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Israel Continues to Strike Gaza; Khyber Pass Closed to NATO; Air New Zealand Uses Bio-Fuel to Power Jet

Aired December 30, 2008 - 10:00   ET

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

HEIDI COLLINS, CNN ANCHOR: Mid East is flames. New Israeli air strikes on Gazas and Hamas, rocket attacks on Israel. A live report, just ahead.
Plus, it's the engine that drives the economy and it's been sputtering for months. This hour, new numbers on consumer competence.

It is Tuesday, December 30th. I'm Heidi Collins and you are in the CNN NEWSROOM.

The treasury throws GMAC a $6 billion lifeline. It's agreed to bailout the financing arm of the auto giant General Motors. But it's not a blank check. The automakers have to meet a number of conditions. We want to take a look at the numbers now. First for the Dow Jones industrial averages, you see up by about 21 points or so. And we will continue to watch those numbers here today, also get back to that story on GMAC in a moment.

What a brutal year for investors. Homeowners and anybody trying to hold on to a job. No wonder a lot of us can't wait to say good riddance to 2008. Stephanie Elam is back with us now with some new numbers. I hate to say you know good riddance to a whole year, but boy it has been tough. Anything encouraging to look at today, Stephanie?

STEPHANIE ELAM, CNN CORRESPONDENT: That's true, Heidi. It's been tough for most people. I have some highlights, some good things here and there for people. But overall, it was a rough year and let's take a look at the consumer confidence numbers that we just received the latest reading on. Just coming out here.

The numbers fell to an all-time - a new all-time low I should say in December after a moderate increase last month. And this means it's worse than expected as well. The reading gives us an idea of how willing consumers are to spend their money. The holiday shopping season was a dismal one for many retailers.

The reason we pay so much attention to this is because consumer spending accounts for more than 2/3 of economic activity in the U.S. and for a lot of the retailers, they count on the fourth quarter to really bring in the bulk of their earnings for the year. So for a lot of - that's why we'll see so many businesses going out of business. That's because of the fact that this is the roughest time of the year for them if the numbers are low.

Now housing stocks they are also lower today as home prices continue to slide. The S&P Case Schiller home price index shows prices fell more than two percent in 20 of the nation's major metropolitan areas. In October compared to the month before. And compared to a year ago, prices fell by a record 18 percent. Cities in the sunbelt continued to take the brunt of the impact with Phoenix and Las Vegas, the worst performers over the past year. Dallas and Charlotte stand out as the best performers. They both still posted three and four percent decline respectively. So it's not a good number there necessarily, Heidi.

COLLINS: No, it's not. All right. Stephanie. We'll check back in with you a little bit later on today. Thank you.

Well the signs are everywhere. I'm sure you've seen them 50, 60, 70 percent off. And stores are packed. So why are so many retailers suffering? We're going to talk a little bit more about that coming up later this hour.

Explosions rocking the Middle East again this morning. Israel launching new air strikes against suspected Hamas targets. Several Hamas government buildings hit in Gaza. Meanwhile, Israeli defense forces say Hamas has fired more than 70 rockets into Israel since Monday. Some landing as far as 22 miles outside of Gaza. Palestinian medical sources put the death toll at 375 in Gaza, most of them Hamas militants. U.N. officials say at least 60 civilians are dead.

Israeli military officials say Hamas rockets have killed three civilians and one soldier. Israel says the air strikes are just the first step in the battle with Hamas. CNN's Paula Hancocks has been following the story. She's joining us live from the Israeli-Gaza border this morning. Good morning once again, Paula.

PAULA HANCOCKS, CNN CORRESPONDENT: Hello, Heidi. It's interesting that you mention what the Israeli Prime Minister said. This is just the first stage. All day we've seen these Israeli air strikes continue. And we've been seeing the Hamas militant rockets heading back into Israel. So if this is just the first stage, what is next? Maybe Olmert is thinking about a possible ground operation.

Certainly, the defense minister said that is an option. And today we have been moved on from the point to point by the Israeli military trying to push us further away from the border saying this is a closed military zone. We've managed to circumvent it somewhat to get half a mile from this border. But the tanks are lining up. We're seeing at one point we saw about 30 tanks, APCs, bulldozers all lined up facing the direction of Gaza, the soldiers cleaning their weapons and getting ready and waiting for that order.

At this point there are no Israelis inside Gaza. But those air strikes are still continuing to devastate the area. Hamas compounds and Hamas buildings are being targeted. But it's so densely populated that civilians are dying as well, women and children are dying as well because there's just so many people inside this tiny strip of land. 1.5 million residents.

At this point, Heidi, the Israeli air strikes are not managing to stop the rockets. There are less rockets today. There were more than 75 yesterday. At this point we have about 25 rockets hitting Israel, but they're hitting further. As you say, some of these rockets are hitting about 25 miles away. So the militants showing they have the capability to hit further into the state of Israel. Heidi.

COLLINS: Wow. All right. Paula Hancocks for us watching the situation there very, very closely. Paula, thank you from the border there. Appreciate that.

Controversy now over a ship carrying medical volunteers and supplies to Gaza. The "Dignity" landed a short time ago in Lebanon. An Israeli patrol boat collided with the vessel off the coast. The relief boat's crew says it was intentional. But Israel denies that claim. They say the boat was trying to outmaneuver the Israeli blockade. Our Karl Penhaul was aboard the ship at the time of the collision. And earlier he told us from his vantage point it looked intentional.

This was the scene in New Orleans on Monday. Pro Palestinian protesters took to the streets calling for an end to Israeli aggression and for a free Palestine. Much larger anti-Israeli demonstrations are being seen in parts of the Middle East.

Our i-reporters helping to tell the story as well. Also weighing in with their opinions on the escalating violence in the Middle East. Our Josh Levs will be joining us in a few minutes to look at some of those i-reports.

And later today we're going to be hearing from Daniel Ayalon, the Israeli ambassador to the United States. Ayalon, pardon me, he will be addressing the on going conflict of course in that region. And you will see it live right here on CNN.

A county employee in Minnesota could be paying a huge price for making a small detour. He tried to do a little homework with company equipment.

It took scuba divers, in fact, six hours to pull out the 15-ton machine. Officials say so far it's cost the city $9,000 and counting. The employee was sent home. He is facing disciplinary action. What are we talking about? Well, Jacqui Jeras joins me now. Because we don't have any video on that but we can tell the story right, Jacqui.

JACQUI JERAS, CNN METEOROLOGIST: I know.

COLLINS: Use the snowplow, a big huge 15-ton to clear a path to his ice house, ice not so sturdy.

JERAS: Well, how else is he going to get there?

COLLINS: Yes.

JERAS: You know. Clear it up. Where else you know would we watch the Vikings strike in the play-offs.

COLLINS: Yes. That was some good news, right.

JERAS: Those ice are good for (INAUDIBLE) - let me tell you.

COLLINS: Yes.

JERAS: You bet you.

Hey, we got more snow across parts of Minnesota. And it's coming on pretty heavy at times. In fact, look at that band just north of the twin cities from about St. Cloud, you extending over across the St. Croix river there into Wisconsin. We're looking at some pretty significant accumulation throughout the day today. We got some winter storm warning specially along I-94 and northward is where you're going to see six to 10 inches of snow. Everybody else should be around the three to five inch range or more.

We've also got a little bit of snow across the northeastern corridor. This is much lesser than what you're seeing in the Midwest. But the big problem is the wind, really strong here. We've got advisories in effect across much of the northeastern corridor, including all of the big cities. And Heidi, I hope you don't get sea sick at all as we take a look a look at this tower cam here from Boston. Check it out.

COLLINS: Oh, yes.

JERAS: Look at all the shaking. Really windy, 43-mile-per-hour wind gusts at Boston Logan at this hour. So white-knuckles on the steering wheel today. Wear pants, not a skirt. That would be my recommendation to you. We'll have lots of airport delays likely as a result of some of those strong crosswinds. Just Newark across the northeast right now, about an hour and a half.

San Francisco looking at delays around 45 minutes. Not the winds in that area. We've got some warm conditions just to the south of this system. Our high pressure here is bringing in a nice southerly flow, bringing temperatures somewhere from 10 to 20 degrees above average. We're talking 50s to 70s across much of that area today. But tomorrow back to reality. A lot of you are going to be feeling not quite as cold as those in Minnesota. I guess we have the video now by the way, Heidi.

COLLINS: OK.

JERAS: Can we take a look at that?

COLLINS: Yes. OK. There it is.

JERAS: You know, you'd like to say he's in hot water. But you know that wasn't the case. Look at that ice. Can you imagine being a scuba diver.

COLLINS: Yes. What was he thinking?

JERAS: Thankfully the river wasn't so deep that you can see he was not submerged.

COLLINS: Yes. Very good. JERAS: I guess he's in a little trouble today.

COLLINS: Yes. Those expensive equipment. That's for sure.

JERAS: $200,000 for that. It costs $9,000 to get the thing out of there.

COLLINS: Yikes.

JERAS: So I guess it was worth the cost to try to save it.

COLLINS: Yes. Maybe.

All right. Jacqui, we sure do appreciate it. Thank you very much.

You know, back to Minnesota, a lot of story out of Minnesota. In fact, maybe one step closer to having a winner in the Minnesota senate race. The state canvassing board can be meeting this hour to review the recount totals.

Most recounts have democratic challenger Al Franken leading republican and incumbent Norm Coleman by a slim margin. Those are live pictures right there for you, doing all that counting. But there are still about 1500 unopened absentee ballots we are told that haven't been counted. So maybe Monday before they're accounted or throw it out.

They have served our nation. And now one man says they deserve our help. His plan to put Iraq and Afghanistan war veterans to work on the home front.

(COMMERCIAL BREAK)

COLLINS: Hundreds of people hurt in the explosions in Gaza. The hospitals near the breaking point trying to care for the badly injured. Joining me from a hospital in Gaza City is Dr. Mahmud El Khzndar. I hope that I was close on the pronunciation, sir.

DR. MAHMUD EL KHZNDAR, SHIFA HOSPITAL: Yes.

COLLINS: We sure do appreciate you being with us. Tell us a little bit about the situation with the injured and what you have been able to witness firsthand inside the hospitals.

EL KHZNDAR: Really inside the hospital is a very difficult situation. Last night there was a rumor that the Israeli army would shoot the hospital and will have some visits to the hospital. So we have to evacuate most of the patients. Really it's a rumor.

But we have to respect any word and to deal with it. It was a very difficult situation to work under threatening of aircraft, Israeli which does not respect hospital, which does not respect mosque in front of Shifa Hospital. The mosque was destroyed and the windows of the hospital of the intensive care was destroyed. And the patients were inside the intensive care, was exposed to very cold weather. Really inside the hospital there is not equipment to continue working and dealing with all of this mess, catastrophic situation of injured people. I was working last - since Tuesday in emergency room which we open two or three emergency rooms new. But there is nothing you can give to the patients, only IV line I can do. But chest tube I lost so much patients, simply I couldn't insert chest tube because it's not there.

Laryngoscope and the tracheal tubes, tubes to the blood bank, electrolyte, blood transfusion is not available. So we are losing much and much of patients simply because we could not afford the appropriate - provide appropriate medical management for these injured people.

The injuries were so huge, pressure of limbs, internal bleeding, pneumothorax and bed of these people due to collapsed building. This type of injury is so difficult to deal. And because of so much number of patients come to the hospital at the same moment, so we lose so much of them.

Since Tuesday, there was about a hundred - more than 100 killed before and the mortuary could not accept all of this number. So because of cold weather, we put them in the street and start to evacuate them back to their families to bury them. And the situation still is very hard, even when there is some equipment come to Shifa Hospital today, but still Shifa and other hospitals and clinics are in very bad need of other equipments which is disposable for the use of these injured people.

COLLINS: So what you're saying, doctor, is you have basically no supplies. All you are able to do is to put IV lines in people with the extent of injuries that you are seeing, and I'm certainly not a physician, but I would imagine that really doesn't help a whole lot. You're taking them out into the streets, both the injured and the dead, and the dead are going home with family members. Is there anything at all that you can do for these people by way of shelter as apparently some of these bombings and attacks are still coming your way?

EL KHZNDAR: Really some of the patients which hospital can receive some medical advice, but others could not receive medical advice. We have some psychological trauma, but we could not deal with any of these patients because simply hospitals will accept only injured people due to aircrafts and due to the collapsed buildings.

Nearly 1.5 million population with shortage of supplies, one and a half year of siege around Gaza, there is no supply for the hospitals. No medicine. No narcotics for severely crushed people, for injured people. These people are dying in front of our eyes, in between our hands simply due to shock, and due to shock of electrolytes loss and fluid loss so how can we simply centralize for the patient without any equipment you have. How can like those, a patient with tension pneumothorax, but I could not do anything for him except to put in a few needles which is not enough to treat a patient like this. I have simply there is one or two rooms equipped with some chest tubes, but the other - all of the hospital, which is the hospital now, could not have any chest tubes, could not have any equipments, could not have sections, could not have laryngoscope and endotracheal tube. So we're losing these people and there is so much killed simply because of shortage of supplies. One and a half year of -- anybody who comes to Shifa Hospital and other hospitals, one and a half year depleting the hospital from disposable materials, we're in a bad situation to give management for these patients.

COLLINS: Well, doctor, we certainly appreciate your story as someone who was there in Gaza City and trying to deal with the wounded and the dead. It's actually the first time we've been able to hear from anyone inside. And we certainly do wish you the best of luck with everything that you're trying to handle as a physician there.

Dr. Mahmud El Khzndar, we sure do appreciate that.

Boy, what a dire situation. In fact, while explosions rock the Middle East again this morning, Palestinian medical sources put the death toll at 375 in Gaza. Hundreds have been wounded in these attacks.

And CNN's chief medical correspondent Dr. Sanjay Gupta is here now with a look at some of the injuries and the treatment that's available. Sanjay, you were sitting next to me when you heard the doctor talk about it. There is no treatment available. There is no shelter. There is nothing but some IV lines and family to take the wounded home. And what sort of shelter they have at their home obviously is probably minimal as well.

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: That was a description of war zone triage. I've seen this before. I was in the Middle East in 2006 when this sort of conflict was breaking out.

That's exactly what's happening there. And that's why the death- to-injury ratio is so high. Typically you have so many people who would otherwise be classified as preventable deaths, people who could have been treated. People who could have been saved in hospitals. But because of the lack of supplies, also because sometimes these hospitals, these clinics come into the target zone themselves, makes it hard to take care of these patients.

COLLINS: Right. And that's what he said.

GUPTA: The death ratio becomes so high as a result of that. You have primary blasts, secondary blasts and some tertiary blasts. They call it the primary blast from the air strike itself, from the explosion. The secondary blast from all the shrapnel that is thrown up that cause a different pattern of injuries.

A tertiary blast as bodies are thrown against each other or against walls in closed spaces. You get burns probably what you're seeing right there on the television now. These are the types of injuries they are seeing. And a lot of these can be treated if there is enough supplies, and supplies meaning fuel, meaning narcotics, meaning antibiotics, things that we take for granted. But if they're not available, these preventable deaths turn into actually deaths which is what happens in war zones like this.

COLLINS: Yes. I mean just operating without power. And there we see, you know, some of the ambulances. And I was kind of thinking to myself when I was speaking with the doctor, is it better to be sort of out in the field, if you will, before being taken to a hospital where it seems there's just really nothing there.

GUPTA: Well you know, sometimes they'll try to transfer patients from one hospital to another if perhaps there's a little bit more resources at another hospital but you know, the problems are exactly what you might think. First of all, just communicating from one hospital to another can be difficult. So a hospital doesn't know what types of patients are coming. That can be a problem. Also you're subjecting not only the patients but the health care personnel to additional risks in the transportation process itself.

COLLINS: Absolutely.

GUPTA: It's really bizarre. And I saw this in 2006 that hospitals, even Red Cross vehicles are sometimes targeted, sometimes hit as well. So it's a very challenging situation. But that was a classic description of war zone triage.

COLLINS: Yes. We'll stay on top of that story as we have been here for the last four days anyway as those attacks continue to happen. We sure do appreciate it.

GUPTA: Sure.

COLLINS: Dr. Sanjay Gupta, our chief medical correspondent.

Moving on to this story now. They served our nation. And now one man says they deserve our help. His plan to put Iraq and Afghanistan war veterans to work on the home front.

(COMMERCIAL BREAK)

COLLINS: Rewarding the troops for defending the country. A national model program in (INAUDIBLE) New York helps veterans returning from Afghanistan and Iraq find employment in these tough times. The Warriors to Work program is the first of its kind in the nation.

And joining us to talk a little bit more about the program, four star General Richard Cody and Tom Suozzi, the founder of the group. We sure do appreciate the two of you being with us there.

The first question I want to ask county executive Suozzi, how exactly is this program going to work? I know you've already got placement for some 200 people.

TOM SUOZZI, FOUNDER, WARRIORS TO WORK: Well, the program is going to work that we'll be reaching out to the 3,000 veterans returning from Afghanistan in Nassau County and asking them to contact us if they're looking for employment.

We've worked with our building trade unions, everybody from carpenters, to laborers to sheet metal workers to steam fitters, as well as with about 15 different companies that have said they've slot between the two groups, building trade unions and private companies about 200 jobs that they'll make available to returning veterans.

COLLINS: Well I know that in Nassau county, you know, to be particular, the statistics are pretty interesting. I'm looking at a press release here that says over 3,000 Nassau county residents have actually served in Iraq and Afghanistan since September 11th. But then that unemployment for returning veterans versus you know non- veterans, the national average is double. Is this really going to make a difference?

SUOZZI: It will make a difference if other people replicate what we're doing as well. You know, these are very tough times in our nation. We're still a nation at war. The economy is a wreck. We have to go back to basics. And one of our most basic obligations we have as a society is to take care of those who have served us as veterans. And by working with the private sector and the public sector, I think that we can work together to take care of this basic obligation and provide jobs for veterans who need them.

COLLINS: So how did you get the guy next to you on board, General Cody? Obviously he is a former vice chief of staff of the Army. We've had General Cody on our program many times before. General Cody, you can smile now.

(LAUGHTER)

COLLINS: This is something that has been very important to you. Because if anyone knows you, they would describe you, and I said it before as a soldier's general. This is something that has been very near and dear to you as well.

GEN. RICHARD CODY (RET.), FMR. VICE CHIEF OF STAFF, U.S. ARMY: It has. I think what Tom Suozzi and the Nassau County has done is basically said to our veterans, you have fought for us, now it's time for us to fight for you.

You know, these soldiers are enduring 12 months, 15-month tours. It's an all-volunteer force. They've secured our freedoms for all of America. And so we can live the American dream. And the best thing we can do is, when they decide to get out of the service, is to allow them to live the American dream by providing them opportunities to serve in the private sector.

COLLINS: Because I imagine in many conversations that you have had on one-on-one with your soldiers, General, there's a lot of concern, when you're finishing up your tour of duty, what are you going to do? How are you going to be able to provide for your family once moving into civilian life?

CODY: It is. And you know, all the services have programs, Heidi, to assist our soldiers as they transition from their great service to the nation to go into the private sector. But those are centered around our post camps and stations. What Tom Suozzi and Nassau county have done is said you know what that's necessary but not sufficient. We need to, as a county and as a neighborhood, let our veterans who move back into our neighborhoods, that we're going to help you find jobs.

COLLINS: What makes a veteran a good employee?

CODY: Well, I think first off is these are all volunteers now. They're highly trained. This is a high-tech military that we have today. So we have skill sets that we give our soldiers when they come through basic training and advanced individual training.

They learn great skills. More importantly, they learn values. They're highly dedicated. Certainly patriotic for having raised their right hand and served this nation during a time of war. But they've also served something bigger than themselves. So an employer gets a very dedicated, loyal and a person that knows how to be on a team.

And quickly before we let the both of you go, county executive Suozzi, these companies get a tax break when they hire the veterans?

SUOZZI: No. This is just good corporate citizens trying to make the world a better place to live in and fulfill our basic duty as Americans to take care of our veterans. It's really and very gratifying.

This idea was suggested to me just a few weeks ago by a fellow named Fred Wilpon (ph) and in the past three weeks, we've reached out to these companies. We've reached out to the unions. They've all stepped up and said we have a duty as Americans to take care of our veterans.

COLLINS: Retired General Richard Cody, we appreciate your time and county executive and founder of the Warriors for Work project, Tom Suozzi.

Thanks to the both of you and good luck with the program. We'll keep our eye on it.

SUOZZI: Thanks, Heidi.

CODY: Thank you.

COLLINS: Back now, Gaza, not the only place in the Middle East to take an incoming fire. We'll take you live to southern Israel, the target of Hamas rockets.

(COMMERCIAL BREAK)

COLLINS: Israel launching new air strikes this morning, taking aim at suspected Hamas targets. Several Hamas government buildings hit in Gaza. And meanwhile Israeli defense forces say Hamas fired more than two dozen rockets into Israel today. At least one landing not far from our own Paula Hancocks, just a couple of hours ago. She is OK. But, she's at the Israeli/Gaza border where Israeli tanks and bulldozers have massed.

CNN's Ben Wedeman is joining us now live from southern Israel, with the very latest from there.

Ben, hello to you.

BEN WEDEMAN, CNN CORRESPONDENT: Hi, Heidi. It's actually relatively quiet compared to yesterday, according to the Israeli defense forces. More than 70 rockets were fired from Gaza, into southern Israel today. As you said, just 25 so far. We did about an hour ago, hear the impact of three rockets to the south of here. We're in the Israeli city of Ashkelon, which is not far from the border with Gaza.

In the meantime the Israeli air force continues its air strikes against targets in Gaza itself, hitting several government buildings. And today we saw that the Israeli leaders, the prime minister and the defense minister visited various military installations in the southern part of the country. The Israeli Prime Minister Ehud Olmert saying that there are several more steps to this operation yet to go -- Heidi.

COLLINS: Well, that would be a question I'm sure that everybody would like to know. Ben, I know you've been covering this region for many, many years.

What is likely, and is there really any way to know what Israel's next step could be?

WEDEMAN: Well, certainly the Israelis are being quite mum on their specific plans. But all indications are that they are preparing for some sort of ground invasion of Gaza.

They've had a limited call-up of the reserves, many tanks, bulldozers and infantry have been massed on the borders with Gaza. But of course, this would be a much more dangerous phase, certainly for the Israelis if not for the people of Gaza, because it's one thing to bomb from the air. It's another when you send troops into the crowded, cramped alleys in streets of Gaza where Hamas has prepared for exactly this eventuality.

So, that's really what the next stage could be in this ongoing operation -- Heidi.

COLLINS: Understood. All right. Our Ben Wedeman for us live today.

Thank you so much, Ben.

You know, our iReporters have been weighing in on both sides of this conflict. And CNN's Josh Levs is joining me now with a look at what our iReporters are saying. Because some have been writing in and then others sending in photographs, as well.

JOSH LEVS, CNN CORRESPONDENT: Right. Photos, videos, we get some of each. We're having a lot of really passionate responses to this conflict. One of them that we got is a video, comes to us from Bob Joseph.

(BEGIN VIDEO CLIP)

BOB JOSEPH, IREPORTER: As strategically targeted as Israel is, because of what Hamas is doing and because of them putting their missiles in playgrounds, near schools and hospitals, they have created an environment where they ensure that some civilians can get hurt. And what they target themselves is, they target children and schools and hospitals. That is what makes Hamas the most evil entity -- one of the most evil entities on this planet.

(END VIDEOTAPE)

LEVS: Well, some iReporters see the conflict very differently. I want to go right to this graphic here. This from David White, who wrote us this:

"I'm appalled at the amount of overkill that's being used in Gaza. Rocket-propelled grenades against unstoppable air strikes? Who is terrorizing whom."

Maggie Dowling says Israel should defend itself. She sent us a video but she also says this.

(BEGIN VIDEO CLIP)

MAGGIE DOWLING, IREPORTER: I also believe that Israel's retaliation against Hamas in the Gaza strip, the scale of that was way above and beyond what it should have done. Israel also needs to cease fire immediately. And I do believe that Israel has every right to protect itself and its citizens. But to what end will this current strike against Gaza come to? What is Israel's position in Gaza? What is their goal? What is their strategy?

(END VIDEOTAPE)

LEVS: We are looking at all viewpoints here. There's a conversation really going on right at ireport.com. We encourage you -- send us your videos and your photos.

And Heidi, we're going to keep bringing some of them right here to you on the air.

COLLINS: Yes, great. Some really good stuff there.

All right, Josh. Appreciate it.

LEVS: Thanks.

COLLINS: And later today, we are going to be hearing from Daniel Ayalon, the Israeli Ambassador to the United States. He's going to address the ongoing conflict in the Middle East. And of course, you will see that live, right here on CNN.

A grim security picture now coming out of Afghanistan. The U.S. Ambassador there, William Wood, says the number of roadside bombs have doubled this year. So have kidnappings. Much of the surge in violence in eastern and southern Afghanistan is being blamed on Taliban militants.

And that's who the Pakistan army is going after. Because of the new military operation, Pakistan has closed a key supply route -- it's the Khyber Pass -- which NATO uses to get fuel, food and other goods to their troops. Since the first of November, Pakistanis say convoys have come under frequent attack by militants.

(BUSINESS REPORT)

COLLINS: A leading figure in the jazz world has died. Grammy- winning trumpeter Freddy Hubbard lost a long battle with heart disease yesterday, in a Los Angeles suburb. Hubbard's career spanned five decades. His publicist says he was probably among the five greatest trumpet players ever. Freddy Hubbard was 70 years old.

A family Christmas tragedy. An 11-year-old girl walks miles in the snow. Now her father faces charges in her death.

(COMMERCIAL BREAK)

COLLINS: Now to the severe weather that a lot of you are dealing with this morning. In Washington state, people are digging out from record-breaking levels of snow. It got so heavy in Spokane, a supermarket roof collapsed, forcing fire officials to evacuate the area.

Parts of the Midwest also got slammed. A snowstorm last night, blanketed most of Minneapolis. Clean-up crews had to work through the night to clear roads there.

(WEATHER REPORT)

COLLINS: Meanwhile, I want to get to Canada now, where police have found the bodies of seven of eight missing snowmobilers caught in pair of avalanches. Searchers and volunteers will keep looking for the last man unaccounted for. A total of 11 people were snowmobiling in the back country in southeastern Canada, Sunday, when two avalanches buried part of the group. Three people did survive with minor injuries.

In Idaho, the father of an 11-year-old girl is now facing second degree murder and other charges. Police say his daughter likely died of hypothermia after trying to walk 10 miles in the snow on Christmas day. Police say the father let his daughter and 12-year-old son start walking to their mother's house after his truck got stuck in a snowdrift. Search teams found the girl and her brother, who ended up surviving, the very next day.

Airlines have been trying everything. Making flyers pay for extra leg room, for food and, of course, to check their bags. Well now, some carriers are looking at vegetable oil as a fuel of the future. CNNMoney.com's Poppy Harlow has our Energy Fix now from New York.

So, is that the real deal, vegetable -- what happened to the jet fuel, the JP-8 or whatever it is they're using these days?

POPPY HARLOW, CNNMONEY.COM: Right. Right. We're not talking about pouring canola oil right in the tank. But we're talking about something that really uses vegetable oil to power something as big as a 747.

A very cool story to tell you about today. It's a test flight that's already taken off and landed successfully. Earlier today, Air New Zealand flew a jet powered by 50/50 -- a blend, 50/50 of standard jet fuel and vegetable oil that comes from a Jatropha plant. You might not have heard of that.

What makes this really attractive -- there's a picture of the plant right there is that unlike biofuels, such as ethanol that uses corn, Jatropha would not take away from the food supply because it grows on land that is not really suitable for farming. Of course, Heidi, it is cleaner than regular jet fuel. Another plus for this.

COLLINS: Yes. Are the airlines going to really start using bio- fuel for commercial flights? Or, are we just talking about some of the cargo flights?

HARLOW: They might. That's the long-term plan. But, it could take some time. Air New Zealand says it could be up to five years before it starts using this on a regular basis. More tests still need to be done. Large quantities still need to of course, be produced.

The idea though, of bio-fuel for planes is getting some serious attention. Next week, Continental Airlines right here in the U.S., is hoping to be the first American carrier to complete a test flight powered in part, by Jatropha and also algae, believe it or not. Last February Virgin Atlantic carried out a bio-fuel test flight, as well.

So, so far, all the tests have been successful, Heidi.

COLLINS: OK. All right. Well, we'll watch that one very closely. I want to ask you about the cost though. I mean, bio-fuel -- is it more expensive, less expensive?

HARLOW: That's the kicker. It really has to be cost efficient for these airlines to use it or they'll just stick with jet fuel. So far, no specific price tag because it's only been produced in those small quantities. Continental and Air New Zealand though, both say bio-fuel will be competitive with petroleum fuels especially if we see the price go up like we did this summer.

Interesting, interesting Energy Fix today, Heidi. Not sure I'd jump on board just yet though.

COLLINS: Yes, yes, yes. We'll wait that one out maybe a little bit.

All right, Poppy Harlow. Thank you.

HARLOW: You're welcome.

COLLINS: Brawl at the mall. While many shoppers are returning gifts, these guys are trading punches. We'll show you why.

(COMMERCIAL BREAK)

COLLINS: Sales down, returns up. Not exactly what retailers were hoping for this holiday season. And that could mean your favorite store may not be around much longer. Here now, CNN's Deborah Feyerick.

(BEGIN VIDEOTAPE)

DEBORAH FEYERICK, CNN CORRESPONDENT (voice-over): With markdowns as much as 70 percent, you'd think people would be buying like crazy. So, why aren't they?

UNIDENTIFIED FEMALE: People are still edgy.

UNIDENTIFIED MALE: Oh, absolutely. People are just very worried about what's going to happen to their job, what the future outlook's going to be. You know, if you're that next percentage point on the unemployment rolls, you don't want to spend right now.

FEYERICK: Malls were packed after Christmas, but the spending surge store owners were praying for didn't materialize, a sign the shopping landscape may radically change soon, say retail analysts like Joseph Feldman.

Here you have a store that says 60 percent off. What do you think it's going to look like in the next six months?

JOSEPH FELDMAN, RETAIL ANALYST: Not all the stores are going to survive. I mean, there's quite a few retailers that are on the endangered list right now.

FEYERICK: Stores like Linens 'N Things, Sharper Image, Bombay Company and Mervyn's have all but disappeared. Rumors about Circuit City spurred shoppers to use gift cards sooner rather than later.

UNIDENTIFIED MALE: Since it's going to close down, might as well use it sooner than before it does close.

FEYERICK: While companies like Borders, Ann Taylor and the Gap are expected to tighten up and close stores that don't perform well.

FELDMAN: We're going to see store closings. We're going to see Chapter 11 bankruptcies. We're going to see less store expansion. A lot of the retailers that have announced their expansion plans for 2009 have really cut it down to a fraction of what it should be.

FEYERICK: A trade group that represents shopping centers estimates 73,000 retail shops, including restaurants and jewelry stores, will close the first half of 2009. That's on top of the 148,000 stores already expected to close this year. Retail trade groups say only stores and shopping centers that have traditionally done well will likely survive these turbulent times.

SCOTT KRUGMAN, NATIONAL RETAIL FEDERATION: That is going to impact mom and pop retailers more than larger national chains. I do believe you're going to see consolidation. And I think some of the most at-risk companies are probably those companies that don't have a lot of cash reserves.

FEYERICK (on camera): Clearly it's not just so-called mom and pop shops at risk, but smaller designers who may be just on the verge of breaking through, they may not make it. Overall, it's a lot of jobs that may be lost. The retail industry waiting with bated breath for President-elect Obama to detail his economic stimulus plan.

Deborah Feyerick, CNN, New York.

(END VIDEOTAPE)

COLLINS: Shoppers looking for bargains at a mall in Milwaukee got more than they bargained for. Police say two men got into a fight, and it turned into a huge brawl spilling into a store the day after Christmas. Shoppers were stunned and the store was left in shambles. Police don't know what started the fight. But they did arrest three men for disorderly conduct.

Our coverage continues on the crisis in the Middle East. We'll take you live to southern Israel, the scene of Hamas attacks.

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COLLINS: It was a love story that tugged on the heartstrings of Oprah Winfrey and a book publisher. But you won't be reading that book because the story never happened. CNN's John Zarrella explains.

(BEGIN VIDEOTAPE)

JOHN ZARRELLA, CNN CORRESPONDENT (voice-over): Since the 1990s, Herman and Roma Rosenblatt had recounted their love story over and over. Herman was a young boy imprisoned at a Nazi concentration camp.

HERMAN ROSENBLATT, WROTE "ANGEL AT THE FENCE": We didn't have nothing to eat. We only ate one slice of bread a day and water.

ZARRELLA: Roma, a young girl outside the camp who for months threw him food.

ROMA ROSENBLATT, GIRL IN "ANGEL AT THE FENCE": I threw the apple over, and I threw out a piece of bread.

H. ROSENBLATT: The guards in the towers, if they see us, they shoot us. So we didn't talk, and I didn't have nothing to say anyway. All I was interested was getting the apple.

ZARRELLA: Years later, they meet on a blind date and are married. But today, this seemingly impossible love story may be turning out to be just that, impossible. A soon-to-be published book titled "Angel at the Fence" about the Rosenblatts' saga has been canceled.

And the publisher has asked for its advance money back. Rosenblatt, who was a prisoner, has now admitted he made up the story of the girl and the apple. In a statement released by his agent, Rosenblatt says, quote, "Why did I do that and write the story with the girl and the apple? Because I wanted to bring happiness to people, to remind them not to hate, but to love and tolerate all people," end quote.

Ever since the story became public, including this children's book based on it called "Angel Girl," some Holocaust scholars had questioned it, and experts say fabrications make people less confident in the Holocaust stories they hear.

DAVID MARWELL, DIRECTOR OF THE MUSEUM OF JEWISH HERITAGE: And on the far extreme, something like this could give fuel to those who are in the business of denying that the Holocaust ever took place.

ZARRELLA: It is also further grief for the publishing industry, rocked in recent times by bogus book bombshells.

SARA NELSON, PUBLISHERS WEEKLY: It just seems to me that you don't need to be a well-trained fact checker to be somebody who would hear the story and say what you or I would say, which is, wow, really? Did that really happen?

ZARRELLA: According to their agent, Rosenblatt says his tale was only a dream.

ZARRELLA (on camera): A movie version of the Rosenblatt's story remains in the works. Atlantic Overseas Pictures says theirs is a fictionalized adaptation, so, quote, "the story retains its power to grip audiences worldwide."

John Zarrella, CNN Miami.

(END VIDEOTAPE)

COLLINS: I'm Heidi Collins. You could join us again tomorrow morning at 9 a.m. Eastern.

For now, CNN NEWSROOM continues with Tony Harris.