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First Official Funeral Mass for Those Killed in Madrid Bombings Held; Pakistani Forces Continue Battle for Control in Tribal Areas

Aired March 16, 2004 - 14:30   ET

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

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


KYRA PHILLIPS, CNN ANCHOR: Live pictures now. The first official funeral mass for those killed in the Madrid bombings is happening right now. Two hundred one people were killed in those attacks. More than 1,500 were injured in the commuter train attack that happened March 11. Authorities say that backpacks loaded with more than 220 pounds of explosives, mostly dynamite, were used.
President Bush vows that terror attacks will never shake the will of the United States. Mr. Bush met in Washington today with the Dutch foreign minister (sic) and urged U.S. allies to remain committed to rebuilding Iraq. About 1,100 Dutch troops are in there.

In Pakistan, paramilitary forces continue to battle for control in tribal areas along the Afghan border. Twenty-four terror suspects were killed, 18 captured in the latest battle near the town of Wana. U.S. and Pakistani officials believe remnants of the Taliban and al Qaeda network may be hiding out in that area.

Two people reported dead and ten wounded in Gaza after a strike by Israeli attack helicopters. Sources say the two dead -- the two that were killed were Islamic Jihad members. The Israeli cabinet has decided to step up targeted killings of Palestinian militants in response to suicide attacks over the weekend.

A year after the U.S.-led campaign to depose Saddam Hussein, what do Iraqis think about their new life? A new ABC poll taken in face- to-face interviews with more than 2,700 Iraqis provides a glimpse. Forty-eight percent say the coalition did the right thing. Thirty- nine percent say it was wrong. People are equally divided over whether Iraq was humiliated or liberated.

And while most Arabs oppose the U.S. occupation, most of them also want U.S. forces to stay in Iraq for the time being. They overwhelmingly oppose attacks on coalition troops.

One final note. Fifty-six percent of all Iraqis say life is better now than it was a year ago.

CNN's Aaron Brown takes a closer look now at life in Iraq one year later.

(BEGIN VIDEOTAPE)

AARON BROWN, CNN CORRESPONDENT (voice-over): This was Baghdad after the fall, right after the fall. Captain Shawn Mehana was there then and is still here now.

CAPT. SHAWN MEHANA, U.S. ARMY: We rolled into Baghdad. There was no power. A lot of people weren't out in the streets. And I think they were a little bit weary of us still at the time. No sewage, no running water. It was like it was dead. And that was a little bit shocking to me, the fact that -- to see a city of 5.5 million people that is completely nonfunctional.

BROWN: Ten months later, things are vastly different. Power is on more than it's not. The lawlessness of those early weeks has stabilized markedly. Things are much better, but they aren't perfect by any means. And the occupying force often gets the blame. After all, they are Americans.

MAJ. SCOTT CALDWELL, U.S. ARMY: They think that we can go to the moon. We have a space shuttle. We conquered, we knocked down Saddam in two weeks. Hey, if you wanted us to live just like you live in America, right now, you could do that right now, but you're not for some reason.

BROWN: The new Iraq, if it is to become a democracy of any sort, will be built one neighborhood a time. Civil affairs units go in and help set up neighborhood councils. This is democracy at its lowest level; 88 councils, all with American mentors, exist today in Baghdad alone.

But the largest and the most important task right now is finding and training a new security force. After the regime fell, there was no law. There was no order. There were no police. There was no sense of safety or security. It was an enormous problem.

MEHANA: When I first got here, we said, well, you know, at least under Saddam, the security force may come out and kidnap or kill somebody, but, at least, for the most part, I felt pretty comfortable walking on the street. Now they're in a situation where they feel like their security has improved a little bit. Now they're starting the next complaint. Well, the police are -- the police are abusive sometimes.

BROWN: Training is slow, leaders hard to find. An effective chain of command is hard to create. It is happening slowly. And there's no guarantee that it will happen at all.

Sovereignty is to be transferred the last day of June. The military will still be here, of course. But Iraq will start assuming responsibility for itself more and more each day, their choices and their future.

(on camera): Do you ever think that you'll look back, when you're 40 years old and go, my God, look at it; it's not that much better?

SPC. FRANCISCO FERNANDEZ, U.S. ARMY: That's a possibility, but once we put this government into their hands, what they do with it is ultimately up to them.

(END VIDEOTAPE)

PHILLIPS: All this week LIVE FROM... will continue to look at changes in Iraq as we mark the first anniversary of the start of the war.

Al Sharpton says so long to the White House in 2004. Will he be back in 2008? And who are the up-and-comers to watch for?

Also ahead, kick the habit your way. What works best when you're trying to quit smoking.

(COMMERCIAL BREAK)

PHILLIPS: Former Democratic presidential candidate Al Sharpton tosses his hat into John Kerry's ring. You'll want to hear what he has to say about why he gave up his presidential bid and how he hopes to turn it into his advantage. Al Sharpton on "CROSSFIRE" at 4:30 Eastern. Don't miss it today.

(BEGIN VIDEO CLIP)

AL SHARPTON (D), FRM. PRESIDENTIAL CANDIDATE: It issue of 2004 is not if gays married, the issue is not who you go to bed with, issue is whether either of you have a job when you get up in the morning.

(END VIDEO CLIP)

PHILLIPS: Al Sharpton often boiled the rhetoric down to the basics providing classic and amusing moments in the Democratic presidential campaign. CNN political analyst Carlos Watson joins to us talk about what Sharpton brings to the political table and of course, the future of more African-Americans running for the presidency.

Good to see you, Carlos. Let's talk about the impact here that -- did it matter that he even ran?

CARLOS WATSON, CNN POLITICAL ANALYST: Well, clearly in terms of the votes, it didn't matter. Fewer than 100,000 votes. Fewer than 40 or 50 delegates. Ultimately didn't make a big difference that way. By comparison, by the way, Jesse Jackson in 1984 racked up some 3 million votes and more than 300 delegates.

But I think he did three significant things. One, clearly what he calls the urban agenda got put on the table. Everything from racial profiling to the health care of minorities and the poor.

No. 2, and a very significant way, he was the funniest one at these debates and often the most important and most effective way to launch a negative attack in this case on President Bush is with a little bit of humor. You saw Sharpton do that.

No. 3, Kyra, I still believe that Howard Dean's downfall, while people took a lot of shots at him in late December and early January, the numbers didn't begin to move until Al Sharpton, the black round debate, hit him between the eyes with the diversity of his cabinet. That's when his numbers started to go south.

So while he wasn't a winner or even a contender, he took out the leader at one point.

PHILLIPS: When you look at presidential contenders, can you compare Al Sharpton to Jesse Jackson?

WATSON: That's tough to do. As I said before, if you go back 20 years, Jackson was a real candidate who ran a real campaign. Agree with him or disagree with him, he added up again three million votes and Sharpton less than 100,000. Jackson had almost 400 delegates and won several states.

Again, Sharpton came in second in one place, third maybe in another. But never really rack up impressive wins. Jackson by the way, later on went on to rack up seven million votes in 1988.

So very different candidates. One was more of a protest figure in the case of Sharpton. The other was legitimately running at one point for the presidency of the United States.

PHILLIPS: Let's talk about paving the way for minorities and listen to what Carol Moseley Braun had to say during the debates.

(BEGIN VIDEOTAPE)

CAROL MOSELEY BRAUN (D), FRM. PRESIDENTIAL CANDIDATE: When women run for office, when people of color run, we open up the possibility that women and people of color can win.

I have a record. And I'm glad Tom referenced it. I have a record of building bridges, bringing people together, and breaking barriers. And I am proud of my role in breaking new ground with this campaign.

(END VIDEO CLIP)

PHILLIPS: That's actually when Carol Moseley Braun dropped out of the race.

Let's talk about breaking barriers. Let's talk about making inroads. Where does it stand now, Carlos, with regard to women, blacks, Hispanics, Native Americans? Are we going forwards or backwards when we look at these type of candidates coming forward and being contenders?

WATSON: In the case of women you see us making progress in a number of different parts of the country. California where I live, both of our senators are women. If you go to the other coast, Maine, both of Maine's senators. Both of the state of Washington senators are women. So you see a lot more women senators. And certainly when Carol Moseley Braun won in 1992, it was dubbed "The Year of the Woman."

This year, 2004, believe it or not, Kyra, may ultimately be dubbed "The Year of the Minority" when it comes to the Senate. You've got some very interesting candidates, relatively young candidates, running in different states.

Today in Illinois, we're likely to see a young African-American, Barack Obama, ivy league graduate, Columbia, Harvard Law School, professor at University of Chicago. We're likely to see him become the nominee for the Senate there in Illinois.

Move a couple states over to Colorado, you're very likely later on this summer to see the nominee become a Hispanic. Ken Salazar, the state attorney general, a former member of Governor Roy Roamer's cabinet, a lawyer himself, 49 years old. You're likely to see Salazar have a chance to become the first Latino member of the U.S. Senate since '77 when Joseph Montoya served in New Mexico.

If you continue to move over in this central region of Oklahoma, a full enrolled member of the Cherokee Nation, Brad Carson, Rhodes scholar, young member of Congress, right now not only the odds-on favorite to win the Democratic nomination there. But right in head- to-head polls with the leading Republican, he's actually ahead, which is a surprise because Oklahoma is a classic Red State, if you will. Classic Republican state.

So you're likely to see a number of very interesting things happen in 2004. Lo and behold, fast forward to the presidential race, there is even talk now that the CEO of Fannie Mae, who also is a former director of the Office of Management and Budget in the Clinton White House, Frank Raines, very serious long shot candidate for the vice presidency.

If he doesn't get that, there is talk that he may end up being the secretary of the treasury which would make him the first African- American to serve as secretary of the treasury.

PHILLIPS: Carlos Watson, I still think you need to be setting your sights on the presidency. We'll continue to follow diversity and also the urban agenda, of course.

WATSON: Kyra Phillips and my mom are the two people who look out for me the best in this world. I like it.

PHILLIPS: We'll be your campaign manager and your publicist. Is that a deal?

WATSON: One in Florida, one in Georgia. I like that.

PHILLIPS: There you go. We're going to cover the globe. Carlos Watson, thanks so much.

WATSON: Take care.

PHILLIPS: All right.

Will the economy strike a chord with the voters this year? Let's check in with Frank Newport, editor in chief of the Gallup Poll -- Frank.

FRANK NEWPORT, EDITOR-IN-CHIEF, GALLUP POLL: Well, Kyra, yes. In answer to your question, most important problem facing the nation, we ask that every month. Here's the results. It's the economy, it's the economy, it's the economy. We see it every month. Terrorism, Iraq, national security, they're certainly there. These are top of mind responses from the American public.

But look at the top two there: 21 percent say the economy, 19 percent jobs. That's up a little. Add those together and 40 percent- plus of Americans who spontaneously tell us that it is the economy which is going to be problem they think bedeviling the United States the most.

Speaking of the economy, is it getting better or worse? Economists may argue, Kyra, but the public doesn't. It's getting worse. At least by three points. That's huge change from what we found early in January. See that 66 to 27 opinion point margin there, almost a 40-point positive over negative perception of the direction of the economy, now that's collapsed.

Forty-seven percent say it's getting worse. For whatever reason, stock market, jobs, Democratic criticisms, Americans look ahead and say the economy is going to go down, not up.

PHILLIPS: Let's talk about the mood of Americans. How satisfied are they with the way things are going?

NEWPORT: Key figure here, 39 percent. That's the number who say America is on the right track. The so-called satisfaction measure we track at Gallup. It's been up and down over the last year. Last year a year ago right after the war started, we had a rally effect. It was 60 percent. The 39 percent well below 50 percent.

Not fatal, however, to a president seeking election. Historically Clinton in '96 had satisfaction levels overall about the same level. Of course, he beat Bob Dole handily. This in and of itself isn't totally bad news for Bush.

PHILLIPS: Frank Newport, thank you.

Straight ahead, trying to kick the smoking habit? Treatment isn't one size fits all. Our Dr. Sanjay Gupta will explain.

(COMMERCIAL BREAK)

PHILLIPS: Outsourcing is a touchy issue in the presidential election. Secretary of State Colin Powell calls it a fact of life. Today Powell discussed American jobs outsourced to India where labor is plentiful and cheap. Powell is pressing India to reciprocate and open its market to more American products.

CNN financial correspondent Lisa Sylvester reports even some companies committed to buy American ethic are forced to go offshore.

(BEGIN VIDEOTAPE)

LISA SYLVESTER, CNNfn CORRESPONDENT (voice-over): Don Frantz is an all-American guy. He drives a Harley, the family vehicles are a Ford pickup truck and a Buick. And at his factory, Frantz Machine Products in New Berlin, Wisconsin, all of the equipment is American made.

But while Frantz believes in buying American, his distributors don't feel the same way.

DON FRANTZ, OWNER FRANTZ MACHINE: When we went to the distributors, we found our foreign competition was much less and they wouldn't even talk to us. We were too expensive.

SYLVESTER: Frantz Machine Products makes precision parts for other manufacturers, including trailer locks. The company's locks sold for $17. The Chinese competitors were retailing the locks for $12. With those numbers, it was hard to find any willing buyers. The company faced a difficult decision.

FRANTZ: It forced us to go to China. Very tough for me to do that, but it was either go to China or quit the business, stop the business.

SYLVESTER: His company ended up compromising, starting a production line in China while still producing some of the locks in the United States.

If the company had its way, all of its products would be made in America. But it's hard when you're up against foreign manufacturers who can tap into cheap labor.

Cathy Kraatz, Don's daughter, believes if American consumers were willing to pay for more American products, it would save manufacturing jobs.

CATHY KRAATZ, FRANTZ MACHINE PRODUCTS: If they could just try and make a conscious effort every time to purchase American-made products, and take a stand against what's happening in the manufacturing industry in America, it can make a huge difference.

SYLVESTER: The way the family sees it, it may cost more to buy American, but there are hidden costs when you don't -- in the form of more pink slips and job lay offs.

(on camera): Don Frantz is not only loyal to the American brand but also his workers. More than half of them have been with him from the very beginning when he started his company 25 years ago.

Lisa Sylvester, CNN, Washington.

(END VIDEOTAPE)

(MARKET UPDATE)

PHILLIPS: As many people know, kicking smoking is not easy. But there are a lot of nicotine replacement products that can help relieve some of the withdrawal symptoms. Now a new study suggests that what works for one smoker may not work for another. Dr. Sanjay Gupta explains. (BEGIN VIDEOTAPE)

DR. SANJAY GUPTA, CNN MEDICAL CORRESPONDENT (voice-over): Kicking nicotine has been compared to kicking a cocaine habit. Even heroin.

TOM GLYNN, AMERICAN CANCER SOCIETY: Nicotine is a very addicting drug. It's a real challenge for people to quit.

GUPTA: So what does it take to quit? Researchers at the University of Pennsylvania compared smokers using a nicotine patch to those using nicotine nasal spray. And they found the spray works better for African-Americans. Why?

GLYNN: African-Americans may be metabolizing nicotine a little differently than white Americans. And so, basically, need some more nicotine. And the nasal spray can provide that very quickly.

GUPTA: The study also found the nasal spray is more effective for obese people. That's because eating and smoking may be linked to a similar reward pathway in the brain and a chemical called dopamine. And so the researchers believe the nasal spray may immediately simulate the same feeling of satisfaction that food and smoking provide.

And if you are highly addicted, whatever your race and weight, the nasal spray, also according to this study, seems to work better. It allows you to pump whenever a craving calls.

GLYNN: Before this, we were kind of reduced to licking our finger and saying, OK, let's say which way the wind is blowing and make a prediction. Now, we can say, OK, for you, here, this may be the best medication.

GUPTA: So, is the patch useful? Well, these researchers say yes. That is, if you stick with it. The patch will help you become smoke-free, especially if you add in another key ingredient, counseling.

Dr. Sanjay Gupta, CNN, Atlanta.

(END VIDEOTAPE)

PHILLIPS: You've heard of six degrees of separation or Friendster. Connecting one person to another. Think about that in terms of terrorism. A University of Pennsylvania professor will show us there aren't that many degrees of separation between some of the world's best-known terrorists.

Also ahead, 11-year-old boy stopped at an Israeli checkpoint with a bomb in his backpack.

Later, he lost his job but then he hit big time in the lottery. You're watching LIVE FROM...

(COMMERCIAL BREAK) TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com




Bombings Held; Pakistani Forces Continue Battle for Control in Tribal Areas>


Aired March 16, 2004 - 14:30   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KYRA PHILLIPS, CNN ANCHOR: Live pictures now. The first official funeral mass for those killed in the Madrid bombings is happening right now. Two hundred one people were killed in those attacks. More than 1,500 were injured in the commuter train attack that happened March 11. Authorities say that backpacks loaded with more than 220 pounds of explosives, mostly dynamite, were used.
President Bush vows that terror attacks will never shake the will of the United States. Mr. Bush met in Washington today with the Dutch foreign minister (sic) and urged U.S. allies to remain committed to rebuilding Iraq. About 1,100 Dutch troops are in there.

In Pakistan, paramilitary forces continue to battle for control in tribal areas along the Afghan border. Twenty-four terror suspects were killed, 18 captured in the latest battle near the town of Wana. U.S. and Pakistani officials believe remnants of the Taliban and al Qaeda network may be hiding out in that area.

Two people reported dead and ten wounded in Gaza after a strike by Israeli attack helicopters. Sources say the two dead -- the two that were killed were Islamic Jihad members. The Israeli cabinet has decided to step up targeted killings of Palestinian militants in response to suicide attacks over the weekend.

A year after the U.S.-led campaign to depose Saddam Hussein, what do Iraqis think about their new life? A new ABC poll taken in face- to-face interviews with more than 2,700 Iraqis provides a glimpse. Forty-eight percent say the coalition did the right thing. Thirty- nine percent say it was wrong. People are equally divided over whether Iraq was humiliated or liberated.

And while most Arabs oppose the U.S. occupation, most of them also want U.S. forces to stay in Iraq for the time being. They overwhelmingly oppose attacks on coalition troops.

One final note. Fifty-six percent of all Iraqis say life is better now than it was a year ago.

CNN's Aaron Brown takes a closer look now at life in Iraq one year later.

(BEGIN VIDEOTAPE)

AARON BROWN, CNN CORRESPONDENT (voice-over): This was Baghdad after the fall, right after the fall. Captain Shawn Mehana was there then and is still here now.

CAPT. SHAWN MEHANA, U.S. ARMY: We rolled into Baghdad. There was no power. A lot of people weren't out in the streets. And I think they were a little bit weary of us still at the time. No sewage, no running water. It was like it was dead. And that was a little bit shocking to me, the fact that -- to see a city of 5.5 million people that is completely nonfunctional.

BROWN: Ten months later, things are vastly different. Power is on more than it's not. The lawlessness of those early weeks has stabilized markedly. Things are much better, but they aren't perfect by any means. And the occupying force often gets the blame. After all, they are Americans.

MAJ. SCOTT CALDWELL, U.S. ARMY: They think that we can go to the moon. We have a space shuttle. We conquered, we knocked down Saddam in two weeks. Hey, if you wanted us to live just like you live in America, right now, you could do that right now, but you're not for some reason.

BROWN: The new Iraq, if it is to become a democracy of any sort, will be built one neighborhood a time. Civil affairs units go in and help set up neighborhood councils. This is democracy at its lowest level; 88 councils, all with American mentors, exist today in Baghdad alone.

But the largest and the most important task right now is finding and training a new security force. After the regime fell, there was no law. There was no order. There were no police. There was no sense of safety or security. It was an enormous problem.

MEHANA: When I first got here, we said, well, you know, at least under Saddam, the security force may come out and kidnap or kill somebody, but, at least, for the most part, I felt pretty comfortable walking on the street. Now they're in a situation where they feel like their security has improved a little bit. Now they're starting the next complaint. Well, the police are -- the police are abusive sometimes.

BROWN: Training is slow, leaders hard to find. An effective chain of command is hard to create. It is happening slowly. And there's no guarantee that it will happen at all.

Sovereignty is to be transferred the last day of June. The military will still be here, of course. But Iraq will start assuming responsibility for itself more and more each day, their choices and their future.

(on camera): Do you ever think that you'll look back, when you're 40 years old and go, my God, look at it; it's not that much better?

SPC. FRANCISCO FERNANDEZ, U.S. ARMY: That's a possibility, but once we put this government into their hands, what they do with it is ultimately up to them.

(END VIDEOTAPE)

PHILLIPS: All this week LIVE FROM... will continue to look at changes in Iraq as we mark the first anniversary of the start of the war.

Al Sharpton says so long to the White House in 2004. Will he be back in 2008? And who are the up-and-comers to watch for?

Also ahead, kick the habit your way. What works best when you're trying to quit smoking.

(COMMERCIAL BREAK)

PHILLIPS: Former Democratic presidential candidate Al Sharpton tosses his hat into John Kerry's ring. You'll want to hear what he has to say about why he gave up his presidential bid and how he hopes to turn it into his advantage. Al Sharpton on "CROSSFIRE" at 4:30 Eastern. Don't miss it today.

(BEGIN VIDEO CLIP)

AL SHARPTON (D), FRM. PRESIDENTIAL CANDIDATE: It issue of 2004 is not if gays married, the issue is not who you go to bed with, issue is whether either of you have a job when you get up in the morning.

(END VIDEO CLIP)

PHILLIPS: Al Sharpton often boiled the rhetoric down to the basics providing classic and amusing moments in the Democratic presidential campaign. CNN political analyst Carlos Watson joins to us talk about what Sharpton brings to the political table and of course, the future of more African-Americans running for the presidency.

Good to see you, Carlos. Let's talk about the impact here that -- did it matter that he even ran?

CARLOS WATSON, CNN POLITICAL ANALYST: Well, clearly in terms of the votes, it didn't matter. Fewer than 100,000 votes. Fewer than 40 or 50 delegates. Ultimately didn't make a big difference that way. By comparison, by the way, Jesse Jackson in 1984 racked up some 3 million votes and more than 300 delegates.

But I think he did three significant things. One, clearly what he calls the urban agenda got put on the table. Everything from racial profiling to the health care of minorities and the poor.

No. 2, and a very significant way, he was the funniest one at these debates and often the most important and most effective way to launch a negative attack in this case on President Bush is with a little bit of humor. You saw Sharpton do that.

No. 3, Kyra, I still believe that Howard Dean's downfall, while people took a lot of shots at him in late December and early January, the numbers didn't begin to move until Al Sharpton, the black round debate, hit him between the eyes with the diversity of his cabinet. That's when his numbers started to go south.

So while he wasn't a winner or even a contender, he took out the leader at one point.

PHILLIPS: When you look at presidential contenders, can you compare Al Sharpton to Jesse Jackson?

WATSON: That's tough to do. As I said before, if you go back 20 years, Jackson was a real candidate who ran a real campaign. Agree with him or disagree with him, he added up again three million votes and Sharpton less than 100,000. Jackson had almost 400 delegates and won several states.

Again, Sharpton came in second in one place, third maybe in another. But never really rack up impressive wins. Jackson by the way, later on went on to rack up seven million votes in 1988.

So very different candidates. One was more of a protest figure in the case of Sharpton. The other was legitimately running at one point for the presidency of the United States.

PHILLIPS: Let's talk about paving the way for minorities and listen to what Carol Moseley Braun had to say during the debates.

(BEGIN VIDEOTAPE)

CAROL MOSELEY BRAUN (D), FRM. PRESIDENTIAL CANDIDATE: When women run for office, when people of color run, we open up the possibility that women and people of color can win.

I have a record. And I'm glad Tom referenced it. I have a record of building bridges, bringing people together, and breaking barriers. And I am proud of my role in breaking new ground with this campaign.

(END VIDEO CLIP)

PHILLIPS: That's actually when Carol Moseley Braun dropped out of the race.

Let's talk about breaking barriers. Let's talk about making inroads. Where does it stand now, Carlos, with regard to women, blacks, Hispanics, Native Americans? Are we going forwards or backwards when we look at these type of candidates coming forward and being contenders?

WATSON: In the case of women you see us making progress in a number of different parts of the country. California where I live, both of our senators are women. If you go to the other coast, Maine, both of Maine's senators. Both of the state of Washington senators are women. So you see a lot more women senators. And certainly when Carol Moseley Braun won in 1992, it was dubbed "The Year of the Woman."

This year, 2004, believe it or not, Kyra, may ultimately be dubbed "The Year of the Minority" when it comes to the Senate. You've got some very interesting candidates, relatively young candidates, running in different states.

Today in Illinois, we're likely to see a young African-American, Barack Obama, ivy league graduate, Columbia, Harvard Law School, professor at University of Chicago. We're likely to see him become the nominee for the Senate there in Illinois.

Move a couple states over to Colorado, you're very likely later on this summer to see the nominee become a Hispanic. Ken Salazar, the state attorney general, a former member of Governor Roy Roamer's cabinet, a lawyer himself, 49 years old. You're likely to see Salazar have a chance to become the first Latino member of the U.S. Senate since '77 when Joseph Montoya served in New Mexico.

If you continue to move over in this central region of Oklahoma, a full enrolled member of the Cherokee Nation, Brad Carson, Rhodes scholar, young member of Congress, right now not only the odds-on favorite to win the Democratic nomination there. But right in head- to-head polls with the leading Republican, he's actually ahead, which is a surprise because Oklahoma is a classic Red State, if you will. Classic Republican state.

So you're likely to see a number of very interesting things happen in 2004. Lo and behold, fast forward to the presidential race, there is even talk now that the CEO of Fannie Mae, who also is a former director of the Office of Management and Budget in the Clinton White House, Frank Raines, very serious long shot candidate for the vice presidency.

If he doesn't get that, there is talk that he may end up being the secretary of the treasury which would make him the first African- American to serve as secretary of the treasury.

PHILLIPS: Carlos Watson, I still think you need to be setting your sights on the presidency. We'll continue to follow diversity and also the urban agenda, of course.

WATSON: Kyra Phillips and my mom are the two people who look out for me the best in this world. I like it.

PHILLIPS: We'll be your campaign manager and your publicist. Is that a deal?

WATSON: One in Florida, one in Georgia. I like that.

PHILLIPS: There you go. We're going to cover the globe. Carlos Watson, thanks so much.

WATSON: Take care.

PHILLIPS: All right.

Will the economy strike a chord with the voters this year? Let's check in with Frank Newport, editor in chief of the Gallup Poll -- Frank.

FRANK NEWPORT, EDITOR-IN-CHIEF, GALLUP POLL: Well, Kyra, yes. In answer to your question, most important problem facing the nation, we ask that every month. Here's the results. It's the economy, it's the economy, it's the economy. We see it every month. Terrorism, Iraq, national security, they're certainly there. These are top of mind responses from the American public.

But look at the top two there: 21 percent say the economy, 19 percent jobs. That's up a little. Add those together and 40 percent- plus of Americans who spontaneously tell us that it is the economy which is going to be problem they think bedeviling the United States the most.

Speaking of the economy, is it getting better or worse? Economists may argue, Kyra, but the public doesn't. It's getting worse. At least by three points. That's huge change from what we found early in January. See that 66 to 27 opinion point margin there, almost a 40-point positive over negative perception of the direction of the economy, now that's collapsed.

Forty-seven percent say it's getting worse. For whatever reason, stock market, jobs, Democratic criticisms, Americans look ahead and say the economy is going to go down, not up.

PHILLIPS: Let's talk about the mood of Americans. How satisfied are they with the way things are going?

NEWPORT: Key figure here, 39 percent. That's the number who say America is on the right track. The so-called satisfaction measure we track at Gallup. It's been up and down over the last year. Last year a year ago right after the war started, we had a rally effect. It was 60 percent. The 39 percent well below 50 percent.

Not fatal, however, to a president seeking election. Historically Clinton in '96 had satisfaction levels overall about the same level. Of course, he beat Bob Dole handily. This in and of itself isn't totally bad news for Bush.

PHILLIPS: Frank Newport, thank you.

Straight ahead, trying to kick the smoking habit? Treatment isn't one size fits all. Our Dr. Sanjay Gupta will explain.

(COMMERCIAL BREAK)

PHILLIPS: Outsourcing is a touchy issue in the presidential election. Secretary of State Colin Powell calls it a fact of life. Today Powell discussed American jobs outsourced to India where labor is plentiful and cheap. Powell is pressing India to reciprocate and open its market to more American products.

CNN financial correspondent Lisa Sylvester reports even some companies committed to buy American ethic are forced to go offshore.

(BEGIN VIDEOTAPE)

LISA SYLVESTER, CNNfn CORRESPONDENT (voice-over): Don Frantz is an all-American guy. He drives a Harley, the family vehicles are a Ford pickup truck and a Buick. And at his factory, Frantz Machine Products in New Berlin, Wisconsin, all of the equipment is American made.

But while Frantz believes in buying American, his distributors don't feel the same way.

DON FRANTZ, OWNER FRANTZ MACHINE: When we went to the distributors, we found our foreign competition was much less and they wouldn't even talk to us. We were too expensive.

SYLVESTER: Frantz Machine Products makes precision parts for other manufacturers, including trailer locks. The company's locks sold for $17. The Chinese competitors were retailing the locks for $12. With those numbers, it was hard to find any willing buyers. The company faced a difficult decision.

FRANTZ: It forced us to go to China. Very tough for me to do that, but it was either go to China or quit the business, stop the business.

SYLVESTER: His company ended up compromising, starting a production line in China while still producing some of the locks in the United States.

If the company had its way, all of its products would be made in America. But it's hard when you're up against foreign manufacturers who can tap into cheap labor.

Cathy Kraatz, Don's daughter, believes if American consumers were willing to pay for more American products, it would save manufacturing jobs.

CATHY KRAATZ, FRANTZ MACHINE PRODUCTS: If they could just try and make a conscious effort every time to purchase American-made products, and take a stand against what's happening in the manufacturing industry in America, it can make a huge difference.

SYLVESTER: The way the family sees it, it may cost more to buy American, but there are hidden costs when you don't -- in the form of more pink slips and job lay offs.

(on camera): Don Frantz is not only loyal to the American brand but also his workers. More than half of them have been with him from the very beginning when he started his company 25 years ago.

Lisa Sylvester, CNN, Washington.

(END VIDEOTAPE)

(MARKET UPDATE)

PHILLIPS: As many people know, kicking smoking is not easy. But there are a lot of nicotine replacement products that can help relieve some of the withdrawal symptoms. Now a new study suggests that what works for one smoker may not work for another. Dr. Sanjay Gupta explains. (BEGIN VIDEOTAPE)

DR. SANJAY GUPTA, CNN MEDICAL CORRESPONDENT (voice-over): Kicking nicotine has been compared to kicking a cocaine habit. Even heroin.

TOM GLYNN, AMERICAN CANCER SOCIETY: Nicotine is a very addicting drug. It's a real challenge for people to quit.

GUPTA: So what does it take to quit? Researchers at the University of Pennsylvania compared smokers using a nicotine patch to those using nicotine nasal spray. And they found the spray works better for African-Americans. Why?

GLYNN: African-Americans may be metabolizing nicotine a little differently than white Americans. And so, basically, need some more nicotine. And the nasal spray can provide that very quickly.

GUPTA: The study also found the nasal spray is more effective for obese people. That's because eating and smoking may be linked to a similar reward pathway in the brain and a chemical called dopamine. And so the researchers believe the nasal spray may immediately simulate the same feeling of satisfaction that food and smoking provide.

And if you are highly addicted, whatever your race and weight, the nasal spray, also according to this study, seems to work better. It allows you to pump whenever a craving calls.

GLYNN: Before this, we were kind of reduced to licking our finger and saying, OK, let's say which way the wind is blowing and make a prediction. Now, we can say, OK, for you, here, this may be the best medication.

GUPTA: So, is the patch useful? Well, these researchers say yes. That is, if you stick with it. The patch will help you become smoke-free, especially if you add in another key ingredient, counseling.

Dr. Sanjay Gupta, CNN, Atlanta.

(END VIDEOTAPE)

PHILLIPS: You've heard of six degrees of separation or Friendster. Connecting one person to another. Think about that in terms of terrorism. A University of Pennsylvania professor will show us there aren't that many degrees of separation between some of the world's best-known terrorists.

Also ahead, 11-year-old boy stopped at an Israeli checkpoint with a bomb in his backpack.

Later, he lost his job but then he hit big time in the lottery. You're watching LIVE FROM...

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