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Live From...

Black Friday Madness; Eye on Iran

Aired November 26, 2004 - 15:00   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: Top of the hour now.
Ready, set, shop. Bargain hunters are packing the stores this day after Thanksgiving, traditionally one of the busiest shopping days of the year. Retailers call it Black Friday, hoping it sparks a profitable season. More in a moment.

Suspended again. At least, that's what Iranian officials are saying. Earlier this week, they attack that several of its facilities not be included in the tentative deal to freeze its nuclear program. After more negotiation, they've dropped that request.

Slapped with sanctions. The World Trade Organization approved the move after the United States refused to repeal the so-called Byrd amendment. It allows American companies to profit from fines levied on other countries that are suspected of selling goods below market price. Now higher duties could be imposed against a number of U.S. products.

First to the stores, where bargain hunters have been emptying the shelves since before dawn. Some early-birds even went for the straight to the big-ticket items on sale, such as flat-screen TVs and computers. Others are filling their carts and arms with clothes and jewelry. Now, the question, is anything going to be left for tomorrow?

CNN's David Mattingly is right in the middle of all the madness. Maybe it's calmed down a little bit at a Wal-Mart north of Atlanta. No, it's a Wal-Mart, so you know it's always a little mad.

Hi, David.

DAVID MATTINGLY, CNN CORRESPONDENT: It has calmed down some, though, Kyra.

At 6:00 this morning, it was a lot more active on this Black Friday. It was very black outside at 4:00 a.m. when people started lining up. And the scene that we saw this morning, when the people were allowed to come in and go after those bargains that they saw advertised at 6:00 this morning, we find out later today that shoppers and store personnel Here are telling us it was a little more hectic in years past.

And part of the reason for that might be because there's no one single item that everyone has put on their must-have list. So there's not that kind of competition going on this year. Instead, there are a lot of different items. Here at Wal-Mart, they've got a top 12 list of all sorts of things they expect people to go after this year.

For kids, they're looking at a lot of familiar faces, including Cabbage Patch Kids making a comeback this year. Elmo also still high on the list this year. Barbie, a perennial favorite, also on the list this year. Gadgets are also expected to be big. You plug this into the TV and you can play Pacman.

Big gadgets, though, are even bigger. This Cadillac Escalade is radio controlled. Same thing like you used to find those smaller radio controlled cars going around the Christmas tree. Spider-Man, things like Shrek, they're also very popular, again, familiar faces this year. The same for adults. Vacuum cleaners, microwaves are expected to go pretty well here at the nation's largest retailer.

And then some twists on the old appliances. For example, this is a cheese grater, but it is a cordless electric cheese grater. And also down here, you have a coffee maker that makes a single serving of coffee. It brews it up and puts it right into a go-cup for you. So a lot of familiar faces, a lot of familiar items that people might be looking for this year.

And, Kyra, everyone says that they expect shoppers this year to take their time and to look for those bargains. And because they're taking their time, Black Friday may not be the big economic indicator that we've seen in the past. That's because they're taking longer to make their decisions and they'll make them later in the shopping season -- Kyra.

PHILLIPS: All right, David Mattingly, thanks much for the show and tell.

We're going to go overseas now, first the effort to keep Iran from developing nuclear weapons. Just a short time ago, President Bush said that any deal reached between Iran and the Europeans must be verifiable. His comments follow word of another potential breakthrough in the difficult talks with Tehran.

CNN's Matthew Chance is following that story from London.

Matthew, what's the word?

MATTHEW CHANCE, CNN CORRESPONDENT: Kyra, thanks very much.

Well, it seems that Iran and negotiators from European countries have overcome an obstacle to a deal with Iran for it to freeze its uranium enrichment program. Uranium, when it's enriched, of course, can be used as fuel for nuclear reactors, but also can be used to manufacture nuclear weapons. Diplomats at the U.N.'s nuclear watchdog agency in Vienna, the IAEA, say that Iran has agreed to lift its demand for 20 of its uranium enrichment centrifuges to be exempted from the agreement.

They've said they've lifted that. But the Europeans have made some concessions as well. They've taken out a clause from the final draft resolution of the U.N., IAEA in Vienna, saying that Iran's nuclear sites can be visited at any time at any moment in the country by U.N. nuclear inspectors. That clause has been taken out as a concession to Iran.

So has a clause that would be a trigger mechanism, essentially, for the Iranians. If they were to transgress on this deal, break the deal, then the mechanism would be for it to be referred immediately to the U.N. Security Council. That has been taken out of this resolution as well.

These are two issues that the U.S. has been pushing for, but the Iranian senior negotiator, Hossein Mousavian, said that he's confident a deal will now be reached.

(BEGIN VIDEO CLIP)

HOSSEIN MOUSAVIAN, CHIEF IRANIAN DELEGATE TO IAEA: We have to make it very clear in the resolution that the basis for further activities of IAEA is protocol and safeguard. And the last issue, also, is that Iran issue should not be in the agenda of IAEA anymore.

(END VIDEO CLIP)

CHANCE: Well, Iran says that this will only be a three-month temporary suspension. Europeans, though, still hope, as well as many others from the international community, that this is going to be turned into a more permanent suspension of uranium enrichment -- Kyra.

PHILLIPS: Matthew Chance, live from London, thank you.

And in Mosul, the U.S. military is calling it a continued campaign of threats, intimidation and murder. More bodies were found in that city today. The grisly discoveries mean even more tension in areas shaken by an insurgent uprising.

CNN's Nic Robertson reports from Mosul.

(BEGIN VIDEOTAPE)

NIC ROBERTSON, CNN SR. INTERNATIONAL CORRESPONDENT: Six more bodies found in Mosul on Friday, 15 on Thursday. Over the last week, at least 30 bodies have been discovered in the city here by the multinational force and Iraqi forces.

What is believed to be happening is that the Iraqi National Guard and Iraqi security forces allied with the coalition here are being targeted. In the last few weeks, some 3,200 Iraqi police have been intimidated to leave their posts either through intimidation or corruption within the police force. Now is it believed that the insurgents are targeting the Iraqi National Guard in particular.

According to coalition commanders here, they believe that it is the Baath Party that presents -- or the former members of Saddam Hussein's Baath Party represent the biggest threat to stability here in Mosul.

BRIG. GEN. CARTER HAM, U.S. ARMY: In my view, the former regime elements and the Baathists are the longer-term threat inside Mosul. And I think it's -- they are clearly gaining in strength. And, you know, Mosul was a place from which many senior Baathists came from. So there's a group of folks here that will welcome the return of the Baath Party under whatever name it may be. So that is a particular challenge.

ROBERTSON: One of the reasons the general believes that the Baath Party represents a significant and resurgent threat here is that senior members of that Baath Party are able to cross the border into Syria, base themselves out of Syria, come back into Mosul, which is quite a close distance to the border with Syria, come back into Mosul when they choose.

They are believed to be behind the intimidation of the residents of Mosul, behind the threats of against people who work with the coalition, and, indeed, funding some elements of the insurgency. The coalition here is studying other insurgencies around the world. They say, in particular, they're looking at the insurgency in Algeria, trying to draw conclusions and lessons from what was learned there.

And they say that one of the conclusions they have drawn is that the way to beat the insurgency here is to win the support of the local population. And they recognize that while troops do house-to-house searches, searching, following up on actionable intelligence that's been generated for key members of the Baath Party and other members of the insurgency, that while people, while soldiers, go into people's houses, they recognize that that does make it difficult to win the support of the local population.

But they believe that is the right method to beat the insurgency at this time. Also, one other point made by the commanding general here, Brigadier General Carter Ham, that he believes the detention a few days ago of a key aide to Abu Musab al-Zarqawi has led to some benefits, some improvements in the security situation here in Mosul since that key aide of Abu Musab al-Zarqawi was detained just a few days ago in Mosul.

Nic Robertson, CNN, Mosul, Iraq.

(END VIDEOTAPE)

PHILLIPS: A mysterious death that would even stump the "CSI" crew. But scientists are gathering in Egypt to solve an ancient mystery. Was King Tut's death an accident or murder?

Also ahead, you have seen these demonstrations in the Ukraine for days. Have you paid attention to them? You should. A terrorism expert tells us why after a break.

(COMMERCIAL BREAK)

PHILLIPS: Well, just a short time ago, the president of Ukraine emerged from a series of meetings to say a multilateral working group now has been established to try and end his country's political crisis.

Tens of thousands of demonstrators still continue to flood Kiev. They say that the recent presidential election was rigged for the candidate fly toward Moscow and against the one pushing for closer ties to the West. The two met today with high-level envoys from the European Union and Russia.

Now, earlier, I talked about the crisis and Ukraine's importance with Jim Walsh from Harvard University.

(BEGIN VIDEOTAPE)

JIM WALSH, HARVARD UNIVERSITY: It is the buffer. You know, Ukrainians think of themselves as the gateway to Europe, the gateway to the west.

But the Russians think of Ukraine as a buffer, as a geographical protection against the threats that the west may pose. So one of the reasons why they want to keep Ukraine in their sphere of influence is security reasons.

Another reason is economic reasons. Ukraine was the richest and most developed of the former Soviet republics when the Soviet Union broke up. Now, it's had some tough economic times recently. They seem to be getting a little better, but it's still a lot better than some of those other poor undeveloped republics.

And then finally, it is one of the major consumers of Russian oil. And of course, that is a point of leverage, a way in which the Russians can influence what happens in Ukraine.

PHILLIPS: All right. Some of the concerns for the U.S. I guess one would be that the acting president, who is supporting the successor who we aren't sure now if he will be the successor or not, actually supported selling radar systems and other military hardware to Saddam Hussein.

WALSH: Well, I think one of the big issues here, when you think -- talk about Ukraine, is what has happened in Ukraine over -- under Kuchma. And what we've really had is a country that was pretty well off economically, has sort of drifted into corruption, a lack of transparency, some arms -- dark arms deals on the side supporting Iraq. And really siding with Russia over the west on some -- some of the Issues in which there are contentions.

So this whole issue of selling arms on the black market, that is directly tied to a lack of transparency, an increase in corruption and the need for reform, which is why this election is being contested.

Most people perceive the last two presidential terms under Kuchma as a drift towards corruption, and instead they are calling for reform.

PHILLIPS: And that's why they're standing up, and they don't want the successor that he's supporting.

Let's talk about import/export. Are there a lot of American businesses in the Ukraine? Is that -- is that a concern for the U. S. ? WALSH: No, I think less so -- as far as the U.S. in particular goes, when you look at their trading partners, traditionally Russia was Ukraine's leading trade partner.

But that's changed in recent years. Now the countries of the E. U. , the European Union, are No. 1 in terms of trade with Ukraine. Russia is No. 2. And the U.S. is further down the list.

Foreign investment, not a lot of foreign investment from the west in Ukraine, again because of problems of corruption and the lack of transparency.

I think the U.S. interests in this issue are, one, democracy. And two, human rights, we continue to have human rights and proliferation problems in the Ukraine. And the finally, three, regional relations. What is Russia's role going to be here? That's what the U.S. is going to keep an eye on.

PHILLIPS: Meanwhile, the Ukraine sent 1,600 troops or so to Iraq to support the fall of Saddam Hussein.

And what's interesting, when you look at the live pictures, in the Independence Square area of Kiev, you see that security and the army has come forward and said that they support the demonstrators. And that's probably leading to the lack of a civil unrest at this point.

WALSH: Well, I think that's critical. In sorts of civil unrest situations where citizens are trying to peacefully take back their country, the role of the police and the role of the military is crucial. It is the swing vote.

If they turn against the protesters, it's unlikely that that sort of protest will succeed. But when they back the protesters, it really helps create a possibility of a peaceful transition.

So we have the military. We have the internal police and now, we have the supreme court, who are all saying wait, let's see about this election. It doesn't look like it's on the up and up. And that all favors the protesters at this point.

(END VIDEOTAPE)

PHILLIPS: News elsewhere around the world now.

Weeks of speculation over. A Palestinian legislator says that Marwan Barghouti will not run in the election to replace Yasser Arafat. Barghouti is currently in prison in Israel and is considered the most popular living Palestinian political figure. Barghouti has reportedly endorsed Fatah leader Mahmoud Abbas. Election Day, January 9.

A brutal attack that has stumped police. Central China this morning, a man broke into a school dormitory. He had a knife. He killed eight teenagers, wounded four others and ran for it. The students were sleeping at the time. That attacker has still yet to be found.

And it looks like Charles Jenkins will leave a U.S. military prison tomorrow. Jenkins, you may recall, deserted from the Army in 1965. He fled to North Korea, where he lived until September of this year. He surrendered to get medical treatment. According to some reports, he wants to live in Japan, his wife's homeland.

He was known as the boy king. And 3,000 years later, the death of King Tut remains a mystery. Egyptian authorities say they're going to solve it, though. Find out how just ahead.

(COMMERCIAL BREAK)

PHILLIPS: It's a murder mystery as old as the hills. Or, in this case, old as the pyramids. Was Egypt's King Tut done in by murder most foul? All the possible perps and witnesses are long dead. But investigators still hope to figure out if today's mummy was antiquity's victim.

CNN's Ben Wedeman goes digging for the story.

(BEGIN VIDEOTAPE)

BEN WEDEMAN, CNN CAIRO BUREAU CHIEF (voice-over): It's a mystery that has been waiting centuries, around 33 centuries, to be solved.

How did pharaoh Tutankhamen, better known as King Tut, die while still in his teens? One theory that won't die is that Tut was murdered by a blow to the back of the head, the victim of palace intrigue.

To shine some light on this pharaonic whodunit or what did it, Egyptian authorities plan on conducting an X-ray of Tut's mummy in its tomb in the Valley of the Kings.

UNIDENTIFIED MALE: We will answer the question of the murder of King Tut or not by the end -- before the end of December. We will announce actually the condition of the mummy.

WEDEMAN: Little is known about Tut. His fame comes more from the treasures he left behind.

UNIDENTIFIED MALE: This one not being made in Taiwan. It is ancient Egyptian ones. They are more than 3,500 years ago.

WEDEMAN: Previous studies of Tutankhamen's mummy showed bone fragments inside the skull. Some Egyptologists suggest the boy king died in an accident. But Egypt's top archaeologists smell skullduggery.

UNIDENTIFIED MALE: I believe there was a conspiracy. And I believe that he was murdered.

WEDEMAN: Prime suspects include Aye, the high priest, and General Horemheb, the commander of the Egyptian army at the time. (on camera): These tests may not prove beyond a reasonable doubt that, say, General Horemheb killed King Tut in the bedroom with a lead pipe, but they do bring very modern investigative methods to bear on a very ancient mystery.

Ben Wedeman, CNN, Cairo.

(END VIDEOTAPE)

PHILLIPS: A quick check of the markets right after a quick break.

(COMMERCIAL BREAK)

(FINANCIAL UPDATE)

PHILLIPS: Well, that wraps up this edition of LIVE FROM.

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Aired November 26, 2004 - 15:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KYRA PHILLIPS, CNN ANCHOR: Top of the hour now.
Ready, set, shop. Bargain hunters are packing the stores this day after Thanksgiving, traditionally one of the busiest shopping days of the year. Retailers call it Black Friday, hoping it sparks a profitable season. More in a moment.

Suspended again. At least, that's what Iranian officials are saying. Earlier this week, they attack that several of its facilities not be included in the tentative deal to freeze its nuclear program. After more negotiation, they've dropped that request.

Slapped with sanctions. The World Trade Organization approved the move after the United States refused to repeal the so-called Byrd amendment. It allows American companies to profit from fines levied on other countries that are suspected of selling goods below market price. Now higher duties could be imposed against a number of U.S. products.

First to the stores, where bargain hunters have been emptying the shelves since before dawn. Some early-birds even went for the straight to the big-ticket items on sale, such as flat-screen TVs and computers. Others are filling their carts and arms with clothes and jewelry. Now, the question, is anything going to be left for tomorrow?

CNN's David Mattingly is right in the middle of all the madness. Maybe it's calmed down a little bit at a Wal-Mart north of Atlanta. No, it's a Wal-Mart, so you know it's always a little mad.

Hi, David.

DAVID MATTINGLY, CNN CORRESPONDENT: It has calmed down some, though, Kyra.

At 6:00 this morning, it was a lot more active on this Black Friday. It was very black outside at 4:00 a.m. when people started lining up. And the scene that we saw this morning, when the people were allowed to come in and go after those bargains that they saw advertised at 6:00 this morning, we find out later today that shoppers and store personnel Here are telling us it was a little more hectic in years past.

And part of the reason for that might be because there's no one single item that everyone has put on their must-have list. So there's not that kind of competition going on this year. Instead, there are a lot of different items. Here at Wal-Mart, they've got a top 12 list of all sorts of things they expect people to go after this year.

For kids, they're looking at a lot of familiar faces, including Cabbage Patch Kids making a comeback this year. Elmo also still high on the list this year. Barbie, a perennial favorite, also on the list this year. Gadgets are also expected to be big. You plug this into the TV and you can play Pacman.

Big gadgets, though, are even bigger. This Cadillac Escalade is radio controlled. Same thing like you used to find those smaller radio controlled cars going around the Christmas tree. Spider-Man, things like Shrek, they're also very popular, again, familiar faces this year. The same for adults. Vacuum cleaners, microwaves are expected to go pretty well here at the nation's largest retailer.

And then some twists on the old appliances. For example, this is a cheese grater, but it is a cordless electric cheese grater. And also down here, you have a coffee maker that makes a single serving of coffee. It brews it up and puts it right into a go-cup for you. So a lot of familiar faces, a lot of familiar items that people might be looking for this year.

And, Kyra, everyone says that they expect shoppers this year to take their time and to look for those bargains. And because they're taking their time, Black Friday may not be the big economic indicator that we've seen in the past. That's because they're taking longer to make their decisions and they'll make them later in the shopping season -- Kyra.

PHILLIPS: All right, David Mattingly, thanks much for the show and tell.

We're going to go overseas now, first the effort to keep Iran from developing nuclear weapons. Just a short time ago, President Bush said that any deal reached between Iran and the Europeans must be verifiable. His comments follow word of another potential breakthrough in the difficult talks with Tehran.

CNN's Matthew Chance is following that story from London.

Matthew, what's the word?

MATTHEW CHANCE, CNN CORRESPONDENT: Kyra, thanks very much.

Well, it seems that Iran and negotiators from European countries have overcome an obstacle to a deal with Iran for it to freeze its uranium enrichment program. Uranium, when it's enriched, of course, can be used as fuel for nuclear reactors, but also can be used to manufacture nuclear weapons. Diplomats at the U.N.'s nuclear watchdog agency in Vienna, the IAEA, say that Iran has agreed to lift its demand for 20 of its uranium enrichment centrifuges to be exempted from the agreement.

They've said they've lifted that. But the Europeans have made some concessions as well. They've taken out a clause from the final draft resolution of the U.N., IAEA in Vienna, saying that Iran's nuclear sites can be visited at any time at any moment in the country by U.N. nuclear inspectors. That clause has been taken out as a concession to Iran.

So has a clause that would be a trigger mechanism, essentially, for the Iranians. If they were to transgress on this deal, break the deal, then the mechanism would be for it to be referred immediately to the U.N. Security Council. That has been taken out of this resolution as well.

These are two issues that the U.S. has been pushing for, but the Iranian senior negotiator, Hossein Mousavian, said that he's confident a deal will now be reached.

(BEGIN VIDEO CLIP)

HOSSEIN MOUSAVIAN, CHIEF IRANIAN DELEGATE TO IAEA: We have to make it very clear in the resolution that the basis for further activities of IAEA is protocol and safeguard. And the last issue, also, is that Iran issue should not be in the agenda of IAEA anymore.

(END VIDEO CLIP)

CHANCE: Well, Iran says that this will only be a three-month temporary suspension. Europeans, though, still hope, as well as many others from the international community, that this is going to be turned into a more permanent suspension of uranium enrichment -- Kyra.

PHILLIPS: Matthew Chance, live from London, thank you.

And in Mosul, the U.S. military is calling it a continued campaign of threats, intimidation and murder. More bodies were found in that city today. The grisly discoveries mean even more tension in areas shaken by an insurgent uprising.

CNN's Nic Robertson reports from Mosul.

(BEGIN VIDEOTAPE)

NIC ROBERTSON, CNN SR. INTERNATIONAL CORRESPONDENT: Six more bodies found in Mosul on Friday, 15 on Thursday. Over the last week, at least 30 bodies have been discovered in the city here by the multinational force and Iraqi forces.

What is believed to be happening is that the Iraqi National Guard and Iraqi security forces allied with the coalition here are being targeted. In the last few weeks, some 3,200 Iraqi police have been intimidated to leave their posts either through intimidation or corruption within the police force. Now is it believed that the insurgents are targeting the Iraqi National Guard in particular.

According to coalition commanders here, they believe that it is the Baath Party that presents -- or the former members of Saddam Hussein's Baath Party represent the biggest threat to stability here in Mosul.

BRIG. GEN. CARTER HAM, U.S. ARMY: In my view, the former regime elements and the Baathists are the longer-term threat inside Mosul. And I think it's -- they are clearly gaining in strength. And, you know, Mosul was a place from which many senior Baathists came from. So there's a group of folks here that will welcome the return of the Baath Party under whatever name it may be. So that is a particular challenge.

ROBERTSON: One of the reasons the general believes that the Baath Party represents a significant and resurgent threat here is that senior members of that Baath Party are able to cross the border into Syria, base themselves out of Syria, come back into Mosul, which is quite a close distance to the border with Syria, come back into Mosul when they choose.

They are believed to be behind the intimidation of the residents of Mosul, behind the threats of against people who work with the coalition, and, indeed, funding some elements of the insurgency. The coalition here is studying other insurgencies around the world. They say, in particular, they're looking at the insurgency in Algeria, trying to draw conclusions and lessons from what was learned there.

And they say that one of the conclusions they have drawn is that the way to beat the insurgency here is to win the support of the local population. And they recognize that while troops do house-to-house searches, searching, following up on actionable intelligence that's been generated for key members of the Baath Party and other members of the insurgency, that while people, while soldiers, go into people's houses, they recognize that that does make it difficult to win the support of the local population.

But they believe that is the right method to beat the insurgency at this time. Also, one other point made by the commanding general here, Brigadier General Carter Ham, that he believes the detention a few days ago of a key aide to Abu Musab al-Zarqawi has led to some benefits, some improvements in the security situation here in Mosul since that key aide of Abu Musab al-Zarqawi was detained just a few days ago in Mosul.

Nic Robertson, CNN, Mosul, Iraq.

(END VIDEOTAPE)

PHILLIPS: A mysterious death that would even stump the "CSI" crew. But scientists are gathering in Egypt to solve an ancient mystery. Was King Tut's death an accident or murder?

Also ahead, you have seen these demonstrations in the Ukraine for days. Have you paid attention to them? You should. A terrorism expert tells us why after a break.

(COMMERCIAL BREAK)

PHILLIPS: Well, just a short time ago, the president of Ukraine emerged from a series of meetings to say a multilateral working group now has been established to try and end his country's political crisis.

Tens of thousands of demonstrators still continue to flood Kiev. They say that the recent presidential election was rigged for the candidate fly toward Moscow and against the one pushing for closer ties to the West. The two met today with high-level envoys from the European Union and Russia.

Now, earlier, I talked about the crisis and Ukraine's importance with Jim Walsh from Harvard University.

(BEGIN VIDEOTAPE)

JIM WALSH, HARVARD UNIVERSITY: It is the buffer. You know, Ukrainians think of themselves as the gateway to Europe, the gateway to the west.

But the Russians think of Ukraine as a buffer, as a geographical protection against the threats that the west may pose. So one of the reasons why they want to keep Ukraine in their sphere of influence is security reasons.

Another reason is economic reasons. Ukraine was the richest and most developed of the former Soviet republics when the Soviet Union broke up. Now, it's had some tough economic times recently. They seem to be getting a little better, but it's still a lot better than some of those other poor undeveloped republics.

And then finally, it is one of the major consumers of Russian oil. And of course, that is a point of leverage, a way in which the Russians can influence what happens in Ukraine.

PHILLIPS: All right. Some of the concerns for the U.S. I guess one would be that the acting president, who is supporting the successor who we aren't sure now if he will be the successor or not, actually supported selling radar systems and other military hardware to Saddam Hussein.

WALSH: Well, I think one of the big issues here, when you think -- talk about Ukraine, is what has happened in Ukraine over -- under Kuchma. And what we've really had is a country that was pretty well off economically, has sort of drifted into corruption, a lack of transparency, some arms -- dark arms deals on the side supporting Iraq. And really siding with Russia over the west on some -- some of the Issues in which there are contentions.

So this whole issue of selling arms on the black market, that is directly tied to a lack of transparency, an increase in corruption and the need for reform, which is why this election is being contested.

Most people perceive the last two presidential terms under Kuchma as a drift towards corruption, and instead they are calling for reform.

PHILLIPS: And that's why they're standing up, and they don't want the successor that he's supporting.

Let's talk about import/export. Are there a lot of American businesses in the Ukraine? Is that -- is that a concern for the U. S. ? WALSH: No, I think less so -- as far as the U.S. in particular goes, when you look at their trading partners, traditionally Russia was Ukraine's leading trade partner.

But that's changed in recent years. Now the countries of the E. U. , the European Union, are No. 1 in terms of trade with Ukraine. Russia is No. 2. And the U.S. is further down the list.

Foreign investment, not a lot of foreign investment from the west in Ukraine, again because of problems of corruption and the lack of transparency.

I think the U.S. interests in this issue are, one, democracy. And two, human rights, we continue to have human rights and proliferation problems in the Ukraine. And the finally, three, regional relations. What is Russia's role going to be here? That's what the U.S. is going to keep an eye on.

PHILLIPS: Meanwhile, the Ukraine sent 1,600 troops or so to Iraq to support the fall of Saddam Hussein.

And what's interesting, when you look at the live pictures, in the Independence Square area of Kiev, you see that security and the army has come forward and said that they support the demonstrators. And that's probably leading to the lack of a civil unrest at this point.

WALSH: Well, I think that's critical. In sorts of civil unrest situations where citizens are trying to peacefully take back their country, the role of the police and the role of the military is crucial. It is the swing vote.

If they turn against the protesters, it's unlikely that that sort of protest will succeed. But when they back the protesters, it really helps create a possibility of a peaceful transition.

So we have the military. We have the internal police and now, we have the supreme court, who are all saying wait, let's see about this election. It doesn't look like it's on the up and up. And that all favors the protesters at this point.

(END VIDEOTAPE)

PHILLIPS: News elsewhere around the world now.

Weeks of speculation over. A Palestinian legislator says that Marwan Barghouti will not run in the election to replace Yasser Arafat. Barghouti is currently in prison in Israel and is considered the most popular living Palestinian political figure. Barghouti has reportedly endorsed Fatah leader Mahmoud Abbas. Election Day, January 9.

A brutal attack that has stumped police. Central China this morning, a man broke into a school dormitory. He had a knife. He killed eight teenagers, wounded four others and ran for it. The students were sleeping at the time. That attacker has still yet to be found.

And it looks like Charles Jenkins will leave a U.S. military prison tomorrow. Jenkins, you may recall, deserted from the Army in 1965. He fled to North Korea, where he lived until September of this year. He surrendered to get medical treatment. According to some reports, he wants to live in Japan, his wife's homeland.

He was known as the boy king. And 3,000 years later, the death of King Tut remains a mystery. Egyptian authorities say they're going to solve it, though. Find out how just ahead.

(COMMERCIAL BREAK)

PHILLIPS: It's a murder mystery as old as the hills. Or, in this case, old as the pyramids. Was Egypt's King Tut done in by murder most foul? All the possible perps and witnesses are long dead. But investigators still hope to figure out if today's mummy was antiquity's victim.

CNN's Ben Wedeman goes digging for the story.

(BEGIN VIDEOTAPE)

BEN WEDEMAN, CNN CAIRO BUREAU CHIEF (voice-over): It's a mystery that has been waiting centuries, around 33 centuries, to be solved.

How did pharaoh Tutankhamen, better known as King Tut, die while still in his teens? One theory that won't die is that Tut was murdered by a blow to the back of the head, the victim of palace intrigue.

To shine some light on this pharaonic whodunit or what did it, Egyptian authorities plan on conducting an X-ray of Tut's mummy in its tomb in the Valley of the Kings.

UNIDENTIFIED MALE: We will answer the question of the murder of King Tut or not by the end -- before the end of December. We will announce actually the condition of the mummy.

WEDEMAN: Little is known about Tut. His fame comes more from the treasures he left behind.

UNIDENTIFIED MALE: This one not being made in Taiwan. It is ancient Egyptian ones. They are more than 3,500 years ago.

WEDEMAN: Previous studies of Tutankhamen's mummy showed bone fragments inside the skull. Some Egyptologists suggest the boy king died in an accident. But Egypt's top archaeologists smell skullduggery.

UNIDENTIFIED MALE: I believe there was a conspiracy. And I believe that he was murdered.

WEDEMAN: Prime suspects include Aye, the high priest, and General Horemheb, the commander of the Egyptian army at the time. (on camera): These tests may not prove beyond a reasonable doubt that, say, General Horemheb killed King Tut in the bedroom with a lead pipe, but they do bring very modern investigative methods to bear on a very ancient mystery.

Ben Wedeman, CNN, Cairo.

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