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Sen. Pat Roberts Calls for Sweeping Intelligence Reform; Amber Frey Expected Back on Stand at Peterson Trial

Aired August 23, 2004 - 14:01   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.


CAROL LIN, CNN ANCHOR: President Bush addressing questions by reporters, cracking a funny there at the end about whether he was going to go to Athens, Texas. Of course he was joking. In the meantime, CNN's Jill Dougherty standing by in Crawford, Texas.
Jill, you heard the remarks. Specifically, President Bush actually was critical of the 527 groups, these soft money groups that are producing these attack ads. And he, in fact, did single out this particular group to say that they should stop running these ads attacking Kerry's war record.

JILL DOUGHERTY, CNN CORRESPONDENT: Yes. You know, Carol, you have to listen closely but you do hear two really important words, and those are "that ad," and then he goes on to say, "and all of them."

Now, the change here is the president, so far, his campaign, the White House have all been saying we condemn these ads in general, these ads that are put together by unregulated soft money groups. And specifically, the president was asked about that ad that is funded by the Swift Boat Veterans for Truth.

And some names were named, in fact. And as the president broke into that question from the reporter, he said, "Yes, that ad, all of them, they should all go." He has said that he has been disappointed, that he thought that that had been put away with by the McCain- Feingold bill, but apparently it has not.

Now, the crucial part about that -- those two words is that the Democrats and the Kerry campaign have been saying and calling upon the president directly to condemn that specific ad. The White House response has been to condemn all ads and to say it had nothing to do with that ad. So the president hasn't gone so far as to say there was any connection, certainly, but he has said let's get rid of that ad and all of them.

LIN: So what are the chances that the president or anybody on his staff is actually going to pick up the phone, call this particular group, take action and express it personally to them?

DOUGHERTY: Well, they would not do that because, by law, they are not able to have communication, coordinate in any way. The message, obviously, is out there through the media now. You've heard the president. So we'll just have to see what those groups do. But the president, it would appear, has moved toward that position in saying let's get rid of all of these and specifically that one ad.

LIN: All right. Thanks very much, Jill.

We're going to move on to Miles.

Miles, got some reaction?

MILES O'BRIEN, CNN ANCHOR: All right. Changing campaign finance law. The laws of unintended consequences always seem to come to bear. Kelly Wallace watching politics for us from New York today.

Kelly, I suppose it's a bit of an artful dodge to say get rid of all 527s. But nevertheless, that's where it sits right now.

KELLY WALLACE, CNN NATIONAL CORRESPONDENT: Yes, Miles, it's interesting, because I was talking to a Kerry adviser who heard a little bit of some of the audio comments coming from the president and then got off the phone to listen to exactly what the president said. And the initial comments from this Kerry adviser was basically that the Kerry campaign was not all that impressed, saying that the president was saying -- at least what this person thought he was saying -- what he had said before, that he is condemning all of these 527s, but that he wasn't specifically singling out this group and these ads by this group Swift Boat Veterans for Truth.

And that they were saying as long as the president doesn't come out and specifically condemn and denounce this ad, and call for all these ads to be stopped, well that in a way is good for the Kerry campaign, according to this adviser, saying the president's credibility is at stake here and saying that the president would ultimately blamed -- be blamed for these negative attacks.

Again, we have to sort of hear from this person again. And I know my colleague was trying to get on the phone with that person as we are doing this live shot to find out. But I will guess or take a bet that the campaign will say the president is not going far enough, that they want the president to specifically denounce the ad and the allegations in this ad and say that this ad and these ads should be pulled right away -- Miles.

O'BRIEN: What is, just for the record here, the Kerry campaign's position on these 527 ads? Because there have been lots of 527 ads on the other side of the political spectrum here.

WALLACE: And they will say that John Kerry did come out when there were specific ads by 527s backed by Kerry supporters and Democrats critical of President Bush when the Kerry campaign thought they crossed the line. And the Kerry campaign pointing to a recent ad by one of the groups questioning President Bush, what he did or did not do.

The ad was alleging in terms of his Vietnam-era service, serving in the National Guard, whether any strings were pulled to give him some special privileges. And Kerry advisers say that John Kerry denounced that ad. He has not criticized ads that criticize the president's policies, but the campaign will say that he has criticized ads when he thinks they have gone too far and they've become personal. No surprise the Bush campaign will say, oh, that's not the case. Because they will say John Kerry might have said one thing, but that Kerry's own advisers later in a news conference were bringing up questions about President Bush's own military service -- Miles.

O'BRIEN: And just to button this final thought up, what evidence do we have that this is moving voters one way or another?

WALLACE: It is really hard to say. You do have last week's CBS- "New York Times" poll which was looking at the issue of veterans. And it showed right after the convention President Bush and John Kerry pretty much tied at 46 percent when it comes to how veterans feel, but that John Kerry dropped dramatically, I think about nine points, so that President Bush now has a significant lead over John Kerry when it comes to veterans.

And then there was a poll, I believe, by the National Annenberg Group looking at how many people have actually seen these ads. The majority say they have seen these ads. And also, a number, I guess something like 44 percent, find them very believable. So some sense that these ads are getting out there and having some impact -- Miles.

O'BRIEN: Kelly Wallace, thank you very much -- Carol.

LIN: All right, Miles.

We want to turn from politics to the battle in Iraq. Specifically, a standoff involving the United States forces near a hallowed mosque in Najaf.

You can see by these grainy photos and the audio that U.S. forces battled gunmen loyal to Shiite leader Muqtada al-Sadr. And American tanks rolled to within several hundred yards of this mosque to try to pressure al-Sadr's insurgents into finally leaving that compound.

A freed American journalist says he plans to stay in Iraq despite being held as a hostage and threatened with death. Journalist Micah Garen says his abductors treated him well during his nine days of hostage. And at last report, he remains in Iraq, but in western hands.

And the prisoner abuse scandal. A military judge has refused today to suppress graphic photographs of alleged torture from the trial of Army Specialist Charles Graner. Graner is being tried on a U.S. base in Germany amid security worries inside of Iraq.

And also today, another soldier charged in the prison scandal reportedly says he plans to plead guilty to some if not all of the charges against him. Sergeant Chip Frederick made his intentions known in a letter to The Associated Press.

O'BRIEN: Well, you can call it a facelift for the nation's spy network. One lawmaker's idea for reforming the intelligence community under one national intel director calls for some radical changes. And we're not talking just about a nose job here. The works. His ideas are also generating a lot of criticism, and our Ed Henry explains.

(BEGIN VIDEOTAPE)

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: There has been a lot of talk this summer about reform on Capitol Hill, a lot of discussion about how to follow up on the 9/11 Commission's final report. The significance here is that we finally have a powerful Republican lawmaker becoming the first one on Capitol Hill to actually put together a very aggressive legislative plan, follow up those hearings with action.

Chairman Pat Roberts, the top Republican on the Senate Intelligence Committee, has put together a plan that while at the beginning a lot of people knew he was going to be talking about proposing a very strong national intelligence director with full budget authority, the big change here, the big surprise is that he's also talking about dismantling the CIA as we know it. That is causing a lot of flack, creating a lot of tension obviously at the CIA, but also among Democrats here on Capitol Hill who are concerned that maybe Chairman Roberts is moving too far too fast.

Chairman Roberts, however, believes that half measures will not cut it. He thinks Congress needs to be very bold.

SEN. PAT ROBERTS (R), INTELLIGENCE COMMITTEE CHAIRMAN: We didn't pay any attention to turf. We didn't pay any attention to boxes. We didn't pay any attention to, say, the agencies. And what we have proposed is a national intelligence service with a national intelligence director that has real line-item budget authority and personnel authority. So we think it's a good plan.

HENRY: U.S. intelligence officials are calling this plan "reckless," however. In fact, one senior U.S. intelligence official said, "It would be akin to taking apart a ship in the middle of the ocean."

Democrats also echoing some of that criticism. Democrats concerned that they were left out of the loop, not part of the discussions as this plan was crafted. But Democrats like Jay Rockefeller, the top Democrat on the Senate Intelligence Committee, is expressing concern that he thinks ripping apart the CIA at this critical time in the war on terror could be, as he put it, "a mistake." And, in fact, Democrat Carl Levin, also a member of the Intelligence Committee, said he is very concerned about the fact that Democrats were not clued into the details and that this may, in fact, pull a lot of power away from the Pentagon.

SEN. CARL LEVIN (D-MI), ARMED SERVICES COMMITTEE: I'm willing to give greater powers to an intelligence director provided we do not give him the power to direct military operations. The 9/11 Commission gave the intelligence director that power.

I think that would give too much power to the intelligence director. We have seen abuses by intelligence directors before. I'm not willing to give the power to take military action, which is an act of war, to an intelligence director.

HENRY: What you are seeing there is that Carl Levin, in addition to serving on the Intelligence Committee, is also the top Democrat on the Armed Services Committee in the Senate. And allies of the Pentagon are concerned this plan by Pat Roberts would pull some $30 to $40 billion in intelligence money away from the Pentagon, put that instead in the hands of a national intelligence director.

And that's causing a lot of turf battles up here on Capitol Hill, as well as in the Bush administration. That's why this, while it's just an opening shot in this debate, this is not the final word. Chairman Roberts' plan is going to kick off this debate, but there will be a lot more debate to come.

Back to you.

(END VIDEOTAPE)

O'BRIEN: The mistress in the murder trial, Amber Frey, expected back on the stand today in Redwood City, California. Scott Peterson's defense will get its long-awaited chance to question her.

Rusty Dornin, when last we saw her, indicated that Mark Geragos was going to kind of go easy on Amber Frey, which we're a bit skeptical of. Nevertheless, let's talk about what the strategy would be on the cross-examination.

RUSTY DORNIN, CNN CORRESPONDENT: This is definitely a case of hurry up and wait for Amber Frey to even take the stand for this highly-anticipated cross-examination. We are expecting it to happen later this afternoon because, as expected, an out of order witness was called to the stand from Florida. She is an AT&T fraudulent wireless phone records expert.

Now, she is talking about the calls that we're made on Christmas Eve morning from Scott Peterson's cell phone, implying that they could track his whereabouts and direction while he was on those phones. On cross-examination, Mark Geragos was able to get the witness to admit that fraud records are not the best way to pinpoint a location of someone using a cell phone.

They did take a court break, and Geragos says he has a lot more questions for this witness. So it doesn't look like Amber Frey is going to take the stand until later this afternoon. But everything is prepared for him to begin the questioning.

He set up a Power Point demonstration to begin that. We're not expecting a lengthy, nor a ferocious cross-examination. Of course, he could always change his mind -- Miles.

O'BRIEN: Rusty Dornin, thank you very much. Appreciate it -- Carol.

LIN: All right, Miles.

Which Americans will get a little something extra in their paycheck? We're crunching the numbers on a new law governing who gets overtime pay. That is straight ahead on LIVE FROM.

And on guard in New York, securing the city for the upcoming Republican convention.

And we want to hear from you regarding the Paul Hamm gold medal. How should the men's gymnastics medal controversy be resolved? E-mail us at livefrom@cnn.com. Some of your comments later this hour.

(COMMERCIAL BREAK)

O'BRIEN: The uproar over overtime pay. New federal rules in effect today could shrink or fatten the paychecks of millions of Americans. There's widespread disagreement over what the changes will mean. Right now, who wins and who loses isn't clear. Here is our Louise Schiavone.

(BEGIN VIDEO TAPE)

LOUISE SCHIAVONE, CNN CORRESPONDENT (voice-over): James Ware is a sous chef at a big Washington hotel. He worries about the new overtime rules.

JAMES WARE, CHEF'S ASSISTANT: If I didn't have the overtime, my income would be cut at least by a quarter or better.

SCHIAVONE: His big concern, if he becomes a non-union chef, the new rules might cost him 10 hours a week of overtime pay.

WARE: All the managers work a 10 hour shift, and unlike the non- union managers, we get paid overtime.

SCHIAVONE: The Labor Department says it's clarifying complex and outdated federal overtime rules. As of today, among those guaranteed overtime wage protections, all hourly workers and anyone earning no more than $23,660 annually.

VICTORIA LIPNIC, ASSISTANT LABOR SECRETARY: That will result in about another 1.3 million people getting overtime who don't have it today and we also think that until strengthen overtime protection for about another 6.7 million people.

SCHIAVONE: But it's not that clear. While labor officials predict that almost no one earning less than $100,000 will lose their overtime privileges, they admit that 100,000 workers earning more than that could be hit. Labor advocates predict that as many as six million workers will find themselves fighting the new regulations, due in large part to new management descriptions.

ROSS EISENBREY, ECONOMIC POLICY INSTITUTE: This is going to be a mess, because they've said it doesn't matter what degree you have, what matters is what level of knowledge you have. And that's a very hard thing to test. The Department of Labor, for example, doesn't have people who can decide whether a cook has the same skills as somebody who graduated from a culinary arts school.

SCHIAVONE: The new rules specify that regardless of annual pay, most blue collar workers, like plumbers and carpenters, along with police and firefighters, are guaranteed overtime pay. (on camera): Democrats have stood by for a year with legislation to block any new regulations that would take overtime pay away from workers who now have it. But it's tough to get anything done this close to elections and this issue is no exception.

Lisa Schiavone, CNN Financial News, Washington.

(END VIDEO TAPE)

O'BRIEN: There are hundreds of pages describing the new overtime rules. It's kind of a bear to read. Among those entitled to overtime: some police officers, firefighters, first responders and better-paid blue collar workers. Labor officials say some upper-ranking police officers could lose overtime, however. Among those exempt from overtime: administrative assistants, finance industry workers, insurance adjusters, computer programmers, dental hygienists, pharmacists, journalists, funeral directors and chefs.

LIN: On the road to the RNC. CNN's Election Express is on its way to the Republican National Convention in New York. The Election Express is making a pit stop in the Keystone State today. The bus is in Philadelphia, where CNN's "CROSSFIRE" will broadcast live later this afternoon.

In fact, right now you are seeing a live picture. "CROSSFIRE" co- host Paul Begala and Tucker Carlson are going to join me later this hour to debate the Swift Boat ad controversy and all things politics.

O'BRIEN: Don't want to miss that.

Grand theft artwork. Thieves make off with a couple of masterpieces while museum-goers watch in disbelief. Makes you want to scream. It's just ahead on LIVE FROM.

(STOCK MARKET REPORT)

(COMMERCIAL BREAK)

LIN: We're taking your e-mail on the Paul Hamm gold medal controversy. How should the dispute be resolved? E-mail us now at livefrom@cnn.com. We'll read some of your comments when Randy Cohen, a "New York Times" ethicist joins Miles in a few minutes.

O'BRIEN: Well, you could call it the scream heard around the world. The search continues today for the two stolen prices -- priceless pieces of artwork. "The Scream" and "Madonna" by artist Edvard Munch were taken in broad daylight yesterday from an Oslo museum named for the Norwegian painter.

Art experts say the theft was probably carried out as a trophy robbery since it is virtually impossible to sell those masterpieces. Surveillance video captured the masked robbers. Norwegian authorities later found the getaway car and the paintings' frames. They say the robbers threatened security guards with guns, but many are questioning the lack of security at that museum. LIN: Google's stock continues to gain ground on Wall Street, but the company's management is getting slammed. Rhonda Schaffler joins us live from the New York Stock Exchange with that story.

(MARKET REPORT)

(COMMERCIAL BREAK)

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Aired August 23, 2004 - 14:01   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL LIN, CNN ANCHOR: President Bush addressing questions by reporters, cracking a funny there at the end about whether he was going to go to Athens, Texas. Of course he was joking. In the meantime, CNN's Jill Dougherty standing by in Crawford, Texas.
Jill, you heard the remarks. Specifically, President Bush actually was critical of the 527 groups, these soft money groups that are producing these attack ads. And he, in fact, did single out this particular group to say that they should stop running these ads attacking Kerry's war record.

JILL DOUGHERTY, CNN CORRESPONDENT: Yes. You know, Carol, you have to listen closely but you do hear two really important words, and those are "that ad," and then he goes on to say, "and all of them."

Now, the change here is the president, so far, his campaign, the White House have all been saying we condemn these ads in general, these ads that are put together by unregulated soft money groups. And specifically, the president was asked about that ad that is funded by the Swift Boat Veterans for Truth.

And some names were named, in fact. And as the president broke into that question from the reporter, he said, "Yes, that ad, all of them, they should all go." He has said that he has been disappointed, that he thought that that had been put away with by the McCain- Feingold bill, but apparently it has not.

Now, the crucial part about that -- those two words is that the Democrats and the Kerry campaign have been saying and calling upon the president directly to condemn that specific ad. The White House response has been to condemn all ads and to say it had nothing to do with that ad. So the president hasn't gone so far as to say there was any connection, certainly, but he has said let's get rid of that ad and all of them.

LIN: So what are the chances that the president or anybody on his staff is actually going to pick up the phone, call this particular group, take action and express it personally to them?

DOUGHERTY: Well, they would not do that because, by law, they are not able to have communication, coordinate in any way. The message, obviously, is out there through the media now. You've heard the president. So we'll just have to see what those groups do. But the president, it would appear, has moved toward that position in saying let's get rid of all of these and specifically that one ad.

LIN: All right. Thanks very much, Jill.

We're going to move on to Miles.

Miles, got some reaction?

MILES O'BRIEN, CNN ANCHOR: All right. Changing campaign finance law. The laws of unintended consequences always seem to come to bear. Kelly Wallace watching politics for us from New York today.

Kelly, I suppose it's a bit of an artful dodge to say get rid of all 527s. But nevertheless, that's where it sits right now.

KELLY WALLACE, CNN NATIONAL CORRESPONDENT: Yes, Miles, it's interesting, because I was talking to a Kerry adviser who heard a little bit of some of the audio comments coming from the president and then got off the phone to listen to exactly what the president said. And the initial comments from this Kerry adviser was basically that the Kerry campaign was not all that impressed, saying that the president was saying -- at least what this person thought he was saying -- what he had said before, that he is condemning all of these 527s, but that he wasn't specifically singling out this group and these ads by this group Swift Boat Veterans for Truth.

And that they were saying as long as the president doesn't come out and specifically condemn and denounce this ad, and call for all these ads to be stopped, well that in a way is good for the Kerry campaign, according to this adviser, saying the president's credibility is at stake here and saying that the president would ultimately blamed -- be blamed for these negative attacks.

Again, we have to sort of hear from this person again. And I know my colleague was trying to get on the phone with that person as we are doing this live shot to find out. But I will guess or take a bet that the campaign will say the president is not going far enough, that they want the president to specifically denounce the ad and the allegations in this ad and say that this ad and these ads should be pulled right away -- Miles.

O'BRIEN: What is, just for the record here, the Kerry campaign's position on these 527 ads? Because there have been lots of 527 ads on the other side of the political spectrum here.

WALLACE: And they will say that John Kerry did come out when there were specific ads by 527s backed by Kerry supporters and Democrats critical of President Bush when the Kerry campaign thought they crossed the line. And the Kerry campaign pointing to a recent ad by one of the groups questioning President Bush, what he did or did not do.

The ad was alleging in terms of his Vietnam-era service, serving in the National Guard, whether any strings were pulled to give him some special privileges. And Kerry advisers say that John Kerry denounced that ad. He has not criticized ads that criticize the president's policies, but the campaign will say that he has criticized ads when he thinks they have gone too far and they've become personal. No surprise the Bush campaign will say, oh, that's not the case. Because they will say John Kerry might have said one thing, but that Kerry's own advisers later in a news conference were bringing up questions about President Bush's own military service -- Miles.

O'BRIEN: And just to button this final thought up, what evidence do we have that this is moving voters one way or another?

WALLACE: It is really hard to say. You do have last week's CBS- "New York Times" poll which was looking at the issue of veterans. And it showed right after the convention President Bush and John Kerry pretty much tied at 46 percent when it comes to how veterans feel, but that John Kerry dropped dramatically, I think about nine points, so that President Bush now has a significant lead over John Kerry when it comes to veterans.

And then there was a poll, I believe, by the National Annenberg Group looking at how many people have actually seen these ads. The majority say they have seen these ads. And also, a number, I guess something like 44 percent, find them very believable. So some sense that these ads are getting out there and having some impact -- Miles.

O'BRIEN: Kelly Wallace, thank you very much -- Carol.

LIN: All right, Miles.

We want to turn from politics to the battle in Iraq. Specifically, a standoff involving the United States forces near a hallowed mosque in Najaf.

You can see by these grainy photos and the audio that U.S. forces battled gunmen loyal to Shiite leader Muqtada al-Sadr. And American tanks rolled to within several hundred yards of this mosque to try to pressure al-Sadr's insurgents into finally leaving that compound.

A freed American journalist says he plans to stay in Iraq despite being held as a hostage and threatened with death. Journalist Micah Garen says his abductors treated him well during his nine days of hostage. And at last report, he remains in Iraq, but in western hands.

And the prisoner abuse scandal. A military judge has refused today to suppress graphic photographs of alleged torture from the trial of Army Specialist Charles Graner. Graner is being tried on a U.S. base in Germany amid security worries inside of Iraq.

And also today, another soldier charged in the prison scandal reportedly says he plans to plead guilty to some if not all of the charges against him. Sergeant Chip Frederick made his intentions known in a letter to The Associated Press.

O'BRIEN: Well, you can call it a facelift for the nation's spy network. One lawmaker's idea for reforming the intelligence community under one national intel director calls for some radical changes. And we're not talking just about a nose job here. The works. His ideas are also generating a lot of criticism, and our Ed Henry explains.

(BEGIN VIDEOTAPE)

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: There has been a lot of talk this summer about reform on Capitol Hill, a lot of discussion about how to follow up on the 9/11 Commission's final report. The significance here is that we finally have a powerful Republican lawmaker becoming the first one on Capitol Hill to actually put together a very aggressive legislative plan, follow up those hearings with action.

Chairman Pat Roberts, the top Republican on the Senate Intelligence Committee, has put together a plan that while at the beginning a lot of people knew he was going to be talking about proposing a very strong national intelligence director with full budget authority, the big change here, the big surprise is that he's also talking about dismantling the CIA as we know it. That is causing a lot of flack, creating a lot of tension obviously at the CIA, but also among Democrats here on Capitol Hill who are concerned that maybe Chairman Roberts is moving too far too fast.

Chairman Roberts, however, believes that half measures will not cut it. He thinks Congress needs to be very bold.

SEN. PAT ROBERTS (R), INTELLIGENCE COMMITTEE CHAIRMAN: We didn't pay any attention to turf. We didn't pay any attention to boxes. We didn't pay any attention to, say, the agencies. And what we have proposed is a national intelligence service with a national intelligence director that has real line-item budget authority and personnel authority. So we think it's a good plan.

HENRY: U.S. intelligence officials are calling this plan "reckless," however. In fact, one senior U.S. intelligence official said, "It would be akin to taking apart a ship in the middle of the ocean."

Democrats also echoing some of that criticism. Democrats concerned that they were left out of the loop, not part of the discussions as this plan was crafted. But Democrats like Jay Rockefeller, the top Democrat on the Senate Intelligence Committee, is expressing concern that he thinks ripping apart the CIA at this critical time in the war on terror could be, as he put it, "a mistake." And, in fact, Democrat Carl Levin, also a member of the Intelligence Committee, said he is very concerned about the fact that Democrats were not clued into the details and that this may, in fact, pull a lot of power away from the Pentagon.

SEN. CARL LEVIN (D-MI), ARMED SERVICES COMMITTEE: I'm willing to give greater powers to an intelligence director provided we do not give him the power to direct military operations. The 9/11 Commission gave the intelligence director that power.

I think that would give too much power to the intelligence director. We have seen abuses by intelligence directors before. I'm not willing to give the power to take military action, which is an act of war, to an intelligence director.

HENRY: What you are seeing there is that Carl Levin, in addition to serving on the Intelligence Committee, is also the top Democrat on the Armed Services Committee in the Senate. And allies of the Pentagon are concerned this plan by Pat Roberts would pull some $30 to $40 billion in intelligence money away from the Pentagon, put that instead in the hands of a national intelligence director.

And that's causing a lot of turf battles up here on Capitol Hill, as well as in the Bush administration. That's why this, while it's just an opening shot in this debate, this is not the final word. Chairman Roberts' plan is going to kick off this debate, but there will be a lot more debate to come.

Back to you.

(END VIDEOTAPE)

O'BRIEN: The mistress in the murder trial, Amber Frey, expected back on the stand today in Redwood City, California. Scott Peterson's defense will get its long-awaited chance to question her.

Rusty Dornin, when last we saw her, indicated that Mark Geragos was going to kind of go easy on Amber Frey, which we're a bit skeptical of. Nevertheless, let's talk about what the strategy would be on the cross-examination.

RUSTY DORNIN, CNN CORRESPONDENT: This is definitely a case of hurry up and wait for Amber Frey to even take the stand for this highly-anticipated cross-examination. We are expecting it to happen later this afternoon because, as expected, an out of order witness was called to the stand from Florida. She is an AT&T fraudulent wireless phone records expert.

Now, she is talking about the calls that we're made on Christmas Eve morning from Scott Peterson's cell phone, implying that they could track his whereabouts and direction while he was on those phones. On cross-examination, Mark Geragos was able to get the witness to admit that fraud records are not the best way to pinpoint a location of someone using a cell phone.

They did take a court break, and Geragos says he has a lot more questions for this witness. So it doesn't look like Amber Frey is going to take the stand until later this afternoon. But everything is prepared for him to begin the questioning.

He set up a Power Point demonstration to begin that. We're not expecting a lengthy, nor a ferocious cross-examination. Of course, he could always change his mind -- Miles.

O'BRIEN: Rusty Dornin, thank you very much. Appreciate it -- Carol.

LIN: All right, Miles.

Which Americans will get a little something extra in their paycheck? We're crunching the numbers on a new law governing who gets overtime pay. That is straight ahead on LIVE FROM.

And on guard in New York, securing the city for the upcoming Republican convention.

And we want to hear from you regarding the Paul Hamm gold medal. How should the men's gymnastics medal controversy be resolved? E-mail us at livefrom@cnn.com. Some of your comments later this hour.

(COMMERCIAL BREAK)

O'BRIEN: The uproar over overtime pay. New federal rules in effect today could shrink or fatten the paychecks of millions of Americans. There's widespread disagreement over what the changes will mean. Right now, who wins and who loses isn't clear. Here is our Louise Schiavone.

(BEGIN VIDEO TAPE)

LOUISE SCHIAVONE, CNN CORRESPONDENT (voice-over): James Ware is a sous chef at a big Washington hotel. He worries about the new overtime rules.

JAMES WARE, CHEF'S ASSISTANT: If I didn't have the overtime, my income would be cut at least by a quarter or better.

SCHIAVONE: His big concern, if he becomes a non-union chef, the new rules might cost him 10 hours a week of overtime pay.

WARE: All the managers work a 10 hour shift, and unlike the non- union managers, we get paid overtime.

SCHIAVONE: The Labor Department says it's clarifying complex and outdated federal overtime rules. As of today, among those guaranteed overtime wage protections, all hourly workers and anyone earning no more than $23,660 annually.

VICTORIA LIPNIC, ASSISTANT LABOR SECRETARY: That will result in about another 1.3 million people getting overtime who don't have it today and we also think that until strengthen overtime protection for about another 6.7 million people.

SCHIAVONE: But it's not that clear. While labor officials predict that almost no one earning less than $100,000 will lose their overtime privileges, they admit that 100,000 workers earning more than that could be hit. Labor advocates predict that as many as six million workers will find themselves fighting the new regulations, due in large part to new management descriptions.

ROSS EISENBREY, ECONOMIC POLICY INSTITUTE: This is going to be a mess, because they've said it doesn't matter what degree you have, what matters is what level of knowledge you have. And that's a very hard thing to test. The Department of Labor, for example, doesn't have people who can decide whether a cook has the same skills as somebody who graduated from a culinary arts school.

SCHIAVONE: The new rules specify that regardless of annual pay, most blue collar workers, like plumbers and carpenters, along with police and firefighters, are guaranteed overtime pay. (on camera): Democrats have stood by for a year with legislation to block any new regulations that would take overtime pay away from workers who now have it. But it's tough to get anything done this close to elections and this issue is no exception.

Lisa Schiavone, CNN Financial News, Washington.

(END VIDEO TAPE)

O'BRIEN: There are hundreds of pages describing the new overtime rules. It's kind of a bear to read. Among those entitled to overtime: some police officers, firefighters, first responders and better-paid blue collar workers. Labor officials say some upper-ranking police officers could lose overtime, however. Among those exempt from overtime: administrative assistants, finance industry workers, insurance adjusters, computer programmers, dental hygienists, pharmacists, journalists, funeral directors and chefs.

LIN: On the road to the RNC. CNN's Election Express is on its way to the Republican National Convention in New York. The Election Express is making a pit stop in the Keystone State today. The bus is in Philadelphia, where CNN's "CROSSFIRE" will broadcast live later this afternoon.

In fact, right now you are seeing a live picture. "CROSSFIRE" co- host Paul Begala and Tucker Carlson are going to join me later this hour to debate the Swift Boat ad controversy and all things politics.

O'BRIEN: Don't want to miss that.

Grand theft artwork. Thieves make off with a couple of masterpieces while museum-goers watch in disbelief. Makes you want to scream. It's just ahead on LIVE FROM.

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LIN: We're taking your e-mail on the Paul Hamm gold medal controversy. How should the dispute be resolved? E-mail us now at livefrom@cnn.com. We'll read some of your comments when Randy Cohen, a "New York Times" ethicist joins Miles in a few minutes.

O'BRIEN: Well, you could call it the scream heard around the world. The search continues today for the two stolen prices -- priceless pieces of artwork. "The Scream" and "Madonna" by artist Edvard Munch were taken in broad daylight yesterday from an Oslo museum named for the Norwegian painter.

Art experts say the theft was probably carried out as a trophy robbery since it is virtually impossible to sell those masterpieces. Surveillance video captured the masked robbers. Norwegian authorities later found the getaway car and the paintings' frames. They say the robbers threatened security guards with guns, but many are questioning the lack of security at that museum. LIN: Google's stock continues to gain ground on Wall Street, but the company's management is getting slammed. Rhonda Schaffler joins us live from the New York Stock Exchange with that story.

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