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Protests Against Israel; Attack on Gaza; Loan to GM, Chrysler

Aired December 29, 2008 - 12:02   ET

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

TONY HARRIS, CNN ANCHOR: And hello again, everyone.
I'm Tony Harris in the CNN NEWSROOM. And here are the headlines from CNN for this Monday, the 29th day of December.

(BEGIN VIDEO CLIP)

PAULA HANCOCKS, CNN INTERNATIONAL CORRESPONDENT: This particular area now -- we're hearing rockets coming in.

(END VIDEO CLIP)

HARRIS: Our CNN correspondent ducks rocket fire from Gaza. Israel's three-day aerial blitz in Gaza sparks protests throughout the Arab world.

An incredible tale straight from a Hollywood script. A bank manager's family held hostage in their home, then forced to withdraw money the next morning. At least that was the plan.

No letup in sight. As Israel unleashes a third straight day of airstrikes on Gaza, new damage seen today across the Hamas-controlled area.

The Israeli airstrikes reducing several targets to rubble. Israel now positioning tanks and troops at its border with Gaza. Many fear a ground assault is coming.

Palestinian medical sources reporting more than 300 people killed, another 650 wounded so far. The hospitals are overwhelmed.

The attacks now sparking Arab anger and protests in several cities around the world. Again, these attacks have sparked protests.

Our Paula Newton is at one protest site at the Israeli Embassy in London.

And Paula, if you would, describe the situation there for us.

PAULA NEWTON, CNN INTERNATIONAL SECURITY CORRESPONDENT: Well, we were quite a distance away from the front doors of the Israeli Embassy. People here saying, "No justice, no peace," saying, "Free Palestine now."

What they are trying to do right now, Tony, is continually put pressure on these front barricades to get ever closer to the Israeli Embassy. The police here really have their hands full. They are well prepared in the sense that police have decided to move a lot of different -- certainly officers and motorized vehicles and horses in front of the Israel Embassy, but as you can see from the pictures, the protesters intent on getting ever closer to the embassy doors.

Tony, what you're seeing here is a lot of anger manifested here on the streets. They want to put this front and center on the news agenda, Tony. Not satisfied with any government in terms of what they're doing to really put pressure on Israel -- Tony.

HARRIS: All right. Our Paula Newton there watching the situation from just outside of the Israel Embassy in London.

And Paula, we'll be checking back with you in just a few minutes. Appreciate it. Thank you.

Let's go right now to Jerusalem and our Cal Perry.

Cal, good to see you. Good to get an opportunity to talk to you. We should point out that the Israel authorities are not allowing CNN or any other media into Gaza at this time.

Cal, I get the defense minister, Ehud Barak, calling this an all- out war, but an all-out war to what end? At the end of the day, are we talking about Israel reoccupying Gaza?

CAL PERRY, CNN INTERNATIONAL CORRESPONDENT: Well, Tony, I think we should probably start by saying this is the Middle East. Just listening to Paula Newton, I mean, anything is possible.

I don't think Israel wants to reoccupy Gaza. I think we should think back to 2005.

It was an incredibly painful moment in many ways for the Israeli soldiers pulling those settlers. Remember, when they pulled those settlers off of those rooftops in Gaza and took them out of the Gaza Strip by force, that was in many ways an incredibly painful moment for the Israeli army.

Now, what is the end game here, I think, is really the core of your question. Is it to stop all the rocket fire, is it to decapitate the Hamas leadership? In either one of those scenarios, it's hard to imagine how they could solve either of those problems without some kind of a ground incursion. Whether or not they stay, that's the real question, Tony, I think.

HARRIS: Well, and Cal, give us some perspective here, your perspective. You were and are our Beirut correspondent. You were there in '06. You were certainly there are for the 30-day war in Lebanon between Israel and Hezbollah, a conflict many believe Israel did not win.

Does this declaration of all-out war from the defense minister mean, in effect, that Israel will do whatever is necessary in this case to win? Whatever that means?

PERRY: Well, exactly. And what does that mean? And I think that's the question.

And don't forget, Tony, I mean, last May, you and I were talking back and forth as there was gunfire in Beirut, and Hezbollah retook half of Beirut. And there's this interesting thing that's been going on in the Middle East for years.

When Israel decides to attack or when Israel decides to publicly denounce somebody, you'll remember Yasser Arafat, all those years of publicly denouncing Yasser Arafat. Every time Israel did that, his popularity spiked. They were doing the same thing in Lebanon in 2006. They pummeled southern Lebanon in the same way that they're pummeling Gaza, and now Hezbollah...

HARRIS: Hey, Cal -- Cal, I'm sorry. Yes. Cal, I apologize. I apologize for this.

I just want to give everyone the very latest on what's happening right now. U.N. Secretary-General Ban Ki-moon is delivering a statement on the Middle East crisis, and he's taking some questions. I believe he's still apparently in the statement portion of his remarks.

Let's listen in and then we will circle back, and I'll give you some of his remarks from the top of the statement.

(JOINED IN PROGRESS)

BAN KI-MOON, SECRETARY-GENERAL, UNITED NATIONS: Other world leaders must also step up efforts to support a longer-term resolution on the issue.

During the past few days, I have spoken to the principals of the quartet, to regional leaders, including Prime Minister Olmert, Foreign Minister Livni, President Abbas, President Mubarak, President Assad, Prime Minister Siniora, Prime Minister (INAUDIBLE), and Secretary- General of the League of Arab States Amr Moussa, and to a number of other leaders in order to underscore the need to restore calm in full. I shall continue these efforts personally, as well as through my envoys in the field.

I reiterate my call that unhindered access should be ensured for the delivery of humanitarian assistance. Through the United Nations' special coordinator for Middle East Process, United Nations Relief and Works Agency for Palestine refugees in the Middle East, and other agencies on the ground, have been in continuous contact with all relevant authorities, and mobilizing themselves to provide much needed assistance and alleviate civilian suffering.

I expect all parties to fully heed my call. In particular, Israel must keep opening all border crossings necessary for the continued provision of humanitarian supplies. Israeli government leaders have given me a guarantee that such supplies and personnel would be allowed entry into Gaza. This cooperation must continue on a rolling basis in the coming days.

My colleague, John Holmes, under-secretary-general (INAUDIBLE) here in New York, and Karen AbuZayd, commissioner-general of UNRA, and Maxwell Gaylard, humanitarian coordinator (INAUDIBLE), through the dealings, can provide a further update on the humanitarian situation and our work in the area.

Thank you very much for your support. Thank you.

UNIDENTIFIED FEMALE: The secretary-general will now depart.

HARRIS: OK. We've been listening to a statement from U.N. Secretary-General Ban Ki-moon on the situation right now in Gaza.

And what we'd like to do is circle back to the top of the statement, the portion of the statement you didn't get to hear as we were talking to Cal Perry, and give you a bit of what the secretary- general had to say at the top of the statement. Let's do that and then we'll move on from there.

(BEGIN VIDEO CLIP)

BAN: First of all, I'm deeply alarmed by the current escalation of violence in and around Gaza. This is unacceptable.

I have been repeatedly condemning the rocket attacks by Hamas militants against Israel. While recognizing Israel's right to defend itself, I have also condemned the excessive use of force by Israel in Gaza. The suffering close to a civilian populations as a result of the largest scale violence and destruction that have taken place over the past few days has saddened me profoundly.

(END VIDEO CLIP)

HARRIS: And let's get back to our Cal Perry now. He is in Jerusalem.

And Cal, we just heard what to my ears sounds like the strongest statement on this so far from the international community coming from the U.N. secretary-general, calling Israel's use of force excessive, and also saying at one point in the statement that a cease-fire needs to happen and it needs to happen now.

PERRY: Definitely. And this is something that we have not heard from the Bush administration. And one of the big questions on everybody's mind here is the sort of "Why now?" question.

Is Israel doing this now because Bush is about to hand over power to Barack Obama on January 20th? In other words, is there this window to take out Hamas? Israel has always said they want to take down the Hamas terrorist organization.

Let me also paint you a picture of what the U.N. is up against in Gaza. It's the same thing that the people of Gaza are up against.

This is one of those densely populated pieces of land on the face of the earth. Imagine about twice the size of Washington, D.C., with 1.5 million people living there. So how do you do pinpoint strikes in a place that's equivalent to, like, Manhattan, and how would you then get humanitarian aid in out of there when you're talking about 300 aerial strikes, Tony?

HARRIS: Yes. Boy, that's a pretty vivid picture you just painted for us there, Cal.

Cal Perry for us in Jerusalem.

Cal, appreciate it. Thank you.

The White House today is calling on both sides to work toward a cease-fire.

CNN's Elaine Quijano is with the president in Crawford, Texas, with more on the reaction to this current crisis from the administration -- Elaine.

ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: Well, Tony, President Bush is remaining out of sight at his ranch here in Crawford, Texas. We do know from aides that he began his day with a phone call with Jordan's King Abdullah to discuss the situation in the Middle East. He also then later got his daily intelligence briefing and then took part in a discussion with his top advisers about the Middle East. Those advisers included Vice President Dick Cheney; his chief of staff, Josh Bolten; as well as the national security adviser, Stephen Hadley.

But the White House position on this has remained unchanged over the last couple of days. We first heard on Saturday from a White House spokesman calling on Hamas to stop firing rockets into Israel, really laying the blame at Hamas' feet for this latest round of violence.

And the possibility of a ground operation, that was a topic that came up a short ago in the daily briefing here in Crawford. Here is what a White House spokesman said on that front.

(BEGIN VIDEO CLIP)

GORDON JOHNDROE, DEP. WHITE HOUSE PRESS SECRETARY: I can't speak to any potential ground operation. I think that any ground operation, according to the Israelis, would be part and parcel of the overall operation given their statements saying that they don't want to retake Gaza, that they simply want to protect their people.

(END VIDEO CLIP)

QUIJANO: So the White House being very careful in commenting about the potential for a ground operation, being very careful in the comments regarding Israel's intentions.

Now, we should also tell you Secretary of State Condoleezza Rice has been in touch with her counterparts, foreign ministers, from the region. We also should mention as well, the secretary was on the phone over the weekend with President-elect Barack Obama to give him the latest on the developments in Mideast -- Tony.

HARRIS: With the president in Crawford, Texas, Elaine Quijano for us.

Elaine, good to see you. Thank you.

Very quickly, we want to show you the live pictures once again of this protest still ongoing right now outside of the Israeli Embassy. This is in London.

Our Paula Newton is on the scene for us. It started as a protest of about 60, maybe 70 people, and quickly to about 600 to 700. Certainly much better organized than yesterday's protest at that same location.

We will keep you up to date and posted with the latest information, and update the story on the other side of the break.

You're in the CNN NEWSROOM.

(COMMERCIAL BREAK)

HARRIS: Once again, live pictures again just outside of the Israeli embassy in London. We have a protest. We've been following this for about the last hour, maybe a little more than an hour.

Again, it started as about 60, 70 people. Kind of a response to the protest that was much more muted yesterday. Clearly, the folks, the organizers involved in the effort yesterday, went home last night, reorganized, and came back in force today. It started with about 60, 70 people and quickly grew to about 700.

Can't really give you an accurate picture of the scale of it right now because our camera, as you can see, is right in the middle of it right now. The security forces that you see there have done an effective job, it must be said, in setting up a barrier between the embassy and the demonstrators.

We have folks who have been on bullhorns right now, organizing and really pumping up this crowd. As you can see, a number of signs on display.

The central theme being, "Free Palestine. Free Palestine." And that has been the overriding theme of the protest.

We will continue to follow this. Sorry about not being able to provide sort of natural sound of what's going on right now, but we will get to our Paula Newton in just a couple of minutes for you.

GM and Chrysler get their first billions in taxpayer loans today.

CNN's Christine Romans is back with us. She's at the business desk in New York.

And Christine, so we're talking about $17 billion. Walk us through this, $17 billion in all.

CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Sure.

HARRIS: Walk us through how much is being doled out today and in how many installments here.

ROMANS: Well, the Treasury Department today giving the first dollars, $4 billion each, to GM and Chrysler, Tony. This is the Treasury Department opening up our money, opening up the coffers, $4 billion today to Chrysler and GM. January 16th, another $5.4 billion to GM. February 17th, another $4 billion to GM.

That was what was negotiated, but, of course, Congress has to approve or deny that one once again because it will have to come out of another chunk of money after the first chunk of money runs out. That's, of course, from the bailout money.

It comes with an awful lot of strings, Tony. Remember, there was a lot of concern there weren't enough strings and there wasn't enough oversight...

HARRIS: Yes.

ROMANS: ... to the banking sector bailout. So these low- interest loans to this industry have all kinds of conditions that have to be met. And the Treasury can turn around and reel that money back in, at least in theory, if viability isn't on track by March 31st and if they don't meet a bunch of other conditions into the end of the year.

And quickly, I want to give you another little car note, Tony. I also want to point out that Ford is not included in here. Ford, in a healthier position, said it doesn't need those loans.

HARRIS: OK.

ROMANS: And then this other car note. Edmunds.com says that 51 percent of car sales in December are likely to be trucks and SUVs, that low gas prices and huge incentives and winter weather all combining to inspire people to buy trucks and SUVs again. Especially those low gas prices. So what a difference a few months make, huh?

HARRIS: Yes. What's the suggestion here? That you've got the combination of lower gas prices and you've got these powerful incentives? Is the incentives portion of this, this is about getting the supply off the lot at this point.

ROMANS: Oh yes.

HARRIS: Is there any suggestion that in the new year that Ford will continue and other big truck manufacturers will continue to build these big vehicles to respond to what looks like new demand?

ROMANS: I don't know because they're under an awful lot of pressure, right, to talk about...

HARRIS: To go the other way.

ROMANS: To go the other way, you're right. But the consumer, at least in the month of December, is telling a different story. The consumer is saying that gas prices near five-year lows are a powerful incentive for them. And then, of course, I mean, I don't know if you've been to the car dealership lately, but some of these truck incentives are just incredible, Tony.

HARRIS: Are they ridiculous? Yes.

ROMANS: They really are ridiculous. They're trying to move these trucks and they're pretty ridiculous.

And then we've had some terrible weather, too. I mean, if you've been sitting on buying a new vehicle, and you think, well, you live in the Midwest or the Northeast, I mean, there is a practicality to buying a truck in some places.

HARRIS: But we also hear from analysts -- and then I'll let you go -- we also hear from analysts that these gas prices at this level are unsustainable.

ROMANS: Oh, yes. Of course. We hear that all the time.

HARRIS: Yes. So just something to put in the mix.

ROMANS: But look, they also say that their forecast for sales of hybrid vehicles are expected to be way down. So things have really changed a lot, Tony, in three or four months.

HARRIS: Got to follow it every day. Thank goodness you're here.

All right, Christine. Good to see you. Thank you.

ROMANS: Bye, Tony.

HARRIS: Crisis in the Middle East. How does it affect us half a world away? I will talk to a Middle East expert. That's next.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

ZALMAY KHALILZAD, U.S. AMBASSADOR TO U.N.: The way forward from here is for rocket attacks against Israel to stop, for all violence to end, because the continuation of rocket attacks against Israel -- clearly, in that context, Israel has the right to self-defense, and nothing in this press statement should be read at anything but that.

(END VIDEO CLIP)

HARRIS: The U.S. ambassador to the United Nations making it clear the U.S. backs Israel in striking Hamas targets in Gaza. The White House issued a statement this morning saying, in order for the Israeli strikes to stop, Hamas must stop firing missiles into Israel.

The big question for many this morning, why should we care about what happens between the Israelis and Palestinians? Of course, we should care, but their fight seems unending. And joining me now from Washington, Shibley Telhami of the University of Maryland Brookings Institution.

It is good to see you, sir. It's been a long time since we've had an opportunity to speak together.

Let me first ask you that question again. Why should we care? Again, the fighting seems unending. Why should we care about this most resent flare-up in violence between Hamas, Palestinians and Israel?

PROF. SHIBLEY TELHAMI, UNIVERSITY OF MARYLAND: You know, beyond the humanitarian issue, which is obviously compelling -- we know that -- but beyond that, you know, I do public opinion polls in the Arab world every single year. And I go to the region and I interview people on a regular basis. And it's obvious that most Arabs look at the world and certainly look at American foreign policy largely through the prism of the Israeli/Palestinian conflict. They pass judgment on the basis of that.

It's not they so much care about individual issues. It's part of their collective psyche, it's part of their identity, it's part of the way they view the world. And always, the U.S. is judged on the basis of this issue.

We see the anger with American foreign policy, the anger of this. It's not almost subjective. It's part of the psychology of the region that we have to come to grips with.

HARRIS: Yes.

TELHAMI: And I think that it has repercussions. It influences our policy with other countries. It influences our policy with Arab countries, which we have to have relations. It influences public opinion far beyond the Palestinian arena.

HARRIS: Yes. I certainly understand that perhaps some kind of a new -- maybe a new approach from the international perspective may be needed, necessary here, but I've got to tell you, Professor, as we go to these pictures again of what's happening right now, if we still have that shot from Paula Newton's camera -- OK, we don't have it. And we take a look at the protest in front of the Israel Embassy in London, I'm just sort of curious as to when you get a more unified Arab response to the suffering of Palestinians.

When do we see some of these nations, these Arab nations, step up in a really meaningful way to help the Palestinians with their economy, with their governance? When does that day happen?

TELHAMI: Yes, I think it's a good question. And certainly Arab public opinion is very supportive. But our governments have been divided.

On the other hand, I think it should be noted that they did put forth the Arab peace plan, which is an important move. And I think it should be exploited. And I think the new administration, the incoming Obama administration, will work with that, because in the end, I think given how weak the Palestinians are and remain divided, given how divided the Israelis are, there needs to be an international role.

That international role doesn't only include the U.S.. It certainly does include the U.S., but it includes Arab states. They weigh in, they provide more legitimacy, more support, more material support. And in the end, I think the issues that separate Israel from its neighbors, particularly from the Palestinians, go beyond the Palestinians themselves, such as Jerusalem. And so they have to be there at the table.

HARRIS: But I would suggest to you that the plans in many cases aren't worth the paper that they're written on. So at some point there needs to be concrete action, certainly throughout the broader Arab world, in support of Palestinians. But I would only add, at some point you mentioned that Palestinians themselves are divided. So rebuild the house internally first.

Wouldn't that be a useful start?

TELHAMI: Sure, no question. But I think first, from our foreign policy point of view, from the American foreign policy point of view, we have to understand that unless we have a united Palestinian house, and some enforceable cease-fire, it's very difficult to do diplomacy.

HARRIS: Yes, I agree. I agree.

TELHAMI: So when the new administration comes to office, the first thing it has to work on is a strategy to create that as an environment that would lead to resolution of this conflict.

But the second thing is to understand that unless we put a plan on the table that rallies people behind, puts American leadership at the center of this, as we have in previous administrations, regional actors are going to continue to preempt foreign policy. Everybody wants to get on the agenda.

And they dictate the terms and they'll limit the options of the United States as we see now. You don't want to be in that situation because you get dragged in. It influences your policy on other issues, such as Iraq. You don't want to be in that place.

HARRIS: What do you see in this incoming administration? What do you see in the president-elect and the way he has conducted himself during the campaign on a national stage that suggest to you that he has an opportunity here to bring these forces together in a way that could lead possibly the a sustainable peace?

TELHAMI: There are four factors. One, there's Bush fatigue. So people are tried of the Bush administration. A new president is going to make a difference.

Second, there's Obama-mania. I mean, you know, a lot of people are fascinated by Barack Obama outside of this country. That is very clear. And, third, there is a sense of a vacuum of leadership in the national community at a time of crisis, including economic crisis. People are hungry for leadership.

And, fourth, the president himself, on this issue, has stated over and over again, the president-elect that is, has stated over and over again that he believes the Arab-Israeli issue is an important issue. That he will not do what the Bush administration has done and just ignore it for a number of years. That he's going to make it a central issue for him from day one.

He announced that even on the day when he introduced his national security cabinet. That's important. We don't know how this is going to play itself out. But there's no question that there's some receptivity in the international community to him. There's hunger for leadership. He understand it's an important issue. It doesn't mean it's an easy task.

HARRIS: Professor Telhami, it's great to talk to you. Thanks for your insights as always. Thanks for your time.

TELHAMI: A pleasure.

HARRIS: Again, these attacks in Gaza, the rocket attacks that brought on the Israeli response, certainly protests all over the world right now. Our Paula Newton is at one protest site, the Israeli embassy in London.

And, Paula, if you would, give us on update on the protests at your location.

PAULA NEWTON, CNN CORRESPONDENT: Well, Tony, you know, these protests, they tend to have an energy of their own. And right now, people are really trying to express themselves in terms of the anger they feel. They say they can't just sit at home and watch it on TV anymore. They want people to understand exactly how angry they are. Not just what Israel is doing they say in terms of the air strikes, but the fact that they do not feel that their government are doing what they need to do to put pressure on Israel.

To give you a situation here. This protest started out quite peacefully a couple of hours ago. Since then, quite a few hundred have come ever so much closer to the entry gates to the Israeli embassy.

They continue to press on those barricades, Tony, but we do feel there has been a bit of a stalemate with police. Police have been trying to talk to them, making sure they don't try and go over from those barricades.

There are mainly a lot of young students at the front. They are very angry. They are very aggressive right now. But they continually are asking for Israel to stop. And again, not anger towards many of the governments here in Europe, towards the United States saying why aren't you doing more.

Tony.

HARRIS: And, Paula, at this point, has it been primarily pushing and shoving, nothing worse than that?

NEWTON: Not so far thankfully, Tony. There's been a lot of pushing and shoving against the barricades. And as I said, certainly a very expressive protect. But the police have really been trying to calm down the small group of people at the front who continually try and push through. They're hoping this protest just exhausts itself.

But you know, Tony, as you and I were talking about earlier, this protest has succeed. They really don't believe that a peaceful protest on the sidewalk is going to do anything. That's why they said that they had to vent their frustrations and let people know, look, we're angry but we want the people inside the Israel embassy here to know that we're angry about this and they've certainly been successful of really making themselves heard here today on the streets of London.

Tony.

HARRIS: Yes. OK. Our Paula Newton in the middle of that scrum (ph) right now, that protest outside of the Israeli embassy in London.

Paula, appreciate it. Thank you.

And let's get more now on the United Nations reaction. When we come back, we will talk to our United Nations' correspondent Richard Roth.

(COMMERCIAL BREAK)

HARRIS: U.N. Secretary-General Ban Ki-Moon issued a statement at the top of the hour on the latest flare-up of violence in the Palestinian territories. The Israeli military conducting operations in Gaza right now. Here is what the secretary-general had to say about the crisis just a short time ago.

(BEGIN VIDEO CLIP)

BAN KI-MOON, U.N. SECRETARY-GENERAL: A cease fire must be declared immediately. They must also stop (ph) their inflammatory rhetoric. Only then can dialogue start. I think regional and international partners have not done enough. They should do more. They should use all possible means to end the violence and encourage a political dialogue emphasizing peaceful ways of resolving differences.

(END VIDEO CLIP)

HARRIS: And let's get to Richard Roth at the United Nations in New York.

And, Richard, if you would, talk us through the actions of the United Nations, starting with consultations over the weekend with the Security Council members, and the statement that came out of those meetings. RICHARD ROTH, CNN CORRESPONDENT: Well, the Security Council met late Saturday night and ended in the wee hours on Sunday morning. The statement by the Security Council called for a cease fire. It condemned violence by both sides. Because of all of the political differences regarding the Middle East, both the Palestinians, the United States, each side knows that they can't really ram home tough language pointing the finger at either side. So it was a compromised document for now.

The Palestinians warned that they would come knocking on the door of the Security Council if Israel did not stop. Israel hasn't stopped. We haven't heard any timing plan for any meeting.

You just played a sound bite from the secretary-general. It was notable that he was criticizing key influential, international partners, he said, in the peace process. Probably pointing the finger at the United States for not putting more pressure on Israel. And he'd like to put pressure on Arab countries to tell Hamas to stop. This doesn't always work, as we've seen.

HARRIS: And what's been the response from the U.S. ambassador to the U.N.? Ambassador Khalilzad.

ROTH: Well, Ambassador Khalilzad said he regrets the loss of any human life, but he said, don't pin the blame and don't point the finger at Israel. For years, with this Bush administration and with some other U.S. presidencies, they drew the line. They're not going to be approving any resolution. They're ready to veto any resolution which just singles out Israel.

So you have what we've had over decades here, a big power deadlock on what to do regarding the Middle East. They have revamped efforts. They've all joined together, Russia and the U.S. Even a few weeks ago, one British official was saying that there's been progress made, especially in Gaza. But that was sharply and rudely interrupted, that progress, over the week.

HARRIS: Yes. Our Richard Roth at the United Nations.

Richard, appreciate it. Thank you.

And, once again, let's show you the latest pictures that we have. Maybe some live images from our Paula Newton's location just outside of the Israeli embassy in London. The protest continues. We're back with an update in just a moment.

(COMMERCIAL BREAK)

HARRIS: Fear and death overwhelming both sides in this latest conflict in the Mid East. Our Cal Perry reports from Jerusalem.

(BEGIN VIDEOTAPE)

CAL PERRY, CNN CORRESPONDENT, (voice over): Grief amid a continued barrage of violent attacks. As Gaza lays its dead to rest, Israel's military mite remains unabated. As one of the most densely populated places on earth is slowly reduced to rubble. As are the lives of those living in Gaza.

"What are my five girls guilty of?," this man says. "I have seven and five were killed. They were sleeping. I want to understand why they were killed. I only have God. That's all I have."

As the death toll continues to rise, Israel maintains it's not fighting the Palestinian people, but rather is targeting their Hamas leadership.

EHUD BARAK, ISRAELI DEFENSE MINISTER, (through translator): We want peace. We have stretched out a hand in peace many times to the Palestinian people. We have nothing against the people of Gaza, but this is an all out war against Hamas and its branches.

PERRY: After more than 300 air strikes, all out war is exactly what seems to be unfolding. Israel says the goal of its operation is to stop an ongoing stream of rockets being fired from Gaza into its south, but the Israeli military says that since its campaign began, more than 150 rockets have been launched from Gaza.

Across southern Israel, sirens wail and the young and old run for cover. In the southern city of Sterat (ph), fear turns to overwhelming emotion. A grief counselor tries to help, but it seems to make little difference.

The U.N. Security Council has called on both sides to immediately end the violence, but with Israel's defense minister declaring all out war on Hamas, and Israel continuing to maneuver tanks and other equipment to the south, it appears little chance that that will happen anytime soon.

Cal Perry, CNN, Jerusalem.

(END VIDEOTAPE)

HARRIS: Oil prices are moving in response to the conflict in the Gaza Strip. So where does crude stand right now and where does it go from here? CNNMoney.com's Poppy Harlow has our "Energy Fix" from New York.

And, Poppy, predictable that the price of oil would go up. The question is, how high.

POPPY HARLOW, CNNMONEY.COM: You know, Tony, it's really hard to even talk about this when you see all of that human destruction and death, but it's something that we have to face. We have to talk about it at this point because we're looking at oil prices rising in the face of this really instability around the world. Focusing on that point.

And just two weeks ago, when we looked at oil, it was trading at a four-year low. Around 430 a barrel. Earlier today it topped $40. That's a big jump. Traders are worried the fighting in Gaza could affect supplies. And you have to think, after all, Tony, right, the Middle East, that's the world's largest producing oil region.

Tony.

HARRIS: Yes, that's right. The Mid East produces a lot of oil. But Israel and Gaza don't have any. So why are suppliers concerned here?

HARLOW: That's a great question. And so far oil supplies have not been affected. The fear, though, is that this fighting could spread. Surrounding nations already voicing opinions about the conflict. The anger is rising through the Arab world, as we've been telling you all day. Syria has broken off peace talks with Israel. And, remember, the Gaza Strip is controlled by Hamas. Hamas is backed by Iran. Iran has the world's second largest oil reserves. It's a vital channel that is used to ship oil, Tony. So that's where the concern is coming from.

HARRIS: But in the long run, shouldn't oil prices actually keep dropping because the worldwide recession is having such a large, big, wide, effect?

HARLOW: That's a good question. It's one that I posed to an oil trader just about an hour ago. And he told us, oil prices could stabilize around $35 to $45, somewhere in that range, because the economy is not expected to turn around any time soon. Demand is likely to remain weak. So far, oil is down more than $100 from that record high that we saw this summer.

Take a look at that chart and that precipitous decline. Right now, with just a few days left in 2008, oil is on track to fall 60 percent this year. That would be the biggest annual drop on record. It has certainly had a dramatic effect on gas prices. That is one good energy fix of all of this. We're watching this story as everything develops closely right on CNNMoney.com.

Tony, back to you.

HARRIS: OK, Poppy, appreciate it. Thank you.

What would you do if you and your family were held at gunpoint?

(BEGIN VIDEO CLIP)

JAMES SPRUILL, SAVED FAMILY FROM HOSTAGE SITUATION: A lot was going through my mind, man. You know, that's my family, man. My wife, my kids. You know, like I said before, I'd die for my family.

(END VIDEO CLIP)

HARRIS: Find out the lengths this dad went through to capture the attention of police and get his family rescued.

(COMMERCIAL BREAK)

HARRIS: Two are in custody. Police in suburban Washington are looking for a third suspect today in a brazen kidnapping and robbery plot. Police say the Spruill family of Clinton, Maryland, was held in their home at gunpoint overnight Friday. The next morning, the gunman loaded the family into their car and headed to Mrs. Spruill's workplace at SunTrust Bank. The gunmen planned for Mrs. Spruill, an assistant bank manager, to withdrawal money.

(BEGIN VIDEO CLIP)

GREG SHIPLEY, MARYLAND STATE POLICE: They held this family hostage overnight. They actually used electrical cords from within the home to tie up the father mother.

(END VIDEO CLIP)

HARRIS: James Spruill, husband and father, and as it turns out hero, picks up the story from there. He spoke with our John Roberts on CNN's "American Morning."

(BEGIN VIDEO CLIP)

JAMES SPRUILL, SAVED FAMILY FROM HOSTAGE SITUATION: The plan was for one of the robbers to go to the bank while the other one stayed here with us. And if the plan didn't go right, he was supposed to give him the word to, you know, to exterminate us.

JOHN ROBERTS, CNN'S "AMERICAN MORNING": Oh, my God, you must have been terrified.

SPRUILL: Yes, of course, we were scared. But I was just sitting there and I made up a plan, a hoax, that my aunt was coming over. And he was like, well, I'm going to take all of you out. So when he took all of us, which that's what I wanted, we was riding down the highway and I was speeding, hopefully to be pulled over. And then as I was driving, the trooper, Officer Cameron (ph), the trooper that came through, he was just starting his shift. So what I did was . . .

ROBERTS: So let me just set the scene here for folks. So you're driving down the beltway that loops around Washington, D.C., and it just so happens a Maryland state trooper pulls up behind your car. So you start weaving back and forth to attract his attention. What happened then?

SPRUILL: OK. Well, what happened then was that the gunman had took his mask off. So when he was taking his mask off, that's when I started weaving, you know, weaving in and out of traffic, just weaving and swerving the car. And then the state trooper pulled us over. So what I did was I handed him by bank card instead of my license. And then I -- which made him kind of sense that something wasn't right. So I said, I could give you my drivers license if I could unbuckle myself, you know, from my seat belt. So when he had me unbuckle myself from my seat belt, that gave me the opportunity. You know, I looked at my son, gave him a look, he moved to the side and that's when I jumped on his cell and hold him down . . .

ROBERTS: You dove into the backseat of the car and jumped on a guy with a gun?

SPRUILL: Yes, I did.

ROBERTS: Unbelievable.

SPRUILL: And I -- I jumped in the back and held him down and told -- said to the (INAUDIBLE), I said, he has a gun, he has a gun.

ROBERTS: Wow.

SPRUILL: And that's when the trooper responded quickly. He drew his weapon and back up came and he apprehended the suspect.

ROBERTS: And I understand that the swat team was sent to your house after that, but the other guy had left by that time. But, I mean, what an unbelievable act of heroism to leap from the front seat of your car, into the back seat of your car, pin a guy down with a gun and try to get the policeman's attention to say, help me out here. I mean, did you ever think - I mean what was the calculation you were making in your mind at that point?

SPRUILL: My thing was this. I would have went to the bank for them to facilitate that robbery with my wife, we wasn't guaranteed to still be here talking -- I wouldn't be down (ph) here to be talking to you today. I just thank God that it turned out the way it did turn out because it could have turned out another way, which wouldn't have been too pleasant for nobody.

(END VIDEOTAPE)

HARRIS: Isn't that the truth.

KYRA PHILLIPS, CNN ANCHOR: I love him. I love James.

HARRIS: Isn't he something.

But, what a story. All right. You know, if it sounds a little familiar, this whole scenario, it's because it actually played out in a movie with Harrison Ford. What was the name of the move?

PHILLIPS: Did he see the movie?

HARRIS: You know, I don't know. And "Firewall." Yes, "Firewall." Harrison Ford. And in that one he played a bank worker whose family was held hostage. There you go. Maybe, maybe it worked out. Because it could have . . .

PHILLIPS: You'll do anything for your kids, right? You would do the same thing.

HARRIS: Amen. Amen.

PHILLIPS: I'd do the same thing for you.

HARRIS: Would you?

PHILLIPS: Absolutely.

HARRIS: Let's talk about that.

PHILLIPS: You're my man.

HARRIS: President-elect Obama following the Mid East crisis from Hawaii. A live report. Our Ed Henry up next right here in the CNN NEWSROOM.

(COMMERCIAL BREAK)

HARRIS: Once again, before we turn things over to Kyra Phillips right here in the CNN NEWSROOM, just want to show you the most recent pictures that we have into the CNN NEWSROOM of this demonstration. This is from a while ago. As I recall, the pictures are still pretty animated. Folks are still plenty excited outside of the Israeli embassy in London right now, demonstrating against Israeli actions in Gaza right now. This is a protest that started earlier in the day with about 60 people and grew quickly to about 600 to 700 people.

The president-elect is following developments very closely on this front. President-elect Obama, as you know, is vacationing in Hawaii. Our senior White House correspondent Ed Henry is traveling with the president-elect.

And, I tell you what, Ed, it's another reminder, almost on a daily basis here, that the president-elect, as much as he would like to be maybe, singularly focused on the economy and getting the economy turned around, events around the world have a way of interjecting themselves on to his plate front and center.

Where's Ed's microphone? Do we know? OK. It's there, but we just need to -- can you hear me, Ed? All right. I don't think Ed can hear us. OK. He can us, but we can't hear him. All right, so I've got a couple of minutes here with Kyra, and I know that you're going to be covering this extensively throughout the day here.

PHILLIPS: And Paula Hancocks, she's there on Israel's border with Gaza. She's bringing us, you know, moment to moment what's happening.

But here's what's interesting. Here's what we're going to talk about. How many times has this happened, for how many years, for how many decades. This back and forth, back and forth. And an Israeli newspaper actually came forward and said, an Israeli newspaper said this, criticizing its own government. You know, we're the neighboring bullies. Whether, you know, those in Gaza are doing the wrong thing or not, we're a bigger force and at some point we have to stop the violence, the rockets back and forth, the bombs back and forth. And look at the numbers. You're seeing how many people are dying in Gaza and how many Israelis are being killed. And at what point will this ever cease? Will it ever cease?

HARRIS: And the proportionality argument is such -- we get into this debate and it is such a tortured debate. We've been going through this for years and years, as you mentioned. And I just keep waiting for the day when Arab nations, instead of being so quick to condemn, condemn, condemn, when they, in a very meaningful way, and we took this up with Octavia Nasser, in a very meaningful way step in to help the Palestinian people who are suffering right now. Because, let's face it, firing rockets into southern Israel is not a strategy. PHILLIPS: Right.

HARRIS: It's not a strategy.

PHILLIPS: Either way. There's got a -- and like you said, other Arab countries have to step in and help. Egypt is going to play a huge role in this.

HARRIS: Kyra, have a great show.

PHILLIPS: All right, Tony, thanks.