Return to Transcripts main page

Live From...

Last Stand in Najaf; War of Words; Back Door Draft?

Aired August 19, 2004 - 13:59   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.


FREDRICKA WHITFIELD, CNN ANCHOR: Up first this hour, tough words, exclusive pictures from and about Najaf. Barely a day after it appeared the end was in sight to that bloody war of wills between an Iraqi Shiite cleric and Iraq's new leaders, the leaders are issuing a final call to disarm while the cleric is reportedly vowing victory or death.
We get the latest now from CNN's Matthew Chance.

(BEGIN VIDEOTAPE)

MATTHEW CHANCE, CNN CORRESPONDENT: Fierce fighting on the streets of Najaf. And in the last few minutes we've heard a ferocious artillery barrage launched from this camp on the outskirts of Najaf in to the city itself. It seems there is very fierce fighting indeed in several areas of the city.

The U.S. military describing this as just the kind of clashes that we've been witnessing over the past several weeks here. But certainly they seem more significant from the vantage point that we have. It does seem that there are a number of units involved in clashes with the Mehdi Army, loyal, of course, to the radical Shiite cleric, Muqtada al-Sadr. Many of them holed up in the Imam Ali Mosque in the center of Najaf.

Now, U.S. military officials denying that this is the start of that much-anticipated offensive against the Imam Ali shrine, although they're saying that, subject to political approval, these operations could develop in that direction. I want to stress, though, that political approval, foreign assault on the mosque, has not yet been given. If it does, the Iraqi government says it will be Iraqi troops that are involved and leading that charge, not U.S. forces.

(END VIDEOTAPE)

KYRA PHILLIPS, CNN ANCHOR: Well, if al-Sadr decides to fight it out, or Allawi decides his patience is exhausted, the next step will be tough militarily, politically and diplomatically. That's just for Americans. I'm joined now by CNN military analyst, former Air Force Major General Don Shepperd.

General, when you look at these pictures just in, and you see all these supporters inside the mosque, how do you get the word to these individuals that, look, we're trying to de-escalate the threat here and make peace? How do you communicate with supporters like this and so many of them? MAJ. GEN. DON SHEPPERD (RET.), AIR FORCE: Yes. The key, Kyra, is you have got to work with the Iraqis and let the Iraqis do the negotiating for you. Stand in the background to support the forces.

What you don't want at all costs is you do not want a big fight inside the Imam Ali Shrine that destroys it or damages it. That will work against us.

So, you stand back outside with U.S. forces. You cordon off the area. You prevent the movement of people and arms in the area, particularly heavy arms. And then you let the Iraqis take the lead and support them.

PHILLIPS: So, when you see these pictures, you see this kind of support, General, does this mean that the new government is not working, that the new prime minister is having a difficult time getting control of his country?

SHEPPERD: Partly. The new government is not yet working. They are trying to gain the confidence of the people. And this is an important step.

Najaf has to be brought to a -- to an appropriate conclusion. Allawi has to -- has to work to handle this situation down in Najaf. And how Najaf goes will depend in great measure on how successful he is in other areas of the country.

So, the fact that these supporters of al-Mehdi are inside the shrine just makes it much, much more complicated. But it's a very difficult situation not only in Najaf, but in Al Sadr City and other areas across the south, such as Karbala, Nasiriyah, Al Kut, et cetera.

PHILLIPS: General, stay with us. We want to continue talking about the military side. We want to bring in our Matthew Chance, who is live from Najaf.

Matthew, looking at these pictures, seeing what is taking place, the violence obviously still continuing, the standoff continuing. When you look at the history of Muqtada al-Sadr's father, and you also consider the anti-American sentiment, what do you think is at the core here?

CHANCE: Well, it certainly seems that Muqtada al-Sadr, who is this radical Shiite cleric, has struck a cord with many people in Iraq who are very much opposed to the U.S. presence, very much opposed to the fact they have appointed this interim Iraqi government. And the fact is that every day he holds out inside this Imam Ali Mosque he gets more and more support from people around the country.

He seems very much as -- more and more the foremost opposition figure in the country, and that's obviously a bad thing. He poses a big challenge to the interim Iraqi government and to the presence of U.S. forces here. And everybody wants to bring this crisis to an end.

PHILLIPS: Matthew, so you are confirming that Muqtada al-Sadr is, for sure, he's definitely holed up inside the mosque where all these supporters are?

CHANCE: Well, certainly that's the -- that's the belief among U.S. military officials that we have spoken to. Though, of course, we don't have actual eyes in the -- in the mosque itself.

There's thought that he may be in the immediate area of the mosque, if not in the compound itself. But certainly there are hundreds of his Mehdi Army fighters. And if you believe the interim Iraqi government, foreign fighters and criminals, as well, holed up inside that mosque.

And they have been using it as a base to launch attacks against U.S. forces and against the Iraqi police. Only a few hours ago, seven Iraqi police were killed in a mortar attack in a police station that was launched from inside the mosque compound.

PHILLIPS: So, General, at what point does the U.S. military decide, or do they have to get word from the Iraqis that they need to enter this mosque and go in for Muqtada al-Sadr if indeed they confirm he's inside that mosque -- General Shepperd. General Shepperd?

SHEPPERD: Yes. I suspect, Kyra, that the U.S. forces will not go inside the mosque. That will be done by Iraqis in the end if it has to be done. I also suspect that there will be a negotiated solution in the end.

Matthew Chance is right. This movement is getting stronger and al-Sadr is becoming a symbol of resistance for all of the people opposed to the United States' occupation. He's got to be dealt with for the interim government to be successful. And the Ayatollah al- Sistani is not in country to -- to help handle this situation.

So, Sadr is becoming stronger. He's got to be dealt with. And the U.S. forces are going to be in the background.

PHILLIPS: Now, so much talk was said, General, about Saddam Hussein, that he would take his own life, he would die a martyr before anybody got to him. Knowing what you know about Muqtada al-Sadr is this somebody that will negotiate, or is that somebody that will -- would rather go down a martyr before -- before having this -- to deal with the U.S. or the new Iraqi government?

SHEPPERD: Yes, hard to get inside someone else's head. But my gut tells me that he is going to negotiate.

He's been perfectly willing to sacrifice the lives of his followers, and the word "martyrdom" is thrown all around the -- the Islamic and Arab world all the time very freely. You don't know what he's going to do at the end. But the problem is, every time we till another Iraqi, we make enemies for the future.

And we're hearing reports of 50, 200 being killed every day. And that make the movement, and it makes it more -- the movement stronger. And it makes it more difficult to bring it to a negotiated conclusion. But my guess is, in the end, it will be a negotiation, and he will join the political process with amnesty, as opposed to a military solution that kills him, Kyra.

PHILLIPS: Matthew Chance, you're there embedded with the troops. What can you tell us right now about the negotiation process? And if, indeed, troops believe that will happen?

Matthew Chance, can you hear me?

All right. We had a problem establishing our communications with him. That was Matthew Chance in Najaf.

Retired Major General Don Sheppard of the U.S. Air Force out of Tucson, Arizona, thanks so much for your time, General. We'll continue to follow this story.

SHEPPERD: Pleasure.

PHILLIPS: Fred.

WHITFIELD: Well, now back to an old war that may never cease to cause bad blood. It's Vietnam, and the latest firestorm centers on John Kerry's service there and the role it plays in the campaign for president.

We get the blow by blow by CNN's Sean Callebs in Washington -- Sean.

SEAN CALLEBS, CNN CORRESPONDENT: Indeed, Fredricka.

Democratic presidential candidate John Kerry is firing back at critics at a campaign commercial that questions his service record during the Vietnam War. Kerry denounced the ad that basically says he is lying about his military record. This is it.

It is running under the name Swift Boat Veterans for Truth and funded by Texas Republicans. It is not paid for by the Bush campaign.

Well, speaking in his backyard of Boston to some of his most staunch supporters, a group of firefighters who have been onboard with him since the beginning, Kerry said he will begin running a counter- commercial on TV tomorrow to counter the criticism.

The White House says Kerry knows his statements are false and that the president has called Kerry's Vietnam service noble. Kerry is now going on the offensive.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: But here's what you really need to know about them. They are funded by hundreds of thousands of dollars from a Republican contributor out of Texas. They are a front for the Bush campaign. And the fact that the president won't denounce what they are up to tells you everything that you need to know. He wants them to do his dirty work.

(END VIDEO CLIP) CALLEBS: Speaking about lying about events, Larry Thurlow -- Thurlow, who also received a Bronze Star that day, says Kerry's citation is "totally fabricated," and Thurlow says he "never heard a shot."

Kerry has maintained his boat came under fire after a mine explosion. Records back in March of 1969 show Thrurlow said he and other boats that day came under "constant small arms fire." Well, today, Thurlow told CNN he didn't even know he won a Bronze Star until he was out of the Navy, and he contends Kerry wrote the after action report -- Fred.

WHITFIELD: So, now this war of words involving Thurlow and Kerry. Need Kerry really say much about it since, based on this Freedom of Information Act, these records have been obtained by various news organizations that show the Bronze Star that both Thurlow and Kerry received was because there was ongoing fire in Vietnam.

CALLEBS: Well a couple of points here. Kerry has always maintained he was going to take the high road on his record in Vietnam. But recently a number of Democrats have reportedly told him, "You have you to get out. You have to defend yourself. You have to make it known what you did back in that war."

So, today, he said if anybody wants to take a look at my record, "bring it on."

Now, about Thurlow, Thurlow maintains that Kerry wrote that after-incident report. So, even though there may be quotes from that, what Thurlow is saying, in essence, is that Kerry is the one who carefully scripted this, and if indeed he won a Bronze Star, it was on information that was fabricated. So, we probably haven't heard the last of this one -- Fredricka.

WHITFIELD: I have that same feeling. All right. Thanks a lot. Sean Callebs in Washington.

PHILLIPS: A soldier sues Defense Secretary Donald Rumsfeld over a controversial war-time program. A California National Guardsman has launched a federal challenge of the military's Stop-Loss Program. Some say it is nothing more than a backdoor draft. CNN's Miguel Marquez has more on this case.

(BEGIN VIDEOTAPE)

MIGUEL MARQUEZ, CNN CORRESPONDENT (voice-over): He is now in the National Guard, Company B of the first of the 184th in Dublin, California. His lawyers say he served nine years of active duty in the Marines and Army and that he got awards for his combat service. But now he's anonymously suing Secretary of Defense Donald Rumsfeld, who his lawyers claim is keeping him from getting out of the military.

MICHAEL SORGEN, PLAINTIFF'S ATTORNEY: He is challenging the Stop-Loss policy because it's really unfair. And it's unfair because what it does is it extends the enlistments involuntarily. MARQUEZ: The soldier known only as John Doe has filed a lawsuit asking a federal judge to allow him to leave the military when his obligation ends in December. But because of the Pentagon Stop-Loss Program, put into effect by President Bush in the days following September 11, John Doe is headed to Iraq again. Groups opposed to the Iraq war, like the Military Law Task Force, calls Stop-Loss a back door draft.

MARGUERITE HIKEN, MILITARY LAW TASK FORCE: Daily, we in the Military Law Task Force, and those on the G.I. Rights hotline, deal with and recognize the depth of dissatisfaction and anger with those serving in Iraq.

MARQUEZ: The lawsuit contends that when President Bush put Stop- Loss into effect it was to assist in the war on terror, and now that Iraq has been declared a sovereign nation with questionable ties to al Qaeda, the order should be declared invalid. The dean of Golden Gate University Law School says good luck.

PETER KEANE, GOLDEN GATE UNIVERSITY SCHOOL OF LAW: The likelihood of the courts wanting to go ahead and get in there and start interpreting what the powers of the commander-in-chief of the United States is as president are about zilch.

MARQUEZ (on camera): An Army spokeswoman says about 20,000 soldiers are now serving because of the Stop-Loss Program. She also says the military has no response to the lawsuit because its lawyers haven't seen it yet. She added that because the nation is at war, the military uses the Stop-Loss Program to keep skilled and trained soldiers in their position in Iraq and elsewhere.

Miguel Marquez, CNN, San Francisco.

(END VIDEOTAPE)

PHILLIPS: Hit hard by a hurricane.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: It's not easy. Life's not easy.

(END VIDEO CLIP)

PHILLIPS: It's definitely not easy, especially when you are this man. Tarnished golden years. Dealing with Charley was definitely not part of the retirement plan. That's just ahead.

American children abandoned in Nigeria. An update on the investigation into exactly how they got there.

And it can be the longest 26.2 miles of your life if you're running it. The origins of the modern day marathon as we cross the finish line later on LIVE FROM.

(COMMERCIAL BREAK)

(WEATHER REPORT)

WHITFIELD: Well, they have lived in the United States since they were children, ages seven and 10. Now only an act of Congress can solve a deportation dispute that could send two sisters back to Mexico forever.

College students Edith and Martha Luna took a short trip to Tijuana from San Diego. However, border agents would not allow them back into the U.S. because the sisters only had work permits and not the proper residency papers. The sisters re-entered the country illegally, and now they face deportation. Their lawyer explains that only Congress can help them.

(BEGIN VIDEO CLIP)

CARL SHUSTERMAN, LUNA SISTERS' ATTORNEY: Unless a senator or a congressman introduces a private bill in Congress specifically for the Luna sisters, really they are finished as far as living in the U.S. They are supposed to report with their baggage packed in Ventura on September the 1st, and they will put them on a green bus and drop them off in Tijuana, and they will spend the rest of their lives now in Mexico.

(END VIDEO CLIP)

WHITFIELD: Well, the sisters are here to share their stories with us now. Edith and Martha Luna join us from Los Angeles.

Good to see you ladies.

MARTHA LUNA, FACES DEPORTATION: Hello.

EDITH LUNA, FACES DEPORTATION: Good seeing you.

WHITFIELD: All right. Well, this trip began with a rather innocent odyssey to San Diego, right, to Sea World? And then you all decided, "Let's go to Tijuana." Why did you make that decision, knowing what potentially was at stake -- Edith.

E. LUNA; Well, we kind of knew that we were going to go -- well, it was just like an error that we did, we committed, because we were planning to go to -- to SeaWorld, but it -- I mean, it turned out that -- I mean, like since we were young, we went to TJ, because we wanted to know what was the culture over there.

And since we hadn't been there for such a long time, we decided to go. But it turned out that we ended up getting into this big mess and making this big error.

WHITFIELD: Yes.

But Martha, you all knew that, you know, your parents came to this country illegally and helped raise you all in the states, is my understanding. And apparently, for the past 10 years you have been trying to get a green card. Why did you think that it was worth taking a risk to go across the border, knowing that there may be a possibility you can't make it back over without the proper papers?

M. LUNA: You know what? At that time we were not thinking. You know, it just happens to young adults.

You know, you are driven by an impulse of unwisdom (ph) -- no wisdom. And you just make mistakes. You know?

And only god knows why we're going through this kind of situation. And you know, we believe that, you know, god is going to help us. It's kind of hard, though, to explain.

WHITFIELD: Well, try to explain to us what happened once you got to Tijuana. You are there, you are having a good time. And then it's time to come back home to the states. What happened exactly?

M. LUNA: As we tried to enter, you know, I guess you have to line up. And there's someone there checking your stuff. And you know, you have to show what you have.

So, what we did is that we showed our work permit. And he said, "You know, you guys can't go in there with this paper, you know? These are work authority stations. You just might as well go back." And...

WHITFIELD: And Edith, what was going through your mind at this point?

E. LUNA: Well, I mean, like, I thought we could go back since we knew the English language. But it turned out that we couldn't do it, you know, because, I mean, we couldn't lie that we were American citizens. And since we didn't lie, you know, we got caught.

But now we have to face our penalty. And -- which I think it's not -- it's not really proportional, because, I mean, like, I'm sure like we are educated. And I know there has to be like some solution to our problem.

WHITFIELD: But given that you are educated, you all are college students at Cal State, I'm sure the response from them was, well, you all should know better. You know that there are consequences if you don't have the proper identification to get across the border. You can't just explain yourself out of this or try to explain yourself back into the country.

So, instead, you all took the route of trying to get back into the country illegally, right? Martha, explain exactly how you made that decision and what you did.

M. LUNA: I tried doing things correctly, you know, talking to the person, you know, like in an office after, you know, the other guy told me that I couldn't cross. So, I tried and went to the office, and that's when they find out, "Oh, you know why? Your petition has been here since 1992. And you know, you are still on the waiting list."

You know, "You just made that mistake of coming over here. You just deported yourself."

So, they sent us to another office and that's where, you know, they took my fingerprints. And they said, "You know what? Maybe you guys can see another person," you know, "at 7:30 in the morning." And that's what we did.

You know, we lined up in the morning at 7:30 and tried talking to that INS officer. And the same thing. He said, "You know what? There's nothing we can do. You know? You guys just might as well go back to Mexico, make a living." You know?

And they took our fingerprints, all our information. And that was it.

(CROSSTALK)

WHITFIELD: And so, now your attorney is describing this as an unfortunate circumstance because, had you not tried to cross the border illegally, you might have stood a chance at petitioning your way back in. And now those hopes are dashed.

So, you really do have no other legal resource courses now, Martha and Edith. And you are being told that in a month you all will definitively be deported, right?

M. LUNA: Right.

WHITFIELD: And so, you are trying to make an appeal to Congress, and you're hoping that that is the only way in which to maintain your residency in L.A. and continue your college education?

E. LUNA: Yes.

WHITFIELD: All right. And what are you being told the chances of that happening are?

M. LUNA: They are very small. Very, very small. It's only a miracle from god, you know, can, you know, make this miracle come through. Because it's very, very small, those chances.

WHITFIELD: All right. I know it's a tough situation for you, as well as your family. But best of luck to both you, Martha and Edith Luna. And thanks so much for telling us your story.

E. LUNA: Thank you.

M. LUNA: Thank you.

WHITFIELD: All right.

PHILLIPS: It's a problem few of us have, instant wealth. An Internet entrepreneur who struck it rich then lost it all has some advice on how to deal with the rise and fall of fortune.

Unicorns, the Loch Ness monster, and an animal almost as rare: a wild white elephant. Ahead, never before seen images. RHONDA SCHAFFLER, CNN CORRESPONDENT: I'm Rhonda Schaffler at the New York Stock Exchange. Are you sick of paying for those ATM fees? The government is saying that you shouldn't have to. I'll explain just ahead.

(COMMERCIAL BREAK)

PHILLIPS: Well, if you think it costs you way too much money every time you use an ATM, listen up. Help may be on the way. Rhonda Schaffler joins us now from the New York Stock Exchange with that story.

(STOCK MARKET REPORT)

(COMMERCIAL BREAK)

WHITFIELD: Well, welcome back from the CNN Center in Atlanta. This is LIVE FROM. I'm Fredricka Whitfield.

PHILLIPS: And I'm Kyra Phillips. Here is what is all new this half-hour.

If you watched CNN yesterday, you heard about the seven American children abandoned at an orphanage in Nigeria. Well, just in a few minutes, a follow-up on their amazing case. But first, here's what's happening in the news.

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 August 19, 2004 - 13:59   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
FREDRICKA WHITFIELD, CNN ANCHOR: Up first this hour, tough words, exclusive pictures from and about Najaf. Barely a day after it appeared the end was in sight to that bloody war of wills between an Iraqi Shiite cleric and Iraq's new leaders, the leaders are issuing a final call to disarm while the cleric is reportedly vowing victory or death.
We get the latest now from CNN's Matthew Chance.

(BEGIN VIDEOTAPE)

MATTHEW CHANCE, CNN CORRESPONDENT: Fierce fighting on the streets of Najaf. And in the last few minutes we've heard a ferocious artillery barrage launched from this camp on the outskirts of Najaf in to the city itself. It seems there is very fierce fighting indeed in several areas of the city.

The U.S. military describing this as just the kind of clashes that we've been witnessing over the past several weeks here. But certainly they seem more significant from the vantage point that we have. It does seem that there are a number of units involved in clashes with the Mehdi Army, loyal, of course, to the radical Shiite cleric, Muqtada al-Sadr. Many of them holed up in the Imam Ali Mosque in the center of Najaf.

Now, U.S. military officials denying that this is the start of that much-anticipated offensive against the Imam Ali shrine, although they're saying that, subject to political approval, these operations could develop in that direction. I want to stress, though, that political approval, foreign assault on the mosque, has not yet been given. If it does, the Iraqi government says it will be Iraqi troops that are involved and leading that charge, not U.S. forces.

(END VIDEOTAPE)

KYRA PHILLIPS, CNN ANCHOR: Well, if al-Sadr decides to fight it out, or Allawi decides his patience is exhausted, the next step will be tough militarily, politically and diplomatically. That's just for Americans. I'm joined now by CNN military analyst, former Air Force Major General Don Shepperd.

General, when you look at these pictures just in, and you see all these supporters inside the mosque, how do you get the word to these individuals that, look, we're trying to de-escalate the threat here and make peace? How do you communicate with supporters like this and so many of them? MAJ. GEN. DON SHEPPERD (RET.), AIR FORCE: Yes. The key, Kyra, is you have got to work with the Iraqis and let the Iraqis do the negotiating for you. Stand in the background to support the forces.

What you don't want at all costs is you do not want a big fight inside the Imam Ali Shrine that destroys it or damages it. That will work against us.

So, you stand back outside with U.S. forces. You cordon off the area. You prevent the movement of people and arms in the area, particularly heavy arms. And then you let the Iraqis take the lead and support them.

PHILLIPS: So, when you see these pictures, you see this kind of support, General, does this mean that the new government is not working, that the new prime minister is having a difficult time getting control of his country?

SHEPPERD: Partly. The new government is not yet working. They are trying to gain the confidence of the people. And this is an important step.

Najaf has to be brought to a -- to an appropriate conclusion. Allawi has to -- has to work to handle this situation down in Najaf. And how Najaf goes will depend in great measure on how successful he is in other areas of the country.

So, the fact that these supporters of al-Mehdi are inside the shrine just makes it much, much more complicated. But it's a very difficult situation not only in Najaf, but in Al Sadr City and other areas across the south, such as Karbala, Nasiriyah, Al Kut, et cetera.

PHILLIPS: General, stay with us. We want to continue talking about the military side. We want to bring in our Matthew Chance, who is live from Najaf.

Matthew, looking at these pictures, seeing what is taking place, the violence obviously still continuing, the standoff continuing. When you look at the history of Muqtada al-Sadr's father, and you also consider the anti-American sentiment, what do you think is at the core here?

CHANCE: Well, it certainly seems that Muqtada al-Sadr, who is this radical Shiite cleric, has struck a cord with many people in Iraq who are very much opposed to the U.S. presence, very much opposed to the fact they have appointed this interim Iraqi government. And the fact is that every day he holds out inside this Imam Ali Mosque he gets more and more support from people around the country.

He seems very much as -- more and more the foremost opposition figure in the country, and that's obviously a bad thing. He poses a big challenge to the interim Iraqi government and to the presence of U.S. forces here. And everybody wants to bring this crisis to an end.

PHILLIPS: Matthew, so you are confirming that Muqtada al-Sadr is, for sure, he's definitely holed up inside the mosque where all these supporters are?

CHANCE: Well, certainly that's the -- that's the belief among U.S. military officials that we have spoken to. Though, of course, we don't have actual eyes in the -- in the mosque itself.

There's thought that he may be in the immediate area of the mosque, if not in the compound itself. But certainly there are hundreds of his Mehdi Army fighters. And if you believe the interim Iraqi government, foreign fighters and criminals, as well, holed up inside that mosque.

And they have been using it as a base to launch attacks against U.S. forces and against the Iraqi police. Only a few hours ago, seven Iraqi police were killed in a mortar attack in a police station that was launched from inside the mosque compound.

PHILLIPS: So, General, at what point does the U.S. military decide, or do they have to get word from the Iraqis that they need to enter this mosque and go in for Muqtada al-Sadr if indeed they confirm he's inside that mosque -- General Shepperd. General Shepperd?

SHEPPERD: Yes. I suspect, Kyra, that the U.S. forces will not go inside the mosque. That will be done by Iraqis in the end if it has to be done. I also suspect that there will be a negotiated solution in the end.

Matthew Chance is right. This movement is getting stronger and al-Sadr is becoming a symbol of resistance for all of the people opposed to the United States' occupation. He's got to be dealt with for the interim government to be successful. And the Ayatollah al- Sistani is not in country to -- to help handle this situation.

So, Sadr is becoming stronger. He's got to be dealt with. And the U.S. forces are going to be in the background.

PHILLIPS: Now, so much talk was said, General, about Saddam Hussein, that he would take his own life, he would die a martyr before anybody got to him. Knowing what you know about Muqtada al-Sadr is this somebody that will negotiate, or is that somebody that will -- would rather go down a martyr before -- before having this -- to deal with the U.S. or the new Iraqi government?

SHEPPERD: Yes, hard to get inside someone else's head. But my gut tells me that he is going to negotiate.

He's been perfectly willing to sacrifice the lives of his followers, and the word "martyrdom" is thrown all around the -- the Islamic and Arab world all the time very freely. You don't know what he's going to do at the end. But the problem is, every time we till another Iraqi, we make enemies for the future.

And we're hearing reports of 50, 200 being killed every day. And that make the movement, and it makes it more -- the movement stronger. And it makes it more difficult to bring it to a negotiated conclusion. But my guess is, in the end, it will be a negotiation, and he will join the political process with amnesty, as opposed to a military solution that kills him, Kyra.

PHILLIPS: Matthew Chance, you're there embedded with the troops. What can you tell us right now about the negotiation process? And if, indeed, troops believe that will happen?

Matthew Chance, can you hear me?

All right. We had a problem establishing our communications with him. That was Matthew Chance in Najaf.

Retired Major General Don Sheppard of the U.S. Air Force out of Tucson, Arizona, thanks so much for your time, General. We'll continue to follow this story.

SHEPPERD: Pleasure.

PHILLIPS: Fred.

WHITFIELD: Well, now back to an old war that may never cease to cause bad blood. It's Vietnam, and the latest firestorm centers on John Kerry's service there and the role it plays in the campaign for president.

We get the blow by blow by CNN's Sean Callebs in Washington -- Sean.

SEAN CALLEBS, CNN CORRESPONDENT: Indeed, Fredricka.

Democratic presidential candidate John Kerry is firing back at critics at a campaign commercial that questions his service record during the Vietnam War. Kerry denounced the ad that basically says he is lying about his military record. This is it.

It is running under the name Swift Boat Veterans for Truth and funded by Texas Republicans. It is not paid for by the Bush campaign.

Well, speaking in his backyard of Boston to some of his most staunch supporters, a group of firefighters who have been onboard with him since the beginning, Kerry said he will begin running a counter- commercial on TV tomorrow to counter the criticism.

The White House says Kerry knows his statements are false and that the president has called Kerry's Vietnam service noble. Kerry is now going on the offensive.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: But here's what you really need to know about them. They are funded by hundreds of thousands of dollars from a Republican contributor out of Texas. They are a front for the Bush campaign. And the fact that the president won't denounce what they are up to tells you everything that you need to know. He wants them to do his dirty work.

(END VIDEO CLIP) CALLEBS: Speaking about lying about events, Larry Thurlow -- Thurlow, who also received a Bronze Star that day, says Kerry's citation is "totally fabricated," and Thurlow says he "never heard a shot."

Kerry has maintained his boat came under fire after a mine explosion. Records back in March of 1969 show Thrurlow said he and other boats that day came under "constant small arms fire." Well, today, Thurlow told CNN he didn't even know he won a Bronze Star until he was out of the Navy, and he contends Kerry wrote the after action report -- Fred.

WHITFIELD: So, now this war of words involving Thurlow and Kerry. Need Kerry really say much about it since, based on this Freedom of Information Act, these records have been obtained by various news organizations that show the Bronze Star that both Thurlow and Kerry received was because there was ongoing fire in Vietnam.

CALLEBS: Well a couple of points here. Kerry has always maintained he was going to take the high road on his record in Vietnam. But recently a number of Democrats have reportedly told him, "You have you to get out. You have to defend yourself. You have to make it known what you did back in that war."

So, today, he said if anybody wants to take a look at my record, "bring it on."

Now, about Thurlow, Thurlow maintains that Kerry wrote that after-incident report. So, even though there may be quotes from that, what Thurlow is saying, in essence, is that Kerry is the one who carefully scripted this, and if indeed he won a Bronze Star, it was on information that was fabricated. So, we probably haven't heard the last of this one -- Fredricka.

WHITFIELD: I have that same feeling. All right. Thanks a lot. Sean Callebs in Washington.

PHILLIPS: A soldier sues Defense Secretary Donald Rumsfeld over a controversial war-time program. A California National Guardsman has launched a federal challenge of the military's Stop-Loss Program. Some say it is nothing more than a backdoor draft. CNN's Miguel Marquez has more on this case.

(BEGIN VIDEOTAPE)

MIGUEL MARQUEZ, CNN CORRESPONDENT (voice-over): He is now in the National Guard, Company B of the first of the 184th in Dublin, California. His lawyers say he served nine years of active duty in the Marines and Army and that he got awards for his combat service. But now he's anonymously suing Secretary of Defense Donald Rumsfeld, who his lawyers claim is keeping him from getting out of the military.

MICHAEL SORGEN, PLAINTIFF'S ATTORNEY: He is challenging the Stop-Loss policy because it's really unfair. And it's unfair because what it does is it extends the enlistments involuntarily. MARQUEZ: The soldier known only as John Doe has filed a lawsuit asking a federal judge to allow him to leave the military when his obligation ends in December. But because of the Pentagon Stop-Loss Program, put into effect by President Bush in the days following September 11, John Doe is headed to Iraq again. Groups opposed to the Iraq war, like the Military Law Task Force, calls Stop-Loss a back door draft.

MARGUERITE HIKEN, MILITARY LAW TASK FORCE: Daily, we in the Military Law Task Force, and those on the G.I. Rights hotline, deal with and recognize the depth of dissatisfaction and anger with those serving in Iraq.

MARQUEZ: The lawsuit contends that when President Bush put Stop- Loss into effect it was to assist in the war on terror, and now that Iraq has been declared a sovereign nation with questionable ties to al Qaeda, the order should be declared invalid. The dean of Golden Gate University Law School says good luck.

PETER KEANE, GOLDEN GATE UNIVERSITY SCHOOL OF LAW: The likelihood of the courts wanting to go ahead and get in there and start interpreting what the powers of the commander-in-chief of the United States is as president are about zilch.

MARQUEZ (on camera): An Army spokeswoman says about 20,000 soldiers are now serving because of the Stop-Loss Program. She also says the military has no response to the lawsuit because its lawyers haven't seen it yet. She added that because the nation is at war, the military uses the Stop-Loss Program to keep skilled and trained soldiers in their position in Iraq and elsewhere.

Miguel Marquez, CNN, San Francisco.

(END VIDEOTAPE)

PHILLIPS: Hit hard by a hurricane.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: It's not easy. Life's not easy.

(END VIDEO CLIP)

PHILLIPS: It's definitely not easy, especially when you are this man. Tarnished golden years. Dealing with Charley was definitely not part of the retirement plan. That's just ahead.

American children abandoned in Nigeria. An update on the investigation into exactly how they got there.

And it can be the longest 26.2 miles of your life if you're running it. The origins of the modern day marathon as we cross the finish line later on LIVE FROM.

(COMMERCIAL BREAK)

(WEATHER REPORT)

WHITFIELD: Well, they have lived in the United States since they were children, ages seven and 10. Now only an act of Congress can solve a deportation dispute that could send two sisters back to Mexico forever.

College students Edith and Martha Luna took a short trip to Tijuana from San Diego. However, border agents would not allow them back into the U.S. because the sisters only had work permits and not the proper residency papers. The sisters re-entered the country illegally, and now they face deportation. Their lawyer explains that only Congress can help them.

(BEGIN VIDEO CLIP)

CARL SHUSTERMAN, LUNA SISTERS' ATTORNEY: Unless a senator or a congressman introduces a private bill in Congress specifically for the Luna sisters, really they are finished as far as living in the U.S. They are supposed to report with their baggage packed in Ventura on September the 1st, and they will put them on a green bus and drop them off in Tijuana, and they will spend the rest of their lives now in Mexico.

(END VIDEO CLIP)

WHITFIELD: Well, the sisters are here to share their stories with us now. Edith and Martha Luna join us from Los Angeles.

Good to see you ladies.

MARTHA LUNA, FACES DEPORTATION: Hello.

EDITH LUNA, FACES DEPORTATION: Good seeing you.

WHITFIELD: All right. Well, this trip began with a rather innocent odyssey to San Diego, right, to Sea World? And then you all decided, "Let's go to Tijuana." Why did you make that decision, knowing what potentially was at stake -- Edith.

E. LUNA; Well, we kind of knew that we were going to go -- well, it was just like an error that we did, we committed, because we were planning to go to -- to SeaWorld, but it -- I mean, it turned out that -- I mean, like since we were young, we went to TJ, because we wanted to know what was the culture over there.

And since we hadn't been there for such a long time, we decided to go. But it turned out that we ended up getting into this big mess and making this big error.

WHITFIELD: Yes.

But Martha, you all knew that, you know, your parents came to this country illegally and helped raise you all in the states, is my understanding. And apparently, for the past 10 years you have been trying to get a green card. Why did you think that it was worth taking a risk to go across the border, knowing that there may be a possibility you can't make it back over without the proper papers?

M. LUNA: You know what? At that time we were not thinking. You know, it just happens to young adults.

You know, you are driven by an impulse of unwisdom (ph) -- no wisdom. And you just make mistakes. You know?

And only god knows why we're going through this kind of situation. And you know, we believe that, you know, god is going to help us. It's kind of hard, though, to explain.

WHITFIELD: Well, try to explain to us what happened once you got to Tijuana. You are there, you are having a good time. And then it's time to come back home to the states. What happened exactly?

M. LUNA: As we tried to enter, you know, I guess you have to line up. And there's someone there checking your stuff. And you know, you have to show what you have.

So, what we did is that we showed our work permit. And he said, "You know, you guys can't go in there with this paper, you know? These are work authority stations. You just might as well go back." And...

WHITFIELD: And Edith, what was going through your mind at this point?

E. LUNA: Well, I mean, like, I thought we could go back since we knew the English language. But it turned out that we couldn't do it, you know, because, I mean, we couldn't lie that we were American citizens. And since we didn't lie, you know, we got caught.

But now we have to face our penalty. And -- which I think it's not -- it's not really proportional, because, I mean, like, I'm sure like we are educated. And I know there has to be like some solution to our problem.

WHITFIELD: But given that you are educated, you all are college students at Cal State, I'm sure the response from them was, well, you all should know better. You know that there are consequences if you don't have the proper identification to get across the border. You can't just explain yourself out of this or try to explain yourself back into the country.

So, instead, you all took the route of trying to get back into the country illegally, right? Martha, explain exactly how you made that decision and what you did.

M. LUNA: I tried doing things correctly, you know, talking to the person, you know, like in an office after, you know, the other guy told me that I couldn't cross. So, I tried and went to the office, and that's when they find out, "Oh, you know why? Your petition has been here since 1992. And you know, you are still on the waiting list."

You know, "You just made that mistake of coming over here. You just deported yourself."

So, they sent us to another office and that's where, you know, they took my fingerprints. And they said, "You know what? Maybe you guys can see another person," you know, "at 7:30 in the morning." And that's what we did.

You know, we lined up in the morning at 7:30 and tried talking to that INS officer. And the same thing. He said, "You know what? There's nothing we can do. You know? You guys just might as well go back to Mexico, make a living." You know?

And they took our fingerprints, all our information. And that was it.

(CROSSTALK)

WHITFIELD: And so, now your attorney is describing this as an unfortunate circumstance because, had you not tried to cross the border illegally, you might have stood a chance at petitioning your way back in. And now those hopes are dashed.

So, you really do have no other legal resource courses now, Martha and Edith. And you are being told that in a month you all will definitively be deported, right?

M. LUNA: Right.

WHITFIELD: And so, you are trying to make an appeal to Congress, and you're hoping that that is the only way in which to maintain your residency in L.A. and continue your college education?

E. LUNA: Yes.

WHITFIELD: All right. And what are you being told the chances of that happening are?

M. LUNA: They are very small. Very, very small. It's only a miracle from god, you know, can, you know, make this miracle come through. Because it's very, very small, those chances.

WHITFIELD: All right. I know it's a tough situation for you, as well as your family. But best of luck to both you, Martha and Edith Luna. And thanks so much for telling us your story.

E. LUNA: Thank you.

M. LUNA: Thank you.

WHITFIELD: All right.

PHILLIPS: It's a problem few of us have, instant wealth. An Internet entrepreneur who struck it rich then lost it all has some advice on how to deal with the rise and fall of fortune.

Unicorns, the Loch Ness monster, and an animal almost as rare: a wild white elephant. Ahead, never before seen images. RHONDA SCHAFFLER, CNN CORRESPONDENT: I'm Rhonda Schaffler at the New York Stock Exchange. Are you sick of paying for those ATM fees? The government is saying that you shouldn't have to. I'll explain just ahead.

(COMMERCIAL BREAK)

PHILLIPS: Well, if you think it costs you way too much money every time you use an ATM, listen up. Help may be on the way. Rhonda Schaffler joins us now from the New York Stock Exchange with that story.

(STOCK MARKET REPORT)

(COMMERCIAL BREAK)

WHITFIELD: Well, welcome back from the CNN Center in Atlanta. This is LIVE FROM. I'm Fredricka Whitfield.

PHILLIPS: And I'm Kyra Phillips. Here is what is all new this half-hour.

If you watched CNN yesterday, you heard about the seven American children abandoned at an orphanage in Nigeria. Well, just in a few minutes, a follow-up on their amazing case. But first, here's what's happening in the news.

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