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Journalists Recovering from Iraq Bombing; Kennedy, Kerry Make Last Stand Against Alito; Al Qaeda's No. 2 Puts out Tape Responding to Recent Events; Jury Trial Begins for Enron CEOs

Aired January 30, 2006 - 13:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

BETTY NGUYEN, CO-HOST: Hello and good afternoon, I'm Betty Nguyen live at CNN headquarters in Atlanta. Kyra Phillips has the day off.
TONY HARRIS, CO-HOST: And hello everyone. I'm Tony Harris in B Control. CNN's LIVE FROM starts right now.

And we begin this hour with some breaking news just in to CNN. The Arab television network Al Jazeera has received a new tape, we understand, from al Qaeda's No. 1, Ayman al Zawahiri. And we also understand that Al Jazeera is preparing at this moment to air that new tape from al Qaeda's No. 1, Ayman al Zawahiri.

We will be monitoring that feed from Al Jazeera. We will take that tape into our system here at CNN. We will vet it and we will bring you developments, any news that is on that new broadcast, that new tape from al Qaeda's No. 1, set to air in moments on Al Jazeera from al Qaeda's No. 1, Ayman al Zawahiri.

Well, they were covering a war zone and got way to close to the action. Now, though, encouraging news about two seriously wounded ABC journalists. Anchor Bob Woodruff and photographer Bob Vogt -- Doug Vogt were caught in a roadside bombing north of Baghdad in which an Iraqi soldier is also hurt. No U.S. soldiers were injured.

The journalists are at the U.S. military hospital in Landstuhl, Germany, at least temporarily, and so was CNN's Chris Burns. And Chris is on the phone with us right now.

And Chris, what can you tell us about the latest information that's being shared by doctors?

CHRIS BURNS, CNN CORRESPONDENT: Tony, here in Landstuhl, the doctors are quoted as saying they have had good, early signs of reaction, signs of slow improvement.

But even the head of the hospital who dealt with reconstructive surgery as a surgeon during the first Gulf War said there's really no telling how long it will take for them to recover, what kind of surgery they're going to need.

They went through CAT scans and other tests today. So far, it does look like there is improvement, that they are reacting to the tests. But they arrived here early this morning from Iraq under heavy sedation, intubated, after the roadside bomb went off on Sunday next to the Iraqi military vehicle they were traveling in.

They did have body armor. They did have helmets. But they were riding with the hatch open and standing in the hatch of that military vehicle when that bomb went off, and that's why they were so badly injured. Head injuries and broken bones -- Tony.

HARRIS: And Chris, let me just sort of go back over this information just a bit here. You're telling us that a reconstructive surgeon is a part of the team that's treating these two men?

BURNS: That -- no. The head of the Landstuhl military hospital is -- has had experience in reconstructive surgery.

HARRIS: I see.

BURNS: So there is -- that is not to indicate anything about any kind of reconstructive surgery on the two men.

HARRIS: OK. Do we know at this point whether or not family members of the two men have made it to Germany?

BURNS: Yes, we do know that members of both families have arrived as well at least one ABC News executive. So they have them there. And that is one reason why the officials at the hospital have been tight-lipped about giving any information. They first want to talk to the families and decide what the next step is. Should they stay here or, as we saw in that ABC News message -- statement that was made earlier today from New York, that the two men could actually come back to the states as early as tomorrow.

So Woodruff and Vogt might actually be back in the states sooner than we think, although the hospital here says that they may -- they will be out of there by the end of the week.

HARRIS: I see. And Chris, just so that we understand, are those top of the hour church bells that we hear behind you?

BURNS: That is the top of the hour. That is Landstuhl. You are in Germany, and it's the beautiful sound of 6 p.m.

HARRIS: OK. Just wanted to explain it to folks watching. Chris Burns for us in Germany. Chris, thank you.

NGUYEN: Tony, the Iraq war zone, few places on earth more dangerous for journalist. They've been directly targeted, caught in the cross fire or subject to revenge attacks simply because of their work. Since the war began almost three years ago, 61 journalists have been killed. Two of those were Americans. Most, one in 40, were Iraqis.

In the next hour of LIVE FROM, senior international correspondent Nic Robertson will join us live to talk about the dangers that they face.

And of course, soldiers, civilians, even churches are also in the crosshairs in Iraq. Yesterday, bombs went off near five churches in Baghdad and two are others in the northern city of Kirkuk. Three people were killed and almost 20 wounded. Two Iraqi soldiers were killed in a roadside bombing south of Baghdad.

Also south of Baghdad, hours earlier a bomb went off in a candy store, killing 10 people and wounding three -- Tony.

HARRIS: Well, don't look for any fireworks when Saddam Hussein's trial resumes on Wednesday. Don't even look for Saddam Hussein. He and his lawyers plan to boycott in light of what happened yesterday. Did you see this?

The former Iraqi dictator got into a shouting match with the new chief judge, who expelled a co-defendant and a defense lawyer. Eventually, the entire defense team stormed out in protest. Saddam Hussein was escorted out -- Betty.

NGUYEN: Well, you don't want to give up the fight, that's what a few senators have to say, Democrats in particular. That fight being Samuel Alito's Supreme Court nomination, and the few being chiefly John Kerry and Edward Kennedy.

Republicans boast they have the votes to prevail against a filibuster, and many Democrats agree. At ringside on Capitol Hill our congressional correspondent, Ed Henry.

Is this fight -- is there any fuel left in it, Ed?

ED HENRY, CNN CORRESPONDENT: Well, the drama really has been sucked out of it, because as you know and as you pointed out the Republicans are very confident. They have at least the 60 votes they need to break off this filibuster.

The test will come at 4:30 this afternoon Eastern Time, when they'll actually have a procedural vote to see whether or not the debate will end. We just saw Senator John Kerry on the Senate floor a couple of moments ago, making if you will, his last stand again this nomination.

You now see Republican senator Mitch McConnell of the Senate leadership talking, as well, and the bottom line is take a listen first to what Senator Kerry had to say.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D), MASSACHUSETTS: This is the time for debate. This is the time when it counts, not after the Supreme Court has granted the executive the right to use torture or to eavesdrop without warrants, not after a woman's right to privacy has been taken away. History is really not going care what we say after the courthouse door is slammed in the faces of women and minority, the elderly, the disabled and the poor. History will wonder why we didn't do more when we knew what was coming.

(END VIDEO CLIP)

HENRY: But another blow to Kerry's filibuster came a short while ago when we learned that the so-called Gang of 14 moderates in the Senate will be meeting about an hour before that vote this afternoon. You'll remember they signed that pact last year saying that they would not support any filibuster of the president's judicial nominees unless there were extraordinary circumstances. The Gang of 14 widely expected to say they do not believe there are extraordinary circumstances here to justify a filibuster -- Betty.

NGUYEN: But if they wanted to, could they stop a filibuster?

HENRY: Yes, they could. They have the votes to stop it. And it's clear. Senator Kerry knows he doesn't have the votes. He was trying to make a stand here.

But I've heard Democrats privately saying, look, if he and Senator Kennedy really wanted to stop this, they should have launched this filibuster a couple of weeks ago when the hearings ended and there were a lot of undecided people on both sides, particularly on the Democratic side. Right now, most people are in cement and have come out, and the majority have said that they're going to support Judge Alito. So it's really hard to change any votes at this point, Betty.

NGUYEN: We'll be watching. Ed Henry on Capitol Hill. Thank you, Ed.

HENRY: Thank you.

NGUYEN: Tony.

HARRIS: And Betty, just in, we want to give you a little bit of the flavor of this new tape that is being broadcast right now, even as we speak, on Arab television network Al Jazeera. This is new video of al Qaeda's No. 2, Ayman al Zawahiri.

And he starts out on this tape -- we're going to turn the sound down on it, because we still have to fully vet this videotape -- but he starts out by speaking about the air strikes on Pakistan just a couple of weeks ago. You recall that those were CIA air strikes that were targeting him, in fact.

He lists the name of the city where the attack took place, the region of the country of Pakistan and that 18 were killed. And you'll see that behind him there is nothing distinguishing there, nothing to indicate where he might be. Nothing distinguishing at all. Just a black backdrop behind Ayman al Zawahiri right now.

Again, as we watch the tape, and as it is coming on the feed from Al Jazeera, just to let you know, we're going to take the entire feed in here to CNN. And our international desk is working pretty feverishly right now to translate this. It's pretty much on the fly right now. We will fully vet the tape. I just want to remind you of that before we put any of the audio on the air.

But what we have heard so far is that Ayman al Zawahiri is referencing the CIA air strike in Pakistan about two weeks ago.

We understand that CNN's international correspondent, Nic Robertson, is on the set with us right now.

And Nic, give us a sense of -- this is the second tape from Ayman al-Zawahiri in the last few weeks. The first tape was followed in short order by a tape from Osama bin Laden. What are we to make of this?

NIC ROBERTSON, CNN CORRESPONDENT: Well, we can look for some time references of when this -- when this tape was recorded. You mentioned that attack that was targeting Zawahiri on the border region of Pakistan and Afghanistan. That was 17 days ago, Friday two weeks ago. He makes a reference to that.

But there's a time reference on this audiotape that is even more recent. This tape, Zawahiri makes a reference to -- to Osama bin Laden's offer to the United States of a truce. Now, that offer was made 12 days ago.

And in this -- in his statement he says the United States, Washington turned down this request for a truce. So it appears as if this tape was recorded. And we are just beginning to analyze its full content, but our initial reading at this time, it appears as if the most recent time reference is about 12 days ago.

And this is quite an extraordinary turnaround, even by al Qaeda's standards, to turn around an incident, respond to it on videotape and get that tape broadcast.

Now, certainly people in the intelligence community, the CIA were expecting Zawahiri to release a tape, saying that he wasn't killed in that bombing 17 days ago in the border area of Pakistan, a bombing that killed 18 people in a small Pakistani village. They were expecting such a response, but this almost goes one step beyond that. It takes off on Osama bin Laden's latest message.

What we know about the contents of this message so far. He lambastes President Bush, criticizing President Bush much in the same way Osama bin Laden did in his audio message just 12 days ago, Tony.

HARRIS: Nic, I have to ask you, we've been -- we've all been curious as to the logistics of something like this. And there's been some time lag between when tapes -- we thought that tapes were recorded and when they were finally aired on Al Jazeera.

This -- this seems very present, seems right in the moment with the time stamps that you mentioned. It seems to point to a level of coordination that I'm not sure we felt that al Qaeda was capable of at this point in time.

ROBERTSON: In previous times we've perhaps seen a month lag between al Qaeda's statements and events they referred to. Think back to the London bombings in July last year, where al Qaeda targeted the underground network or the underground transport network in London. It took a month for them to respond then.

In this particular case it seems al Qaeda has pulled out all of the stops to turn this message around and get it out very quickly. And it does give that indication or perhaps a hint that al Qaeda is, as we have heard before, listening to the news, watching it very carefully, playing a propaganda game, if you will and rushing, it seems, this particular statement now.

But it gives an indication that, whatever the cutouts, whatever the methodology of moving this tape around, of physically getting it from when they record it for that cameraman right in front of Ayman al-Zawahiri there, from that moment, 12 days later it appears at this time at least, 12 days later getting it to Al Jazeera, who are not in Pakistan. They're across a body of water away. So the indications are they're able to do this relatively quickly.

HARRIS: And Nic, I don't want to read too much into this. I know that you'll be listening to the entire message and helping us sort it all out, but there is also the indication here. We have felt for some time that al Qaeda -- we've always asked the question is al Qaeda in control? Are they controlling operations?

And perhaps if they can turn tape around this quickly and get it to Al Jazeera, as you mentioned, in such a timely fashion, perhaps al Qaeda is in more control of the situation than maybe we give them credit for at this stage.

ROBERTSON: Well, certainly, they're very aware that whenever they release a statement like this then potentially it can lead back to them. And intelligence experts believe that bin Laden and Zawahiri tend to lay low in terms of communications because they could lead back to them.

But it does give an indication that they're in touch with the days' events, that they can reach out to the rest of their organization. It appears to be when they choose and how they choose to do it. They're able to make that determination themselves.

So it would raise questions about their involvement in everyday operations, but I think from what we see and from the accident we've seen around the globe in the last couple of years is that they're not really that involved in the day to day business but represent a very big psychological boost for the organization there. They appeared down two weeks ago, and now they come back with this. So for them it's important.

HARRIS: Yes. Well, first of all, Nic, great to have you here in Atlanta as this news breaks. And I know you're going to leave the set now and probably listen to the rest of this tape and help us sort it out. And just let us know if there's anything else in that tape that we should be made aware of. Nic Robertson for us here in Atlanta -- Betty.

NGUYEN: We'll be talking to Nic a little bit later on, as well.

Now, if you think you have heard everything about FEMA's response to Hurricane Katrina, you better think again. A Senate panel holds hearings this afternoon to review some surprising new information. Among the findings, the Interior Department offered trucks, boats and hundreds of officers for search and rescue missions, but FEMA didn't follow up. Homeland Security acknowledges that some federal assets went unused early on but says the agency is reviewing the problem so it can do better next time.

Enron's back in the spotlight with two key executives on trial. The search is on for enough impartial people in Houston to seat the jury. LIVE FROM will take you there just ahead.

(COMMERCIAL BREAK)

HARRIS: And again, this just in to CNN. Right now, airing on the Arab television network, Al Jazeera, is new videotape from al Qaeda's No. 2, Ayman al-Zawahiri. We've just had some initial analysis of this tape from CNN's Nic Robertson.

On the video tape, Ayman al Zawahiri references a number of incidents. First of all, the CIA air strike that was targeting him just a couple of weeks ago in Pakistan. Obviously, on this tape we get evidence of proof of life. He lists the name of the city where the attack took place, the region of the country and that 18 were killed.

We want to go to our national security correspondent, David Ensor, in Washington.

And David, here we are with another tape in just a matter of weeks from the No. 2 from al Qaeda, Ayman al-Zawahiri.

DAVID ENSOR, CNN CORRESPONDENT: Well, that's right. And Tony, U.S. intelligence officials had expected this tape. In fact, they were predicting it a bit sooner than it came.

Their view was that, once it became clear that Zawahiri had survived the attack by the CIA in northeastern Pakistan, that it would be al Qaeda's -- in al Qaeda's interest to try to exploit this failure as a propaganda advantage. So they expected a tape out very quickly.

Clearly, it took a little time to get reorganized. Zawahiri's team up there in that area, well, they lost some personnel. And he probably needed to make this tape and get it out in a careful fashion in order to make sure that he's not attacked successfully again.

But again, people -- the view of U.S. intelligence is likely to be today that this is what they expected, a confirmation that Zawahiri survived the last attack. What I think you can be fairly confident of, though and I'm sure Zawahiri is, that the attempt the other day will not be the last one.

Right now U.S. intelligence has been going on the offensive in the last six, eight weeks. They have attacked a number of times in the mountainous area in the northeast of Pakistan, knocked out an al Qaeda operations chief, they believed ,in one of the attacks and killed a couple of close associates of this man, Mr. Zawahiri, in the last attack. They didn't get him, though and, of course, he's now here to speak for it and to prove that.

As for the truce that he's talking about, that Osama bin Laden offered in the last tape, an audiotape from Osama bin Laden, that was viewed by U.S. government analysts as more aimed at the Arab world than at the United States. The truce offer was you get all your forces out of the entire region, you withdraw completely and we'll offer you a truce. In the view of U.S. government officials that's not a serious offer, Tony.

HARRIS: And David, you can help clear something up for me and I'm sure some of our viewers. There was a period in time right after the attack in Pakistan on this man that it there was some doubt as to -- there was some question as to whether or not he had actually been killed, had been killed in that attack. When was it clear to all the officials that you speak with that he had in fact survived?

ENSOR: For the first day or two they were still saying they thought they might have gotten him. The intelligence that he was going to be at this gathering, this Ede dinner that was being held in this house, was quite good, they said.

But then, within about I'd say 48, 72 hours, something like that they were confirming what Pakistani officials very quickly said which was that the Zawahiri had not shown up at the dinner, but others did apparently. So there was damage done to al Qaeda, but, of course, women and children were killed as well, unfortunately.

HARRIS: And you know, David, there's a sense that intelligence has an idea where this man is, but this attack a couple of weeks ago led to a lot of protests in Pakistan. Are there likely to be new further attacks in that region?

ENSOR: You know, it's a good question. Certainly the U.S. works closely with the Pakistanis. My understanding is that they would not conduct an attack without a head's up to the Pakistani authorities.

But since the Pakistanis are not able to get troops up and control this region -- it's a largely lawless tribal region. The view is increasingly, shall we say, impatience here in Washington. The Bush administration wants to show progress in its effort to go after Osama bin Laden and Ayman al-Zawahiri, and they're prepared to use missiles to do it if necessary.

They forewarn the Pakistanis. And it seems to me that the deal is, a wink and a nod a little bit, but the Pakistanis can protest and say they're against it, but in fact, these are enemies was Pakistani government, too, Tony.

We will continue to watch this tape that is on al Jazeera right now, the No. 2 for al Qaeda, Ayman al Zawahiri. David Ensor, national security correspondent in Washington. Thank you.

NGUYEN: Tony, north of the U.S. border all is safe and sound in Saskatchewan. Seventy-two miners trapped for more than 22 hours underground were all pulled out alive today in central Canada.

Fire broke out yesterday in a pot ash mine, trapping the men more than a half mile underground. Now, pot ash is a minimal used to make fertilizer and is not flammable. These miners, unlike the victims of recent coal mine disasters in America, were able to find safety in refuge chambers, which are stocked with oxygen, food and water. The cause of the fire, well, that's still being investigated.

It was the scandal that rocked corporate America and shocked everyone else. It cost thousands of jobs, wiped out thousands of bank accounts and 401(k)s, and today it is the subject of a federal trial in Houston.

Jury selection is underway in the case against Enron founder Ken Lay and former CEO Jeffrey Skilling. Our Ali Velshi is there. He's been watching.

Ali, what have you seen so far in the courtroom? What's the mod today?

ALI VELSHI, CNN CORRESPONDENT: Betty, it's very courtroomish in that there's not a whole lot of drama going on. There were 96 potential jurors brought in. They've got to pick 12 of those and four alternates. And they are going through that whole list.

But the judge in the case says he wants the jury picked today. He wants opening arguments tomorrow, and he wants evidence starting on Wednesday. But that's going to be what could be a four-month trial.

And like you pointed out, this wasn't just a corporate scandal. This is thousands of people, 4,000-plus people laid off at Enron, thousands, tens of thousands laid off at Arthur Anderson, the accounting firm that was responsible for this. So this is families and people all over the country affected. And that's part of the problem here.

Ken lay had said, and his lawyers had said, "We can't get a fair trial in Houston. This city was all about Enron. And how do they find a pool of jurors who might not be biased?"

We caught up with him on his way into court this morning and here's what he had to say about it.

(BEGIN VIDEO CLIP)

KEN LAY, FORMER CEO, ENRON: We'll see how it goes.

UNIDENTIFIED FEMALE: How are you feeling prior to this?

LAY: I feel fine. All we're hoping for today to pick a fair -- fair jury that will give me a fair shake. We'll be fine.

(END VIDEO CLIP)

VELSHI: Well, that's the thing. They've got to pick a fair jury. Part of the rush to get the jury that the judge has imposed, some of our legal analysts have said, well, that can play into the hands of the defense if they need to appeal this by saying what was the rush to pick the jury? This is a long trial. It's been four years since the bankruptcy of Enron. On trial, Ken Lay and Jeffrey Skilling. Ken Lay was the former chairman and CEO of the company, Jeff Skilling, the former president and CEO.

Their defense -- certainly Ken lay's defense is that he was a bad CEO. He didn't see what was going under him while people were looting the company. The prosecution is going to try and prove the fact that he was too smart a guy not to have seen what was going under him and that these two men knew what was going on and how much this company was being plundered from within.

That's what we're looking at right now. We're looking at having a jury in place, hopefully, by the end of the day and this trial getting underway first thing in the morning -- Betty.

NGUYEN: All right. But I've got to ask you about this. The judge wants the jury in place, but realistically, you've been in there. You said it's been going slowly. Do you think it's possible that they'll get a jury by the end of the day?

VELSHI: You know, they're taking these 96. They're dividing them up into groups of 12. They're walking up to talk to the judge in groups. The lawyers are there. They're having long conferences about the whole thing.

We do know that they've gotten through about 48 jurors of the 96 so far, and they've broken for lunch. So they're making some good time.

But this judge has said, he is known, Judge Sim Lake is known for punctuality and getting things done quickly. So if he says it's going to happen, I'll be around to make sure whether it does or doesn't, that we tell you about it.

NGUYEN: We'll be checking in with you to see if it does.

VELSHI: Yes.

NGUYEN: Ali Velshi in Houston. Thank you, Ali -- Tony.

HARRIS: In medical news now, backtracking in Iraq. The health ministry says a girl who died on January 17 did have bird flu after all. Earlier reports blamed her death on pneumonia.

The teen becomes the first official bird flu death in the Middle East. Tests are also underway on samples from her uncle, who died on Friday.

A spokesman for the Iraqi ministry says the area around Sulaymaniyah, some 25 miles west of Iran, is being cleansed of infected birds. Experts fear a bird flu outbreak in Iraq could be hard to control or monitor, given a lack of resources and wartime conditions.

The island nation of Cyprus, meanwhile, is reporting an outbreak of bird flu in poultry. A British lab con firms the presence of H5-N1 in the northern part of the island controlled by Turkey. Turkey itself has reported at least a dozen recent cases of bird flu in humans and four deaths. It's culled about 1 1/2 million birds to try and stop the disease from spreading.

The news keeps coming. We'll keep bringing it to you. That's Kyra's line. I like it. More LIVE FROM next.

(COMMERCIAL BREAK)

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