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Report: Terrorist Have Shoulder-Fired Missiles; Senate Debates Rice Confirmation; Deficit to Hit Almost $400 Billion, Fueled by Iraq

Aired January 25, 2005 - 13:00   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.


MILES O'BRIEN, CO-HOST: A flight risk. Could airliners be targeted by shoulder-fired missiles? A report out today on the threat and the very steep price tag for a defense.
BETTY NGUYEN, CO-HOST: Held hostage. A newly released video shows an American held at gunpoint and pleading for his life. We are live from Baghdad.

O'BRIEN: Kudos and brickbats for the secretary of state nominee, Condoleezza Rice. The Senate spends hours in debate, not over yet.

NGUYEN: And, the nominees are? Well, one of the year's biggest box office draws and most controversial films did not get a nomination for best picture. Should it?

From the CNN center here in Atlanta, I'm Betty Nguyen in for Kyra Phillips, who's on assignment today.

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

On one side, 7,000 airliners, give or take, filled with people crisscrossing the skies above America. On the other, man PADs, or man portable air defense systems. You know them better as shoulder-fired missiles.

In the middle, an aviation industry already fighting for its life and a government focused on protecting planes from their own passengers and luggage. CNN's "Security Watch" hones in on a Rand Corporation study showing the man PADs are a clear and present danger, and the cost of equipping planes to dodge them, prohibitive.

We get an eye-opening report from CNN's Lindsey Arent in Washington -- Lindsey.

LINDSEY ARENT, CNN CORRESPONDENT: Good afternoon to you, Miles.

Now the Rand corporation's 64-page study confirms what the U.S. government has known for a long time now, that terrorists like al Qaeda and others have both the motives and the equipment to attack commercial U.S. Aircraft with shoulder-fired missiles.

Now there has been one notable attempt to down a plane using the missiles. You might have heard of it. It happened back in 2003 when terrorists with ties to al Qaeda fired two missiles at an Israeli plane taking off from a Kenyan airport. In that case they missed.

(BEGIN VIDEO CLIP)

RAFI MAREK, AIRLINE PILOT: Everything was normal until just a few seconds after takeoff when we reached an altitude of about 500 feet. And when we heard just not very impressive, like a bang, which at that time I thought was a strike of a small bird hitting the belly of the aircraft.

(END VIDEO CLIP)

ARENT: Now soon after that incident, homeland security officials invested some $6 million to look at plans to put anti-missile systems on American airplanes.

Now the question here is whether or not it makes sense to install these anti-missile defense systems on the nation's civilian jetliners. And according to the Rand study that came out today, now is definitely not the time. Main reason here, they say, it's the high price tag.

The study found it would cost some $11 billion to install these defense systems on the nation's 6,800 commercial airplanes, and it would cost $2.1 billion per year to run it.

(BEGIN VIDEO CLIP)

JACK RILEY, RAND CORPORATION: What we're saying at this point is the technology is not there. We don't know enough about the reliability, and the cost seems relatively high.

Let's invest in trying to control the proliferation of those weapons so that people are less likely to get their hands on them, and let's invest in driving down the costs of those technologies and increase the reliability with the idea that, combined, the steps that we can take now lead to increases in protection.

(END VIDEO CLIP)

ARENT: Now at the same time, the report found that a single successful missile attack would also have devastating costs for the nation's aviation industry.

Now we're talking, aside from the human toll, a downed aircraft could cost up to $1 billion, $3 billion more if the nation's flight systems were shut down for a week, and then another $12 billion over a few months if passengers were simply too scared to fly.

But, despite those costs, the study recommends the government should hold off on anti-missile defense systems until the operating and installation costs can be brought down.

Now Miles, I spoke to the study's author just a short time ago. He says there could be a potential solution to this problem. All you have to do is significantly increase funding for transportation security from the $4.4 billion total the government spends right now -- Miles.

O'BRIEN: Lindsay Arent in Washington, thank you very much. So what will it take to defend commercial airliners? And is anybody willing to pay for it? We'll return to those topics a little later on CNN, 10 p.m. Eastern on "NEWSNIGHT." That's 7 p.m. on the left coast.

Now CNN is committed to providing the most reliable coverage of news that affects your security. Stay tuned to CNN for the latest information day and night.

NGUYEN: Sound and fury in the U.S. Senate today, signifying basically Democrats plan to spend the next four years on their feet.

The issue is Condoleezza Rice's fitness to be secretary of state, but no one believes she won't be readily confirmed. The real issue is Democrats' determination not to be a silent minority.

And we get more on all of that from CNN congressional correspondent Joe Johns.

Hi, Joe.

JOE JOHNS, CNN CORRESPONDENT: Hi, Betty.

Nine hours of debate set aside for this, although it's unlikely they'll use all of that time. Some sharp criticism of Condoleezza Rice from about four Democratic senators. Also, some complimentary remarks, as well.

However, Democrats are using this time to focus the spotlight on Condoleezza Rice and the U.S. policies in Iraq, even though it's quite clear that after all of this debate, she will be confirmed when the nomination comes up for a vote tomorrow morning.

Still, Democrats out on the Senate floor today, criticizing her, criticizing Iraq policies, including Senator Edward Kennedy of Massachusetts.

(BEGIN VIDEO CLIP)

SEN. EDWARD KENNEDY (D), MASSACHUSETTS: There was no reason to go to war in Iraq when we did, the way we did, and for the false reasons we were given. As a principal architect of our failed policy, Dr. Rice is the wrong choice for secretary of state.

We need, instead, a secretary who is open to a clearer vision, and a better strategy to stabilize Iraq, to work with the international community, and to bring our troops home with dignity and honor, and to restore our lost respect in the world.

(END VIDEO CLIP)

JOHNS: Now Republicans wanted a quick vote on Rice. Instead, they had to take to the floor to mount a defense of her, including Senator Kay Bailey Hutchison of Texas.

(BEGIN VIDEO CLIP) SEN. KAY BAILEY HUTCHISON (R), TEXAS: What would foreign leaders look for in a secretary of state? No. 1, somebody who has a deep understanding of foreign policy. Condoleezza Rice has had a 25-year career in foreign policy.

(END VIDEO CLIP)

JOHNS: So, why all of this debate? Well, Democrats are saying they have a constitutional obligation to debate this nomination fully. On the other hand, with weakened numbers after the last election, they do realize they will have to use the power of debate to get their message out -- Betty.

NGUYEN: Joe, is there any indication whether this debate is really going to make a difference? Or is it just going to sort of widen the differences between the parties?

JOHNS: Well, obviously, this is one of those things that the Democrats have said they simply have to do. Republicans, of course, have said, OK, we'll have this debate. It really doesn't make that much difference in the greater scheme of things, because everyone knows, she will be confirmed.

What Democrats are saying essentially here is that we're not going to go away. We're going to make sure our voices are going to be heard. Essentially, it sets the tone, if anything, for coming debate on the Senate floor -- Betty.

NGUYEN: More of a statement being made. All right, correspondent Joe Johns in Washington today, thank you, Joe -- Miles.

O'BRIEN: Lawmakers soon will get a chance to hash out the war all over again when they chew on a White House request for another $80 billion. Now sources are telling CNN the latest supplemental budget request is imminent, covering the conflicts in Iraq and Afghanistan, and bringing the total for both to roughly $300 billion.

In the meantime, congressional accountants estimate this year's deficit will hit $368 billion, not counting any spending on wars or on overhauling Social Security, the bulk of the Iraq war spending expected to go the Army.

CNN's Barbara Starr is following those dollars very closely for us at the Pentagon -- Barbara.

BARBARA STARR, CNN CORRESPONDENT: Well, Miles, those bills for the war, both in Iraq and Afghanistan, certainly do continue to add up. As the White House begins to put the final shape on this supplemental spending plan it will send to Capitol Hill, sources here at the Pentagon looking very closely at what the priorities are for the U.S. military out of that entire package.

As you say, roughly speaking, an $80 billion request to go for U.S. military. That's on top of $25 billion that the military already has in a previous supplemental that it's still spending. So something over $100 billion that they are looking for. The war is now costing about $5 billion a month or so, $60 billion a year. So that $60 billion now really includes the ongoing expenses: combat pay, food, fuel to run the weapons, the routine operation and maintenance of the equipment being used by 150,000 troops.

But there is much more to it. This year, in this supplemental, what the military is now looking at is a substantial cost for the repair of the equipment it has been using for the last two years in Iraq. That equipment, by all accounts, becoming very badly worn out in some cases.

Of course, Iraq is a sandy climate. The equipment really takes a beating over there. And as they bring that equipment back, they're having to spend a considerable amount of time and money repairing helicopters, tanks, vehicles, the up-armored Humvee vehicles, all of it that they have been using up.

So they are going to be looking for billions of dollars in this supplemental to take care of that very specific problem that's emerging. By one account, for example, the Marine Corps says some of its equipment has been used at a rate five times what it would have been used at if it had been here at home -- Miles.

O'BRIEN: Which brings up an important point, Barbara. To what extent does all of this supplemental spending change the way the Pentagon is going to be thinking long-term about what it buys and what it does not buy?

STARR: Well, it's -- it's going to be changing some of that, certainly, because the priorities -- the big lesson from Iraq, is what they call more mobile, lighter, faster moving equipment, more of the infantry type of equipment, because Iraq certainly now is becoming a combat zone where you need boots on the ground, troops that can move quickly and move safely.

So those armored vehicles are a top priority. Personal body armor equipment is a top priority.

But personnel, Miles, is also the key issue. Over the next several months, they certainly would like to draw down the number of troops in Iraq. That would save a lot of money. But no firm indication yet that they can do it.

They can't do it until they get the Iraqi security forces trained up, ready to defend their own country, ready to replace those U.S. combat forces. So we, of course, have learned that the Army planning scenario right now is 120,000 troops in Iraq, soldiers in Iraq, for the next two years. That's simply a planning figure.

If the Iraqis can't take over, that is the figure that the U.S. Army is willing to commit to, and the equipment to support those 120,000 troops, Miles.

O'BRIEN: Barbara Starr at the Pentagon -- Betty.

NGUYEN: And speaking of Iraq, a newly released tape of an American held hostage.

Plus, an assassination of a high-ranking Iraqi government official just days before the election. We are live in Baghdad, just ahead.

And later on LIVE FROM, plastic or paper? A major city could make you answer -- or pay for that answer.

And LIVE FROM has a question for you -- should Mel Gibson's movie, "The Passion of the Christ," have gotten a best picture Oscar nomination? E-mail us at LiveFrom@CNN.com. We will have some of your answers later on LIVE FROM.

ANNOUNCER: We're watching LIVE FROM on CNN, the most trusted name in news.

(COMMERCIAL BREAK)

O'BRIEN: An American taken hostage in Iraq is seen in a new videotape. The tape surfaced today more than two months after Roy Hallums was kidnapped. Let's go right now to CNN international correspondent Christiane Amanpour, joining us live in Baghdad -- Christiane.

CHRISTIANE AMANPOUR, CNN CORRESPONDENT: Miles, it's not clear why that tape was released today or who exactly has him.

In the tape, the man, Roy Hallums, is shown sitting down. He looks obviously anxious. He's got a rifle barrel pointed at his head, and he's basically pleading for his life. He's asking for help so that he can have his life saved and spared from what he called definite death unless something is done.

Again, he was a contractor, an American citizen, working for a Saudi contractor here in Iraq. And we're told that he was abducted back on November 1 when there was a firefight between insurgents or whoever came to get him and members of a household where he was staying. Some people were killed in that firefight. He, along with a Filipino, was taken into custody.

Again, we don't know exactly what efforts are under way, if any, to get him released. We're not sure whether it's a resistance group, so-called, an insurgent or terrorist cell that may have its own reasons for having him and may not be about to bargain. Or, could it be -- could it be a criminal gang, as has happened in the past. We're not sure about that at all, Miles.

O'BRIEN: All right. So Christiane, there's no way to really tell when this particular tape was rolled. There's no date imprint on it, if you will?

AMANPOUR: No, at this point there seems to be no such clues.

O'BRIEN: All right, Christiane Amanpour in Baghdad, thank you very much for bringing us up to date on that -- Betty. NGUYEN: We all know the security situation in Iraq is dire. But this next story puts it all into perspective. In the city of Mosul, there is one single election official. The other 700 members quit.

And as can you imagine, the man didn't want to appear on camera, but he talked to CNN's Nic Robertson about his struggle to prepare the city for the election and to stay alive.

(BEGIN VIDEOTAPE)

NIC ROBERTSON, CNN CORRESPONDENT (voice-over): In a darkened warehouse, already filling with election materials, Mosul's only fully trained election official is under pressure.

Brought in to replace the city's 700 electoral workers, who quit because of intimidation, he is behind in preparations. He, too, is afraid of potential violence and asked we do not identify him. His biggest concern, though, is recruiting enough staff.

UNIDENTIFIED MALE (through translator): Last night I called the independent electoral commission in Iraq and told them I need more staff. And they said they'll send everybody as soon as they can.

ROBERTSON: Hundreds more election workers are expected, many from out of town and many likely warming to the promise of more than $500 for just a few days' work.

MAJ. ANTHONY CRUZ, ELECTION OFFICER: Getting all these people to come in and, trained, get them back up, pushed out to the polling centers on election day, putting up the security, there's a lot that has to happen in such a short amount of time.

ROBERTSON: But even that is still only part of the problem. Over 100 more pallets of balloting supplies are on their way.

(on camera) The challenge over the next few days will be sorting through these mountains of election material, preparing the right numbers of ballot boxes and papers for all the individual polling stations.

(voice-over) In his hastily set-up office, he is still trying to grapple with the logistics ahead. Locations of polling stations have yet to be fixed. Never mind places for his workers to sleep.

UNIDENTIFIED MALE (through translator): We are choosing polling centers that will be close to the people. Our planning covers a large area, and it will be easy for people to vote.

ROBERTSON: On election day, traffic will be banned to minimize the risk of terror attacks, meaning voters will have to walk to the polls. And although he doesn't know how many people will turn out, he is sure they do want the elections.

UNIDENTIFIED MALE (through translator): We feel and we know our people want to vote, that they want a new government. We can feel that. They worry about security, but they can see the coalition and Iraqi forces are making it safer.

ROBERTSON: So critical is his role, running the elections in Mosul, when one of the U.S.' top generals came to town, he got a handshake and words of encouragement.

UNIDENTIFIED MALE: We just wanted to get the electoral commission guys together with the intervention forces, brigade commanders, as an example of how they're going to work together to pull off this election.

ROBERTSON: The bottom line from everyone involved: Mosul's elections will happen.

UNIDENTIFIED MALE (through translator): This is my duty. I do it for my country. In the future, I'll be able to tell my sons and my sons' sons about it. My name will go down in the history of Iraq.

ROBERTSON: Nic Robertson, CNN, Mosul, Iraq.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

O'BRIEN: Well, paper or plastic? Whichever you choose, it could soon cost you, at least in one city.

San Francisco's environmental commission voting today whether to recommend that the city impose a fee on grocery bags. Rita Williams from our affiliate KTVI in the Bay Area explains shoppers aren't exactly taking the issue lightly.

(BEGIN VIDEOTAPE)

RITA WILLIAMS, KTVI REPORTER (voice-over): San Francisco, full of spectacular sights, the pyramid, cable cars that go half-way to the stars, soon, also may be known as the first American stow charge a fee for grocery bags.

JARED BLUMENFELD, SAN FRANCISCO ENVIRONMENTAL DIRECTOR: What we're trying to do here in San Francisco is to say do we need to be using 50 million paper and plastic bags every year? What happens to those? It's very hard to recycle them. A lot of them end up on the streets. We have increasing litter problems.

WILLIAMS: it won't be a question of whether it's paper or plastic. The proposed fee to discourage usage at large grocery stores will be the same for either: 17 cents a bag.

UNIDENTIFIED MALE: I'm against it. I think it's silly.

UNIDENTIFIED MALE: Seventeen cents, it's really too much money.

UNIDENTIFIED FEMALE: That's outrageous. It really is. It should be free.

WILLIAMS: But those who favor the fee say overuse of the bags carries its own cost: for litter pickup, recycling and higher grocery prices.

UNIDENTIFIED MALE: I think it's a good idea, because it just makes people more conscious about the environment.

UNIDENTIFIED MALE: It's not a bad idea, as long as you're allowed to bring your own plastic and/or paper bags back, and they can get used all over again.

UNIDENTIFIED FEMALE: Well, I bring my own bag then, huh? That will teach them.

WILLIAMS: And that's just what city officials hope happens, that people bring their own reusable bags. They say that's what happened in Ireland where a 15-cent fee for plastic bags cut usage by 90 percent.

UNIDENTIFIED MALE: This bag cost me $1, and it will last my whole life.

WILLIAMS: But the California Grocer's Association says the fee really is a regressive tax and that smaller markets, department stores and restaurants that use the bags are not included, at least not yet.

PAUL SMITH, RETAIL GROCERS ASSOCIATION: This is a dramatic increase, a dramatic increase for our customers to pay, going from, you know, a fraction of a penny or a penny, to 17 cents per bag.

WILLIAMS: And he says all those people who already reuse grocery bags as pooper-scoopers, trash can liners and diaper wrappers will just buy boxes of cheaper bags, and that won't reduce usage.

(END VIDEOTAPE)

NGUYEN: Well, people in Washington state could be facing a different kind of tax. It's a vanity tax on cosmetic procedures such as Botox and hair transplants. A state senator wants the tax to help pay for children's health care. A similar tax in New Jersey brings in about $20 million a year.

And it seems impossible to watch an hour of television without seeing prescription drug ads. But, has the marketing gone too far? A new study says yes.

Susan Lisovicz joins us now from the New York Stock Exchange for that report.

Hi there, Susan.

(STOCK REPORT)

(COMMERCIAL BREAK)

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Aired January 25, 2005 - 13:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
MILES O'BRIEN, CO-HOST: A flight risk. Could airliners be targeted by shoulder-fired missiles? A report out today on the threat and the very steep price tag for a defense.
BETTY NGUYEN, CO-HOST: Held hostage. A newly released video shows an American held at gunpoint and pleading for his life. We are live from Baghdad.

O'BRIEN: Kudos and brickbats for the secretary of state nominee, Condoleezza Rice. The Senate spends hours in debate, not over yet.

NGUYEN: And, the nominees are? Well, one of the year's biggest box office draws and most controversial films did not get a nomination for best picture. Should it?

From the CNN center here in Atlanta, I'm Betty Nguyen in for Kyra Phillips, who's on assignment today.

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

On one side, 7,000 airliners, give or take, filled with people crisscrossing the skies above America. On the other, man PADs, or man portable air defense systems. You know them better as shoulder-fired missiles.

In the middle, an aviation industry already fighting for its life and a government focused on protecting planes from their own passengers and luggage. CNN's "Security Watch" hones in on a Rand Corporation study showing the man PADs are a clear and present danger, and the cost of equipping planes to dodge them, prohibitive.

We get an eye-opening report from CNN's Lindsey Arent in Washington -- Lindsey.

LINDSEY ARENT, CNN CORRESPONDENT: Good afternoon to you, Miles.

Now the Rand corporation's 64-page study confirms what the U.S. government has known for a long time now, that terrorists like al Qaeda and others have both the motives and the equipment to attack commercial U.S. Aircraft with shoulder-fired missiles.

Now there has been one notable attempt to down a plane using the missiles. You might have heard of it. It happened back in 2003 when terrorists with ties to al Qaeda fired two missiles at an Israeli plane taking off from a Kenyan airport. In that case they missed.

(BEGIN VIDEO CLIP)

RAFI MAREK, AIRLINE PILOT: Everything was normal until just a few seconds after takeoff when we reached an altitude of about 500 feet. And when we heard just not very impressive, like a bang, which at that time I thought was a strike of a small bird hitting the belly of the aircraft.

(END VIDEO CLIP)

ARENT: Now soon after that incident, homeland security officials invested some $6 million to look at plans to put anti-missile systems on American airplanes.

Now the question here is whether or not it makes sense to install these anti-missile defense systems on the nation's civilian jetliners. And according to the Rand study that came out today, now is definitely not the time. Main reason here, they say, it's the high price tag.

The study found it would cost some $11 billion to install these defense systems on the nation's 6,800 commercial airplanes, and it would cost $2.1 billion per year to run it.

(BEGIN VIDEO CLIP)

JACK RILEY, RAND CORPORATION: What we're saying at this point is the technology is not there. We don't know enough about the reliability, and the cost seems relatively high.

Let's invest in trying to control the proliferation of those weapons so that people are less likely to get their hands on them, and let's invest in driving down the costs of those technologies and increase the reliability with the idea that, combined, the steps that we can take now lead to increases in protection.

(END VIDEO CLIP)

ARENT: Now at the same time, the report found that a single successful missile attack would also have devastating costs for the nation's aviation industry.

Now we're talking, aside from the human toll, a downed aircraft could cost up to $1 billion, $3 billion more if the nation's flight systems were shut down for a week, and then another $12 billion over a few months if passengers were simply too scared to fly.

But, despite those costs, the study recommends the government should hold off on anti-missile defense systems until the operating and installation costs can be brought down.

Now Miles, I spoke to the study's author just a short time ago. He says there could be a potential solution to this problem. All you have to do is significantly increase funding for transportation security from the $4.4 billion total the government spends right now -- Miles.

O'BRIEN: Lindsay Arent in Washington, thank you very much. So what will it take to defend commercial airliners? And is anybody willing to pay for it? We'll return to those topics a little later on CNN, 10 p.m. Eastern on "NEWSNIGHT." That's 7 p.m. on the left coast.

Now CNN is committed to providing the most reliable coverage of news that affects your security. Stay tuned to CNN for the latest information day and night.

NGUYEN: Sound and fury in the U.S. Senate today, signifying basically Democrats plan to spend the next four years on their feet.

The issue is Condoleezza Rice's fitness to be secretary of state, but no one believes she won't be readily confirmed. The real issue is Democrats' determination not to be a silent minority.

And we get more on all of that from CNN congressional correspondent Joe Johns.

Hi, Joe.

JOE JOHNS, CNN CORRESPONDENT: Hi, Betty.

Nine hours of debate set aside for this, although it's unlikely they'll use all of that time. Some sharp criticism of Condoleezza Rice from about four Democratic senators. Also, some complimentary remarks, as well.

However, Democrats are using this time to focus the spotlight on Condoleezza Rice and the U.S. policies in Iraq, even though it's quite clear that after all of this debate, she will be confirmed when the nomination comes up for a vote tomorrow morning.

Still, Democrats out on the Senate floor today, criticizing her, criticizing Iraq policies, including Senator Edward Kennedy of Massachusetts.

(BEGIN VIDEO CLIP)

SEN. EDWARD KENNEDY (D), MASSACHUSETTS: There was no reason to go to war in Iraq when we did, the way we did, and for the false reasons we were given. As a principal architect of our failed policy, Dr. Rice is the wrong choice for secretary of state.

We need, instead, a secretary who is open to a clearer vision, and a better strategy to stabilize Iraq, to work with the international community, and to bring our troops home with dignity and honor, and to restore our lost respect in the world.

(END VIDEO CLIP)

JOHNS: Now Republicans wanted a quick vote on Rice. Instead, they had to take to the floor to mount a defense of her, including Senator Kay Bailey Hutchison of Texas.

(BEGIN VIDEO CLIP) SEN. KAY BAILEY HUTCHISON (R), TEXAS: What would foreign leaders look for in a secretary of state? No. 1, somebody who has a deep understanding of foreign policy. Condoleezza Rice has had a 25-year career in foreign policy.

(END VIDEO CLIP)

JOHNS: So, why all of this debate? Well, Democrats are saying they have a constitutional obligation to debate this nomination fully. On the other hand, with weakened numbers after the last election, they do realize they will have to use the power of debate to get their message out -- Betty.

NGUYEN: Joe, is there any indication whether this debate is really going to make a difference? Or is it just going to sort of widen the differences between the parties?

JOHNS: Well, obviously, this is one of those things that the Democrats have said they simply have to do. Republicans, of course, have said, OK, we'll have this debate. It really doesn't make that much difference in the greater scheme of things, because everyone knows, she will be confirmed.

What Democrats are saying essentially here is that we're not going to go away. We're going to make sure our voices are going to be heard. Essentially, it sets the tone, if anything, for coming debate on the Senate floor -- Betty.

NGUYEN: More of a statement being made. All right, correspondent Joe Johns in Washington today, thank you, Joe -- Miles.

O'BRIEN: Lawmakers soon will get a chance to hash out the war all over again when they chew on a White House request for another $80 billion. Now sources are telling CNN the latest supplemental budget request is imminent, covering the conflicts in Iraq and Afghanistan, and bringing the total for both to roughly $300 billion.

In the meantime, congressional accountants estimate this year's deficit will hit $368 billion, not counting any spending on wars or on overhauling Social Security, the bulk of the Iraq war spending expected to go the Army.

CNN's Barbara Starr is following those dollars very closely for us at the Pentagon -- Barbara.

BARBARA STARR, CNN CORRESPONDENT: Well, Miles, those bills for the war, both in Iraq and Afghanistan, certainly do continue to add up. As the White House begins to put the final shape on this supplemental spending plan it will send to Capitol Hill, sources here at the Pentagon looking very closely at what the priorities are for the U.S. military out of that entire package.

As you say, roughly speaking, an $80 billion request to go for U.S. military. That's on top of $25 billion that the military already has in a previous supplemental that it's still spending. So something over $100 billion that they are looking for. The war is now costing about $5 billion a month or so, $60 billion a year. So that $60 billion now really includes the ongoing expenses: combat pay, food, fuel to run the weapons, the routine operation and maintenance of the equipment being used by 150,000 troops.

But there is much more to it. This year, in this supplemental, what the military is now looking at is a substantial cost for the repair of the equipment it has been using for the last two years in Iraq. That equipment, by all accounts, becoming very badly worn out in some cases.

Of course, Iraq is a sandy climate. The equipment really takes a beating over there. And as they bring that equipment back, they're having to spend a considerable amount of time and money repairing helicopters, tanks, vehicles, the up-armored Humvee vehicles, all of it that they have been using up.

So they are going to be looking for billions of dollars in this supplemental to take care of that very specific problem that's emerging. By one account, for example, the Marine Corps says some of its equipment has been used at a rate five times what it would have been used at if it had been here at home -- Miles.

O'BRIEN: Which brings up an important point, Barbara. To what extent does all of this supplemental spending change the way the Pentagon is going to be thinking long-term about what it buys and what it does not buy?

STARR: Well, it's -- it's going to be changing some of that, certainly, because the priorities -- the big lesson from Iraq, is what they call more mobile, lighter, faster moving equipment, more of the infantry type of equipment, because Iraq certainly now is becoming a combat zone where you need boots on the ground, troops that can move quickly and move safely.

So those armored vehicles are a top priority. Personal body armor equipment is a top priority.

But personnel, Miles, is also the key issue. Over the next several months, they certainly would like to draw down the number of troops in Iraq. That would save a lot of money. But no firm indication yet that they can do it.

They can't do it until they get the Iraqi security forces trained up, ready to defend their own country, ready to replace those U.S. combat forces. So we, of course, have learned that the Army planning scenario right now is 120,000 troops in Iraq, soldiers in Iraq, for the next two years. That's simply a planning figure.

If the Iraqis can't take over, that is the figure that the U.S. Army is willing to commit to, and the equipment to support those 120,000 troops, Miles.

O'BRIEN: Barbara Starr at the Pentagon -- Betty.

NGUYEN: And speaking of Iraq, a newly released tape of an American held hostage.

Plus, an assassination of a high-ranking Iraqi government official just days before the election. We are live in Baghdad, just ahead.

And later on LIVE FROM, plastic or paper? A major city could make you answer -- or pay for that answer.

And LIVE FROM has a question for you -- should Mel Gibson's movie, "The Passion of the Christ," have gotten a best picture Oscar nomination? E-mail us at LiveFrom@CNN.com. We will have some of your answers later on LIVE FROM.

ANNOUNCER: We're watching LIVE FROM on CNN, the most trusted name in news.

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O'BRIEN: An American taken hostage in Iraq is seen in a new videotape. The tape surfaced today more than two months after Roy Hallums was kidnapped. Let's go right now to CNN international correspondent Christiane Amanpour, joining us live in Baghdad -- Christiane.

CHRISTIANE AMANPOUR, CNN CORRESPONDENT: Miles, it's not clear why that tape was released today or who exactly has him.

In the tape, the man, Roy Hallums, is shown sitting down. He looks obviously anxious. He's got a rifle barrel pointed at his head, and he's basically pleading for his life. He's asking for help so that he can have his life saved and spared from what he called definite death unless something is done.

Again, he was a contractor, an American citizen, working for a Saudi contractor here in Iraq. And we're told that he was abducted back on November 1 when there was a firefight between insurgents or whoever came to get him and members of a household where he was staying. Some people were killed in that firefight. He, along with a Filipino, was taken into custody.

Again, we don't know exactly what efforts are under way, if any, to get him released. We're not sure whether it's a resistance group, so-called, an insurgent or terrorist cell that may have its own reasons for having him and may not be about to bargain. Or, could it be -- could it be a criminal gang, as has happened in the past. We're not sure about that at all, Miles.

O'BRIEN: All right. So Christiane, there's no way to really tell when this particular tape was rolled. There's no date imprint on it, if you will?

AMANPOUR: No, at this point there seems to be no such clues.

O'BRIEN: All right, Christiane Amanpour in Baghdad, thank you very much for bringing us up to date on that -- Betty. NGUYEN: We all know the security situation in Iraq is dire. But this next story puts it all into perspective. In the city of Mosul, there is one single election official. The other 700 members quit.

And as can you imagine, the man didn't want to appear on camera, but he talked to CNN's Nic Robertson about his struggle to prepare the city for the election and to stay alive.

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NIC ROBERTSON, CNN CORRESPONDENT (voice-over): In a darkened warehouse, already filling with election materials, Mosul's only fully trained election official is under pressure.

Brought in to replace the city's 700 electoral workers, who quit because of intimidation, he is behind in preparations. He, too, is afraid of potential violence and asked we do not identify him. His biggest concern, though, is recruiting enough staff.

UNIDENTIFIED MALE (through translator): Last night I called the independent electoral commission in Iraq and told them I need more staff. And they said they'll send everybody as soon as they can.

ROBERTSON: Hundreds more election workers are expected, many from out of town and many likely warming to the promise of more than $500 for just a few days' work.

MAJ. ANTHONY CRUZ, ELECTION OFFICER: Getting all these people to come in and, trained, get them back up, pushed out to the polling centers on election day, putting up the security, there's a lot that has to happen in such a short amount of time.

ROBERTSON: But even that is still only part of the problem. Over 100 more pallets of balloting supplies are on their way.

(on camera) The challenge over the next few days will be sorting through these mountains of election material, preparing the right numbers of ballot boxes and papers for all the individual polling stations.

(voice-over) In his hastily set-up office, he is still trying to grapple with the logistics ahead. Locations of polling stations have yet to be fixed. Never mind places for his workers to sleep.

UNIDENTIFIED MALE (through translator): We are choosing polling centers that will be close to the people. Our planning covers a large area, and it will be easy for people to vote.

ROBERTSON: On election day, traffic will be banned to minimize the risk of terror attacks, meaning voters will have to walk to the polls. And although he doesn't know how many people will turn out, he is sure they do want the elections.

UNIDENTIFIED MALE (through translator): We feel and we know our people want to vote, that they want a new government. We can feel that. They worry about security, but they can see the coalition and Iraqi forces are making it safer.

ROBERTSON: So critical is his role, running the elections in Mosul, when one of the U.S.' top generals came to town, he got a handshake and words of encouragement.

UNIDENTIFIED MALE: We just wanted to get the electoral commission guys together with the intervention forces, brigade commanders, as an example of how they're going to work together to pull off this election.

ROBERTSON: The bottom line from everyone involved: Mosul's elections will happen.

UNIDENTIFIED MALE (through translator): This is my duty. I do it for my country. In the future, I'll be able to tell my sons and my sons' sons about it. My name will go down in the history of Iraq.

ROBERTSON: Nic Robertson, CNN, Mosul, Iraq.

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O'BRIEN: Well, paper or plastic? Whichever you choose, it could soon cost you, at least in one city.

San Francisco's environmental commission voting today whether to recommend that the city impose a fee on grocery bags. Rita Williams from our affiliate KTVI in the Bay Area explains shoppers aren't exactly taking the issue lightly.

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RITA WILLIAMS, KTVI REPORTER (voice-over): San Francisco, full of spectacular sights, the pyramid, cable cars that go half-way to the stars, soon, also may be known as the first American stow charge a fee for grocery bags.

JARED BLUMENFELD, SAN FRANCISCO ENVIRONMENTAL DIRECTOR: What we're trying to do here in San Francisco is to say do we need to be using 50 million paper and plastic bags every year? What happens to those? It's very hard to recycle them. A lot of them end up on the streets. We have increasing litter problems.

WILLIAMS: it won't be a question of whether it's paper or plastic. The proposed fee to discourage usage at large grocery stores will be the same for either: 17 cents a bag.

UNIDENTIFIED MALE: I'm against it. I think it's silly.

UNIDENTIFIED MALE: Seventeen cents, it's really too much money.

UNIDENTIFIED FEMALE: That's outrageous. It really is. It should be free.

WILLIAMS: But those who favor the fee say overuse of the bags carries its own cost: for litter pickup, recycling and higher grocery prices.

UNIDENTIFIED MALE: I think it's a good idea, because it just makes people more conscious about the environment.

UNIDENTIFIED MALE: It's not a bad idea, as long as you're allowed to bring your own plastic and/or paper bags back, and they can get used all over again.

UNIDENTIFIED FEMALE: Well, I bring my own bag then, huh? That will teach them.

WILLIAMS: And that's just what city officials hope happens, that people bring their own reusable bags. They say that's what happened in Ireland where a 15-cent fee for plastic bags cut usage by 90 percent.

UNIDENTIFIED MALE: This bag cost me $1, and it will last my whole life.

WILLIAMS: But the California Grocer's Association says the fee really is a regressive tax and that smaller markets, department stores and restaurants that use the bags are not included, at least not yet.

PAUL SMITH, RETAIL GROCERS ASSOCIATION: This is a dramatic increase, a dramatic increase for our customers to pay, going from, you know, a fraction of a penny or a penny, to 17 cents per bag.

WILLIAMS: And he says all those people who already reuse grocery bags as pooper-scoopers, trash can liners and diaper wrappers will just buy boxes of cheaper bags, and that won't reduce usage.

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NGUYEN: Well, people in Washington state could be facing a different kind of tax. It's a vanity tax on cosmetic procedures such as Botox and hair transplants. A state senator wants the tax to help pay for children's health care. A similar tax in New Jersey brings in about $20 million a year.

And it seems impossible to watch an hour of television without seeing prescription drug ads. But, has the marketing gone too far? A new study says yes.

Susan Lisovicz joins us now from the New York Stock Exchange for that report.

Hi there, Susan.

(STOCK REPORT)

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