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Explosion at Chemical Plant in Morganton, North Carolina; News Conference on Deadly Postal Shootings in Goleta, California; Enron Trial

Aired January 31, 2006 - 13:59   ET

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

KYRA PHILLIPS, CNN ANCHOR: At the top of the hour we're straight to the newsroom. Betty Nguyen working a story. Still, that chemical explosion, raging fire taking place.
BETTY NGUYEN, CNN ANCHOR: Yes, the chemical plant exploded around 11:30 this morning. You've got to take a look at these pictures.

You can see big, black smoke billowing into the air. You can see fire still coming from what's left of the building. And to tell you how big of an explosion this is, a man living nearby, just about 200 yards away, said he saw a mushroom cloud. But, again, looking at these pictures, you can see there is not much left.

Let me tell you a little bit about what kind of a chemical plant this is. It's called Synthron Inc. It's French owned. And this is an area of Morganton, North Carolina, which is about an hour northwest of Charlotte.

This plant makes detergent, perfumes, air fresheners, fertilizers, cosmetics, glue, you name it. It really runs the gamut. And you can see why this was so explosive today and why there's so much smoke billowing into the air.

Now, the mayor of Morganton told me just a few minutes ago that several employees have been taken to the hospital by helicopter. He didn't know the exact number, but he said it was several of them.

This chemical plant is about 35 years old in this town of Morganton, which only holds about 18,000 people. So it's not a real big town, and there are few residential homes in the area, which is good news considering there is concern about the toxic fumes that could be released into the air because of this explosion.

But we are learning that firefighters are letting this simply burn out, letting the chemicals burn out. And they do have the fire contained.

But just look at the pictures here. Much of the building is gone. Simply gone.

And another bit of good news is that the firefighters working the scene, we're told by the mayor that many of them don't have respirators on. So that gives you an idea of the caution that's being taken. It doesn't seem like the fumes could be too bad at this point, but of course you definitely don't know at this time, when this plant makes so many different types of chemicals.

So we're going to stay on top of that and bring you the latest -- Kyra.

PHILLIPS: All right, Betty. Thanks so much.

Meanwhile, we're talking about homeward bound. ABC News anchor Bob Woodruff and photographer Doug Vogt are heading back to the U.S. The two left Germany aboard a medical transport plane this morning. They are expected at the Brain Injury Center at Bethesda Naval Hospital near Washington later today. They will receive further care for serious injuries from the roadside bombing that took place Sunday in Iraq.

Both men are said to be making good progress. Woodruff briefly opened his eyes overnight and responded to stimuli. We're told Vogt was sitting up and speaking.

Let's take you straight now to a news conference that's taking place in California regarding that shooting at the post office, seven people dead.

(JOINED IN PROGRESS)

SHERIFF JIM ANDERSON, SANTA BARBARA COUNTY, CALIFORNIA: ... on January 30, the Sheriff's Department, Goleta Valley Patrol Bureau, responded to a report of shots fired at the U.S. Postal Service distribution center at 400 Stork Road in the city of Goleta, California. Within several minutes of the initial call, more than five deputies had arrived on scene and determined that a suspect had entered the facility armed with a firearm and began shooting employees.

Five deputies formed a crisis entry team to address the situation. As they approached the front doors of the facility, they encountered two employees in the parking lot which had sustained gunshot wounds. Another victim was found outside the front door of the facility, and a fourth victim was found just inside the front doors.

Once inside the facility, the deputies heard no gunfire or any indication of further violence. Deputies focused their efforts on the safe rescue of victims of which had already succumbed to their wounds. In total, over 80 employees were safely evacuated from the facility by law enforcement personnel.

A county fire station across the street was used as a temporary shelter for victims. The Santa Barbara Sheriff's Department S.W.A.T. and Santa Barbara City Police S.W.A.T. teams were deployed and given the mission to locate the suspect and effect the rescue of any additional victims. During the search of the facility, S.W.A.T. teams encountered three additional subjects that were deceased, one of which had an apparent self-inflicted gun shot wound.

At 3:00 a.m. briefing, we had reported that we had found four deceased inside the facility. This was an error. Only three were found, one of which we believe to be the suspect.

In total, five employees of this facility were killed. We believe the suspect took her own life. And one employee is listed in critical condition at Santa Barbara Cottage Hospital.

Currently, the Santa Barbara Sheriff's Department is the lead agency investigating with the assistance from the U.S. Postal Inspector's Office, the FBI, and other state agencies. We have crime scene investigators processing the crime scene as we speak and detectives looking into the background of the suspect and possible motives for the incident.

The suspect's name is being withheld pending notification. She was an employee of the facility for -- over two years ago. According to witnesses at the scene, she was armed with a .9-millimeter pistol and reloaded at least once during her rampage. We have recovered that firearm.

The Red Cross has been assisting with the victims and the families of the victims, as well as our county mental health.

Again, I want to offer my sympathies to all who have been affected by this tragedy.

Randy from the U.S. Postal Inspection Service will come up next.

Good morning.

RANDY DEGASPERIN, U.S. POSTAL INSPECTOR: My name is Randy DeGasperin, a U.S. postal inspector. That's D-E-G-A-S-P-A-R-I-N. I represent the U.S. Postal Inspection Service which has the primary federal law enforcement jurisdiction in this matter.

And before I go further, I just want to also add our heartfelt prayers and condolences go out to families of the victims and to our employees who have suffered through this tragic incident.

The Los Angeles Division of the U.S. Postal Inspection Service has dispatched numerous inspectors to Goleta to assist in the investigations with the Orange County -- or with the Santa Barbara Sheriffs and other agencies that are investigating here.

I will now read the names of the victims.

The first one is Ze Fairchild, Age 37, hometown Santa Barbara.

The next is Dexter Shannon, age 57, hometown of Oxnard.

The next is Nicola Grant, age 42, Long Polk (ph).

The next, Guadalupe Swartz, age 52, also of Long Polk (ph).

Injured is Charlotte Colton. Her age is 44, hometown of Santa Barbara.

The last is Maleka Higgins, age 28, hometown of Santa Barbara. At this time, I'll introduce Don Smeraldi with the U.S. Postal Service.

DON SMERALDI, U.S. POSTAL SERVICE: Good morning, everybody.

I have a statement from the postmaster general of the United States, John E. Potter.

"It was with complete shock and sadness that I learned early today of the shooting of employees of the Santa Barbara processing and distribution center in Goleta, California. Our heartfelt prayers and condolences go out to the families of the victims and to our employees who have suffered through this tragic incident."

"At this time, law enforcement officials have notified the postal service that five employees were killed and a sixth has been hospitalized with injuries. Their families have been notified and professional counselors are available to the families and to other facility employees. The shooter, identified as a former Postal Service employee, also died, apparently from a self-inflicted gunshot wound."

"The Postal Service and the Postal Inspection Service are cooperating fully with local law enforcement officials in their investigation. I ask that you keep the families of the victims in your thoughts and prayers."

And that's what I have. And I'd like to introduce the mayor of Goleta, Jonny Wallis.

MAYOR JONNY WALLIS, GOLETA, CALIFORNIA: Good morning.

Let me start by sending the city of Goleta's condolences to the families and friends of these victims. An act of violence is always a shock to the soul, but especially in a small community such as ours, where our neighbors are our friends and where violence of any kind is extremely rare.

As the mayor of the city of Goleta, I want to acknowledge the rapid response by the Goleta police force. Within minutes after shots were fired, the Santa Barbara Sheriff's Department and their partners in the city of Goleta, the city of Santa Barbara, the Santa Barbara County Fire Department and the UCSB Police Department mobilized to ensure the safety of our surrounding community and the employees within the postal facility.

I would like to acknowledge the extraordinary efforts of individuals and agencies who worked throughout the night to ensure that our community was safe, protected and informed.

We as a community are extremely saddened by this act of violence. A day at the office should not result in death.

Our community stands together in prayerful solidarity with all whose lives are affected by this tragedy. The city stands ready to help in any way. Thank you.

PHILLIPS: Major Jonny Wallis, the mayor of Goleta, California, talking about the violence that shook that small area next to Santa Barbara. It has been a shock to the soul, remembering five postal workers that were killed by another female worker by a .9-millimeter handgun. That suspect working at that postal area, that sorting area, the facility in Goleta, still that name has not been released until proper relatives are notified.

Meanwhile, make a point to honor the five employees that were killed, Ze Fairchild, Dexter Shannon, Nicola Grant, Guadalupe Swartz, and Maleka Higgins. Charlotte Colton, the one survivor injured right now, in the hospital. We will keep you updated, of course, on her condition.

Meanwhile, you can watch the rest of this live news conference on CNN.com/pipeline if you want to follow what more is coming out of Goleta, California, after this gun -- gun woman, actually, opened fire on a sorting facility at the U.S. Postal Service in Goleta, California.

Well, his speaking style is slow, deliberate, sometimes intentionally vague, but Wall Street lived or died on his every word. Federal Reserve chairman Alan Greenspan chairing his final fed policy meeting before he retires almost two decades -- after almost two decades, rather, of fears full of inflation. Greenspan won support for an interest rate hike at his very first Fed meeting back in 1987. He will probably do the same thing again today.

We expect an announcement shortly. When it happens, we will have live coverage from the floor of the New York Stock Exchange.

The news keeps coming. We'll keep bringing it to you.

More LIVE FROM coming up next.

(COMMERCIAL BREAK)

PHILLIPS: And we've just been told the Federal Reserve has made the announcement on its decision on interest rates. Alan Chernoff standing by live from the New York Stock Exchange to tell us how this is going to affect everything.

(STOCK MARKET REPORT)

PHILLIPS: Well, we want to stay on the note of business news. As we continue to follow, of course, the fed rate hike, we're also talking a blockbuster trial of two formerly big-time executives. Both sides are having their say in the federal case against the former top bosses at Enron, a complicated case about accounting and accountability.

Our Chris Huntington is live outside the federal courthouse in Houston.

Chris, how are both sides doing so far in their opening statements?

CHRIS HUNTINGTON, CNN CORRESPONDENT: Well, Kyra, we heard from the government. And you said this is a complicated case about complicated accounting. The government's lawyer in his opening statement said, "We want to make this is a very simple case," saying to the jury that, frankly, this is just about two guys who lied, Jeff Skilling, the former CEO, and chairman Kenneth Kay, former chairman of Enron.

The story told by the government a very compelling story, pretty easy to follow if you connect the dots that they want you to look at. The struggle for the defense is to try to obscure those lines, and that's what Daniel Petreceli (ph), lawyer for Jeff Skilling, has been doing this morning. We will hear him wrap up his opening statements a little bit later.

Many, many lawyers are following this case closely. We caught up to one of them who was in the court today, and this is how he saw the events as they have gone so far.

(BEGIN VIDEO CLIP)

JACOB ZAMANSKY, SECURITIES ATTORNEY: The prosecution laid out a very compelling and very organized presentation that Lay and Skilling lied to investors, misled investors about the financial condition of the company when they knew it was in deep trouble. The defense started off slowly. They started explaining what a great company Enron was, how successful it was. But at the very end they started poking holes in some of the things that the government was talking about.

They said that there were tapes where Lay -- where Skilling was lying to investors. They said that was taken out of context. And if you look at it carefully, that there really were no lies.

So I think the proof is going to come down to what those tapes show

(END VIDEO CLIP)

HUNTINGTON: Now, Kyra, you heard him talk about the tapes. An unusual aspect of the opening statements so far is both the government and the defense played snippets of audiotapes of Ken Lay and Jeff Skilling speaking not only to their employees, but also to Wall Street analysts. And then, as you heard Jacob Zamansky say there, the defense is planning to run as much of that type as they possibly can in one part to show all of their defendants' -- all of their clients' comments in context, but also potentially just to kind of drag things out and sort of overwhelm the jury with information, again, in the effort of trying to poke holes in the prosecution's case -- Kyra.

PHILLIPS: Chris, just curious, you have covered WorldCom, Tyco, now this. How does it all compare, or does it?

HUNTINGTON: Well, I'm going to use a football analogy here, Kyra. Those cases were important. But those were the playoffs. This is the Super Bowl.

This is the case that the government has been working toward for four years. Enron, in a sense, was the first big, big corporate scandal. But it's taken the government this long to put -- put together the case against the two top guys.

And believe me, even though these cases are in theory unrelated, for the government, for the Justice Department, this is culmination of all that work, WorldCom, Martha Stewart, ImClone. It all is a continuance as far as the Justice Department is concerned.

They won't admit that freely, but the fact is this is a culmination of all that work. This is what they have been working towards. And this matters a lot to the government. It matters even more, frankly, to Jeff Skilling and Ken Lay, and perhaps most of all to all those folks at Enron and shareholders who lost all their money -- Kyra.

PHILLIPS: Chris Huntington. We'll keep checking in.

Thanks so much.

Straight ahead, the passengers aboard Flight 93 went down as heroes for what they did on 9/11. Mark Bingham was one of them. He fought the hijackers. And ahead on LIVE FROM, his mother joins me to talk about a new movie depicting that flight and why she's protesting new rules on airline security.

(COMMERCIAL BREAK)

PHILLIPS: Alice Hoglan knows all too well what can happen aboard an airplane. She was trained to know as a flight attendant more than 18 years ago. Then came the unthinkable.

On 9/11, two hijacked planes were flown directly into the World Trade Center towers. Another dove into the Pentagon. The fourth crashed in a Pennsylvania field. Forty-four people were on board that plane. One of them was her son, Mark Bingham.

Remember that name? He was one of the heroic men who fought the hijackers of Flight 93. Last night, A&E aired a movie about that dramatic deadly struggle. Mark's mother watched it.

She is in San Francisco to talk to us about it.

Good to see you, Alice.

ALICE HOGLAN, MARK BINGHAM'S MOTHER: Thank you. Thanks for having me.

PHILLIPS: Well, I can just imagine -- actually, I probably can't imagine what was going through your head and your heart when you saw that film last night.

HOGLAN: Well, I was lucky enough to get together with my sister- in-law Kathy (ph), my brother Vaughn (ph), my brother Lee. We sat down in the very room where all of those events transpired that were -- that were portrayed of us receiving the call from Mark at 6:44 in the morning, hearing him tell us that he loved us.

His message to us was, "I love you." He didn't tell us that he had moments before seen three or four people butchered before his eyes in the first class cabin of that United Airlines 757.

PHILLIPS: When you actually saw "Flight 93," this A&E special last night, you remembered what happened from a personal perspective. But was there anything else that you saw that you didn't realize happened that day?

HOGLAN: A&E deserves a lot of credit. David Gerber, David Craig, Delia Fein (ph), Nevin Shriver (ph), they have all done a remarkable job on this.

It has -- it was a tight-knit depiction of events on the ground and in the air. And yes, we learned quite a bit.

We learned how the controllers were trying to work through the problems. We learned about the interaction and the beautiful, sensitive, compassionate interplay between other Flight 93 family members talking to their loved ones in the air.

PHILLIPS: Alice, you mentioned that phone call you received from your son on that aircraft.

HOGLAN: Yes.

PHILLIPS: I just want to listen to a scene from the movie, and of course this is an actress playing you trying to call him back.

Let's take a listen.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE, "FLIGHT 93": Mark, this is your mother. Apparently it's terrorists, and they are hell bent on crashing the aircraft. So if you can, try to take over the aircraft. There doesn't seem to be much of a plan to landing the aircraft normally, so group some people and perhaps do your best to take control of it.

I love you, Sweetie. Good luck. Good-bye.

(END VIDEO CLIP)

PHILLIPS: Alice, I don't know how you got through watching that.

HOGLAN: Well, I had a lot of strength and support from my brother Vaughn (ph), my brother Lee, my sister-in-law Kathy (ph). People have been very supportive of us. I have really tapped the energy of all of America that has come forward to support us.

And I'm very grateful. I'm very grateful for the opportunity to stand with the Association of Flight Attendants as a former flight attendant and a mother who lost a son to terrorists on board Flight 93. I feel very strongly that the TSA should reconsider its recent relaxation of restrictions on such things as scissors and matches and wrenches and screwdrivers on board our flights.

PHILLIPS: I know you...

HOGLAN: If I can...

PHILLIPS: No, I was just going to say, you have been so active pushing for that. There's -- it made us think of the scene in the film where you see these terrorists with the box cutters.

HOGLAN: It's awful.

PHILLIPS: And it just brings to life -- you think, oh, it's just a small box cutter. But if you see this film, you see how many people were killed by these box culters.

HOGLAN: That's right. Nearly 3,000 people went to their deaths because 19 men were able to board four flights with nothing more than box cutters and small knives.

If I can give you a personal example of what a mistake it is to allow scissors and matches and tools on board, it means that the TSA is relaxing its grip on small items. It means that they are releasing their focus on things.

What happened to me before December 20, when the -- when the rules were relaxed, the TSA caught me unintentionally carrying this on board and took it away from me. I got it back.

When I flew last Thursday from out of San Jose to New York City, I didn't realize it until I got to my hotel room in New York, but I had unintentionally carried this on board. Think of the damage that this can do in the hands of a person who means to do us harm.

PHILLIPS: Was that in your bag? Was it...

HOGLAN: Yes. It was in my carry-on bag. I didn't...

PHILLIPS: They didn't even stop you?

HOGLAN: They didn't even know it was there. And it shocked me. It was folded up and much smaller, but my point is, if this had happened before the rules were relaxed, they certainly would have caught this because they caught this. But now they are complacent enough to let this go through. So we cannot afford to become less vigilant.

The United States government has a formidable job keeping us safe, and the terrorists only have to be right one time, and we have to be right 100 percent of the time, but that doesn't mean that we shouldn't continue to focus on small weaponry aboard our aircraft.

It is even worse now because the pilots are cocooned safely behind a fortified cockpit door, so the flight attendants have lost one more reserve to call on. They can't ask the pilots to come out to help them against an armed attacker in the cockpit. What a mistake it is then to allow those attackers to have wrenches, screwdrivers, scissors, and matches aboard our aircraft.

PHILLIPS: Well, Alice, I will tell you one thing that was not a mistake, and that is how your son reacted to what happened when he realized what was going on. I want to play this scene of him and others there when they stormed the cockpit. We all heard about this story. Let's take a look.

HOGLAN: Thank you.

(BEGIN VIDEO CLIP)

(SCREAMING)

(END VIDEO CLIP)

PHILLIPS: You can see your son. You can see these other men exactly from what you heard on phone calls to what we heard on tapes. Your son was a pretty amazing, strong and courageous man.

HOGLAN: Oh, I miss Mark. A lot of credit goes to Tom Burnett, Jeremy Glick, Todd Beamer and that little knot of guys who had the guts to come forward and fight with nothing more than their fists and seat belt extensions and coffee pots against armed murderers that they had seen bloody people before their eyes.

I'm very grateful of the life of Mark Bingham and the other beautiful men who fought with him. It was a real honor for me to be his mom.

PHILLIPS: Well, you raised that son, Alice. You raised him to be exactly how he was, and thank God that you were able to talk to him that -- just one last phone call.

HOGLAN: It was a real gift.

PHILLIPS: Alice Hoglan, we sure appreciate your time. I know it is not easy for you to talk about.

HOGLAN: Thank you.

PHILLIPS: But we lift your son up, and we remember. We will always remember what he did. And I know you are going to keep his spirit alive and his memory alive by doing exactly what you are doing. And you are fighting for the safety of all of us when we fly.

HOGLAN: We need to remember the lessons of September 11th. Thanks.

PHILLIPS: Alice, remember you and your son, Mark Bingham. Thank you, Alice Hoglan.

HOGLAN: Thank you for remembering Mark.

(COMMERCIAL BREAK) PHILLIPS: Son of an Italian immigrant and a long time New Jersey jurist is the nation's 110th Supreme Court justice.

(BEGIN VIDEO CLIP)

SEN. TED STEVENS (R), ALASKA: The ayes are 58, the nays are 42. The president's nomination of Samuel A. Alito Jr. of New Jersey to be an associate justice of the Supreme Court of the United States is confirmed -- majority leader.

(END VIDEO CLIP)

PHILLIPS: It was a nasty partisan battle that lasted exactly three months. In the end, all by one Senate Republican voted for Samuel Alito's confirmation, all but four Senate Democrats against.

Less than two hours later, Alito was at his new workplace, his wife by his side, taking the oath of office. Chief Justice John Roberts, himself a high court newcomer, officiated. Both men are expected to be front and center at tonight's State of the Union Address.

Upbeat, optimistic, and confident -- White House previews of President Bush's fifth State of the Union speech, now seven hours away in Washington. But one of the president's key audiences seems to be downbeat, pessimistic, and unsure.

We're talking about seniors. Mr. Bush knows he has to reach out, but will they meet him halfway? Our John King visited Scranton, Pennsylvania, to try and find out.

(BEGIN VIDEOTAPE)

JOHN KING, CNN CORRESPONDENT (voice-over): Coney Island, Texas Lunch, the busy grill signals the afternoon rush. It has been a Scranton landmark for 83 years now. Lucy Warner has worked here the last 20 and thinks anyone upbeat about the State of the Union isn't paying much attention.

LUCY WARNER, WAITRESS: Now, today, I have to get oil for the furnace, my heating oil. It's going to cost me about $350. That's right out of my pocket.

KING: Add in $400 a month for 10 different medications, and Social Security just isn't enough. So 69-year-old Lucy works 30 hours a week. She's worried about the economy and the Iraq war, and confused by that new Medicare Prescription Drug Benefit the president thought would help Republicans with elderly voters.

WARNER: No, I don't understand them. Now, my daughter went on a computer and she's trying to find out.

KING (on camera): Now, you seem to think that somebody needs to send them a message?

UNIDENTIFIED MALE: Correct. KING (voice-over): America's anxious seniors are one audience President Bush must reach if he is to rebuild his own political standing and help his Republican Party in mid-term Congressional elections where older Americans could be the decisive voting block.

Bill Keib is one of many elderly Bush voters, now disillusioned.

(on camera): What is different from the Bush you voted for and the Bush you see now?

BILL KEIB, SOUTH SIDE SR. CENTER MEMBER: I don't know. He seems like a changed person altogether to me. He's got no whoomph in him, or no nothing no more. He's like half dead.

KING (voice-over): Of course, Bill and his friends at the South Side Senior Center won't see Mr. Bush on a ballot again. But any president standing impacts the success of his party.

And a little time here tells you why Republican strategists are so distressed. Worried, for example, a sour mood among elderly voters could cost the GOP a Senate seat and two or three House seats just here in Pennsylvania alone.

UNIDENTIFIED MALE: In God we trust, but in hospitals, never.

KING: Just 20 percent think the new prescription drug benefit is working. More than half, 56 percent of elderly Americans, call the Iraq war a mistake.

JOHN TULOSCHETSKE, SOUTH SIDE ST. CENTER MEMBER: Is it right? Is it wrong? I mean, we're there. We're stuck.

KING: Only 43 percent approve of how Mr. Bush is handling his job; and just 35 percent of those over 65 plan to vote Republican for Congress, well below the 48 percent Republicans have averaged among elderly voters the last three elections.

CHET PACINI, SOUTH SIDE SR. CENTER MEMBER: Looking for big business, but they're not looking out for the smaller person.

KING: This is a generation that remembers guaranteed pensions, when prayer before meals was routine. And it is a generation that votes, making their sense the country is off course all the more important, and troubling to the majority of Republicans, because the elderly make up an even higher percentage of the vote in mid-term elections, when overall turnout slumps.

That raises the State of the Union stakes for a struggling president, whose hopes of a political rebound rest in part on quickly changing his luck in here.

UNIDENTIFIED MALE: D-12.

KING: John King, CNN ...

UNIDENTIFIED FEMALE: Bingo! KING: Scranton, Pennsylvania.

(END VIDEOTAPE)

PHILLIPS: And this just in, we're getting word that the Senate has approved Ben Bernanke to succeed Alan Greenspan as the Fed chairman. This coming to us right now, right across the wire.

As you know, this is considered the most influential economic policy job in the world. Bernanke, 52, was cleared on a voice vote about a short debate in the chamber -- or after a short debate, rather, in the chamber amid strong bipartisan support.

He succeeds 79-year-old Alan Greenspan. You know, Greenspan was the second longest serving chairman at the Central Bank. Now Ben Bernanke, the man in charge, the new Fed chair.

President Bush gives his fifth State of the Union address after arguably the worst year of his presidency. Will his words help his standing in the polls or hurt?

Let's crunch some numbers with Frank Newport, editor-in-chief of Gallup. Frank, the State of the Union is the biggest speech a president gives each year. How much of an impact can it have on his approval ratings?

FRANK NEWPORT, EDITOR-IN-CHIEF, GALLUP: Well, Kyra, we've gone back and looked at previous presidents and looked at the pre and post- State of the Union approval ratings. And our bottom line conclusion is, in more instances or not, it has very little effect one way or the other.

Let's look at Bush himself for some examples. Back in 2002, his ratings were very high. Pre and post, however, they stayed virtually the same. Same thing in 2003. That pre and post-State of the Union address in January, that year, no impact. Last year, his approval rating after the speech went up a little, from 51 to 57. That was contemporaneous, however with the Iraqi elections, so we're not sure if that was the speech itself.

A couple of interesting historical examples. Bush's father had a really critical State of the Union address back in January of 1992. He had been promising voters for many months that he would in that speech give his outline for how to cure the economy. It had no effect. His pre and post-State of the Union job approval ratings didn't move at all. Of course, he lost the election.

One place where an address did have a big difference, Kyra, was Bill Clinton, 1968 (sic). Revelations were out about Monica Lewinsky. He spoke about the economy. His approval rating shot up by 10 points. That's a good example of where a speech can make a difference. But on the average, they don't seem to move the needle very much at all.

PHILLIPS: So how does the public view the State of the Union now? NEWPORT: Well, not great. As you said a minute ago, this is probably the worst situation the president has seen since he took office back in Jan of 2001. Satisfaction with the way things are going? 35 percent, down from a high point of 65, you can see, when he spoke in January 2002.

Now, the president has some strengths. No doubt he'll play off of these tonight. At least a slight majority of Americans do see the president as doing a good job handling terrorism and also as a strong and decisive leader.

However, look at this laundry list in our recent CNN/"USA Today"/Gallup polls, Kyra. These are issues and dimensions on which well under 50 percent of Americans give a positive rating to the president. He's going to have to address the economy and healthcare and others tonight. We will see how he does when the dust clears -- Kyra.

PHILLIPS: Frank, thanks so much.

And stick with CNN tonight for complete State of the Union coverage. We'll start with a preview at 7:00 Eastern with Wolf Blitzer and Paula Zahn, hosting a special edition of "THE SITUATION ROOM." That's followed by live coverage of the president's speech at 9:00 Eastern. Then Anderson Cooper brings you reaction at 10:00. Larry King hosts an hour of insight and analysis at midnight.

A supermodel questioned by police, and Oscar buzz. Academy Award nominations are out. We've got all your entertainment news straight ahead. Stay with us.

(COMMERCIAL BREAK)

PHILLIPS: Straight to Betty Nguyen in the newsroom working for a story for us -- Betty.

NGUYEN: Yes, Kyra. Remember when the band Great White took to the stage in 2003, a fire broke out. We're learning more about the fallout from that fire. The manager of the band Great White, Daniel Biechele has agreed to plead guilty to 100 counts of manslaughter and serve no more than ten years in prison. That's a plea agreement that was made today. Daniel Biechele, along with the nightclub owners, are charged with 200 counts of manslaughter.

Let me give a little history about what happened. There's a picture of Daniel Biechele right now. On February 20 of 2003, the band Great White began to play and then pyrotechnics went off. Now, flames started crawling up the clubs' wall in the back of the band. A lot of the concert-goers -- and you're seeing some video of it right now -- thought that this was part of the act. They started cheering.

But then they realized this fire started to spread, and then panic broke out and there was a lot of pushing and shoving. People ran toward the exits, many of them getting trampled in that, a lot of them not making it out of the building. Now, again, 100 people were killed in that fire, along with one of the band members. And today we have learned that the manager of the band Great White -- his name is Daniel Biechele -- has agreed to plead guilty to 100 counts of manslaughter and serve more than -- no more than ten years in prison. Now, this formal plea will be entered next week. Mr. Biechele was not in court today, but you can bet he will be next week. There's another picture of him. So that's the latest on the fallout from that fire -- Kyra.

PHILLIPS: All right. Betty Nguyen, thanks very much.

Well, a huge day in Hollywood. Oscar nominations announced this morning, and our Sibila Vargas was there -- Sibila.

SIBILA VARGAS, CNN ENTERTAINMENT CORRESPONDENT: That's right, Kyra. At the crack of dawn this morning in Beverly Hills, California, we found out who may be the newest Oscar winners at the 78th Annual Academy Awards. I'll have all the details when LIVE FROM continues.

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PHILLIPS: There are lots of sleepy people in Hollywood today. Some of whom also pretty disappointed. Others are really happy. Academy Award nominations came out early this morning. CNN Entertainment Correspondent Sibila Vargas joins me with an eye opening look of this year's competition.

VARGAS: Hey there, Kyra. I was there this morning I'm not that sleepy. It is invigorating.

PHILLIPS: It is an exciting time for you.

VARGAS: Absolutely. The Oscar goes to well, we don't know who the Oscar winners are yet, but we found out this morning who is in the running.

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UNIDENTIFIED FEMALE: Best Picture nominees for 2005 are

VARGAS (voice-over): A controversial love in "Brokeback Mountain," the story of author Truman Capote in "Capote." Issues of race explored in "Crash." Journalism takes McCarthyism in "Good Night and Good Luck." And terrorism and its aftermath in "Munich."

The Oscar lineup in the Best Picture category is filled with films that highlight some contentious issues.

TOM O'NEIL, COLUMNIST, THEENVELOPE.COM: This year Oscar voters are sending political and social messages unlike anything in recent Oscar history.

VARGAS: In the Best Actress category past Oscar winners Judi Densch of "Mrs. Henderson Presents" and "North Country's" Charlize Theron are joined by first time nominees Keira Knightley for "Pride and Prejudice," Felicity Huffman for "TransAmerica" and Reese Witherspoon for "Walk the Line." Reese's co-star, Joaquin Phoenix, is up for Best Actor along with "Capote's" Philip Seymour Hoffman, "Brokeback Mountain's" Heath Ledger, David Strathairn for "Good Night and Good Luck," and break-out talent Terrence Howard for "Hustle and Flow."

TERRENCE HOWARD, ACADEMY AWARD NOMINEE: This is the most incredible moment of my life.

VARGAS: With three individual Oscar nominations, another star having an unbelievable year, George Clooney. For "Good Night and Good Luck," Clooney is nominated as Best Director and along with Grant Heslov, Best Original Screenplay.

GEORGE CLOONEY, ACADEMY AWARD NOMINEE: I've never been to the Oscars. It should be a fun night. I'm excited about that.

GRANT HESLOV, ACADEMY AWARD NOMINEE: I have never even watched the Oscars. For me it is fantastic.

VARGAS: Clooney's third nomination, Best Supporting Actor for "Syriana." Other supporting actors acknowledged with nominations include Matt Dillon, Paul Giamatti, William Hurt and Jake Gyllenhall.

Fellow "Brokeback Mountain" cast member, Michelle Williams received Best Supporting Actress nomination as did supporting Actresses Amy Adams for "Junebug," Catherine Keener for "Capote," "North Country's" Frances MacDermond and Rachel Weiss may continue her award-season winning streak for her work in "The Constant Gardener" at the Oscars.

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VARGAS: By the way, George Clooney scored an Oscar first with his nominations today. This is the very first time in Academy history that a nominee in the directing category is also nominated in one of the acting categories. He co-starred in the drama "Syriana" and was at the helm for "Good Night and Good Luck," which by the way he also received an Oscar nod for co-writing.

The envelope will be opened on Sunday March 5th on ABC. Kyra, I'm keeping my fingers crossed for my favorite Steven Spielberg, who got a Best Director nod and Best Picture contender for "Munich." Kyra, any favorites?

PHILLIPS: I thought you were going to mention George Clooney again.

VARGAS: OK. I'm not over him

PHILLIPS: Just checking. I know Patrick Dempsey still in there too.

This is just the wrong awards.

VARGAS: Exactly.

PHILLIPS: Thanks, Sibila.

She dumped the bad boy boyfriend, spent time in rehab, then partied in Paris. Today Kate Moss finally talked to British police about the headline grabbing alleged cocaine sniffing incident caught on tape last September. ITV's Keir Simmons has the latest from London.

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KEIR SIMMONS, ITV NEWS (voice-over): Kate Moss was driven from her police interview in a silver Mercedes. Through the blacked out windows, our camera caught a glimpse of her. She stared straight ahead as she was driven away.

The 32-year-old model appears to have chosen the time she would meet detectives. Scotland Yard says she attended the interview voluntarily. Since the pictures of her seemingly taking cocaine, she's had a remarkable comeback, even sending up the incident in this phone advert. The police say she has not been charged or cautioned, and the inquiries continue.

PAUL GILBERT, CELEBRITY LAWYER: We don't know what the evidence is they have got against her, but if it is simply that photograph that appears on the front page of a newspaper last year, it's not a lot. It's certainly not enough to back up prosecution against her for either possession or supply of cocaine.

SIMMONS: It's thought Kate Moss may have already left the country tonight. The reality is this scandal has done little to dent her image in the fashion world. Keir Simmons, ITV News.

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PHILLIPS: They were special guests of the president and first lady at last year's State of the Union, a Texas family grieving the loss of a son killed in Iraq. We'll meet the Norwoods again when LIVE FROM continues.

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