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Unrest in Libya Disrupts Oil; Catfight Over Nevada Brothels

Aired February 24, 2011 - 10:00   ET

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

KYRA PHILLIPS, CNN ANCHOR: All right. Well, it's just before 10:00 a.m. on the East Coast, 7:00 a.m. out west. We're keeping an eye on New Zealand right now. More than 200 people still missing after Tuesday's earthquake that leveled Christchurch. The death toll, nearing 100.

We are also seeing more video like this. This came actually from a security camera in a store. You kind of get the idea of how powerful that quake was the minute it hit.

It's 9:00 a.m. in Wisconsin, the day could be the biggest day yet for protests, not just in the capitol. State workers calling for the biggest rallies outside of Madison in state history.

And another massive recall from Toyota; more than two million vehicles with gas pedals that might get caught in floor mats. The company has also extended a previous recall to more vehicles because of floor mat issues.

Well, we continue to track the increasing chaos in Libya. Gunfire spitting out of Tripoli's skies. You can actually hear it on this amateur video. Take a listen.

(BEGIN VIDEO CLIP)

(GOVERNMENT FORCES CRACK DOWN IN TRIPOLI)

(END VIDEO CLIP)

Government forces trying to tighten their grip on the capital city. It's said to be a ghost town right now as eccentric leader Gadhafi fights to keep control. He spoke by phone on a Libyan TV talk show just moments ago, and, yes, as you might expect, it was just another rambling speech.

(BEGIN VIDEO CLIP)

MOAMMAR GADHAFI, LIBYAN PRESIDENT (through translator): We have three million Libyans. They run the country. So they - well, if you agree, then they might come and give you orders. Don't let terrorists to take over you because your country will be destabilized.

(END VIDEO CLIP)

PHILLIPS: Now he's throwing Osama Bin Laden into the speeches. Meanwhile Americans still trapped in Tripoli, this video shot by an I- reporter days ago at the jammed airport. And a planned boat evacuation is a no-go for now because of bad weather. They're stuck. The violence is just escalating between government loyalists and opposition ralliers.

And there are signs that Gadhafi's power is fast eroding. Take a look at this poster. It roughly translates to happy holidays and it's burning, in the city of Zawiyah. We are also hearing that the opposition has taken control of the country's third largest city, Misrata. There's also some multiple reports that the of town (INAUDIBLE) is now under protester control. And the opposition also controls Libya's second largest city of Benghazi right now where crowds cheered our own Ben Wedeman for his reports. Take a listen.

(BEGIN VIDEOTAPE)

BEN WEDEMAN, CNN SENIOR INTERNATIONAL CORRESPONDENT (on camera): This demonstration in Benghazi gives you an idea of the passion of the people of this city, the passion of so many Libyans who have been thirsting for 42 years for this sort of opportunity, the chance to express themselves freely.

We arrived in this city, and from the beginning, everywhere we went, I felt like I was an American soldier going into Paris during World War II. Everybody clapping and cheering. We are the first television crew to get to this city, and we were just overwhelmed by the welcome here. People were throwing candy inside the car, clapping, shaking our hands, telling us, you're welcome, thank you for coming here. An incredible experience.

And, you know, I'm almost - I feel like I'm just not up to the task of conveying just the significance of what we're seeing here.

(END VIDEO CLIP)

PHILLIPS: Once again, that was our Ben Wedeman. Let's go to Zain Verjee joining us once again from London. You know, Zain, just hearing the latest rambling on from Gadhafi, this time on radio, now he is interjecting Osama Bin Laden into his speeches?

ZAIN VERJEE, CNN ANCHOR: Yes. You know, Kyra, I can't say when I heard that that I was particularly surprised. For the last few days, his son Saif al Islam has also been saying, "look, you know, if Libya becomes chaotic, we're going to have to worry about the Islamic emirate, the Islamic extremists are going to taking over." So there is this fear-mongering that they're obviously doing. The bottom line is that he has oppressed the people of Libya for the 42 years that he has ruled that country with an iron grip.

That having been said, one thing that Libya has done is to cooperate with the U.S. in sharing intelligence because the U.S. has been worried about Al Qaeda in Maghreb, that's the region of North Africa that Libya is in. So there is a concern for the U.S. but Moammar Gadhafi is exploiting it and insists on saying that the threat is the islamists.

PHILLIPS: And my guess is we are going to continue more of these crazy rambling speeches. Meanwhile, the oil fields. You know a lot about the tribes and a lot about how they have continually protected these oil fields. What can you tell us now about these latest reports coming out of Zawiyah and about the oil there and how tribes are still trying to fight the Gadhafi regime, even trying to interject to try to get in on the oil fields?

VERJEE: When Secretary of State Condoleezza Rice went to Libya on that historic trip that really brought Libya back into the fold, I spent a little time in Zawiyah. Essentially, it is a very important oil field, and has an oil refinery there as well. I spoke to one person today who told me that just a few hours ago there were pro- Gadhafi men who came into the square. The source said that people were shot. Seven people were dead and at least 40 people were injured, and that people in the square were angry.

This eyewitness said that the anti-Gadhafi forces were now in control of that area. With respect to the tribal issue and oil, a lot of the oil is in the eastern part of the country, and now it's in control of tribes that no longer seem to be supporting Moammar Gadhafi because, Kyra, he comes from this minority tribe called the Gadafa and he has relied on the tribal system to keep him in power and if they pull that support, he can't withstand it, and what it seems like he is doing is hunkering down in Tripoli and making his last stand.

PHILLIPS: Good point. I mean, he's losing his grip in parts of Libya and we're seeing what's happening in Tripoli now, and now the tribal areas where he used to find support, it's not happening. I mean, he is falling fast.

VERJEE: Right, and that's one of the key things we need to keep in mind here, and the other is that he was able to exploit the tribal system also to benefit him in the situation that we are seeing right now because a lot of the battalions of the military that he has belong to his tribe and are loyalists to his tribe. The guys that are very senior officials are part of his tribe or loyal to it, guys in the air force, same thing.

He also has these mercenaries there, about 2,500 or so that the "New York Times" reported as a number today from places like Chad and (INAUDIBLE), so they are with him in Tripoli. He also has seven sons, and each of them has a battalion of a very superior military force and artillery, and they, in fact, the sons even competed with each other to beef up their own battalions. So these are the die-hard loyalists and are also on tribal lines supporting Moammar Gadhafi in Tripoli.

PHILLIPS: All right. Zain Verjee live from London. Zain, thanks so much. And the effects of the crisis in Libya is felt far beyond its borders. Maybe all the way to your gas station. If you fill it up today, you will be paying around $3.20 a gallon today according to AAA, and some experts say if the unrest spreads to other oil-rich countries, $5 gas isn't out of the question.

Steven Leeb is the president and chairman of the Investment Committee of Leeb Capital Management. So, Steve, this isn't just about gas prices. I mean, we're talking about our entire economic recovery, and at what point are we in big trouble when it comes to a recovery? Is it $5 for gas, $4.50?

STEVEN LEEB, LEEB CAPITAL MANAGEMENT: I think, Kyra, typically it's about 80 to 100 percent year over year change in oil prices that really is the tipping point for the economy. I mean, right now, oil prices, yes, they're very, very high by historical standards, but they're still only about 30 percent, 40 percent above year-ago levels, and if you look at oil in comparison to other commodities, it is actually a lot, it's quite a bit below it's 2008 highs.

This doesn't mean that things can't get out of hand very, very quickly, but I think it would take oil prices around $150 and that would probably equate to gasoline prices around 4.30, very, very high numbers, and that coming relatively quickly, within the next few months, that would probably be a very, very dangerous spot for the economy.

But right now, I think that oil is not having that great of an effect, at least on the stock market, the financial markets, et cetera. What I would watch for - I know everyone is focusing on Libya, and that is a serious situation. It's about 1.6 million barrels but we probably could make that up or at least the Saudis can. I would focus a little more on Bahrain. Because Bahrain really borders, not really. It borders Saudi Arabia. And there is a big Shiite majority in Bahrain and there's a big Shiite majority on those eastern provinces where the Saudi oil is.

If you saw any disturbances in Saudi Arabia, then I would say all bets are off right now. But as it stands today, I really don't think the market reaction has been anything. I mean, stocks are down about three percent from their highs. They probably would have done that anyway.

PHILLIPS: Right. Because gas prices were already rising, and Libya doesn't account for a huge percentage of our oil.

LEEB: Exactly.

PHILLIPS: So are you saying we need to stop, you know, making the two intersect here? Because even OPEC has come out and said, "don't worry about it, it's not a big deal, you know, there are stockpiles."

LEEB: Right. There are tremendous stockpiles. I mean, ironically, what could make it a little bigger deal would be countries wanting to add to those stockpiles, in particular, China, because you know, Saudi Arabia's situation is serious. The Libyan situation we can manage but the Saudi Arabian situation, if it did become a situation, would not be something that we could easily manage, and I think it really would lead to, you know, I hate to say it, but, you know, a very, very severe recession, very quickly.

I think you'd see oil shoot up to maybe $180 and see the economy really almost shut down and I think you'd see oil prices crash again. It would be very similar to what we saw in 2008, but we're not there yet. But all I'm saying is I think that Libya is Libya, and right now the eastern part of the country is out of Gadhafi's control. I think they're still producing - excuse me - oil, and we can manage probably without Libya, but we cannot, absolutely not, manage without Saudi Arabia.

And I would really keep our eyes - we should really keep our eyes on Bahrain and whether or not the unrest in Bahrain spreads into those eastern Shiite provinces in Saudi Arabia. If that happens, we do have the potential for a major economic event. Right now, not a major event.

PHILLIPS: Got it. Steven Leeb, great perspective. Appreciate it so much. Thanks.

LEEB: Thanks.

PHILLIPS: Meanwhile, President Obama says that the violence in Libya must stop and he says that the administration is looking at a full range of options to respond to the crisis.

CNN's White House correspondent Ed Henry is telling us now what the White House is saying about all these. Ed.

ED HENRY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, Kyra, you're right, among the options on the table, according to U.S. officials would be sanctions, either unilateral ones by the U.S. against the regime in Libya or working, of course, with the U.N. security council in New York and you got the European Union also looking at sanctions, and also a possible no-fly zone that could be imposed on Libya just as it once was imposed upon Saddam Hussein and his regime in Iraq by the international community.

The president obviously has been taking flack in recent days for not speaking out earlier but he came out last night here at the White House and was very firm and very direct in challenging Gadhafi in saying that it's time for the violence to end.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The suffering and bloodshed is outrageous, and it is unacceptable. So are threats and orders to shoot peaceful protesters and further punish the people of Libya. These actions violate international norms and every standard of common decency. This violence must stop.

(END VIDEO CLIP)

HENRY: Interesting, CNN learning this morning as well that another option on the table for the president is military action in Libya. A senior U.S. official telling our Barbara Starr that the Pentagon is drafting up potential military plans for the president to consider, and we stress consider.

It does not mean that the U.S. is planning to move forward with any military action. The Pentagon, of course, put together all kinds of plans, potential action around the world. This would be one of many options on the table, Kyra.

PHILLIPS: All right. Ed Henry, live from the White House. Ed, thanks.

The parting Gadhafi family, WikiLeaks cables uncover a lavish lifestyle for the Gadhafis highlighted with private parties and A-list American celebrities. We have a live report.

And how do you make the owner of Nevada's famous Bunny Ranch hopping mad? Well, tell him you want to ban brothels in his state. Senator Harry Reid put the idea of that ban out there, and Mr. Moonlite Bunny Ranch himself well, he's got a lot to say about that. He's joining me live.

(COMMERCIAL BREAK)

PHILLIPS: Well, as the unrest in Libya widens, we're learning more about leader Moammar Gadhafi and his family's penchant for parties. The WikiLeaks web site has posted cables about private performances at the Gadhafi's paradise get-away by such American A- list celebrities as Beyonce, Usher and Mariah Carey.

Atika Shubert following that part of the story, live from London. We're talking high dollar for those performances, Atika?

ATIKA SHUBERT, CNN CORRESPONDENT: well, exactly. In one of the reports basically suggested that Gadhafi's son had paid as much as $1 million to Mariah Carey to perform just four songs at a New Year's party. That's a lot of money per song. But basically what these cables showed was the kind of squabbling between family members for more power, squabbling who would succeed Gadhafi in power in Libya.

And what's interesting about these cables is the sort of lavish lifestyles they led. Not only do they have this one party with Mariah Carey and the next year one of the sons tried to top it by inviting Usher and Beyonce, for example. So these are the kinds of lifestyles that they had in addition to the fact that they were fighting each other for claims over businesses, military concessions, all kinds of trade issues, and they were getting into trouble with the law. For example, Hannibal, one of the younger sons was accused of beating his wife, got almost arrested in Switzerland, for example. So this is basically the kind of family that Gadhafi was dealing with while simultaneously attempting to rule Libya in his own unique style. Kyra.

PHILLIPS: Yes, sort of having flashbacks of Saddam Hussein and his sons here. And so the next question is, are we going to hear from Beyonce or Usher or Mariah Carey about this, considering what's happening in Libya? And, also, it really puts in perspective, Atika, how this family, how the Gadhafi family has been living, while people have been suffering in that country with unemployment, not able to get a job, highly educated but not able to live above the poverty line.

SHUBERT: Well, this is just it. What really seems to upset people is how these U.S. diplomats have basically been chronicling through their sources, just how much money they were pouring into these things, like buying cars, gambling, for example, womanizing. In one of the reports it says - and this was common behavior apparently among all of Gadhafi's seven sons and his one daughter was also spending money quite exorbitantly in various trips across Europe. And so these cables basically document some of these complaints and grievances coming across but also pointing out the squabbles between the family members.

And so for many Libyans who may have access to this information, it could be shocking to them to find out about all this considering the kind of poverty conditions they were living under Gadhafi.

PHILLIPS: Atika Shubert, live from London. Atika, thanks.

And another massive recall from Toyota, more than two million vehicles with gas pedals that might get caught in floor mats. Yep, we heard this before. It's yet another recall. We're getting the latest in just minutes.

(COMMERCIAL BREAK)

PHILLIPS: Another massive recall from Toyota. More than two million vehicles with gas pedals that might get caught in floor mats. The company has also extended a previous recall to more vehicles because of floor mat issues.

Poppy Harlow, cnnmoney.com, a little deja vu, Poppy.

POPPY HARLOW, CNNMONEY.COM: Yes, I feel like we've been here before. Let's just go through this so all of the folks that have these cars know what's going on. 2.17 million Toyota vehicles recalled today, Toyota and Lexus, both to correct a problem in which sometimes that accelerator pedal can get stuck in the floor mat.

I'm going to go through all three problems here. The first is that Toyota says the gas pedal can get stuck in a plastic pad that is part of the driver's side floor mat if that floor mat isn't replaced properly. That's one issue. The second separate issue, and this is also a new issue, is that there's sort of a piece of plastic next to the accelerator pedal that can interfere with it, get hooked on it and sometimes cause that pedal to get stuck.

And then Kyra, he's the third part of this recall that makes it so big, more than two million vehicles. Toyota is expanding their 2009 recall, which we all remember, in which sometimes the gas pedal could get trapped in floor mats that were extra thick that did not come with the car. If you put an extra floor mat right there, the accelerator pedal could get caught. Now what we're hearing from the National Highway Traffic Safety Administration or NHTSA, I want to show you their statement.

Here is what they are saying to us this morning. I'll read it to you. They are saying, "The National Highway Traffic Safety Administration reviewed more than 400,000 pages of Toyota documents to determine whether the scope of its recall for pedal entrapment was sufficient, as a result of the agency's review, NHTSA asked Toyota to recall these additional vehicles, and now that the company has done so, our investigation is closed."

Kyra, we're waiting for comment from Toyota on that, whether they will say this is a result of NHTSA asking us to do it or whether this is a voluntary recall. I want to point you to cnnmoney.com. We've got our latest right here. It's important that people go here because there are a lot of different vehicles, to cnnmoney.com because there are a lot of vehicles, Lexus and Toyotas vehicles that are part of this recall, a number of them, about a dozen.

Go on-line, go to our home page and you can find out if your vehicle is one of those, and also on the bottom of your screen, you see the number that you can call 1,800-25-LEXUS, to find out if your car is part of this. We'll get more for the day and keep you updated on the site. Kyra.

PHILLIPS: Sounds good. Poppy, thanks so much.

And next, we're talking to the man who runs the famous Moonlite Bunny Ranch in Nevada. What does he think about a call to ban brothels in their last legal hot bed? He said something about prying the cat house keys from his cold dead hands.

(COMMERCIAL BREAK)

PHILLIPS: Yes, the most powerful man in the United States Senate addressed his home state on Tuesday. He had something very important he wanted to discuss with the legislature. Now it wasn't Nevada's foreclosure crisis and the fact that it's five times the national average, and no it had nothing to do with Las Vegas's deplorable unemployment. Senate Majority leader Harry Reid wanted to talk about hookers.

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D), SENATE MAJORITY LEADER: I have talked to families who feel the same way. Parents who don't want their children to look out a school bus and see a brothel or to live in a state with the wrong kind of red lights.

(END VIDEO CLIP)

PHILLIPS: But Nevada's legal prostitutes say if they didn't have brothels like the Moonlite Bunny Ranch, they'd be out on the streets breaking the law, working for abusive pimps. You might have visited the ranch through your TV. It's actually the setting of "Cathouse" on HBO.

As CNN's Amber Lyon actually had a chance to talk to some of the ladies there, just a few weeks ago about their past.

(BEGIN VIDEOTAPE)

AMBER LYON, CNN CORRESPONDENT (on camera): I know you guys are all of age now and are in the business now legally, but how many of you were sex trafficked underage when you started in the business? Can you raise your hand real high? We have one, two three -

(voice-over): We counted hands and asked the women to tell us their stories. UNIDENTIFIED FEMALE: I'm from Seattle. I started when I was 16.

UNIDENTIFIED FEMALE: I got started in the sex industry when I was 15.

UNIDENTIFIED FEMALE: I have been in the game since I was 13.

LYON: All were effectively sex slaves, controlled by pimps and all were sold online.

(END VIDEOTAPE)

PHILLIPS: Now, here's an interesting twist, the man who learned how to swim learned in a brothel in his hometown of Searchlight, Nevada, same town that his mom did laundry for the local whorehouses actually stood before his fellow lawmakers and said, "the time has come for us to outlaw prostitution. That's right, I'm talking about Harry Reid and he says business leaders are complaining more and more that people are having difficulty moving their children to an area where they can look out a school bus window and see a brothel.

The response to his speech this week? Crickets. Silence. No reaction from the floor. The bunny ranchers not happy, either, and this guy, Dennis Hof, the man who runs the brothel well he says Harry Reid will have to pry the house keys from his cold dead hands. Well, Dennis, tell us what you really think.

DENNIS HOF, OWNER, MOONLITE BUNNY RANCH: Good morning, Kyra. Good morning. You know, Harry Reid has forgot his roots, and what this was is a giant smokescreen. In other words, "Don't look at my aim in (ph) paying real low taxes because my sons are the lobbyists for mining. Don't look at gaming because we -- they pay the lowest tax jurisdiction in America. Look over here at the hookers. Look at the hookers." It's crazy.

And I talked to the Northern Nevada Development Authority, and they say that Harry Reid is wrong. They've never had one company say they weren't coming to Nevada because of the brothels. They are curious. They want to know where the HBO show is filmed. The main reason for companies not comes to Nevada is lack of education and infrastructure.

PHILLIPS: So, I'm curious. You mention a lot of these businesses, they come to Nevada for conferences and conventions. And, you know, Reid is saying a number of these business owners are complaining about the image that these brothels bring, and it's chasing people away. How many of these business guys that already live in Nevada and come for these conventions come to the brothel?

HOF: Well, it's a lot of tourism that comes here. We bring money in, but what Harry needs to focus on is the cesspool called Las Vegas. Because Amber Lyon pointed it out, sex trafficking is outrageous. There's 32,000 illegal prostitutes. There's been 400 girls arrested working with HIV. What happens in Las Vegas doesn't stay in Las Vegas. And now the mayor has said there's 3,000 active pimps here. That's the problem. Six billion dollars in income that nobody is getting and disease everywhere.

PHILLIPS: And what else happens? I mean, we saw a little bit from Amber Lyon's piece that she did, and she interviewed a number of the women that worked for you. If, indeed, a ban was put on prostitution, what happens to these women?

HOF: Well, they all go into the illegal trade. This is what they know. This is what they chose. Some educated, some not educated. They're going to go into the illegal trade. They're going to be just like Las Vegas.

I think this is also a payback. Of the 15 rural counties in Nevada, only one voted for Harry Reid. I'm sure Harry is saying, OK, let me take away your brothels so your county can't have a medical center. So another county can't have EMT. Another county can't have police cars. Let me just take away your brothel money. That's what you get for not voting for Harry Reid.

PHILLIPS: How far are you going to go to battle Reid on this, and what are the other brothel owners saying, Dennis?

HOF: Well, you know, I'm the boisterous one, and I'm the one that's standing up to it. But when you've got the Northern Nevada Development Authority saying Harry Reid is wrong -- I think this will go away hopefully because he needs to bring money to Nevada and not worry about what's going on. It's hard to understand what's happening in rural Nevada when you live at the Ritz Carlton and you're ordering your Geritol on Nevada money in Washington, D.C.

PHILLIPS: Obvisouly, we didn't get a chance to call the development committee. Didn't know that that was going to come up in this interview, but I will make that call and indeed get a statement from them. But it's always good to get your side of the story, Dennis Hof, when something like this is said. Obviously, it gets a lot of attention.

Dennis Hof, Bunny Ranch owner. We will be in touch again and see what happens with this talk about banning prostitution in Nevada. Thanks for your --

HOF: Ban Harry Reid. Ban Harry Reid. That's who we need to ban.

PHILLIPS: Dennis Hof, live from Vegas. Dennis, thanks.

Well, the stomach market opening bell rang just about an hour ago. Let's check those numbers. Dow Industrials, down 17 points.

A new sign that the job market is slowly recovering. The Labor Department says that the number of Americans filing first claims for unemployment benefits fell last week. There were 391,000 initial claims. That's down 22,000 from the week before.

Nevertheless, so many people still looking for a job, and one of them joining me today. Traci Miggins has lots of experience in human resources. She actually lost her job last November, eight months after landing it. And before that, she lost a job shortly after buying her first home. She's here to make her "30 Second Pitch" this morning.

It has been tough for you, no doubt. What's been the biggest struggle, Traci, since you lost the job? I understand you just purchased a home, right, before all of this happened?

TRACI NICKENS, JOB SEEKER: Right. Exactly. That's the biggest struggle, me trying to maintain the mortgage as well as my other bills. I had the recommended amount of time, of money in my savings account in case something like this happened. But I had no idea it would last for 17 months.

PHILLIPS: So, how do you get by day-to-day?

NICKENS: My family. My mom and dead have been a great blessing.

PHILLIPS: Wow. And what other types of jobs have you been looking for? What's been the hardest part about the interview process? Can you get in the door? Can you get anybody to talk to you? Or has it just been crickets?

NICKENS: The hardest part is everything now is online. Even if you want to apply for a job at a grocery store, you have to do it online. I've tried to do part-time jobs. I've applied at malls, I've applied at grocery stores, I've applied at gas stations. I have gone online to apply to like, 10 to 15, maybe 20 to 30 jobs a day online. And the biggest frustration is that either you hear nothing back or you get a quick e-mail back that says thank you for your consideration, but other people are more qualified than you are. Or you get the I'm sorry, but you're too qualified.

PHILLIPS: Well, I understand you and your parents were watching a "30 Second Pitch" not too long ago, and you thought to yourself, I've got to do this. So, this is for you and your parents. We are going to start the clock. You've got 30 seconds. Traci Nickens, take it away.

NICKENS: Good morning, my name is Traci Nickens, and I have an MBA in business administration. I have a very diverse background in human resources, information technology and management to include HRIS, business systems analysis, meeting facilitation, performance management and training. I pride myself in having exceptional interpersonal, organizational and analytical skills. I'm an outgoing people person and comfortable conversing with all level of employees.

I welcome any interested parties to please contact me at tdnickens@comcast.net.

PHILLIPS: In addition to that, she has one of the most beautiful smiles we've ever seen. Traci Nickens, tdnickens@comcast.net. Great job, Traci. Let us know what happens, if you get any bites. And we'd love to follow up.

NICKENS: Thank you. I certainly will.

PHILLIPS: You bet. And if you are out of work and you want to sell yourself to prospective employers, let us know. Just send us your resume and a letter to 30SecondPitch@CNN.com. Also, if you want to hire our 30- Second Pitchers, like Traci, just go to my blog, CNN.com/Kyra. I'll have all of the information, e-mails, numbers, et cetera. Please reach out. They need your help.

Last month, a military commission told Congress it was time to drop the ban of women in combat. Brigadier General Wilma Vaughn is one of the most decorated women in U.S. history. And we're going to talk to her about this. Talk about her experience and what she thinks about lifting the ban.

Quickly, though, let's check in with Reynolds Wolf for a quick weather update. Reynolds?

(WEATHER REPORT)

REYNOLDS WOLF, AMS METEOROLOGIST: We'll have more coming up. You're watching CNN. See you in a few.

(COMMERCIAL BREAK)

PHILLIPS: All right. We've got breaking news. Apparently some terrorist arrests have been made in Texas. Our Jeanne Meserve working this story for us. Jeanne, what have you found out?

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: Kyra, a single arrest of an individual in Lubbock, Texas. He's a Saudi national. His name is Khalid Ali-M Aldawsari. Twenty years old. He was in this country legally, I'm told, by a law enforcement source on a student visa, but he was researching and then acquiring ingredients to create explosives. And according to law enforcement, he allegedly planned to target the home of former President George W. Bush, hydroelectric dams, nuclear power plants. A law enforcement source also said he was interested in trying to strike soldiers who had served in Abu Ghraib.

This was not a sting operation, I'm told by law enforcement sources. This was an individual who researched how to make explosives. He was in the process of trying to acquire them, according to this law enforcement source. He needed three ingredients. He had obtained two of them. The third was something a little bit more rare.

What the law enforcement source tells me is he tried to acquire it from a company in North Carolina. That company became suspicious about why the individual wanted it; they tipped off the FBI. And an investigation has been going on for the last couple of weeks which culminated in this individual's arrest yesterday.

They do believe he was acting alone. At this point in time, there is no indication he was working with a terrorist group stationed overseas. Back to you, Kyra.

PHILLIPS: All right. Got it. Homeland security correspondent Jeanne Meserve there with that breaking news out of D.C. We will follow that story coming out of Texas. Jeanne, thanks so much.

Well, women have been fighting alongside their male counterparts in the U.S. armed forces for years. Unofficially. Despite a ban on women in combat, they have even received medals, including the Silver Star for Gallantry in Combat.

So, last month, the Pentagon commission said it was time to ban that ban on women in combat. That's right in line with the chairman of the joint chiefs of staff and what he said past November.

Brigadier General Wilma Vaught is a retired Air Force commander. She's one of the most decorated women in U.S. history. And she did it all, as she says, wearing a skirt. General, great to see you today.

BRIGADIER GEN. WILMA VAUGHT, U.S. AIR FORCE (RET.): Good! It's good to see you.

PHILLIPS: Times have changed. So, what do you think about the talk now about lifting this ban and making it official that women can go into combat. Even though they're already fighting in combat right now, but lifting this ban? Your thoughts.

VAUGHT: Well, they certainly are in combat right now, and I have long thought that we need to lift that ban because -- primarily because a commander should have the option of using his or her troops however he needs -- he or she needs to use them in a difficult situation. And certainly combat is a difficult situation.

PHILLIPS: You know, let me ask you -- and I'm going to ask you more about combat and women in these wars. But, for you, how close did you ever get to a combat position? Did you -- were you ever close to it?

VAUGHT: I never really was in the normal context. When you think of combat, you think of troops out fighting each other. I was stationed in Vietnam during the Vietnam War.

I was in Saigon, and my quarters were downtown. I stayed in a hotel a about a block-and-a-half from the central market, and that was rocketed. It was a target of the Viet Cong from time to time. And one day when I was walking along the street, about two blocks from the embassy, it got rocketed. But that was the closest I ever came to actual, what you might call a combat-type situation.

PHILLIPS: So, General, was there ever a time that you and other women that served right alongside with you -- did you ever say to each other, "I wish we could get in there? I wish we could get into the combat? I wish we could carry a weapon and be a part of this."?

VAUGHT: I don't think we thought that much about it at that time. That was in the late '60s, and, you know, that just wasn't an option. There were, though, a few of us who felt then that we should remove those bans, that we ought to, perhaps. Do some tests of trying to assign women in infantry, armored or artillery and seeing how it worked, so that if we ever had to, we would know -- have some information about how it might work. PHILLIPS: So, after serving for so many years in the military and knowing how women think and knowing the physical strength of women and looking at women in the military now, do you think -- even when we see them on the front lines, carrying out in combat situations, even winning awards for this, do you think overall that women do have the physical and mental strength to be fully engaged in combat?

VAUGHT: Well, combat means so many things. We already have women in combat in aircraft, in fighter and bomber aircraft. And they do 100 percent of all that's required. So, we're 100 percent engaged in that. And that holds true for helicopters, too. So, there are areas where, clearly, physical strength is not a great factor.

Now, when you think about the infantry, we may be looking at something far different than that, but I think that it would not work for all women, anymore than it works for all men.

So, I think it's something that we need to give careful consideration to because the conduct of war has changed so much, the technology of weaponry has changed so much, and we need to look and see how we can best use the people that we have who are volunteers in our volunteer military service today.

PHILLIPS: Points well made. And, General Wilma Vaught, we thank you so much for your years of service and, of course, your insight today. What an honor to spend some time with you. Thank you so much.

VAUGHT: Thank you.

PHILLIPS: More from the CNN NEWSROOM, straight ahead.

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PHILLIPS: Well, starting new link between dirty air and heart attack. Scientists report in today's "Lancet Journal" that air pollution triggers more heart attacks than using cocaine. And the study says that bad air poses as high a health risk as alcohol, coffee, and physical exertion. The World Health Organization describes air pollution as a, quote, "major environmental risk," causing an estimated two million premature deaths around the world each year.

We are just more than a week away from a possible government shutdown. So, do Americans want lawmakers and Congress to stick to their guns or compromise? Let's ask deputy political director Paul Steinhauser. Paul?

PAUL STEINHAUSER, CNN DEPUTY POLITICAL DIRECTOR: You are right, Kyra. Unless there is an agreement in Congress and with the president, eight days from now, the federal government runs out of money and you could have that shutdown.

So, what do Americans think? Well, brand new on the CNN political ticker this morning, a poll by Gallup. Let's go right to the numbers. The first question there, do people want the lawmakers in Congress to stick to their guns and stay firm and hard, or do they want compromise to avoid a shutdown? Well, you can see right there, six out of 10 say compromise, and only 32 percent say, you know what? Their lawmakers should stick to their guns even if that means a government shutdown.

So, which side? Who do they like better, right ? That's the question everybody wants to know. Well, you can see Americans are divided here. Pretty close numbers there between the president and Democrats in Congress or Republicans in Congress when it comes to who is doing a better job on the budget and trying to avoid a shutdown.

So, Kyra, we're going to keep monitoring all this. We have, like I said, eight days to go. If there is no agreement, there to could be a government shutdown. Kyra?

PHILLIPS: All right. Paul, thanks.

We'll have your next political update in just about an hour. You can go to our Web site 24/7, CNNpolitics.com.

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PHILLIPS: Here's some stories happening later today.

The Feds holding a ground breaking ceremony on a big border project. They plan to modernize and expand the nation's biggest border crossing in San Ysidro, California.

The space shuttle Discovery scheduled to blast off on its 39th and final mission. It's set to launch this afternoon at 4:50 Eastern time, carrying supplies to international space station.

And music stars shining at the White House tonight. The Motown Sound Tribute will include a performance by Smokey Robinson as well.

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PHILLIPS: All right. Let's head "Cross Country." Let's see what's happening in Orange County, California. A search is on for this bumbling robber who police say spent six minutes searching for his gun before he held up a convenience store. Why? Well, he was digging through his back pack. Apparently forgot where he put his gun. He eventually found it, though. It was in his pocket, and then he demanded the money.

Next stop, Handam, Connecticut, where age is just a number for this 103-year-old polka dancing nun. That's Sister Cecilia Adorni. She teaches her fancy polka steps to elderly restaurants - residents, rather -- at an adult day care center. On Tuesday, she actually spent her 103rd birthday doing just that, too. Hanging out with those seniors and teaching the polka. Her secret to longevity, she says? Joy.

Finally, Big Lake, Minnesota. A man's home is his ice castle. For the fourth straight year, Roger Hansen has built a massive ice structure in his backyard. Sixty-four feet high, 85 feet wide, twice as big as his own house. Hansen says his only concern now is that it's starting to melt.

Long-time college rivals Auburn and Alabama promising a new era of unity. The school student government presidents announced yesterday they are going to plant sister trees on each other's campus. This happened after last week's poisoning of a grove of 130-year-old oak trees at Auburn by an alleged Alabama fan.

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KURT SASSER, AUBURN SGA PRESIDENT: There will be a plaque underneath that basically describes the mutual respect that we have for one another, how we continue -- how we continue to help and foster a healthy rivalry.

JAMES FOWLER, UNIVERSITY OF ALABAMA SGA PRESIDENT: You know, our rivalry is more than a game. It's a partnership. More times than not, our partnership is one that unites us instead of dividing us.

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PHILLIPS: Now, the two school leaders say the unity trees will be planted within the next few months.

That does it for us. Hope you have a great Thursday. Suzanne Malveaux takes it from here live in Studio 7. Suzanne?