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American Hostage Beheaded on New Video; Israelis & Palestinians Fight in Gaza City

Aired May 11, 2004 - 13:58   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.


(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: We didn't find any order whatsoever, sir, written or otherwise that directed them to do what they did.

(END VIDEO CLIP)

MILES O'BRIEN, CNN ANCHOR: So who is to blame for the abuse of prisoners in Iraq? The major general who reported on the problem testifies.

KYRA PHILLIPS, CNN ANCHOR: Saddam Hussein's date with justice, new information about a future trial for him.

O'BRIEN: Inside the urban combat zone. The tricky battle American forces face in an unexpected hot spot.

PHILLIPS: Madonna's turf war. Why the pop superstar's fighting a losing battle to keep some hiking enthusiasts off her grass.

From the CNN Center in Atlanta, I'm Kyra Phillips.

O'BRIEN: And I'm Miles O'Brien. This hour of CNN's LIVE FROM... starts right now.

PHILLIPS: Up first this hour, failure in leadership, lack of discipline, no training whatsoever, a major general's major complaints about the handling of Iraqi detainees at Abu Ghraib and beyond. If you've been watching CNN, you've seen the author of the Pentagon's internal probe of the prisoner abuse scandal share and defend his findings on Capitol Hill.

CNN's Barbara Starr watching it from the Pentagon now -- Barbara.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Kyra, this hearing could not have started off with a more blunt, direct assessment by the man, General Antonio Taguba, who wrote the report. He appeared this morning before the Senate Armed Services Committee on Capitol Hill. After he was sworn in, along with other top officials, the chairman of the committee, Senator John Warner, got right down to business.

(BEGIN VIDEO CLIP)

SEN. JOHN WARNER (R-VA), CHMN., ARMED SERVICES CMTE.: In simple words, your own soldier's language how did this happen? UNIDENTIFIED MALE: A failure in leadership, sir, from the brigade commander on down, lack of discipline, no training whatsoever and no supervision. Supervisory omission was rampant.

STARR: A very grim assessment by General Taguba of what was going on at Abu Ghraib Prison in Iraq late last year, now seen around the world in those photographs showing the abuse of Iraqi detainees by U.S. soldiers.

Now here at the Pentagon this afternoon, Defense Secretary Donald Rumsfeld appeared before a group of Pentagon employees. It was a previously scheduled meeting. But clearly topic number one on everybody's mind was the prisoner abuse scandal. And the secretary talked about the reaction once those photographs came to the Pentagon.

(BEGIN VIDEO CLIP)

DONALD RUMSFELD, SECRETARY OF DEFENSE: The look on the faces of the people who have viewed the photographs and the videos from what took place there, they were stunned, absolutely stunned, that any Americans wearing a uniform could do what they did.

(END VIDEO CLIP)

STARR: Kyra, a grim assessment all the way around. A number of investigations continued into this matter. And look for still more hearings on Capitol Hill - Kyra.

PHILLIPS: And we'll be following, Barbara Starr, thanks so much.

Well, it is grabbing headlines and attention across America, 80 percent of people surveyed in a new CNN/"USA Today/Gallup poll say that they are closely following the abuse scandal; 49 percent say the abuse is a major setback for the U.S. in the war in Iraq, 36 percent consider it a minor setback. When it comes to blame, there's lots to go around. A majority of those polled say that the soldiers involved and their superiors share a great deal of responsibility. A minority of those surveyed put much of the blame on intelligence officers, Defense Secretary Donald Rumsfeld and President Bush. We'll have more results later in the hour.

O'BRIEN: The coalition's most infamous prisoner, Saddam Hussein, could soon be facing Iraqi justice. Salem Chalabi, who heads the special tribunal set up to prosecute the former dictator, is telling CNN the coalition is considering handing him over before June 30. And that's when power is to be transferred back to the Iraqis, as you well know. A Pentagon spokesman says no date has been set for Saddam's trial, however.

On the ground, meanwhile, a civilian convoy ambushed on the way from Jordan to Baghdad. The Halliburton subsidiary, Kellogg, Brown & Root says all truck drivers have been accounted for. But not known if anyone was hurt or if any trucks were destroyed. We'll have more details later. The newly appointed governor of Najaf has hit the ground running. Hours after arriving, he was meeting with tribal and religious leaders and CNN's Jane Arraf. He says the leaders all agree militias like that of renegade cleric al-Sadr must be disbanded.

The U.S. commander of forces locked in a stand-off with al-Sadr's militia in Najaf and Kufa is urging local leaders to intervene. Fighting in Najaf is now house-to-house, street by street.

Our Jane Arraf is imbedded with the 2nd Armored Cavalry. She brings us an exclusive look at the fighting.

(BEGIN VIDEOTAPE)

JANE ARRAF, CNN BAGHDAD BUREAU CHIEF (voice-over): Attacks from crowded neighborhoods, ambushes from alleys, here in Najaf, the U.S. military is fighting the kind of sustained urban warfare it thought it would encounter in Baghdad but never did. This mission on Sunday was to find weapons and kill or capture members of the Mehdi militia of radical Shia leader Muqtada al-Sadr. It doesn't take long for the militia to attack.

UNIDENTIFIED MALE: I've got contact.

ARRAF: Rocket-propelled grenades fly at the 2nd Battalion 37th Armored tanks and armored vehicles.

UNIDENTIFIED MALE: Right there. It is live. It was just cruising along and just (expletive deleted) landed right there.

ARRAF: A loud speaker warns people to stay off the streets, leaflets tell residents the U.S. is fighting only the militia and not them.

(on camera): We're in an armored personnel carrier in the middle of a crowded city. Major combat was supposed to be over more than a year ago. But this seems like classic urban warfare with soldiers facing an enemy more dangerous than the Iraqi army was.

(voice-over): The attacks can come from anywhere.

UNIDENTIFIED MALE: Second floor where the air conditioner is?

UNIDENTIFIED MALE: Yes.

UNIDENTIFIED MALE: Keep an eye on that. Almost looks like there's a guy in there.

ARRAF: Often they come from places that are hard to fire into, especially in a city that's home to the holiest Shia shrines.

UNIDENTIFIED MALE: They're fighting dirty. It's easy to hide in a mosque. It's easy to hide in civilian crowds and not play by the rules.

ARRAF: The civilians often don't know the rules. After a few heart-stopping seconds, he's allowed to drive away.

UNIDENTIFIED MALE: He's showing his hands. ARRAF: These soldiers spent a year in Baghdad where they helped rebuild the city. There the biggest threat was roadside bombs and the attackers mostly anonymous. Now they're back to actual fighting.

SPC. MICHAEL PERRY, 2ND BAT. 1ST ARMORED REGIMENT: I'd rather be out here, you know, with a known enemy than having some coward try to blow me up on the side of the road. Myself, I mean. These people are fighting me face-to-face for the most part.

ARRAF: And although vastly outnumbered and outgunned, they still keep coming.

UNIDENTIFIED MALE: Ordnance they're sending out, I can't hear them, I can't hear aggressive.

ARRAF: It's yet another mortar round. No damage to the tank or to the soldiers inside, but the militia's point clearly made.

Jane Arraf, CNN, Najaf, Iraq.

(END VIDEOTAPE)

O'BRIEN: We'll talk more about all of today's Iraq developments with CNN military analyst Major General Don Shepperd in just a few moments. Stay tuned for that.

PHILLIPS: Pushing education reform, President Bush in the battleground state of Arkansas. He's in Van Buren speaking on No Child Left Behind. But Arkansas Democrats are criticizing the president. One says the education law is "a collection of broken promises."

Greeting supporters in Kentucky, the presumed Democratic presidential nominee, John Kerry, is in attack mode at a rally in Louisville. Kerry criticized Bush's record on the economy and health care. Kerry plans to tout his own health care ideas in the battleground state of Florida later today. Polls show Kerry neck and neck with Bush.

O'BRIEN: News across America now. We begin in Northern California. The judge in the Scott Peterson case has denied a defense motion for another change of venue. The double murder trial has already been moved to Redwood City where jury selection is under way. Mark Geragos, Peterson's attorney, contends an impartial jury cannot be seated anywhere in the Bay Area.

A bombshell ruling in the recruiting scandal at the University of Colorado: The state's attorney general will not seek criminal charges in nine alleged sexual assaults involving football players at the school. A task force unanimously agreed against the charges.

Farther south, amazing images of a twister in Colorado, it's one of six tornados that touched down in Elberg (ph) County yesterday, destroying a house and a barn. The family of four who live there escaped safely. The storm chaser who shot this video says he was lucky and well prepared. (BEGIN VIDEO CLIP)

ERIC TREECE, STORM CHASER: The biggest thing you can do is learn everything you can about the animal you're hunting before you go out and seek the beast.

(END VIDEO CLIP)

PHILLIPS: Well, straight ahead, from soldiers returning from the field of battle, nothing could mean more than a firm handshake or friendly hug. Meet the strangers who make sure they get it later on LIVE FROM...

Trashy movies, why the next DVD you can bring home -- or you could bring home could very well end up in the garbage.

And I scream, you scream, we all scream when we find out the price of ice cream. The scoop on LIVE FROM... straight ahead.

(COMMERCIAL BREAK)

O'BRIEN: The prisoner abuse scandal is making the future of the U.S. military mission in Iraq even more difficult than it already was. For military analysis of revelations and the overall state of the war effort, we go to Tucson, Arizona, retired General Don Shepperd, U.S. Air Force.

Good to have you, General Shepperd, back with us.

MAJ. GEN. DON SHEPPERD, CNN MILITARY ANALYST: A pleasure, Miles.

O'BRIEN: All right, let's talk, first of all, it seemed as if there was some confusion today in that hearing -- I know you watched it fairly thoroughly, some confusion about who precisely was running that prison. What does military doctrine call for in a case like that?

SHEPPERD: Yes, military doctrine it calls basically for a very clear chain of command, of who is in control, who issues orders. And it's clear that this was muddled from the very beginning and maybe led to some of the problems, Miles. You always have to know who you work for and what you were responsible for, and all of that was muddled up at the beginning of this big mess.

O'BRIEN: Now General Taguba was very scathing, very blunt. It reflects the report, if you'd read it. Does it indicate to you that what's happened at Abu Ghraib is an isolated case?

SHEPPERD: Well, this is a case that faces every police department in the United States and around the world every day, is how do you detain people, how do you handle them, and it is part of military training? What General Taguba said was they had no leadership, no training and no supervision. That is a terrible indictment about the chain of demand at Abu Ghraib Prison.

Obviously, there were other incidents in other prisons around the country. But it appears that this was one section of Abu Ghraib Prison. And it appears that it was a small group of people. So when you say is it isolated, there were other incidents and always have been and always will be. But they were stamped out. This appears to me to be an isolated problem with many tentacles growing out of it.

O'BRIEN: All right, but let's talk about the big picture here for a minute. While there might not be a clear cut written order to do this sort of thing, I can't imagine that you'd ever discover one, the tone that was set at the very top here in the war on terror was to get real tough with potential terrorists. And that goes for not just Abu Ghraib, but Guantanamo, you name it. That tone, does that not sort of set a bad example for people who are at the -- right in the trenches, so to speak?

SHEPPERD: Miles, I don't buy any of that. That becomes an excuse and it certainly will be part of the defense of any of these individuals by defense counsel. But very clearly the purpose of our actions in Iraq were to bring the insurgency to a halt, to gather information, to prosecute those, and all of the people involved in this, military police, military interrogation, they are schooled and trained and know the rules. And one of the basic rules is you don't break the law.

And another basic rule is, no matter who issues you an order, that order has to be legal. There is little confusion about this. The people involved in this knew they were doing wrong. And any winks and nods or any messages from the top command about getting tough with prisoners did not mean carrying out this type of act.

O'BRIEN: This whole incident, we've talked about it before, how it highlighted the lack of personnel on the ground in a sense, a lack of boots on the ground, the fact that there was a lot of stress there. But what compounded the stress in this case really goes back to the roots of all this, which is fundamental failure of intelligence. If the intelligence had been wired a little better, perhaps it wouldn't have had to round up so many people trying to figure out what's going on in the country?

SHEPPERD: Well, you're absolutely right there. Our intelligence -- our human intelligence was just decimated for the past several decades in the Middle East. We simply had none. We were starting from ground zero. The purpose of a lot of these raids, going into these villages in the middle of the night, rounding up people, detaining them, was to obtain intelligence that we simply didn't have.

Later that strategy changed. We were making more enemies than we were doing good. That strategy to getting the intelligence and then going after the individuals involved, a small number of houses as opposed to whole villages. So the decimation of our intelligence certainly played a part in this. But again, the basic reason that all of this happened was men and women did wrong and they knew it when they were doing it.

O'BRIEN: All right, but one other thing, we talked about the top-down pressure that may or may not have been there. Bottom up, literally on the streets there, their friends, their comrades, getting blown up day after day. That's got to, you know, change the psyche quite a bit inside those walls.

SHEPPERD: It plays on your psyche, no question about that. But the basic rule of leadership is, we don't become like them. Our basic American values and what we're fighting for, just because people blow up our comrades, we are carrying out a mission and we know what that mission is. Just because somebody orders you to do something illegal does not mean you do it. Every soldier in America is trained that way from the very, very beginning. So yes, it plays on your psyche, yes, it is frustrating. But you can't let it degrade you into an animal that kills people or carries out illegal acts. And it appears that this is what happened here.

O'BRIEN: The overall strategy here should have been, I think we can all agree, to win the hearts and minds of the Iraqi people, not necessarily the conquest of turf per se in the old fashioned sense. Nothing I see here seems to support that strategy.

SHEPPERD: In fact it goes exactly the opposite way. There has been a lot of talk about winning the hearts and minds of the Iraqi people. Clearly we want to do that. But even more than that, we want to win the hearts and minds of the Arab world. We want to win the hearts and minds of the world. And this takes us in a step in exactly the wrong direction. It really is a black eye on the military, it's a black eye on America. And I think we all feel stained about it.

O'BRIEN: Major General Don Shepperd, retired U.S. Air Force, always appreciate your insights, thanks for your time.

SHEPPERD: Thanks.

O'BRIEN: Kyra.

PHILLIPS: Now to another hot spot, the Middle East, where it is getting even hotter: 13 people are dead in fierce fighting in Gaza City. What started out as an operation to destroy workshops used by militants escalated into chaos. The heavy fighting is particularly troubling to the U.N. We get the latest now from our Matthew Chance in Gaza.

(BEGIN VIDEOTAPE)

MATTHEW CHANCE, CNN CORRESPONDENT: This is turning into a major confrontation between Israeli troops and Palestinian militants here in Gaza. The fighting has been continuing since the early hours of this morning. And then still clashes, quite ferocious ones, being reported from the Zeitoun neighborhood, a very densely populated neighborhood of Gaza City.

Israeli forces, backed by helicopter gunships, staged an incursion in the area as of this morning, but were met with fierce resistance from Palestinian militant fighters here in Gaza. There have been casualties, at least seven, at this stage, on the Palestinian side. Seven people killed, that is. One of them a 14- year-old Palestinian boy when an Israeli helicopter gunship fired one of its rockets into a car on the streets of Zeitoun. There have also been at least six Israelis killed (UNINTELLIGIBLE) Israeli ministry in nearly two years. They were killed when their armored personnel carrier was destroyed by a roadside bomb obviously planted by Palestinian militants near the Zeitoun area.

Hamas, the main Palestinian militant group, said it carried out the attack along with other Palestinian militant groups, Islamic Jihad and the Al Aqsa Martyrs Brigade here in Gaza. They say they filmed the attack against the APC. They also say they've captured some of the body parts of some of those Israeli soldiers who were killed. Those are body parts, the Israeli forces on the ground are now looking for, carrying out door-to-door searches in order to bring those Israeli soldiers killed here in Gaza.

Matthew Chance, CNN, Gaza City.

(END VIDEOTAPE)

O'BRIEN: Their names and faces are known around the world.

PHILLIPS: But will the men and women charged in the Iraqi abuse scandal ultimately bear the blame? That story ahead on LIVE FROM...

O'BRIEN: Also, Madonna's new hit might be titled, this land is my land. Well, I better not give up the day job, right? But her British neighbors are not going to be listening. Those ramblers are very upset.

(COMMERCIAL BREAK)

PHILLIPS: A grim new development now linked to the Iraqi prisoner abuse scandal, one we took special care checking and vetting this story before we went to air. Now we want to tell you about a video clip to an Islamic Web site linked to al Qaeda and related groups showing the beheading of a man who identifies himself as an American. Nick Berg from Philadelphia. CNN's David Ensor has more for us now -- David.

DAVID ENSOR, NATIONAL SECURITY CORRESPONDENT: Well, Kyra, as you say, this video has shown up on a Web site that has been linked to the Abu Musab al-Zarqawi group, a group associated with al Qaeda. It has been operating in Iraq. And the Web site claims that Zarqawi himself executes this American, Nicholas Berg, by chopping his head off with a knife.

It is a rather gruesome video. We're not going to show you that. On the Web site, there's a long speech read by this individual you see here, one of the hooded terrorists in which they say: "We tell you that the dignity of Muslim men and women in the Abu Ghraib Prison and others is not redeemed except by blood and souls. You will not receive anything from us but coffins after coffins slaughtered in this way," says the spokesman, the person, the hooded terrorist in that picture you just saw.

And then the picture goes on to show Nicholas Berg dying before your eyes on the videotape. Now, there is a Nicholas Berg who disappeared April 9. He's a civilian contractor, he was a civilian contractor in Iraq, and we understand that his parents were informed by the U.S. military on Monday that their son had died and had died a violent death -- Kyra.

PHILLIPS: And David Ensor, can we talk more about Nick Berg, the fact that he was a civilian worker, what he -- exactly was he doing in Iraq. Was he over there trying to make money to come back home, support family, support himself?

ENSOR: Well, we understand that he's looking for work basically in the communications area as a civilian contractor. He may or may not have had some work along the way while in Iraq. But he had told his parents that he was planning to leave soon. He then got arrested by the Iraqi authorities and held in prison for a short time. And then he told his parents when he was released, he came out to a very dangerous situation, that there was a lot of fighting and shooting going on around the prison area that he was leaving from.

And then on April 9 they never heard from him again. And apparently he was abducted at that time. Now U.S. officials that I've spoken to say that they do believe it is plausible that this could indeed by the Zarqawi gang that kidnapped this person. The CNN people who know Arabic and who listen to this voice that speaks on it, say it doesn't sound like it is Zarqawi's voice. We do have tapes of Zarqawi that we believe are in fact Zarqawi. So it doesn't seem like the voice is Zarqawi.

The Web site, which has a lot of writing on it, claims that it is Zarqawi himself who was executing Nicholas Berg. But there's no way of knowing if that's true or not.

PHILLIPS: Now you say Nick Berg was in an Iraqi prison. Do you know why he was arrested, why he was in jail?

ENSOR: I'm afraid I really don't know. Apparently he was held for a short period of time by the Iraqi authorities who were working under and with the Americans. Maybe there was just a misunderstanding. I really don't know. But he was released. And then it was at that point that he was abducted.

PHILLIPS: All right, our David Ensor, helping us work this story.

Also following this story is retired General Don Shepperd.

General, I guess that's what has sort of caught my attention here as we start to talk about this story -- actually, let's talk about the fact that he was arrested in an Iraqi prison in just a minute. But first I guess it is very important to point out, as we've been talking about this prison scandal and we look at these pictures involving U.S. forces and prisoners at Abu Ghraib, and now we see this videotape of terrorists beheading an American. I mean, is the difference between the U.S., the U.S. military and terrorists.

SHEPPERD: Kyra, this is absolutely the difference between us and them. And that's why no matter the provocation, no matter the frustration on our part, we cannot become like them. There should be outrage throughout the world about this type of action. There should have been greater outrage about Danny Pearl. There should be greater outrage about mistreatment of prisoners worldwide.

And that's why when aberrant behavior on our part is publicized, it becomes an excuse to other people to do other things and say, see, the Americans are just like us. We aren't like them, we can't become like them. And this is disgusting. And this is the reason why we don't treat people the way others do.

PHILLIPS: So General, now this has come out that he was in an Iraqi prison, have you been able to work your sources or find out why he might have been in that prison? Could it have been he was an American, so they threw him into this prison and then somehow got handed over to these terrorists? Do terrorists come through these prisons and look for Americans? I mean, what could have been the scenario here?

SHEPPERD: No, I think it is a chaotic situation over there. And I don't have any information. As David Ensor said, it could have been a mistake that he was found. But there are all sorts of ways to grab contractors over there and civilians and military as well, the military are well schooled in don't get yourself in a situation where you're isolated and can be grabbed. Contractors are also very vulnerable. And there are thousands of them. But we just don't know yet why he was in there or what took place. It could be that he violated the new Iraqi law and was grabbed for that.

PHILLIPS: Now, U.S. military general, these terrorists are saying on this tape that they tried to talk to the U.S. military, tried to negotiate. Hey, you let some of those prisoners in Abu Ghraib go, and we will give you back this American. What's the reality that that discussion actually took place, and...

SHEPPERD: I suspect...

PHILLIPS: OK, I'm sorry, go ahead.

SHEPPERD: That's all right. I suspect it did take place. We say we don't negotiate with...

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


Aired May 11, 2004 - 13:58   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: We didn't find any order whatsoever, sir, written or otherwise that directed them to do what they did.

(END VIDEO CLIP)

MILES O'BRIEN, CNN ANCHOR: So who is to blame for the abuse of prisoners in Iraq? The major general who reported on the problem testifies.

KYRA PHILLIPS, CNN ANCHOR: Saddam Hussein's date with justice, new information about a future trial for him.

O'BRIEN: Inside the urban combat zone. The tricky battle American forces face in an unexpected hot spot.

PHILLIPS: Madonna's turf war. Why the pop superstar's fighting a losing battle to keep some hiking enthusiasts off her grass.

From the CNN Center in Atlanta, I'm Kyra Phillips.

O'BRIEN: And I'm Miles O'Brien. This hour of CNN's LIVE FROM... starts right now.

PHILLIPS: Up first this hour, failure in leadership, lack of discipline, no training whatsoever, a major general's major complaints about the handling of Iraqi detainees at Abu Ghraib and beyond. If you've been watching CNN, you've seen the author of the Pentagon's internal probe of the prisoner abuse scandal share and defend his findings on Capitol Hill.

CNN's Barbara Starr watching it from the Pentagon now -- Barbara.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Kyra, this hearing could not have started off with a more blunt, direct assessment by the man, General Antonio Taguba, who wrote the report. He appeared this morning before the Senate Armed Services Committee on Capitol Hill. After he was sworn in, along with other top officials, the chairman of the committee, Senator John Warner, got right down to business.

(BEGIN VIDEO CLIP)

SEN. JOHN WARNER (R-VA), CHMN., ARMED SERVICES CMTE.: In simple words, your own soldier's language how did this happen? UNIDENTIFIED MALE: A failure in leadership, sir, from the brigade commander on down, lack of discipline, no training whatsoever and no supervision. Supervisory omission was rampant.

STARR: A very grim assessment by General Taguba of what was going on at Abu Ghraib Prison in Iraq late last year, now seen around the world in those photographs showing the abuse of Iraqi detainees by U.S. soldiers.

Now here at the Pentagon this afternoon, Defense Secretary Donald Rumsfeld appeared before a group of Pentagon employees. It was a previously scheduled meeting. But clearly topic number one on everybody's mind was the prisoner abuse scandal. And the secretary talked about the reaction once those photographs came to the Pentagon.

(BEGIN VIDEO CLIP)

DONALD RUMSFELD, SECRETARY OF DEFENSE: The look on the faces of the people who have viewed the photographs and the videos from what took place there, they were stunned, absolutely stunned, that any Americans wearing a uniform could do what they did.

(END VIDEO CLIP)

STARR: Kyra, a grim assessment all the way around. A number of investigations continued into this matter. And look for still more hearings on Capitol Hill - Kyra.

PHILLIPS: And we'll be following, Barbara Starr, thanks so much.

Well, it is grabbing headlines and attention across America, 80 percent of people surveyed in a new CNN/"USA Today/Gallup poll say that they are closely following the abuse scandal; 49 percent say the abuse is a major setback for the U.S. in the war in Iraq, 36 percent consider it a minor setback. When it comes to blame, there's lots to go around. A majority of those polled say that the soldiers involved and their superiors share a great deal of responsibility. A minority of those surveyed put much of the blame on intelligence officers, Defense Secretary Donald Rumsfeld and President Bush. We'll have more results later in the hour.

O'BRIEN: The coalition's most infamous prisoner, Saddam Hussein, could soon be facing Iraqi justice. Salem Chalabi, who heads the special tribunal set up to prosecute the former dictator, is telling CNN the coalition is considering handing him over before June 30. And that's when power is to be transferred back to the Iraqis, as you well know. A Pentagon spokesman says no date has been set for Saddam's trial, however.

On the ground, meanwhile, a civilian convoy ambushed on the way from Jordan to Baghdad. The Halliburton subsidiary, Kellogg, Brown & Root says all truck drivers have been accounted for. But not known if anyone was hurt or if any trucks were destroyed. We'll have more details later. The newly appointed governor of Najaf has hit the ground running. Hours after arriving, he was meeting with tribal and religious leaders and CNN's Jane Arraf. He says the leaders all agree militias like that of renegade cleric al-Sadr must be disbanded.

The U.S. commander of forces locked in a stand-off with al-Sadr's militia in Najaf and Kufa is urging local leaders to intervene. Fighting in Najaf is now house-to-house, street by street.

Our Jane Arraf is imbedded with the 2nd Armored Cavalry. She brings us an exclusive look at the fighting.

(BEGIN VIDEOTAPE)

JANE ARRAF, CNN BAGHDAD BUREAU CHIEF (voice-over): Attacks from crowded neighborhoods, ambushes from alleys, here in Najaf, the U.S. military is fighting the kind of sustained urban warfare it thought it would encounter in Baghdad but never did. This mission on Sunday was to find weapons and kill or capture members of the Mehdi militia of radical Shia leader Muqtada al-Sadr. It doesn't take long for the militia to attack.

UNIDENTIFIED MALE: I've got contact.

ARRAF: Rocket-propelled grenades fly at the 2nd Battalion 37th Armored tanks and armored vehicles.

UNIDENTIFIED MALE: Right there. It is live. It was just cruising along and just (expletive deleted) landed right there.

ARRAF: A loud speaker warns people to stay off the streets, leaflets tell residents the U.S. is fighting only the militia and not them.

(on camera): We're in an armored personnel carrier in the middle of a crowded city. Major combat was supposed to be over more than a year ago. But this seems like classic urban warfare with soldiers facing an enemy more dangerous than the Iraqi army was.

(voice-over): The attacks can come from anywhere.

UNIDENTIFIED MALE: Second floor where the air conditioner is?

UNIDENTIFIED MALE: Yes.

UNIDENTIFIED MALE: Keep an eye on that. Almost looks like there's a guy in there.

ARRAF: Often they come from places that are hard to fire into, especially in a city that's home to the holiest Shia shrines.

UNIDENTIFIED MALE: They're fighting dirty. It's easy to hide in a mosque. It's easy to hide in civilian crowds and not play by the rules.

ARRAF: The civilians often don't know the rules. After a few heart-stopping seconds, he's allowed to drive away.

UNIDENTIFIED MALE: He's showing his hands. ARRAF: These soldiers spent a year in Baghdad where they helped rebuild the city. There the biggest threat was roadside bombs and the attackers mostly anonymous. Now they're back to actual fighting.

SPC. MICHAEL PERRY, 2ND BAT. 1ST ARMORED REGIMENT: I'd rather be out here, you know, with a known enemy than having some coward try to blow me up on the side of the road. Myself, I mean. These people are fighting me face-to-face for the most part.

ARRAF: And although vastly outnumbered and outgunned, they still keep coming.

UNIDENTIFIED MALE: Ordnance they're sending out, I can't hear them, I can't hear aggressive.

ARRAF: It's yet another mortar round. No damage to the tank or to the soldiers inside, but the militia's point clearly made.

Jane Arraf, CNN, Najaf, Iraq.

(END VIDEOTAPE)

O'BRIEN: We'll talk more about all of today's Iraq developments with CNN military analyst Major General Don Shepperd in just a few moments. Stay tuned for that.

PHILLIPS: Pushing education reform, President Bush in the battleground state of Arkansas. He's in Van Buren speaking on No Child Left Behind. But Arkansas Democrats are criticizing the president. One says the education law is "a collection of broken promises."

Greeting supporters in Kentucky, the presumed Democratic presidential nominee, John Kerry, is in attack mode at a rally in Louisville. Kerry criticized Bush's record on the economy and health care. Kerry plans to tout his own health care ideas in the battleground state of Florida later today. Polls show Kerry neck and neck with Bush.

O'BRIEN: News across America now. We begin in Northern California. The judge in the Scott Peterson case has denied a defense motion for another change of venue. The double murder trial has already been moved to Redwood City where jury selection is under way. Mark Geragos, Peterson's attorney, contends an impartial jury cannot be seated anywhere in the Bay Area.

A bombshell ruling in the recruiting scandal at the University of Colorado: The state's attorney general will not seek criminal charges in nine alleged sexual assaults involving football players at the school. A task force unanimously agreed against the charges.

Farther south, amazing images of a twister in Colorado, it's one of six tornados that touched down in Elberg (ph) County yesterday, destroying a house and a barn. The family of four who live there escaped safely. The storm chaser who shot this video says he was lucky and well prepared. (BEGIN VIDEO CLIP)

ERIC TREECE, STORM CHASER: The biggest thing you can do is learn everything you can about the animal you're hunting before you go out and seek the beast.

(END VIDEO CLIP)

PHILLIPS: Well, straight ahead, from soldiers returning from the field of battle, nothing could mean more than a firm handshake or friendly hug. Meet the strangers who make sure they get it later on LIVE FROM...

Trashy movies, why the next DVD you can bring home -- or you could bring home could very well end up in the garbage.

And I scream, you scream, we all scream when we find out the price of ice cream. The scoop on LIVE FROM... straight ahead.

(COMMERCIAL BREAK)

O'BRIEN: The prisoner abuse scandal is making the future of the U.S. military mission in Iraq even more difficult than it already was. For military analysis of revelations and the overall state of the war effort, we go to Tucson, Arizona, retired General Don Shepperd, U.S. Air Force.

Good to have you, General Shepperd, back with us.

MAJ. GEN. DON SHEPPERD, CNN MILITARY ANALYST: A pleasure, Miles.

O'BRIEN: All right, let's talk, first of all, it seemed as if there was some confusion today in that hearing -- I know you watched it fairly thoroughly, some confusion about who precisely was running that prison. What does military doctrine call for in a case like that?

SHEPPERD: Yes, military doctrine it calls basically for a very clear chain of command, of who is in control, who issues orders. And it's clear that this was muddled from the very beginning and maybe led to some of the problems, Miles. You always have to know who you work for and what you were responsible for, and all of that was muddled up at the beginning of this big mess.

O'BRIEN: Now General Taguba was very scathing, very blunt. It reflects the report, if you'd read it. Does it indicate to you that what's happened at Abu Ghraib is an isolated case?

SHEPPERD: Well, this is a case that faces every police department in the United States and around the world every day, is how do you detain people, how do you handle them, and it is part of military training? What General Taguba said was they had no leadership, no training and no supervision. That is a terrible indictment about the chain of demand at Abu Ghraib Prison.

Obviously, there were other incidents in other prisons around the country. But it appears that this was one section of Abu Ghraib Prison. And it appears that it was a small group of people. So when you say is it isolated, there were other incidents and always have been and always will be. But they were stamped out. This appears to me to be an isolated problem with many tentacles growing out of it.

O'BRIEN: All right, but let's talk about the big picture here for a minute. While there might not be a clear cut written order to do this sort of thing, I can't imagine that you'd ever discover one, the tone that was set at the very top here in the war on terror was to get real tough with potential terrorists. And that goes for not just Abu Ghraib, but Guantanamo, you name it. That tone, does that not sort of set a bad example for people who are at the -- right in the trenches, so to speak?

SHEPPERD: Miles, I don't buy any of that. That becomes an excuse and it certainly will be part of the defense of any of these individuals by defense counsel. But very clearly the purpose of our actions in Iraq were to bring the insurgency to a halt, to gather information, to prosecute those, and all of the people involved in this, military police, military interrogation, they are schooled and trained and know the rules. And one of the basic rules is you don't break the law.

And another basic rule is, no matter who issues you an order, that order has to be legal. There is little confusion about this. The people involved in this knew they were doing wrong. And any winks and nods or any messages from the top command about getting tough with prisoners did not mean carrying out this type of act.

O'BRIEN: This whole incident, we've talked about it before, how it highlighted the lack of personnel on the ground in a sense, a lack of boots on the ground, the fact that there was a lot of stress there. But what compounded the stress in this case really goes back to the roots of all this, which is fundamental failure of intelligence. If the intelligence had been wired a little better, perhaps it wouldn't have had to round up so many people trying to figure out what's going on in the country?

SHEPPERD: Well, you're absolutely right there. Our intelligence -- our human intelligence was just decimated for the past several decades in the Middle East. We simply had none. We were starting from ground zero. The purpose of a lot of these raids, going into these villages in the middle of the night, rounding up people, detaining them, was to obtain intelligence that we simply didn't have.

Later that strategy changed. We were making more enemies than we were doing good. That strategy to getting the intelligence and then going after the individuals involved, a small number of houses as opposed to whole villages. So the decimation of our intelligence certainly played a part in this. But again, the basic reason that all of this happened was men and women did wrong and they knew it when they were doing it.

O'BRIEN: All right, but one other thing, we talked about the top-down pressure that may or may not have been there. Bottom up, literally on the streets there, their friends, their comrades, getting blown up day after day. That's got to, you know, change the psyche quite a bit inside those walls.

SHEPPERD: It plays on your psyche, no question about that. But the basic rule of leadership is, we don't become like them. Our basic American values and what we're fighting for, just because people blow up our comrades, we are carrying out a mission and we know what that mission is. Just because somebody orders you to do something illegal does not mean you do it. Every soldier in America is trained that way from the very, very beginning. So yes, it plays on your psyche, yes, it is frustrating. But you can't let it degrade you into an animal that kills people or carries out illegal acts. And it appears that this is what happened here.

O'BRIEN: The overall strategy here should have been, I think we can all agree, to win the hearts and minds of the Iraqi people, not necessarily the conquest of turf per se in the old fashioned sense. Nothing I see here seems to support that strategy.

SHEPPERD: In fact it goes exactly the opposite way. There has been a lot of talk about winning the hearts and minds of the Iraqi people. Clearly we want to do that. But even more than that, we want to win the hearts and minds of the Arab world. We want to win the hearts and minds of the world. And this takes us in a step in exactly the wrong direction. It really is a black eye on the military, it's a black eye on America. And I think we all feel stained about it.

O'BRIEN: Major General Don Shepperd, retired U.S. Air Force, always appreciate your insights, thanks for your time.

SHEPPERD: Thanks.

O'BRIEN: Kyra.

PHILLIPS: Now to another hot spot, the Middle East, where it is getting even hotter: 13 people are dead in fierce fighting in Gaza City. What started out as an operation to destroy workshops used by militants escalated into chaos. The heavy fighting is particularly troubling to the U.N. We get the latest now from our Matthew Chance in Gaza.

(BEGIN VIDEOTAPE)

MATTHEW CHANCE, CNN CORRESPONDENT: This is turning into a major confrontation between Israeli troops and Palestinian militants here in Gaza. The fighting has been continuing since the early hours of this morning. And then still clashes, quite ferocious ones, being reported from the Zeitoun neighborhood, a very densely populated neighborhood of Gaza City.

Israeli forces, backed by helicopter gunships, staged an incursion in the area as of this morning, but were met with fierce resistance from Palestinian militant fighters here in Gaza. There have been casualties, at least seven, at this stage, on the Palestinian side. Seven people killed, that is. One of them a 14- year-old Palestinian boy when an Israeli helicopter gunship fired one of its rockets into a car on the streets of Zeitoun. There have also been at least six Israelis killed (UNINTELLIGIBLE) Israeli ministry in nearly two years. They were killed when their armored personnel carrier was destroyed by a roadside bomb obviously planted by Palestinian militants near the Zeitoun area.

Hamas, the main Palestinian militant group, said it carried out the attack along with other Palestinian militant groups, Islamic Jihad and the Al Aqsa Martyrs Brigade here in Gaza. They say they filmed the attack against the APC. They also say they've captured some of the body parts of some of those Israeli soldiers who were killed. Those are body parts, the Israeli forces on the ground are now looking for, carrying out door-to-door searches in order to bring those Israeli soldiers killed here in Gaza.

Matthew Chance, CNN, Gaza City.

(END VIDEOTAPE)

O'BRIEN: Their names and faces are known around the world.

PHILLIPS: But will the men and women charged in the Iraqi abuse scandal ultimately bear the blame? That story ahead on LIVE FROM...

O'BRIEN: Also, Madonna's new hit might be titled, this land is my land. Well, I better not give up the day job, right? But her British neighbors are not going to be listening. Those ramblers are very upset.

(COMMERCIAL BREAK)

PHILLIPS: A grim new development now linked to the Iraqi prisoner abuse scandal, one we took special care checking and vetting this story before we went to air. Now we want to tell you about a video clip to an Islamic Web site linked to al Qaeda and related groups showing the beheading of a man who identifies himself as an American. Nick Berg from Philadelphia. CNN's David Ensor has more for us now -- David.

DAVID ENSOR, NATIONAL SECURITY CORRESPONDENT: Well, Kyra, as you say, this video has shown up on a Web site that has been linked to the Abu Musab al-Zarqawi group, a group associated with al Qaeda. It has been operating in Iraq. And the Web site claims that Zarqawi himself executes this American, Nicholas Berg, by chopping his head off with a knife.

It is a rather gruesome video. We're not going to show you that. On the Web site, there's a long speech read by this individual you see here, one of the hooded terrorists in which they say: "We tell you that the dignity of Muslim men and women in the Abu Ghraib Prison and others is not redeemed except by blood and souls. You will not receive anything from us but coffins after coffins slaughtered in this way," says the spokesman, the person, the hooded terrorist in that picture you just saw.

And then the picture goes on to show Nicholas Berg dying before your eyes on the videotape. Now, there is a Nicholas Berg who disappeared April 9. He's a civilian contractor, he was a civilian contractor in Iraq, and we understand that his parents were informed by the U.S. military on Monday that their son had died and had died a violent death -- Kyra.

PHILLIPS: And David Ensor, can we talk more about Nick Berg, the fact that he was a civilian worker, what he -- exactly was he doing in Iraq. Was he over there trying to make money to come back home, support family, support himself?

ENSOR: Well, we understand that he's looking for work basically in the communications area as a civilian contractor. He may or may not have had some work along the way while in Iraq. But he had told his parents that he was planning to leave soon. He then got arrested by the Iraqi authorities and held in prison for a short time. And then he told his parents when he was released, he came out to a very dangerous situation, that there was a lot of fighting and shooting going on around the prison area that he was leaving from.

And then on April 9 they never heard from him again. And apparently he was abducted at that time. Now U.S. officials that I've spoken to say that they do believe it is plausible that this could indeed by the Zarqawi gang that kidnapped this person. The CNN people who know Arabic and who listen to this voice that speaks on it, say it doesn't sound like it is Zarqawi's voice. We do have tapes of Zarqawi that we believe are in fact Zarqawi. So it doesn't seem like the voice is Zarqawi.

The Web site, which has a lot of writing on it, claims that it is Zarqawi himself who was executing Nicholas Berg. But there's no way of knowing if that's true or not.

PHILLIPS: Now you say Nick Berg was in an Iraqi prison. Do you know why he was arrested, why he was in jail?

ENSOR: I'm afraid I really don't know. Apparently he was held for a short period of time by the Iraqi authorities who were working under and with the Americans. Maybe there was just a misunderstanding. I really don't know. But he was released. And then it was at that point that he was abducted.

PHILLIPS: All right, our David Ensor, helping us work this story.

Also following this story is retired General Don Shepperd.

General, I guess that's what has sort of caught my attention here as we start to talk about this story -- actually, let's talk about the fact that he was arrested in an Iraqi prison in just a minute. But first I guess it is very important to point out, as we've been talking about this prison scandal and we look at these pictures involving U.S. forces and prisoners at Abu Ghraib, and now we see this videotape of terrorists beheading an American. I mean, is the difference between the U.S., the U.S. military and terrorists.

SHEPPERD: Kyra, this is absolutely the difference between us and them. And that's why no matter the provocation, no matter the frustration on our part, we cannot become like them. There should be outrage throughout the world about this type of action. There should have been greater outrage about Danny Pearl. There should be greater outrage about mistreatment of prisoners worldwide.

And that's why when aberrant behavior on our part is publicized, it becomes an excuse to other people to do other things and say, see, the Americans are just like us. We aren't like them, we can't become like them. And this is disgusting. And this is the reason why we don't treat people the way others do.

PHILLIPS: So General, now this has come out that he was in an Iraqi prison, have you been able to work your sources or find out why he might have been in that prison? Could it have been he was an American, so they threw him into this prison and then somehow got handed over to these terrorists? Do terrorists come through these prisons and look for Americans? I mean, what could have been the scenario here?

SHEPPERD: No, I think it is a chaotic situation over there. And I don't have any information. As David Ensor said, it could have been a mistake that he was found. But there are all sorts of ways to grab contractors over there and civilians and military as well, the military are well schooled in don't get yourself in a situation where you're isolated and can be grabbed. Contractors are also very vulnerable. And there are thousands of them. But we just don't know yet why he was in there or what took place. It could be that he violated the new Iraqi law and was grabbed for that.

PHILLIPS: Now, U.S. military general, these terrorists are saying on this tape that they tried to talk to the U.S. military, tried to negotiate. Hey, you let some of those prisoners in Abu Ghraib go, and we will give you back this American. What's the reality that that discussion actually took place, and...

SHEPPERD: I suspect...

PHILLIPS: OK, I'm sorry, go ahead.

SHEPPERD: That's all right. I suspect it did take place. We say we don't negotiate with...

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