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Will Iraqi Interim Govt. Weather Security Concerns? Padilla Case Sent Back for Re-Filing

Aired June 28, 2004 - 13:57 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: They're now in charge. Iraq in the hands of Iraqis, two days ahead of schedule. What will this mean for America's future role there?
Saddam Hussein's future. How today's developments might affect his handover from American to Iraqi justice.

Sweet sorrow. The American man once in charge of Iraq says good- bye. His mission accomplished.

America's war on terror. A Supreme Court ruling on legal rights for detainees housed at Gitmo.

From the CNN Center in Atlanta, I'm Kyra Phillips. Miles is on assignment. This hour of CNN's LIVE FROM... starts right now.

What a difference two days makes. If you circled Wednesday, June 30, as Iraqi sovereignty handover day, as millions of us did, I hope you used a pencil. To the surprise of the whole world at the urging of the new Iraqi government, the U.S. civil administrator handed over power two days early. And then the newly unemployed Paul Bremer got on a plane.

In between he reflected on his 14 months as the Bush administration's point man in Baghdad.

(BEGIN VIDEO CLIP)

PAUL BREMER, FMR. CIVIL ADMINISTRATOR: Iraq is a much better place. It was absolutely worth it. No doubt there will be challenges ahead. But I'm delighted to have been able to play a role here in the stabilization part of Operation Iraqi Freedom.

(END VIDEO CLIP)

PHILLIPS: Bremer may be going, but U.S. troops are not. And no one expects insurgents and terrorists to melt away either. Still, the new Iraqi leaders say they're equal to the test.

(BEGIN VIDEO CLIP)

IYAD ALLAWI, IRAQI INTERIM PRIME MINISTER: The security (UNINTELLIGIBLE) now lies in our hands. Basically we have the support of the multinational forces and we look forward to their continued support. We have measures that will be declared today and tomorrow to enhance and insure our security. And this is something that we will carry forward.

(END VIDEO CLIP)

PHILLIPS: Job one for the interim government is to plan for its own dissolution, that is, to organize elections that are supposed to take place next January; elections aimed at transforming Iraq into a democratic nation. Between now and then, the non-elected leaders wield much broader powers than the Governing Council they're replacing if not total independence. And for now that seems OK with most of the Iraqis that we've talked to. CNN's Brent Sadler checks in from Baghdad -- Brent.

BRENT SADLER, CNN SR. INTERNATIONAL CORRESPONDENT: Quite an extraordinary day here, Kyra, in terms of how this ceremonious event took place. It was really shrouded in secrecy, as you say, two days before it was expected. And really Iraqis did not see any of the actual event at all. It was over very, very quickly, indeed. Former administrator Paul Bremer out of the country very quickly as well.

It was only later when Iraqis saw what happened and how they began to react to it when we spoke to them later in the day.

(BEGIN VIDEOTAPE)

SADLER (voice-over): The legal handover of power was completed in a flash. Iraqis unaware of the event until it was over. But within hours they saw on television the swearing in of their newly empowered interim government setting its own agenda, the Iraqi flag flying with new purpose. And on the streets of Baghdad, caution and optimism.

"I ask God to give them success," says pensioner Hamid Khudeir (ph), "that is what I want.

"Of course I'm happy," say Ali Jawad (ph), a businessman, "we want peace and normality, God willing, Iraq has a bright future."

But a future that continues to be heavily influenced by the presence of coalition forces. Many Iraqis believe that an occupation persists, cloaked by the handover.

"I'm optimistic," explains pensioner Ali Hussein Ali (ph), "but we must have law and order and speed up an end to the occupation."

In central Baghdad, U.S. soldiers began removing stretches of barbed wire and dismantling large concrete barricades, reopening a main road and public square where Saddam Hussein's statue once stood. While in Basra, southern Iraq, British troops re-enacted a symbolic handover of power with their Iraqi counterparts, bonding as partners in the struggle to build a new Iraq.

(END VIDEOTAPE)

SADLER: And it does seem to be a struggle that is set to continue with attacks from a raging insurgency, kidnapping and grizzly executions no matter who calls the shots -- Kyra. PHILLIPS: Brent, just backing up a little bit. All of us were -- we were very surprised to hear about the handover happening two days early. We were all planning on Wednesday, how did you get the word? At what point did you realize, OK, something serious is going on, we had better show up and find out what they have to say?

SADLER: Well, we've been getting feelers over the previous 24, 36 hours that something might take us all by surprise. We were getting very little information in terms of how we as the media were going to cover this. No timings, no real description of events, who would be where when.

And really it became really suspicious that something might suddenly be sprung upon us all. And when Hoshyar Zebari, the Iraqi foreign minister, said in Turkey and Istanbul that the event could be brought forward, then we knew by that time, our own Christiane Amanpour had been secretly called to the Green Zone where this event took place, we added two and two together and that four came pretty quickly -- Kyra.

PHILLIPS: Pretty interesting plan. Brent Sadler, thanks so much.

Well, the transfer of power doesn't change the realities of war in Iraq, including the taking of hostages. A U.S. Marine is missing and Iraqi insurgents say they have him. But U.S. military officials say they don't know that for sure. All they know is corporal was Corporal Wassef Ali Hassoun was last seen nine days ago in the Fallujah area where there was heavy fighting. Those who say they have Hassoun say that they will kill him unless all Iraqi prisoners are freed.

That's the same demand other insurgents are making. They are holding a Pakistani man who works for a subcontractor of an American construction firm. And still no word on the fate of Matt Maupin, the Army private was captured April 9 when his convoy was ambushed outside of Baghdad.

Well, for allies Britain and the U.S., the handover in Iraq is the pinnacle at the NATO summit. For the handover, President Bush and Prime Minister Tony Blair sat side by side at the summit in Istanbul. The president glanced at his watch then leaned over to tell the prime minister that the transfer of power complete. Both leaders have faced harsh international criticism over the war. Today NATO agreed to help train Iraqi security forces.

The president and prime minister issued a joint statement earlier from Turkey.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The United States military and our coalition partners have made a clear, specific and continuing mission in Iraq. As we train Iraqi security forces, we'll help those forces to find and destroy the killers. We'll protect infrastructure from the attacks. We'll provide security for the upcoming elections.

Operating in a sovereign nation, our military will act in close consultation with the Iraqi government, yet coalition forces remain under coalition command. The Iraqis' prime minister and president have told me that their goal is to eventually take full responsibility for the security of their country. And America wants Iraqi forces to take that role. Our military will stay as long as the stability of Iraq requires and only as long as their presence is needed and asked by the Iraqi government.

TONY BLAIR, BRITISH PRIME MINISTER: We haven't overcome the disagreement that was about whether the conflict was justified. I mean, there's no point of us standing here and saying all the previous disagreements have disappeared, they haven't.

On the other hand, what is important is you have got a United Nations resolution that has blessed the new government in Iraq, and you have got a situation in which we have accepted today that there is a good and sound NATO role which is actually the only role we ever sought for NATO, of training and helping to train the Iraqis so that they can do their own security work, which is the request that they have made to us. And in that sense, I think the international community has come together and I welcome it.

(END VIDEO CLIP)

PHILLIPS: Now another handover is also in the works. Former dictator Saddam Hussein may be turned over to Iraq soon. The head of Iraq's special tribunal says the new Iraqi government could get legal custody of Saddam within days. CNN's senior legal analyst Jeffrey Toobin now joins us live from New York to hammer this out.

Jeffrey, the American government definitely walks a fine line here.

JEFFREY TOOBIN, CNN SR. LEGAL ANALYST: They sure do, because on the one hand, they have to maintain security. They don't want him to escape after all the trouble that they went to to catch him. And there are obviously people in Iraq who support Saddam Hussein, who might want him free. So security is one big issue.

On the other hand, they need the appearance of fairness to be guaranteed when he, in fact, goes on trial. They can't have some sort of sham where he is hung after two days. They have to make sure that the new Iraqi government tries him in a way that both is and appears to be fair, and most importantly, convinces the world that he was so bad that this invasion was justified. It's a lot of things to do when, in fact, custody, at least some technical legal custody, now belongs to the Iraqis, not the Americans.

PHILLIPS: All right. You bring up an interesting point about the ways that he could be prosecuted. Now, the decision could be made -- he could be turned over into the hands of the Iraqis and the decision could be made just to -- I mean, I don't know how to put it in a -- I guess, a politically correct way, but to kill him, to take his life. TOOBIN: Well, the Iraqis have committed to using a proceeding. They have a tribunal set up so that appears like it's not going to happen. But a lot remains to be worked out about how he's actually going to be tried. And the way this trial takes place has big practical significance, obviously, it affects whether Saddam Hussein lives or dies, but it also has a tremendous impact on how this invasion may be perceived in history.

You know, it's worth remembering that after World War II, there wasn't a lot known to the general public about the Holocaust until the Nuremberg trials, the Nuremberg tribunals of the Nazi war criminals. Similarly, I think, the crimes of Saddam Hussein will be revealed or not revealed in this tribunal in a way that they haven't been before. So what happens now has big historical significance.

PHILLIPS: So you're saying, my final question here, too, is, it would be extremely important to have more of a drawn-out court proceeding so the world, so the Iraqis could see in detail the crimes that he committed versus maybe a short-term solution or just taking his life and ending the situation? I guess from a PR perspective and also a faith perspective, of the Iraqis having faith in a new judicial system.

TOOBIN: That's true, but there's a risk in the other direction, as well. You want fairness. You want the crimes revealed. But you also don't want the trial to turn into an opportunity for Saddam Hussein to filibuster, to try to rally his troops in the way that some people think Slobodan Milosevic has done in his war crimes tribunal in The Hague. So it has to be fair, it has to be public, but it doesn't have to be Saddam Hussein's show. Satisfying all of those requirements is going to be pretty difficult.

PHILLIPS: CNN's senior legal analyst, Jeffrey Toobin. Thanks a lot, Jeffrey

TOOBIN: OK. Kyra.

PHILLIPS: Well, despite Iraq's move toward democracy, Americans are not so optimistic about the nation's future. In a new CNN/"USA Today"/Gallup poll, Only 39 percent of respondents believe that peace will likely be established in Iraq in the next five years, 60 percent say it's unlikely. Americans were also asked how long U.S. troops should stay in Iraq: 40 percent of respondents say that they want U.S. troops home in less than a year; 30 percent say one or two years is enough; 19 percent want troops to stay for a three- to five-year stint; and 8 percent say they should stay longer than that. Currently 138,000 U.S. troops are serving in Iraq.

PHILLIPS: Senator John Kerry is among those critical of the Bush administration's execution of the Iraq mission. The presumptive Democratic candidate for the White House called the need for adequate security on the ground critical.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: As we look forward today there are very important challenges, so that we can finish our mission and get our troops home as rapidly as possible. We have to focus on the top level priority of providing adequate security.

It is absolutely stunning that of the $18 billion that we approved last year for the reconstruction of Iraq, only $400 million has been spent. Ninety percent of the coalition on the ground is American, 90 percent. And 90 percent of the cost is being borne by the American people.

I believe it is critical that the president get real support, not resolutions, not words, but real support of sufficient personnel, troops, and money to assist in the training of security forces in order to be able to guarantee a rapid real transition, and most importantly, in order to be able to provide adequate security on the ground. You must have security on the ground in order to be able to proceed forward with the reconstruction and the political transformation.

(END VIDEO CLIP)

PHILLIPS: Thousands of American troops still on the ground in Iraq. Will a transfer of power make a difference to them? We'll hear from the Pentagon and our own retired general, Don Shepperd.

America's new ambassador to Iraq. Unique challenges he faces on his tough new assignment.

Legal rights versus the war on terror. The Supreme Court weighs in on whether Gitmo detainees can challenge their imprisonment.

(COMMERCIAL BREAK)

PHILLIPS: Now enemy combatants and habeas corpus. The highest court in the land today ruled the right to consult a lawyer and seek relief from a judge applies even to non-American terror suspects captured outside U.S. borders. But that still represents a partial victory for the Bush administration. CNN's Sean Callebs tells us how and why and what it all means.

Hi, Sean.

SEAN CALLEBS, CNN CORRESPONDENT: Hi, Kyra, indeed, these decisions have been eagerly awaited and are widely seen however as a setback to President Bush and his policy. The high court says the government can hold U.S. citizens as well as foreign nationals without charges or a trial. However, all of these detainees should get their day in court.

The Supreme Court says that the United States has a right to hold Yaser Esam Hamdi, however, Hamdi has the right to the lawyer and the right to challenge his detention. Hamdi is a U.S. citizen. He was captured in Afghanistan and has been held in a Navy brig for more than two years in Charlotte, North Carolina. Writing for the majority, Sandra Day O'Connor says a citizen held in the United States as an enemy combatant be given a meaningful opportunity to contest the factual basis for that detention before a neutral decision maker.

(BEGIN VIDEO CLIP)

TOM GOLDSTEIN, LEGAL EXPERT: The Supreme Court today told Yaser Hamdi, yes, you can go back to the trial court and make the government come up with more and better evidence justifying holding you. And so that's what his lawyers will do starting this afternoon. They will push the government to come up with more proof that shows that he really is an enemy combatant and was essentially at war with the United States.

(END VIDEO CLIP)

CALLEBS: In a separate ruling that could affect a 600 or so international detainees at the Navy prison in Guantanamo Bay, Cuba, the court says the government can hold them indefinitely. However, they, too, can use the U.S. court system to contest the captivity and treatment.

Now involving a third case, that of alleged dirty bomber Jose Padilla, the high court sidestepped the issue, the justices ruled Padilla's lawyer improperly filed the case and now it must be re- filed.

(BEGIN VIDEO CLIP)

DONNA NEWMAN, PADILLA'S ATTORNEY: But most significantly what they did find emphatically was that he must, must receive due process. He must have a hearing. That the government assertion was resoundingly rejected; that they simply can tell the court their side of the story. The citizens have a right to give their side of the story. And they will have their day in court. So we should all rejoice in the Supreme Court decision.

(END VIDEO CLIP)

CALLEBS: Padilla has yet to be charged with a crime and he, too, has spent more than two years in the Navy brig in Charlotte -- Kyra.

PHILLIPS: Sean Callebs, LIVE FROM... Washington, thank you.

Well, Iraqis move into the driver's seat as they charge -- or as they take charge, rather, of their own country. But with almost 140,000 American troops still in Iraq, is the United States really prepared to give up the wheel?

Our David Ensor looks at the road ahead.

(BEGIN VIDEOTAPE)

DAVID ENSOR, CNN NATIONAL SECURITY CORRESPONDENT (voice-over): Workmen in Baghdad rushing to transform one of Saddam's former palaces into the new U.S. embassy. Like the embassy, the future of the Iraqi nation is a work in progress.

John Negroponte, America's first ambassador to the new Iraq, insists the U.S. will no longer be running the country. In Baghdad he says he will be just another diplomat.

JOHN NEGROPONTE, U.S. AMBASSADOR TO IRAQ: I also don't see myself as running some kind of super embassy, Senator. I see it more as -- obviously not a traditional embassy, it's going to be an embassy operating under very challenging circumstances.

ENSOR: Very challenging circumstances may be diplomatic understatement. Though protected by U.S. troops and miles of razor wire, American diplomats in Iraq, like James Jeffrey, will more than earn their danger pay.

JAMES JEFFREY, U.S. DEP. CHIEF OF MISSION TO IRAQ: We receive incoming rocket and mortar fire in this vicinity quite often. But our goal is to ensure that we are not overrun, that we do not get significant hostile fire. And so far we have been lucky.

ENSOR: From this building in the heavily protected Green Zone of Baghdad, Negroponte will lead an embassy of about a thousand Americans and 700 Iraqis. Their priorities will be security, preparing for Iraqi elections, and overseeing $18 billion worth of reconstruction assistance for Iraq.

FRANK RICCIARDONE, U.S.-IRAQ TRANSITION OFFICIAL: That is the largest foreign assistance program anywhere.

ENSOR (on camera): That's huge.

RICCIARDONE: That is huge and that takes people to administer properly.

ENSOR (voice-over): Critics say that the U.S. embassy will be much too big, signaling that the Bush administration plans to hang on to control of Iraq.

IVO DAALDER, FMR. NATL. SEC. COUNCIL STAFF : This is going to be the largest embassy the United States has ever created anywhere, larger than Embassy Saigon during the Vietnam War. And that sends a message.

ENSOR: U.S. officials say such concerns are misplaced.

RICCIARDONE: No U.S. ambassador goes out expecting to run a foreign country. Even if that were in his mind, the Iraqis wouldn't let him.

ENSOR: Among Iraqis, the man to watch is the new prime minister, Dr. Iyad Allawi, a 58-year-old Shiite Muslim and a long-time emigre who makes no apologies for his past contacts with the CIA.

ALLAWI: I don't feel ashamed of being in touch and having been in touch to liberate Iraq from the evil forces of Saddam.

ENSOR: Reuel Gerecht, a former CIA officer knows Allawi's past well.

REUEL GERECHT, FMR. CIA OFFICER: He likes to think of himself as a man of ideas and he also has a certain -- how do I want to put this politely, respect for the use of force.

ENSOR: In the mid-'90s, Allawi tried to organize unrest against Saddam Hussein. U.S. officials predict he will be inclusive, but tough.

RICCIARDONE: I know he's a strong leader. He's a total patriot.

ENSOR (on camera): But analysts say Allawi has no political base; that he will be dependent on the continued goodwill of the most influential man behind the scenes, the reclusive Grand Ayatollah Sistani.

(voice-over): The real test of how much control Allawi has may come with the next Fallujah, the next military challenge to the 140,000 or so American troops who remain on the ground in Iraq.

COLIN POWELL, SECRETARY OF STATE: U.S. forces remain under U.S. command and will do what is necessary to protect themselves.

GERECHT: If you have an insurrection in the Sunni Triangle, if you have people attacking the Americans, the Americans may want to respond with a good deal of force. There may be individuals in the government who don't want them to. And how this is resolved quickly and the way that one needs to if one is fighting a counterinsurgency, it's not evident me how that's going to work yet. We'll have to see.

ENSOR (on camera): Do you think the handover is really handover or will Ambassador Negroponte end up being the proconsul of Baghdad?

THOMAS PICKERING, FMR. U.S. UNDERSECRETARY OF STATE: We all know that you won't end the CPA one day and have a fully independent Iraq with a typical American embassy that does demarches and holds dinner parties and does a lot of useful things but is not involved on the next day.

BUSH: Prosperity and freedom and dignity are not just American hopes.

ENSOR (voice-over): But Pickering warns Washington can't continue to pull the strings in Iraq.

PICKERING: And if we think in fact that it has got to be operated in a kind of darkroom way as an American colony forever, we won't get there. In fact, the Iraqis are, in my view, very critical along with the international community in bringing about the solution that we seek.

ENSOR: Like the embassy, Iraq's future is a project under construction and under fire. Finding the right balance between security and sovereignty for Iraqis will not be easy.

(END VIDEOTAPE)

PHILLIPS: Straight ahead, counting the cost in Iraq, adding up what Americans are shelling out and will continue to pay even though the Iraqis are in charge. (MARKET REPORT)

(COMMERCIAL BREAK)

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Aired June 28, 2004 - 13:57 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KYRA PHILLIPS, CNN ANCHOR: They're now in charge. Iraq in the hands of Iraqis, two days ahead of schedule. What will this mean for America's future role there?
Saddam Hussein's future. How today's developments might affect his handover from American to Iraqi justice.

Sweet sorrow. The American man once in charge of Iraq says good- bye. His mission accomplished.

America's war on terror. A Supreme Court ruling on legal rights for detainees housed at Gitmo.

From the CNN Center in Atlanta, I'm Kyra Phillips. Miles is on assignment. This hour of CNN's LIVE FROM... starts right now.

What a difference two days makes. If you circled Wednesday, June 30, as Iraqi sovereignty handover day, as millions of us did, I hope you used a pencil. To the surprise of the whole world at the urging of the new Iraqi government, the U.S. civil administrator handed over power two days early. And then the newly unemployed Paul Bremer got on a plane.

In between he reflected on his 14 months as the Bush administration's point man in Baghdad.

(BEGIN VIDEO CLIP)

PAUL BREMER, FMR. CIVIL ADMINISTRATOR: Iraq is a much better place. It was absolutely worth it. No doubt there will be challenges ahead. But I'm delighted to have been able to play a role here in the stabilization part of Operation Iraqi Freedom.

(END VIDEO CLIP)

PHILLIPS: Bremer may be going, but U.S. troops are not. And no one expects insurgents and terrorists to melt away either. Still, the new Iraqi leaders say they're equal to the test.

(BEGIN VIDEO CLIP)

IYAD ALLAWI, IRAQI INTERIM PRIME MINISTER: The security (UNINTELLIGIBLE) now lies in our hands. Basically we have the support of the multinational forces and we look forward to their continued support. We have measures that will be declared today and tomorrow to enhance and insure our security. And this is something that we will carry forward.

(END VIDEO CLIP)

PHILLIPS: Job one for the interim government is to plan for its own dissolution, that is, to organize elections that are supposed to take place next January; elections aimed at transforming Iraq into a democratic nation. Between now and then, the non-elected leaders wield much broader powers than the Governing Council they're replacing if not total independence. And for now that seems OK with most of the Iraqis that we've talked to. CNN's Brent Sadler checks in from Baghdad -- Brent.

BRENT SADLER, CNN SR. INTERNATIONAL CORRESPONDENT: Quite an extraordinary day here, Kyra, in terms of how this ceremonious event took place. It was really shrouded in secrecy, as you say, two days before it was expected. And really Iraqis did not see any of the actual event at all. It was over very, very quickly, indeed. Former administrator Paul Bremer out of the country very quickly as well.

It was only later when Iraqis saw what happened and how they began to react to it when we spoke to them later in the day.

(BEGIN VIDEOTAPE)

SADLER (voice-over): The legal handover of power was completed in a flash. Iraqis unaware of the event until it was over. But within hours they saw on television the swearing in of their newly empowered interim government setting its own agenda, the Iraqi flag flying with new purpose. And on the streets of Baghdad, caution and optimism.

"I ask God to give them success," says pensioner Hamid Khudeir (ph), "that is what I want.

"Of course I'm happy," say Ali Jawad (ph), a businessman, "we want peace and normality, God willing, Iraq has a bright future."

But a future that continues to be heavily influenced by the presence of coalition forces. Many Iraqis believe that an occupation persists, cloaked by the handover.

"I'm optimistic," explains pensioner Ali Hussein Ali (ph), "but we must have law and order and speed up an end to the occupation."

In central Baghdad, U.S. soldiers began removing stretches of barbed wire and dismantling large concrete barricades, reopening a main road and public square where Saddam Hussein's statue once stood. While in Basra, southern Iraq, British troops re-enacted a symbolic handover of power with their Iraqi counterparts, bonding as partners in the struggle to build a new Iraq.

(END VIDEOTAPE)

SADLER: And it does seem to be a struggle that is set to continue with attacks from a raging insurgency, kidnapping and grizzly executions no matter who calls the shots -- Kyra. PHILLIPS: Brent, just backing up a little bit. All of us were -- we were very surprised to hear about the handover happening two days early. We were all planning on Wednesday, how did you get the word? At what point did you realize, OK, something serious is going on, we had better show up and find out what they have to say?

SADLER: Well, we've been getting feelers over the previous 24, 36 hours that something might take us all by surprise. We were getting very little information in terms of how we as the media were going to cover this. No timings, no real description of events, who would be where when.

And really it became really suspicious that something might suddenly be sprung upon us all. And when Hoshyar Zebari, the Iraqi foreign minister, said in Turkey and Istanbul that the event could be brought forward, then we knew by that time, our own Christiane Amanpour had been secretly called to the Green Zone where this event took place, we added two and two together and that four came pretty quickly -- Kyra.

PHILLIPS: Pretty interesting plan. Brent Sadler, thanks so much.

Well, the transfer of power doesn't change the realities of war in Iraq, including the taking of hostages. A U.S. Marine is missing and Iraqi insurgents say they have him. But U.S. military officials say they don't know that for sure. All they know is corporal was Corporal Wassef Ali Hassoun was last seen nine days ago in the Fallujah area where there was heavy fighting. Those who say they have Hassoun say that they will kill him unless all Iraqi prisoners are freed.

That's the same demand other insurgents are making. They are holding a Pakistani man who works for a subcontractor of an American construction firm. And still no word on the fate of Matt Maupin, the Army private was captured April 9 when his convoy was ambushed outside of Baghdad.

Well, for allies Britain and the U.S., the handover in Iraq is the pinnacle at the NATO summit. For the handover, President Bush and Prime Minister Tony Blair sat side by side at the summit in Istanbul. The president glanced at his watch then leaned over to tell the prime minister that the transfer of power complete. Both leaders have faced harsh international criticism over the war. Today NATO agreed to help train Iraqi security forces.

The president and prime minister issued a joint statement earlier from Turkey.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The United States military and our coalition partners have made a clear, specific and continuing mission in Iraq. As we train Iraqi security forces, we'll help those forces to find and destroy the killers. We'll protect infrastructure from the attacks. We'll provide security for the upcoming elections.

Operating in a sovereign nation, our military will act in close consultation with the Iraqi government, yet coalition forces remain under coalition command. The Iraqis' prime minister and president have told me that their goal is to eventually take full responsibility for the security of their country. And America wants Iraqi forces to take that role. Our military will stay as long as the stability of Iraq requires and only as long as their presence is needed and asked by the Iraqi government.

TONY BLAIR, BRITISH PRIME MINISTER: We haven't overcome the disagreement that was about whether the conflict was justified. I mean, there's no point of us standing here and saying all the previous disagreements have disappeared, they haven't.

On the other hand, what is important is you have got a United Nations resolution that has blessed the new government in Iraq, and you have got a situation in which we have accepted today that there is a good and sound NATO role which is actually the only role we ever sought for NATO, of training and helping to train the Iraqis so that they can do their own security work, which is the request that they have made to us. And in that sense, I think the international community has come together and I welcome it.

(END VIDEO CLIP)

PHILLIPS: Now another handover is also in the works. Former dictator Saddam Hussein may be turned over to Iraq soon. The head of Iraq's special tribunal says the new Iraqi government could get legal custody of Saddam within days. CNN's senior legal analyst Jeffrey Toobin now joins us live from New York to hammer this out.

Jeffrey, the American government definitely walks a fine line here.

JEFFREY TOOBIN, CNN SR. LEGAL ANALYST: They sure do, because on the one hand, they have to maintain security. They don't want him to escape after all the trouble that they went to to catch him. And there are obviously people in Iraq who support Saddam Hussein, who might want him free. So security is one big issue.

On the other hand, they need the appearance of fairness to be guaranteed when he, in fact, goes on trial. They can't have some sort of sham where he is hung after two days. They have to make sure that the new Iraqi government tries him in a way that both is and appears to be fair, and most importantly, convinces the world that he was so bad that this invasion was justified. It's a lot of things to do when, in fact, custody, at least some technical legal custody, now belongs to the Iraqis, not the Americans.

PHILLIPS: All right. You bring up an interesting point about the ways that he could be prosecuted. Now, the decision could be made -- he could be turned over into the hands of the Iraqis and the decision could be made just to -- I mean, I don't know how to put it in a -- I guess, a politically correct way, but to kill him, to take his life. TOOBIN: Well, the Iraqis have committed to using a proceeding. They have a tribunal set up so that appears like it's not going to happen. But a lot remains to be worked out about how he's actually going to be tried. And the way this trial takes place has big practical significance, obviously, it affects whether Saddam Hussein lives or dies, but it also has a tremendous impact on how this invasion may be perceived in history.

You know, it's worth remembering that after World War II, there wasn't a lot known to the general public about the Holocaust until the Nuremberg trials, the Nuremberg tribunals of the Nazi war criminals. Similarly, I think, the crimes of Saddam Hussein will be revealed or not revealed in this tribunal in a way that they haven't been before. So what happens now has big historical significance.

PHILLIPS: So you're saying, my final question here, too, is, it would be extremely important to have more of a drawn-out court proceeding so the world, so the Iraqis could see in detail the crimes that he committed versus maybe a short-term solution or just taking his life and ending the situation? I guess from a PR perspective and also a faith perspective, of the Iraqis having faith in a new judicial system.

TOOBIN: That's true, but there's a risk in the other direction, as well. You want fairness. You want the crimes revealed. But you also don't want the trial to turn into an opportunity for Saddam Hussein to filibuster, to try to rally his troops in the way that some people think Slobodan Milosevic has done in his war crimes tribunal in The Hague. So it has to be fair, it has to be public, but it doesn't have to be Saddam Hussein's show. Satisfying all of those requirements is going to be pretty difficult.

PHILLIPS: CNN's senior legal analyst, Jeffrey Toobin. Thanks a lot, Jeffrey

TOOBIN: OK. Kyra.

PHILLIPS: Well, despite Iraq's move toward democracy, Americans are not so optimistic about the nation's future. In a new CNN/"USA Today"/Gallup poll, Only 39 percent of respondents believe that peace will likely be established in Iraq in the next five years, 60 percent say it's unlikely. Americans were also asked how long U.S. troops should stay in Iraq: 40 percent of respondents say that they want U.S. troops home in less than a year; 30 percent say one or two years is enough; 19 percent want troops to stay for a three- to five-year stint; and 8 percent say they should stay longer than that. Currently 138,000 U.S. troops are serving in Iraq.

PHILLIPS: Senator John Kerry is among those critical of the Bush administration's execution of the Iraq mission. The presumptive Democratic candidate for the White House called the need for adequate security on the ground critical.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: As we look forward today there are very important challenges, so that we can finish our mission and get our troops home as rapidly as possible. We have to focus on the top level priority of providing adequate security.

It is absolutely stunning that of the $18 billion that we approved last year for the reconstruction of Iraq, only $400 million has been spent. Ninety percent of the coalition on the ground is American, 90 percent. And 90 percent of the cost is being borne by the American people.

I believe it is critical that the president get real support, not resolutions, not words, but real support of sufficient personnel, troops, and money to assist in the training of security forces in order to be able to guarantee a rapid real transition, and most importantly, in order to be able to provide adequate security on the ground. You must have security on the ground in order to be able to proceed forward with the reconstruction and the political transformation.

(END VIDEO CLIP)

PHILLIPS: Thousands of American troops still on the ground in Iraq. Will a transfer of power make a difference to them? We'll hear from the Pentagon and our own retired general, Don Shepperd.

America's new ambassador to Iraq. Unique challenges he faces on his tough new assignment.

Legal rights versus the war on terror. The Supreme Court weighs in on whether Gitmo detainees can challenge their imprisonment.

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PHILLIPS: Now enemy combatants and habeas corpus. The highest court in the land today ruled the right to consult a lawyer and seek relief from a judge applies even to non-American terror suspects captured outside U.S. borders. But that still represents a partial victory for the Bush administration. CNN's Sean Callebs tells us how and why and what it all means.

Hi, Sean.

SEAN CALLEBS, CNN CORRESPONDENT: Hi, Kyra, indeed, these decisions have been eagerly awaited and are widely seen however as a setback to President Bush and his policy. The high court says the government can hold U.S. citizens as well as foreign nationals without charges or a trial. However, all of these detainees should get their day in court.

The Supreme Court says that the United States has a right to hold Yaser Esam Hamdi, however, Hamdi has the right to the lawyer and the right to challenge his detention. Hamdi is a U.S. citizen. He was captured in Afghanistan and has been held in a Navy brig for more than two years in Charlotte, North Carolina. Writing for the majority, Sandra Day O'Connor says a citizen held in the United States as an enemy combatant be given a meaningful opportunity to contest the factual basis for that detention before a neutral decision maker.

(BEGIN VIDEO CLIP)

TOM GOLDSTEIN, LEGAL EXPERT: The Supreme Court today told Yaser Hamdi, yes, you can go back to the trial court and make the government come up with more and better evidence justifying holding you. And so that's what his lawyers will do starting this afternoon. They will push the government to come up with more proof that shows that he really is an enemy combatant and was essentially at war with the United States.

(END VIDEO CLIP)

CALLEBS: In a separate ruling that could affect a 600 or so international detainees at the Navy prison in Guantanamo Bay, Cuba, the court says the government can hold them indefinitely. However, they, too, can use the U.S. court system to contest the captivity and treatment.

Now involving a third case, that of alleged dirty bomber Jose Padilla, the high court sidestepped the issue, the justices ruled Padilla's lawyer improperly filed the case and now it must be re- filed.

(BEGIN VIDEO CLIP)

DONNA NEWMAN, PADILLA'S ATTORNEY: But most significantly what they did find emphatically was that he must, must receive due process. He must have a hearing. That the government assertion was resoundingly rejected; that they simply can tell the court their side of the story. The citizens have a right to give their side of the story. And they will have their day in court. So we should all rejoice in the Supreme Court decision.

(END VIDEO CLIP)

CALLEBS: Padilla has yet to be charged with a crime and he, too, has spent more than two years in the Navy brig in Charlotte -- Kyra.

PHILLIPS: Sean Callebs, LIVE FROM... Washington, thank you.

Well, Iraqis move into the driver's seat as they charge -- or as they take charge, rather, of their own country. But with almost 140,000 American troops still in Iraq, is the United States really prepared to give up the wheel?

Our David Ensor looks at the road ahead.

(BEGIN VIDEOTAPE)

DAVID ENSOR, CNN NATIONAL SECURITY CORRESPONDENT (voice-over): Workmen in Baghdad rushing to transform one of Saddam's former palaces into the new U.S. embassy. Like the embassy, the future of the Iraqi nation is a work in progress.

John Negroponte, America's first ambassador to the new Iraq, insists the U.S. will no longer be running the country. In Baghdad he says he will be just another diplomat.

JOHN NEGROPONTE, U.S. AMBASSADOR TO IRAQ: I also don't see myself as running some kind of super embassy, Senator. I see it more as -- obviously not a traditional embassy, it's going to be an embassy operating under very challenging circumstances.

ENSOR: Very challenging circumstances may be diplomatic understatement. Though protected by U.S. troops and miles of razor wire, American diplomats in Iraq, like James Jeffrey, will more than earn their danger pay.

JAMES JEFFREY, U.S. DEP. CHIEF OF MISSION TO IRAQ: We receive incoming rocket and mortar fire in this vicinity quite often. But our goal is to ensure that we are not overrun, that we do not get significant hostile fire. And so far we have been lucky.

ENSOR: From this building in the heavily protected Green Zone of Baghdad, Negroponte will lead an embassy of about a thousand Americans and 700 Iraqis. Their priorities will be security, preparing for Iraqi elections, and overseeing $18 billion worth of reconstruction assistance for Iraq.

FRANK RICCIARDONE, U.S.-IRAQ TRANSITION OFFICIAL: That is the largest foreign assistance program anywhere.

ENSOR (on camera): That's huge.

RICCIARDONE: That is huge and that takes people to administer properly.

ENSOR (voice-over): Critics say that the U.S. embassy will be much too big, signaling that the Bush administration plans to hang on to control of Iraq.

IVO DAALDER, FMR. NATL. SEC. COUNCIL STAFF : This is going to be the largest embassy the United States has ever created anywhere, larger than Embassy Saigon during the Vietnam War. And that sends a message.

ENSOR: U.S. officials say such concerns are misplaced.

RICCIARDONE: No U.S. ambassador goes out expecting to run a foreign country. Even if that were in his mind, the Iraqis wouldn't let him.

ENSOR: Among Iraqis, the man to watch is the new prime minister, Dr. Iyad Allawi, a 58-year-old Shiite Muslim and a long-time emigre who makes no apologies for his past contacts with the CIA.

ALLAWI: I don't feel ashamed of being in touch and having been in touch to liberate Iraq from the evil forces of Saddam.

ENSOR: Reuel Gerecht, a former CIA officer knows Allawi's past well.

REUEL GERECHT, FMR. CIA OFFICER: He likes to think of himself as a man of ideas and he also has a certain -- how do I want to put this politely, respect for the use of force.

ENSOR: In the mid-'90s, Allawi tried to organize unrest against Saddam Hussein. U.S. officials predict he will be inclusive, but tough.

RICCIARDONE: I know he's a strong leader. He's a total patriot.

ENSOR (on camera): But analysts say Allawi has no political base; that he will be dependent on the continued goodwill of the most influential man behind the scenes, the reclusive Grand Ayatollah Sistani.

(voice-over): The real test of how much control Allawi has may come with the next Fallujah, the next military challenge to the 140,000 or so American troops who remain on the ground in Iraq.

COLIN POWELL, SECRETARY OF STATE: U.S. forces remain under U.S. command and will do what is necessary to protect themselves.

GERECHT: If you have an insurrection in the Sunni Triangle, if you have people attacking the Americans, the Americans may want to respond with a good deal of force. There may be individuals in the government who don't want them to. And how this is resolved quickly and the way that one needs to if one is fighting a counterinsurgency, it's not evident me how that's going to work yet. We'll have to see.

ENSOR (on camera): Do you think the handover is really handover or will Ambassador Negroponte end up being the proconsul of Baghdad?

THOMAS PICKERING, FMR. U.S. UNDERSECRETARY OF STATE: We all know that you won't end the CPA one day and have a fully independent Iraq with a typical American embassy that does demarches and holds dinner parties and does a lot of useful things but is not involved on the next day.

BUSH: Prosperity and freedom and dignity are not just American hopes.

ENSOR (voice-over): But Pickering warns Washington can't continue to pull the strings in Iraq.

PICKERING: And if we think in fact that it has got to be operated in a kind of darkroom way as an American colony forever, we won't get there. In fact, the Iraqis are, in my view, very critical along with the international community in bringing about the solution that we seek.

ENSOR: Like the embassy, Iraq's future is a project under construction and under fire. Finding the right balance between security and sovereignty for Iraqis will not be easy.

(END VIDEOTAPE)

PHILLIPS: Straight ahead, counting the cost in Iraq, adding up what Americans are shelling out and will continue to pay even though the Iraqis are in charge. (MARKET REPORT)

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