you call it a bailout, it's different than a buyout, which is different than a rescue plan.

At this stage, for the language to be thrown around like this, the public's going to give it a giant shrug and say, "Wait a minute. Been there, done that." And they're going to judge it for themselves. There's a lot of information out there. But you're not going to hear the term bailout very much because that is a very loaded term.

PHILLIPS: All right. So they keep switching the language around, confusing everybody even more. When you look at this Senate plan and what's been added, what's been taken out, does it really just come down to something that's more politically palatable?

SESNO: Yes. There's a great degree of political palatability in all of this, to be able to go back to their members: people who have been phoning in, people who are so angry, saying, "We clipped the wings of the power of the secretary of the treasury, we built in some more protection for homeowners or for -- if you deposit money and you've got it in a bank, a little bit more protection for you there."

So right now there's some positioning. There's also some real posture, too. And one of the things that I've been hearing today, for example, is that some of these blue dog Democrats, conservative Democrats, are going to be very concerned and looking very closely at the small print here to be sure that there's a sort of pay as you go function. If you're making -- if the government is making additional commitments, that there's money to back it up.

PHILLIPS: All right. Well, in the '80s -- we were talking about this in our morning meeting. You know, the government saw a sizable return when it liquidated the savings and loans. Might we see this, the same time around?

Because if you look at the number, and I thank my writer, Jim Guthrie (ph), who found it for me. You know, it was estimated to be about $500 billion that taxpayers were going to have to suck up. It ended up only being about $120 to $140 billion, which of course, was a lot lower.

So when we hear $700 billion, could it be a lot less?

SESNO: Who knows? But you know, that is what they say. And of course, it stands to reason, if what they say is true, that these are in effect buying bad assets when the market is down. You sit on them for a while and you sell them when it's up. You know, it's what you and I do if we're smart investors, which I'm not, by the way. You know, buy low, sell high. You can actually make some money on the deal.

But the fact of the matter is that a lot of these are bad assets, and some of them may turn sour altogether. And in the meantime, you have to shell out the money. So you've got to have a kitty of maybe $500, $700 billion to shell it out. In the meantime, you don't know when you're going to get it back or, actually, what you're going to get for it.

So it's a big question mark, and that's part of the problem.

PHILLIPS: And you know what's interesting, Frank? Something else we were talking about this morning, the purchase of safes have gone up, because it's like the new mattress of 2008. Putting money under the mattress. People are taking their money out, and they're filling up safes around the country. SESNO: Well, Kyra, you know what I find amazing? I was speaking to somebody the other day. I think she was in her early 30s, maybe. And she was saying, you know, "I'm never going to have a pension. All I'm only going to have is a 401(k). And I went on and I looked at it today, and it's down 30 percent."

She's so far away from where she's going to be drawing on that money. Everybody you talk to says stay in it. Don't worry. It will pass. But that degree of anxiety, which is trickled down, if I can use the phrase, to very young people, is what's really, truly remarkable about this.

One quick point: what makes this so unique in anything I've ever seen here is that it touches so many people, so personally. Anybody who works, saves, spends or borrows is affected by this, and they're watching it closely.

PHILLIPS: Frank Sesno, always great to have you. Thanks, Frank.

SESNO: Thanks. Appreciate it.

PHILLIPS: We want to hear from you. How confident are you in the nation's leaders right now? E-mail us: We'll read your comments later in the hour.

We're also watching Wall Street, where numbers tell only half the story. The Dow sank more than 200 points this morning. Right now, Dow Industrials down 47 points. We're going to get all the ups and downs from our Susan Lisovicz at the bottom of the hour.

Now from the campaign trail, then back to Capitol Hill, John McCain and Barack Obama are getting in some campaigning today before flying back to Washington to vote on the financial bailout bill. McCain had this to say at a stop at Independence, Missouri.


SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: If we fail to act, the gears of our economy will grind to a halt. This is a moment of great testing. At such moments, there are those on both sides of this debate who will act on principle.

Of course, there are always some who think first of their own interests, who calculate their own advantage instead of rushing to the aid of their country. But in the case of this bill, I'm confident there are enough people of goodwill in both parties to see America through this crisis.


PHILLIPS: Democratic candidate Barack Obama is on the trail in Wisconsin and like McCain, the Illinois senator will also return to the Senate to vote on the bailout bill. At a stop this morning in La Crosse, Obama had this to say about the plan.

(BEGIN VIDEO CLIP) SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: It is clear, though, that this is what we have to do right now to prevent a crisis from turning into a catastrophe. That's why I've been reaching out to leaders in both parties to do whatever I can to help pass this plan. That's why I'll be flying back to Washington today to cast my vote to safeguard the American economy.

And to the Democrats -- to the Democrats and Republicans who oppose this plan, I say this. Step up to the plate. Do what's right for the country, even if it's not popular, because the time to act is now.


PHILLIPS: Now, some people questioned bill Clinton's support for Barack Obama. And today the former president is on the campaign trail for the Democratic nominee. We've got a live report from the battleground state of Florida.

An unusual disruption in Washington this morning. A busy street had to be closed and some homes were evacuated after a hand grenade turned up in a popular Rock Creek Park area. A worker found the device near a sports field, called police. They determined it was a real grenade and called in the military.

We're now hearing from law enforcement sources that this thing wasn't live. There was no powder inside. So the military is disposing of it and U.S. park police will handle the investigation.

Some refineries finally starting to pump up the volume of gas heading to the southeast. But it's going to take a while to flow through the pipelines to Atlanta and other cities that are seeing a shortages.

In the meantime, we're getting mixed reports from all the road warriors out there, some of you saying that lines at your stations seemed a little shorter today. Others still having a tough time finding fuel.

And then there are the very popular guys who drive the big tanker trucks.


UNIDENTIFIED MALE: When we pull up to a store, before the stores are even open, the people are coming into the pumps, and they're blocking the trucks in. And it just takes more time for us to do our job properly.

UNIDENTIFIED MALE: Don't panic. And our company's dropping. Stay out my way so I can get out of the gas station and go get another load.


PHILLIPS: Well, the average price of regular unleaded in Georgia is still about 30 cents higher than the national average.

It was real nice and drew some real big lines while it lasted. A gas station in Topeka, Kansas, was selling regular for $2.99 a gallon yesterday. This station's reported been locked in a price war with some of the competitors. So drivers lucky enough to spot the deal crowded the pumps immediately. And not long after, the price went up to $3.03.

And I've get to tell you, I'm still thinking about that road trip.

Well, the sea off the horn of Africa, a dangerous place for international shipping. Already this year Somali pirates have hijacked dozens of merchant vessels. We've got some exclusive video, shot by the pirates themselves, of a hijacking just two hours -- or two years ago, rather.

And in Iraq, they're national heroes. The country's soccer team takes to the practice field in Baghdad for the first time in years.


PHILLIPS: And Pakistanis expect a U.S. missile strike killed at least four people in North Waziristan, a stronghold for Taliban and al Qaeda militants.

Pakistani officials say that the missile was fired by a U.S. drone, launched from Afghanistan yesterday, and that it hit the home of a local Taliban commander. No word on the victims' identities.

Meanwhile, there are conflicting reports on whether the top Taliban leader in Pakistan has died. Pakistan media said he died it Monday of kidney failure, but a Taliban spokesperson denies that report.

North Korea's nukes back on center stage. U.S. envoy Christopher Hill arrived in Pyongyang today with a new bid to put a nuclear disarmament deal back on the tracks. North Korea recently tossed out the deal, saying the U.S. has failed to honor a promise to remove it from a list of terror states. In response the North apparently has begun restoring its nuclear reactors that it had earlier disabled.

A showdown brewing off the coast of Somalia. Pirates are holding a Ukrainian ship loaded with Soviet-era battle tanks and other heavy weapons. And Somalia today gave foreign powers permission to use force to get the ship back.

Right now, the ship is surrounded by several U.S. warships. Washington says the weapons must not fall into the hands of al Qaeda. Meanwhile, Moscow says that one of its warships is now headed to the scene.

CNN has obtained exclusive pictures of Somali pirates in action. This report comes to us now from CNN's David McKenzie.

(BEGIN VIDEOTAPE) DAVID MCKENZIE, CNN CORRESPONDENT (voice-over): The Korean deep sea trawler, the Don Juan 628, stranded off the coast of Somalia. This video was shot by Somali pirates themselves and obtained by CNN from a third party.

Here they board the captured trawler from their sea boats. The pirates parade their heavy weapons -- RPGs, assault rifles and heavy- caliber machine guns -- as they capture and intimidate the hapless crew.

This crew was kidnapped in 2006. They were held for more than 100 days, moored close to the Somali coast. On the video, the pirate leader says this was a vigilante expedition.

"The Korean ship was 30 miles in our waters," he says, "and it is fishing illegally. So we demand that they should pay a fine."

The Korean captain pleads that they paid the Somali government for a license and were fishing in international waters. But in these waters, piracy isn't about fishing rights. It's about cash.

This map explains why the Gulf of Aidan between Yemen and Somalia is so dangerous. On the route used by ships sailing from the Suez Canal and the Red Sea to the Indian Ocean, the journey passes within easy range of the Somali coast, where the pirates are based. So far this year alone at least 47 ships have been attacked, 25 successfully hijacked.

The International Chamber of Commerce posted these pictures what they say are pirate mother ships, suspected of supplying attack boats.

The attacks continue, despite patrols by a multi-national force or warships.

Kenya's port of Mombassa is full of ships that have been hijacked and ransomed. Pirates nabbed the M.B. Mutsa (ph) when it was delivering food aid. Three sister ships from the same company have also been hijacked.

Andrew Mwangura, who helps companies to negotiate the release of hijacked vessels, has never seen it this bad.

ANDREW MWANGURA, SEAFARERS' ASSOCIATION: And this time now, I think we can save some money (INAUDIBLE) have broken the world record. It's a big business. They make a lot of money.

MCKENZIE: The owner of the Mutsa (ph) spent weeks negotiating release.

(on camera) And how did you sort it out?

KARIM KUDRATI, MOTAKU SHIPPING AGENCIES: In the end, it was always ransom. They always want ransom.

MCKENZIE: How much did you have to pay to get your vessels released? KUDRATI: Unfortunately, I would not like to disclose that.

MCKENZIE (voice-over): The Seafarers' Association says ransoms are running into the millions of dollars.

All of the seamen we talked to on the Mutsa had been hijacked at least once. Thumani Said spent months under guard.

THUMANI SAID, SEAMAN: I was afraid. Under gunpoint is not a good feeling. AK-47 rifle.

MCKENZIE: But he still plies his trade from Mombassa to Mogadishu.

SAID: They're not good people. Not good people at all. Up to now, they are not -- Somali were not targets (ph). Now every time I come on the ship, one of the ship is captured by pirates (ph).

MCKENZIE: For now ships traveling through the Gulf of Aidan are on notice. Maintain a 24-hour piracy watch; be especially wary of rapidly approaching small craft.

David McKenzie, CNN, Mombassa, Kenya.


PHILLIPS: Well, can't quite figure out what the whole financial crisis is about? Take a look. This is what it looks like. We're going to take you on a tour of homes in just a moment.

And don't forget to e-mail us. We want to know, in light of the financial crisis and the chaos in Congress, how confident are you in the nation's leaders?


PHILLIPS: San Antonio, we are out of here. Another wave of hurricane evacuees goes home to Galveston today. They are the last of 600 who have been staying in a converted warehouse since Ike hit last month. Most of them know the home that they're going back to probably isn't the home that they left, that life isn't going to be easy.

People in Galveston have to boil their water, and most stores and gas stations are still closed.

October is getting off to a pretty stormy start here in the Nor'east -- northeast, rather. Let me give the floor to Chad Myers, to tell us a little bit more of what's going on.

What do you think? When's it going to get any better?


PHILLIPS: That is cool stuff. Thanks, Chad.

Well, federal investigators are going to take a closer look at a post-Katrina police shooting case in New Orleans. Seven officers accused of killing two unarmed civilians on this bridge in the chaotic days just after the hurricane. This was the reaction after a judge dismissed the charges in August.

Six of the officers are still on the force. They were assigned to desk duty after being charged in that case. Federal authorities, including the Justice Department's civil rights division, will now conduct its own investigation.

And there's a settlement in the death of a woman killed during Boston's controversial Big Dig project. The woman was killed by falling concrete in a traffic tunnel two years ago. Her family filed a wrongful death lawsuit against the project's leaders, including the Massachusetts Turnpike Authority. They'll get more than $28 million in that settlement.

The pride of Iraq herbs sending a message to the world by taking to field of their dreams for the first time in four years. You'll meet them.


PHILLIPS: Hello everyone. I'm Kyra Phillips live at the CNN Headquarters in Atlanta. You're live in the CNN NEWSROOM.

1:28 Eastern Time. Here are some of the stories we're working on right now.

A rescue, a bailout. Call the bail whatever you want. The Senate votes on it tonight. This version has some tweaked design to win over House Republicans. Senators McCain, Obama and Biden will there be for the vote.

A jobs report that comes out Friday isn't going to bring good news. Analysts believe it will show 105,000 jobs lost in September. That would be the biggest monthly loss in five years.

And police in D.C. had their hands full this morning. A hand grenade turned up in Rock Creek Park. The grenade wasn't live, but the military is getting rid of it. U.S. park police are trying to figure out how the heck it got there.

Well, it's round two for the $700 billion bailout bill. This time it includes a provision to protect more of your money.

Susan Lisovicz, that's what we are talking about. Protect our money.

SUSAN LISOVICZ, CNN CORRESPONDENT: Protect our money and also keep everybody calm and rational. You know, the chairwoman of FDIC yesterday afternoon, Sheila Bair, said that there is an increasing crisis of confidence that is feeding unnecessary fear in the marketplace.

So what's the FDIC doing? Proposing that there be a temporary -- that the ceiling, the current ceiling on insured deposits be raised. The current limit, $100,000, be temporarily raised to $250,000. If that is passed as part of this measure that will be voted on tonight, it will be the first time limits have been raised in nearly three decades.

And by the way, governments around the world are taking this kind of action. Ireland has offered unlimited guarantee on all deposits at its domestic banks. There's a really great quote in today's "New York Times," Kyra, which kind of explains this, which -- it says, in this day and age, bank run spreads (ph)" -- when there's a run on a bank it's not just around the block, it's around the world. When there is a crisis of confidence -- and you see a bank run -- it can really undermine the banking system and thus it can also undermine the economy. And that's why we're seeing so much activity focused in Washington in recent days, Kyra.

PHILLIPS: All right. So another reason to move to Ireland, besides the Guinness.

LISOVICZ: Yes, and the beautiful, lush countryside, Kyra.

PHILLIPS: All right. How can the FDIC afford to raise its limits?

LISOVICZ: It's going to go to the U.S. Treasury, which has been very busy. In its own right, the FDIC currently has $45 billion to cover bank failures. It can go to the Treasury in addition to that.

And where do we go right now? We go to the big boards. Let's take a look at what the markets are doing on this first day of October. Coming off the worst September in six years. September is historically a rough month. October has its own hazards. Dow right now down 88 points. The Nasdaq is down 26. Well off our lows. Oil is pretty flat and below $100 a barrel -- Kyra.

PHILLIPS: All right, Susan, we'll be talking again.

Movement also in the markets overseas. Susan touched on that also. Let's see how investors in England, India, Russia, feel about what's going on in the country and their own. Let's go ahead and start with Adrian Finighan in London.



ADRIAN FINIGHAN, CNN CORRESPONDENT: A much better day here in London today where a stiff or tumble breeze has blown away yesterday's gloom and stock markets are in a much more buoyant mood today. We're going to get some sort of bailout plan out of Washington. As far as the stock markets here are concerned, it doesn't matter what that bailout plan looks like, at least we're getting one.

However, the money markets are still frozen. The credit crunch is still biting. We're not out of the stormy weather yet.



We've seen it all this week. We saw the Indian stock market fall to new lows for the year on Monday, a swift recovery on Tuesday. Now traders are waiting for any bit of news, good or bad, to give them direction and inevitably the focus returns to the U.S. and to the bailout package there.

Many stock brokers say until we know what happens with the package, whether it goes through and in what form it goes through, why worry?



MATTHEW CHANCE, CNN CORRESPONDENT: I'm Matthew Chance in Moscow. A degree of stability appears to have been restored to the Russian markets following a round of roller coaster volatility in recent days in reaction to the rejection of the U.S. financial rescue plan.

Russia's powerful prime minister, though, has been sharply critical of Washington's handling of the economic crisis. Vladimir Putin accusing the United States of irresponsibility, saying the U.S. system appears unable to make decisions which are needed to end the crisis.


PHILLIPS: And back here in the United States, a bunch of half finished houses are like monuments to the credit crunch. CNN's Dan Simon talked to one builder who feels like the bank has just thrown him under the bus.


DAN SIMON, CNN CORRESPONDENT: They built these houses but couldn't finish them. The money dried up. These 12 unfinished homes outside of San Diego are a symbol of the nation's financial crisis.

MICK PATTINSON, CEO, BARRATT AMERICAN: This will be the kitchen area here. Family room over there.

SIMON: Nick Patterson is the CEO of Barratt American, a California home builder. He says his company had to stop construction in March after his bank, Bank of America, froze the company's $125 million credit line. He claims they were current on their payments when the funding stopped.

PATTINSON: I'm angry with the way we've been treated. We, and many other home builders like us, have been good customers to these banks for decades. And the way we've been treated is unconscionable.

SIMON: Pattinson calls himself a classic victim of the mortgage meltdown. He says his lender, like a lot of other banks, got spooked by the home real estate market.

PATTINSON: The banks have made a bad situation worse. Let's not forget that this subprime crisis was created by America's lending industry.

SIMON: We called Bank of America. The company didn't get back to us.

Barratt American was one of the top 200 home builders in the country. It received numerous industry awards, built 500 homes and brought in $250 million in revenue. Now its offices are empty after laying off 100 of its 140 employees. Pattinson would like to see language in Congress' bailout package that would help companies regain lost credit.

PATTINSON: Home building is one of the key drivers of the American economy. And if we just bailout banks and the banks do what they've been doing and just sit on that money, then we didn't achieve anything.

SIMON: Dan Simon, CNN, Carlsbad, California.


PHILLIPS: Well those homes you saw are now in foreclosure, and it's unclear when exactly they'll ever be finished.

And with less than four months left in office, President Bush's poll numbers are pretty dismal and he's catching a lot of flack for a lot of things, including the tanking economy. And now he's failing the David Letterman test.

Check this out from last night's show.


DAVID LETTERMAN, HOST, "THE LATE SHOW WITH DAVID LETTERMAN": Let's just see now how George W. Bush actually did.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I'm running for president with a clear and positive plan --


-- to build a safer world --


-- and a more hopeful America.


I want to change the tone of Washington to one of civility and respect.

(BUZZER) And I am glad to have Dick Cheney by my side. He is a man of integrity --


-- and sound judgment.


We will make our country less dependent on foreign sources of energy


When America uses force in the world the cause must be just --


-- the goal must be clear --


-- and the victory must be overwhelming.


The Taliban are history.


If you give me your trust I will honor it.


Give me the opportunity to lead this nation and I will lead.


I am prepared for the work ahead.


I will swear to uphold the honor and dignity of the office to which I have been elected, so help me God.


LETTERMAN: Well, there you go.


PHILLIPS: Got to love David Letterman.

Well, earlier we asked you how confident you are in the nation's leaders. And -- well -- you've all been giving us quite an earful. Unfortunately, it's all negative. Chad writes: "Do I have faith in our leaders? Do I have faith in our system? The answer to both questions is a resounding 'no.' Both parties demonstrated incompetency beyond forgiveness and I certainly can't recall the last time that I ever voted for a president, except for Perot, perhaps."

And this from Gladys: "Here it is in a nutshell. Confident is being... sure about the nature of facts about leading this country of ours into the next phase of our lives. Being bold and presumptuous, which is rude or arrogant. I tell you right now the only part of this definition that I believe our leaders have right now are the ability to be judged, and be bold, rude and arrogant in this cause."

And Jim writes: "I have great confidence in the American people, the American system and America's founding principles, which all have proven track records of resiliency and success. As for Washington, I have total confidence that they will, when and where possible, impede the other three. Our greatest hope is to make D.C. increasingly irrelevant, but fat chance."

In your face images to drive home the dangers of smoking, all part of a new bid by Britain to get smokers to break the habit.

And a sick farmer reaping a harvest of goodwill. Find out what his friends and neighbors are doing to help.


PHILLIPS: New findings about the origin of the AIDS virus. The roots of HIV apparently run deeper into human history than originally believed. Scientists say it's been in the population for about 100 years and that's more than 20 years longer than previously thought.

In the new study in the journal "Nature" researchers tested two strains of the earliest known samples of the virus taken in 1959 and 1960. Knowing that HIV mutates rapidly, scientists calculated backwards to figure out how long it took the strains to become different.

And more tainted milk powder has been found in China. The government says that an extra 31 batches were found contaminated with the industrial chemical melamine. That brings the total to at least 100 now. The tainted milk is blamed for the deaths of four children so far and for making some 54,000 others sick.

Shock treatment. That's what you can call the latest campaign by Britain to get the country's 10 million smokers to quit. Take a look at this. Gruesome pictures showing the devastating health effects of smoking began appearing on cigarette packs in the UK today. Some where there are rotting teeth and throat cancer tumors. The images are being used to illustrate written health warnings introduced five years ago. Each year it's estimated that smoking causes the premature death of 87,000 people in Britain.

Proof that good deeds pay dividends. For more than a dozen years a Colorado farmer has been growing crops free for food banks. But this year he was diagnosed with prostate cancer, which meant no spring planting. Well, the word got out and volunteers rolled up their sleeves.

Here is David Delozier with CNN affiliate KUSA.


TONY MADONE, FARMER: It's really a beautiful place to work.


MADONE: I just love taking care of the crops.

DELOZIER: -- when you give something a chance --

MADONE: All you're doing is giving it a chance to grow.

DELOZIER: -- you just never know what you might get.

On 15 acres --

MADONE: We're going down there and we'll dump those in.

DELOZIER: -- Tony Madone has been growing vegetables.

MADONE: This is the 13th season. My wife and I started this 12 years ago.

DELOZIER: And in that time everything he's grown on this land he's given away.

MADONE: Every harvest has its own satisfaction.

DELOZIER: Given to food bank and the changing faces they served.

MADONE: We're being told that those people are now going to food banks and food pantries. And when they receive the fresh produce, some of them are in tears because they've never done it before in their life.

DELOZIER (on camera): A chance -- through this food Tony has given countless people across this state a chance for 13 years. But this spring Tony got some news and he realized this time around he was going to need a chance.

MADONE: And I was diagnosed in early January with prostate cancer.

DELOZIER (voice-over): It meant surgery in spring. It meant there would be no crops.

MADONE: You only get one chance a year. You get one chance to plant the seed in the spring of the year. You get one chance to harvest the fruit in the fall of the year.

UNIDENTIFIED FEMALE: I'm carrying one in case. DELOZIER: A chance, though, for 250 neighbors to help.


DELOZIER: A chance to grow crops and so much more.

HARRIS: All of our volunteers answered the call. They all knew, and they all wanted to see the success this year as well.

DELOZIER: They've harvested enough corn, cabbage, broccoli and squash to supply more than 35 food banks --

MADONE: Fourteen.

DELOZIER: -- and a chance for Tony to see something more than crops come out of these fields.

MADONE: Watch what happened with the community. I mean -- farm to table is stronger now than it was year ago simply because of the hardship of the cancer.

DELOZIER: He's learned that out here life is measured in the chances you give --

MADONE: Oh, thank you for all your help.

DELOZIER: -- and in the chances you get.

MADONE: To me, the harvest that we received this year is special.


PHILLIPS: This just in to CNN. We're getting word that apparently some I.D.s and other items belonging to missing aviator, Steve Fossett, have been found in the Mammoth Lakes area. You remember earlier this year, the millionaire adventurer had gone missing five months after his plane disappeared over the Nevada desert. Then a judge came forward and declared the millionaire legally dead. There was no sign of any wreckage or belongings. Nobody had any idea what happened to him. There were a lot of conspiracy theories that were thrown out there.

And now word is coming to us that apparently some hikers in the Mammoth Lakes area have found some items belonging to Steve Fossett. On the phone with us right now, Randy Schienle, he's a Mammoth Lakes police chief.

Chief, just kind of tell us how this all unfolded today. Apparently some hikers in your area came across some items. Tell us -- did they call you up and what did they have?

VOICE OF CHIEF RANDY SCHIENLE, MAMMOTH LAKES POLICE CHIEF: Actually they found the items yesterday. And they came into our office yesterday, told us that they had found some miscellaneous I.D. and actually some cash in the area. And the I.D. has the name of Steve Fossett on it. We're not certain that it belongs to Steve Fossett who is missing, but it certainly has his name on the I.D., which are some miscellaneous pilots and/or aircraft licenses.

PHILLIPS: OK. So no pictures? Just --

SCHIENLE: No picture I.D.

PHILLIPS: OK. Have you -- did you -- have you found any wreckage?

SCHIENLE: We found no wreckage. We have found a sweatshirt in the area as well that has been well weathered. It's certainly been out in the area for some time as it's quite faded.

PHILLIPS: And have you sent out a search party now to see if you can find anything else, possibly wreckage, remains, any other items?

SCHIENLE: The lead agency in this entire investigation is going to be the Madera County sheriff's office and working (ph) in connection with us, and the Mono County sheriff's office are putting together a -- both an aerial team and a foot team. They're going to hike in and/or fly the area, with the hiker found this property and see if we can't maybe find something else. But at this point there has been no wreckage at all located.

PHILLIPS: Do you believe it's possible that you may not -- and I don't want to assume anything -- but you may not find any wreckage, that this may be leading into something else? Possibly that he might have been alive, might have been in this area?

SCHIENLE: I can't really speculate as to what might be out there. All I know is we have this I.D. It seems to have been out there for a while because the I.D. itself is well weathered as well.


SCHIENLE: So it's possible, I think, it was missing July of '07. If it's been out there for a year -- we have heavy winters up here, and so it could have sat under some snow and been moved by animals. Who knows? I don't know if we're anywhere near where there was a potential wreckage or not.

PHILLIPS: Sure. And you know Nevada's not far from where you are there -- Mammoth Lakes. Just across the -- the line there, the California line. But September 2007 is where Fossett vanished after taking off in his light plane there. And since then, there had been a long search that produced no trace of him. Now police chief of Mammoth Lakes, Randy Schienle, telling us that some hikers came across some I.D.s, possibly those of Steve Fossett's -- a sweatshirt. Now a search party out there looking for anything more.

Appreciate it, Chief. We'll stay in touch with you. Please let us know if you find out anything else.

SCHIENLE: Thank you very much.

PHILLIPS: Appreciate it.

We'll continue, obviously, to follow this story as well.

Meanwhile, also breaking right now, want to get straight back to Cap Hill where our Kate Bolduan is getting a few more details on, if, when, the House will revote on this reworked bailout bill.

What did you find out, Kate?

KATE BOLDUAN, CNN CORRESPONDENT: Revoting on a rework, exactly, Kyra. You said it so well.

We are hearing now -- I'm just learning from our congressional correspondent Jessica Yellin, as well as congressional producer Deirdre Walsh, that two Democratic House aides -- leadership aides -- tell us that the House will vote on this bill, which is expected to pass the Senate, mid-day Friday. It could be anywhere from late morning to mid-afternoon. So now we hear, at least -- we know the House is coming back, getting back into session tomorrow, but it looks like they're going to be taking up this legislation and seeing where it stands mid-day Friday, Kyra.

PHILLIPS: All right. Indeed it will be a busy day for us once again. Kate, thanks a lot.

They're warriors of a different breed. Winning victories on the playing fields, not the battlefields. And now they're returning home. You'll meet them.


PHILLIPS: Despite a recent drop in violence in Iraq, about 26,000 additional U.S. troops will be ployed (sic) to the country next year. And that will allow the U.S. to keep the number of troops largely steady through much of next year. President Bush announced this month that he'll withdraw about 8,000 American troops from Iraq by February, with about half leaving before the end of the year. The Pentagon says the new deployment is necessary because the situation in Iraq remains fragile and the security improvements are reversible.

Well, here in the U.S. we call it soccer. In Iraq, and the rest of the world the sport is football. Now the Iraqi national team is getting to do something it hasn't done in years. A fitting tribute for a group of champions who've endured so much.

Cal Perry reports.


CAL PERRY, CNN INTERNATIONAL CORRESPONDENT (voice-over): For the first time in years, Iraqi children finally have the chance to get close to their heroes. The Iraqi National Football Team is back practicing in Baghdad. The team trained in Baghdad until 2004, he says. But with the situation worsening drastically, the team started training in Amman, Syria and Dubai. Now is an opportunity for the team to train at Shaab Stadium and for the fans to watch their team after the age of Asian Cup win.

Goal keeper Noor Sabri is a national superstar, mobbed wherever he goes from bringing back that Asia Cup in 2007 to today. The day they won that cup was the day that united a nation. In the shadow of an apache helicopter flying over the stadium, Basim Abbas shrugs off the personal risks in the name of patriotism.

We have been threatened a lot, he tells me. But these threats mean nothing to us because we will make the sacrifice for our country. The Iraqi government resigned the man who led the team to their historic Asia Cup victory last year. Brazilian coach Jorvan Vieira to low one-year deal. But his contract came with one key clause.

BASSAM AL-HUSSAIN, PRIME MINISTER'S SPORTS ADVISER: We had told him, the number one condition that we need to mobilize and train the team, all the training session takes place in Baghdad.

PERRY: A clear acknowledgment of Iraq's public relations strategy.

AL-HUSSAIN: And we're also sending a message to the whole world. Baghdadi is safe now. You know, things are much improved security- wise. And when we see foreign coaches come to Baghdad and practice with the team, this is an indication.

PERRY: Coach Vieira, too, gets mobbed wherever he goes.

JORVAN VIEIRA, COACH: I'm proud. I'm proud, because this is a big responsibility for myself. I hope if I can add something for the peace in this country, I'm ready.

PERRY (on camera): And you think that --

VIEIRA: I don't care about the result. The best result for us is peace that's coming.

PERRY (voice-over): It takes tough security to escort the coach from the stadium, but he's a tough coach who trains his players hard, keeps strict rules. No one is allowed on the pitch. But even that is not enough to stop Iraq's littlest fan from grabbing himself a little souvenir.


PHILLIPS: Cal joins us now, live from Baghdad. Cal, that stadium used to be a forward operating base. You and I remember that well. It has changed quite a bit.

PERRY: It has, absolutely. I remember going there in 2005, to do what we call, Hi Moms, which was Christmas. We went out to talk to U.S. soldiers to say hi to their moms. I remember being there in full flack jacket, helmet, what we call battle rattle. And then last week we spent three hours inside Shaab stadium. No flack jackets. We had security with us.

But the situation has drastically changed. We should be honest about it. This weekend was a very bloody weekend across Baghdad. But by and large in the past few months, violence is down across the country which allows us to get out more and do stories like that on -- Kyra.

PHILLIPS: And let's put it in perspective. I mean, these guys are fantastic football players. I mean, I remember when we were all routing for them in the news room when they almost went to the Olympics.

PERRY: No, absolutely. And that Asia Cup was a huge moment for Iraq. It truly united the entire country. And as you know very well, Baghdad virtually shuts down when these guys play. Everybody crowds around the television stations. And what our viewers probably don't know and you know very well, is when they win, you can't go outside because everybody shoots the weapons in the air in a massive celebratory gun fire.

PHILLIPS: That's right. When we tried to figure out, oh my gosh, are we under attack or are those just the soccer fans.

Did you get me a jersey?

PERRY: You know what? There were no jerseys available because all the kids had already taken them all.

PHILLIPS: All right, Cal. Thanks. Great story. Appreciate it, Cal Perry.

Well, it's not a crime to impersonate a cow, but when you act like a mad drunk cow and scare children, we have a problem. Get ready for the story of lactose tolerance pushed to the udder limits.


PHILLIPS: Police in Middletown, Ohio, say they've arrested this woman for the 50th time. And the golden arrest is a real doozy. The accusations? Well, blocking traffic, chasing kids, urinating on someone's porch. Yes. All while wearing this cow suit. It's official. Middletown police have now seen everything.


MAJ. MARK HOFFMAN, MIDDLETOWN, OHIO POLICE DEPARTMENT: I've been here for 30 years and this is the first bovine arrest that we've made here in Middletown.


PHILLIPS: Oh, but wait, there's more. She wore the cow get-up complete with utter and cord. And police say that she challenged the people inside to have some cream, if you know what I mean? Oddly enough, the cops said she wreaked of alcohol. She's probably going to be in jail for a while.

The next hour of CNN NEWSROOM starts right now.