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Ports Deal to Get Second Look; New Orleans Celebrates Mardi Gras; American Prisoner Possibly Endangered in Afghan Prison Riot

Aired February 28, 2006 - 13:00   ET

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

KYRA PHILLIPS, CNN ANCHOR: Hello, everyone. I'm Kyra Phillips. you're watching LIVE FROM.
Depending on your point of view, the timing couldn't have been better or worse, just as a Senate Committee sits down to eyeball a deal to turn over operations at six U.S. ports to an Arab company. Stern warnings surfaced from the Coast Guard.

CNN senior national correspondent John Roberts has more.

(BEGIN VIDEOTAPE)

JOHN ROBERTS, CNN SR. NATL. CORRESPONDENT: It was the last thing administration officials wanted to see as they briefed senators on the new, upcoming security review, a document from the Coast Guard warning of many intelligence gaps concerning the potential for DPW, or P&O assets, to support terrorist operations that precludes the overall threat assessment of the merger.

For the chair of the Senate Homeland Security Committee, it was a huge red flag.

SEN. SUSAN COLLINS (R), HOMELAND SECURITY CMTE. CHAIR: ... that it involves potential unknown threats against a large number of potential vulnerabilities. That language is very troubling to me.

ROBERTS: Officials who had previously said no one raised objections about the deal insisted that the extra security assurances Dubai Ports World gave put the Coast Guard's worries to rest.

CLAY LOWERY, ASSISTANT TREASURY SECRETARY: In this case, the concerns you're citing were addressed and resolved.

ROBERTS: Even so, senators demanded a classified briefing to more fully understand what happened. The closed hour and a half long session seemed to assure them of one thing.

SEN. SUSAN COLLINS (R-ME), CHAIR, HOMELAND SECURITY COMMITTEE: I am more convinced than ever that the process was truly flawed.

ROBERTS: The new 45-day investigation will begin almost immediately after DP World files a new application. Fourteen government agencies, led by treasury and homeland security, will oversee the review. The director of national intelligence will coordinate intelligence gathering on the company to determine any further possible security concerns. When the investigation is complete, the president will have an additional 15 days to give a thumbs up or down in the deal. At the moment, only the president can make that decision, though Congress may introduce legislation to give it final approval.

PATRICK MULLOY, INTERNATIONAL TRADE LAW EXPERT: It's been a disaster for the president, and it's been a disaster, I think, for the United States.

ROBERTS: International trade expert Patrick Mulloy helped write the original law and can't believe the government fail to do what he said should have been a mandatory security review before the original ports deal decision. He's urging the administration to get a fresh start.

MULLOY: I hope that they feel within themselves the strength to say, "We should not be prejudging this. Let's do the investigation and see where it leads us."

ROBERTS: But will the administration do that? Listen to the president's national security adviser.

STEPHEN HADLEY, NATIONAL SECURITY ADVISER: The president's very clear as to where he stands. He thinks there's been a good process. He thinks that there are not outstanding national security concerns that need to be addressed and that this -- this deal needs to go forward.

ROBERTS: The company, DPW, is confident of a positive outcome. In a statement, saying, "The review will confirm that DP World's acquisition does not pose any threat to America's safety and security. We hope that voluntarily agreeing to further scrutiny demonstrates our commitment to our long-standing relationship with the United States."

(END VIDEOTAPE)

PHILLIPS: John Roberts joins us now live from Washington with the latest twist.

John, good to see you. Let's talk more about just this review period and what members of Congress hope to accomplish as we wait this out.

ROBERTS: It's pretty clear that members of Congress want to be involved in this process. They at least want to be in the loop, if not participating in their own review of this particular deal.

And certainly the law provides for that. They say that the law says that there was nothing that would preclude the relevant committees in Congress and members of Congress from hearing about what the government finds as they undertake this 45-day review. So they want to make sure that they're in the loop on this.

PHILLIPS: All right. So long-term changes, members of Congress just want to be part of this process every step of the way, right? ROBERTS: They do. And in the future, you know, they're not sure whether the CFIUS process is relevant in the post-9/11 world. Don't forget that the original committee was struck in 1975. That was during the Cold War. And any changes that were made to it were well in advance of 9/11.

So there's a question, should treasury still be the lead agency on this, or should it perhaps be the Department of Homeland Security? And Senator Susan Collins, at a hearing on Capitol Hill this morning asked, is it right that the intelligence community does not have a permanent seat on this committee?

So it looks as though Congress is heading down the road of perhaps writing some new legislation to change this process, to make it more relevant in the post-9/11 world.

PHILLIPS: Now Dubai Ports World, of course, the company we've all been talking about for weeks now, are we hearing anything more from the company?

ROBERTS: Well, the company is saying that it is doing everything that it possibly can to try to satisfy Congress that this is the right deal to do.

In the meantime, they've split off their American operations to a subsidiary company. They say that they won't make any changes in the deal as it sits right now with P&O Ports being in charge and Americans being in charge of the ports until at least May the 1st.

But Susan Collins said it yesterday when she came out of this classified briefing with homeland security officials. She said this process is deeply flawed. And she said she wouldn't be surprised if, at the end off the process, the administration changes its mind about this whole deal.

PHILLIPS: Well, you know we'll stay on the story. John Roberts, by the way, welcome aboard. It's great to have you with us. We look forward to more of your reports in our program.

ROBERTS: It's good to be here. Thank you, Kyra, for that welcome.

PHILLIPS: All right. You bet, John.

Well, as lawmakers scramble for seats on political life boats, the president refuses to abandon ship. Meeting today with Italy's prime minister, Silvio Berlusconi, Mr. Bush repeated his belief that the Dubai Ports deal poses no security threat to the U.S.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: My position hasn't changed to my message to the Congress, and I appreciate the fact that the companies concerned have asked the Congress for a review of all the security implications. Now, let me make something clear to the American people. If there was any doubt in my mind or people in my administration's mind that our ports would be less secure and the American people endangered, this deal wouldn't go forward.

The -- and I can understand people's consternation, because the first thing they heard was that a foreign company would be in charge of our port security. When, in fact, the Coast Guard and customs are in charge of our port security. I mean, our duty is to protect America, and we will protect America.

(END VIDEO CLIP)

PHILLIPS: Coming up at 2:30 Eastern, the Senate Commerce Committee takes a closer look. We're going to keep an eye on that and bring you the latest as it happens.

Happy Mardi Gras from New Orleans. It's in the blood. And today that blood is thicker than Hurricane Katrina's floodwaters. The party's in full swing. Not even the worst natural disaster in U.S. History can stop the good times from rolling.

Live pictures right now, right above Bourbon Street. Sure, the crowds there are thinner on this Fat Tuesday, and beads alone won't rebuild the city, but this is no ordinary city, as we well know.

Our Sean Callebs can testify from Bourbon Street.

Hi, Sean.

SEAN CALLEBS, CNN CORRESPONDENT: Good afternoon to you, Kyra. Indeed, you can see Bourbon Street coming to life. It's only, what, noon here. So pretty good crowd out here for this time of day.

Earlier today, I was out on St. Charles down in Napoleon where the start of the Rex Parade was scheduled to make its way through there. It was great to watch those crowds just fill the streets. It was chiefly families out there. A lot of smiles. Everybody had ladders out there, trying to get the best view.

And of course, everybody wants the beads. Kyra, it is all about the beads.

We'll take you to a live picture looking down Bourbon Street. You can see periodically there are groups that just camped up, looking straight up. Well, that's because these hotels with these very distinct balconies, of course the tourists hang over there reward those people who are faithful down there, begging for the beads.

But it has been an absolutely gorgeous day here today. The weather could not be better. Mardi Gras this year has gone off extraordinarily well. There have been no real problems except for one parade, Endymion, having to be postponed for 24 hours because of some rain on Saturday.

In the past this is an event that brought in about $1 billion for this city. It's not going to bring in anyway near that much this year. Best estimates from the visitors and tourism bureau, maybe $200 million. But it's what is going on here that really can't be measured in dollars and cents.

People who have been toiling for six months now, almost six months to the day, trying to rebuild after the worst natural disaster of the U.S.

Kyra, we'll throw it back to you. You can see things out here are really going well.

PHILLIPS: Well, Sean, stay with me. I also hear things are going well. Rex is rolling, you know, founded in 1872, this is the king of carnival. It's one of the biggest parades, of course, one of the most famous.

And our dear friend Susan Roesgen, the first woman rider in the 135-year history of Rex, is on that float. Yes, there she is.

Susan, give us a feel for it.

SUSAN ROESGEN, CNN CORRESPONDENT: Kyra, it's so loud up here, I can barely hear you. But you're right, I am the first woman officially in the 135-year history of Rex, in the Rex parade. I say officially, because they say in years passed, some of the guys would maybe pull up a girl from the street.

But it is an incredible tradition for CNN to have the first woman ride the entire parade. As someone who lives here, for me personally, seeing this parade from the ground before, it's an honor to be here.

Also something different, this year the king of carnival has decided to let the mayor of New Orleans toast him with champagne at the hall and gives him the keys to the city. The king of carnival has decided to call for a moment of silence and then the bells will ring out at St. Patrick's Cathedral to honor all the people who lost their lives in the hurricane -- Kyra.

PHILLIPS: Susan, we had trouble there with your mic for just a few seconds, and so I caught the part about the moment of silence. I want to get back to that in just a second.

But you were talking about the fact that you are the first woman rider in the 135-year history of this parade since it's rolled. How did you get the gig? What does it feel like? And why do you think -- how did it happen?

ROESGEN: Well, it happened because we asked. It happened, I think, because this is post-Katrina, and saying that it was an incredible break in the tradition for CNN to be allowed to have the first woman on a Rex float for the entire length of the parade.

They say in years past, some of the guys might pull a pretty girl off the street and have her ride for a block or two, but this is the first time they've actually allowed a woman to ride the entire length of the parade. And for me personally, as someone who's always been down on the ground, only watching this parade, it's a wonderful thing, a real honor, and something I don't expect to be able to do again, Kyra.

PHILLIPS: Well, you know, a lot of viewers might be saying, well, why couldn't they have had women on this float in the past? Give a little texture to the history of this krewe, Susan, and how this is a big deal.

ROESGEN: Well, Kyra, this is an all-male carnival krewe. As you mentioned, it is -- it was founded in 1872. I think what's interesting about that, Kyra, is it was founded by a group of local businessmen in 1872 to give the city a boost after reconstruction in the Civil War.

And so once again we're looking at this Rex parade in the year 2006 to be part of the Mardi Gras that we hope will give a boost to the city of New Orleans post-Katrina.

PHILLIPS: Oh, Susan this is bringing back great memories. I know exactly where you are. And it's just giving me chill to watch this. Are you going to throw some beads for us? Let's see if we can...

ROESGEN: I've got some beads.

PHILLIPS: Yes.

ROESGEN: Listen, my technique -- my technique is not very good. You're supposed to throw gently to the children first and with a little bit more energy to the people in the back. Now I've seen signs that say, "Hey, you throw like a girl." That's, of course, an insult to the guys. I say I am a girl. So here we go. Let's see, all right.

Happy Mardi Gras.

Now, I've got to tell you, Kyra, this is something I think folks should know, the riders on these floats buy all the beads themselves. They pay for the construction of the float. CNN is contributing to the rebirth of the local economy by providing me with $440 worth of beads, and we've definitely gone through about half of them already.

And also, I want to let you know that the guys on the floats -- I asked for a show of hands earlier. About half of the 22 guys on this float had floodwaters in their homes. The floats themselves were flooded. So no one has forgotten what's happened in New Orleans, but this is a way to try to help the city recover and have a good time.

PHILLIPS: Susan, introduce me to the man behind you. Do we know who he is and what his story is?

ROESGEN: Yes.

PHILLIPS: Tell me about him.

ROESGEN: This is the float sergeant Bob Akum (ph). He controls the people on this float.

Bob, you having a good time today. And you told me earlier...

UNIDENTIFIED MALE: Oh, great.

ROESGEN: ... that you think the crowd is about what it was in a normal Mardi Gras.

UNIDENTIFIED MALE: This is a normal -- almost a normal sized crowd, but the parade route is shorter, so they're more concentrated on the avenue here.

ROESGEN: Now Bob, you're one of the guys who had floodwater in his home.

UNIDENTIFIED MALE: Oh, yes, yes.

ROESGEN: And you're here today.

UNIDENTIFIED MALE: Oh, yes, we're hoping to get back soon!

ROESGEN: OK. We'll let you get back to throwing.

Kyra, I'm going to throw some more and we'll talk to you later.

PHILLIPS: That sounds great. Susan Roesgen there, riding -- rolling out with the Rex crew there, right down St. Charles. Pretty awesome to see this. The first time ever, it's historical. First woman rider, our Susan Roesgen, in 135-year history of that krewe. We'll check in with her a little later.

Well, it's strange to think that the biggest party of the year in New Orleans, if not the nation, a testament to excess and debauchery. Well, it has its roots in religious tradition. Here's the facts.

(BEGIN VIDEOTAPE)

TONY HARRIS, ANCHOR (voice-over): Fat Tuesday marks the last day before the Christian season of Lent begins on Ash Wednesday. It's a day of celebration, giving party-goers the opportunity to enjoy their favorite foods before the 40 days of fasting and sacrifice leading up to Easter.

Some even refer to the day as Pancake Tuesday. That's because pancakes are made to use up all the fat, eggs and dairy before fasting begins. Fat Tuesday is also known as Shrove Tuesday, from "to shrive," or hear confessions.

Mardi Gras ends the carnival season, which begins the 12th night of Christmas. Worth noting, carnival comes from Latin words meaning "farewell to the flesh."

(END VIDEOTAPE)

PHILLIPS: And once again, live pictures of Fat Tuesday celebrations in the French Quarter. Our Sean Callebs is there reporting for us. Stay with us for continuing coverage of Mardi Gras. We're live from the Rex Parade route once again with our Susan Roesgen later this afternoon. And we've got a number of special guests including Harry Connick Sr., New Orleans Police Chief Warren Riley, and entertainer Chris Owens. Don't go away.

And just because you have to work doesn't mean that you can miss a minute of the action. Watch all the Mardi Gras festivities right at your desk. CNN Pipeline will have a live web cam on Bourbon Street, and it's free all day today. A Mardi Gras to remember, coverage you'll only find on CNN.

(COMMERCIAL BREAK)

PHILLIPS: Tracking all the severe weather for you. Jacqui Jeras talking about a tornado warning.

Jacqui, what do you know?

(WEATHER REPORT)

PHILLIPS: All right, Jacqui, thank you so much.

Fighting, killing and allegations of rape at a prison Afghanistan. A 24-hour truce is shattered. Police open fire on inmates trying to push down a gate. One inmate is killed, three wounded.

Five inmates have been killed since that rebellion broke out Saturday in Kabul, the Afghan capital.

Journalist Tom Coghlan once again is there. He joins me by phone.

Tom, why don't you give me the latest with regard to this negotiation process. Why has it hit a brick road -- or hit a road at this point?

TOM COGHLAN, CORRESPONDENT, "THE DAILY TELEGRAPH: Well, the negotiations appeared to break down late today about 6 p.m. local time. That's when prisoners, as you said, tried to break out of one of the blocks that they've been controlling for the past three days.

As you say, one inmate was killed when police opened fire on those prisoners, at least three injured. Now, the death total five, in just 41 -- in the past three days.

It's a pretty precarious situation in the prison, again, now, and there are these reports of sexual violence towards women prisoners in the prison. Those are unconfirmed. The government is denying that they've taken place. But army officers that are on the scene have told me this evening that they believe that some women within the prison have been raped by other prisoners.

PHILLIPS: Are U.S. troops city getting involved and to what capacity, Tom? And what is being done to try to get these women separated from these men, if, indeed, these attacks are taking place? COGHLAN: Well, U.S. forces -- U.S. soldiers have been present in a very discreet, low-key capacity, throughout this, this prison siege. They've been offering advice to the Afghan authorities, but they're very keen to stress -- and I spoke to a couple of these officers yesterday. They're very keen to stress that this is an Afghan operation. This is an Afghan government problem and that the Afghan government is doing, they say, a very good job of dealing with it.

They say that this low-key approach, this refusal to try and storm the building, try and storm the prison, when there are so many prisoners in there -- I mean, there's approximately 1,900 prisoners involved in this riot. With so many prisoners there, they say it's just too dangerous to take them on at this stage, that it would be chaos and potential for huge loss of life. So at the moment, they're favoring this low-key negotiated approach.

PHILLIPS: Now Tom, you were telling me yesterday about 1,900 prisoners in this jail, or in this prison. Members of al Qaeda, other types of criminals. You mentioned the women, also, in this prison.

There are also at least three Americans that we know of that are in this prison. Back in September, these were the three Americans that were found guilty by an Afghan court about -- for torturing Afghans in a private jail there in the area. What do we know about -- know about those three Americans in this jail?

COGHLAN: Well, there were conflicting reports about what's happened to these three Americans. These three Americans, one, Jack Idema, former special forces -- American special forces operations officer. As you say, he was running this illegal prison, torture facility in Kabul, sent down for five years by an Afghan court.

He had two accomplices, Brent Bennett (ph) and a freelance journalist, in fact, called Edward Caraballo, who were imprisoned for shorter sentences with him.

Now, according to officers at the prison, Jack Idema and Brent Bennett (ph) are safe, and they are not -- they're not being held by these prisoners. They haven't been taken hostage.

The same is not the case with the Edward Caraballo, according to these Afghan national army officers. They say that Edward Caraballo is in the hands of the prisoners, who are involved in this revolt. But they also say that, to the best of their knowledge, he hasn't been harmed at this stage.

Now, these are all reports coming from army officers, Afghan army officers on the scene. The Afghan government is refusing to comment on the situation, as is the U.S. embassy. They're declining to comment in any capacity on the state of these American prisoners who were held in Policharki Prison.

PHILLIPS: Now Tom, you mentioned Edward Caraballo, that journalist, the one of three Americans in that jail. You say that the word you're getting is that Caraballo is being held against his will there, possibly by some of these prisoners. Our Anderson Cooper actually worked with him at ABC News, and we are being told that Edward Caraballo contacted Anderson Cooper. Anderson was able to do an interview with him just a short time ago. We want to listen to some of that, and I want to get your reaction.

(BEGIN VIDEO CLIP)

EDWARD CARABALLO, PRISONER: The gates are all open. The prisoners are all walking around, heavily armed with chains and knives and whatever they -- they have to fight. And they're afraid that the police are going to storm in and kill more people.

So today -- I had been -- I had been walking a thin line, Anderson, because everybody -- all the prisoners know I have a mobile. I've been letting whoever -- whatever prisoner, call their family to let them know they're OK. And I've been able -- so I've been able to keep my mobile. They sort of see me as one of them, so -- because I'm Muslim, so they haven't bothered me. But they've said it's nothing personal, you know, we know you are brother, but we want to talk to the American ambassador.

ANDERSON: What do you want people to know, Ed?

CARABALLO: Well, I want people to know that -- I don't know. I just want to -- I would say to the American forces or any -- or the Afghan forces that they should not storm the prison at this point. The prisoners just want to get their message across, and they've asked me to do that for them.

(END VIDEOTAPE)

PHILLIPS: Now, Tom, what's interesting, I hope you could hear that OK, but Caraballo evidently has a cell phone with him and that these individuals are saying to him that they're not going to hurt him because he is Muslim.

What's your take on this? I guess, first of all, how is he able to have a cell phone with him in this prison? And do you think he will be treated differently, considering the -- possibility, that he's American, that he's Muslim, and that he is seen as differently when compared to these other different types of prisoners?

COGHLAN: Yes, well, first of all, in relation to the cell phone, Caraballo and the two other American prisoners were held in a separate area of the prison. They had considerably better conditions and facilities available to them in the area where they were held. They had satellite television. They also had access to the Internet. In fact, Jack Idema runs a rather detailed web site from his cell block.

But the point by Caraballo is that, according to my information, he's been trying to distance himself from those two others, Idema and Brent Bennett (ph) for the past few months, and he asked to be moved to an separate area of the prison. He's been trying to identify himself more with the other Afghan prisoners. And it is clear that he has converted to Islam. This is information I'd heard from Afghan national army officers on the scene, as well. They were saying that other prisoners had shouted across to them, saying that Caraballo says he is a Muslim, that he is one of them.

And so whether he's in danger or not, I mean, obviously, I can only speculate. But clearly, the fact that he hasn't been harmed this far, up to this point, is good news for him.

And prisoners were shouting across to the authorities yesterday, saying that Caraballo was in their possession, that if the authorities did try and storm the prison, than he might be endangered, that his life might be forfeit if the police opened fire on them.

It's a very difficult situation. And clearly, U.S. embassy officials have been shuttling back and forth to the prison today and yesterday. I'm told that that's in an attempt to negotiate his release.

It's a difficult one to call at the moment. But clearly, he is in the hands of these prisoners and we must hope that he's released.

PHILLIPS: Tom Coghlan with "The Daily Telegraph." Tom we appreciate your daily reports and keeping us informed.

In medical news now, dead ducks in Sweden, a dead cat in Germany. The U.S. tells France "hold the chicken," and bird flu gets the blame. Swedish health officials can't confirm what's killing wild ducks south of Stockholm, but Sweden's agricultural board calls it an aggressive strain of bird flu.

Germany is blaming H5N1 for killing a cat on an island where scores of wild birds were infected. It's the first confirmed case of mammal infection in Europe but old news in Asia. A Thailand zoo lost several tigers and snow leopards after feeding them chicken carcasses. Scientists don't yet know whether infected mammals can pass the virus to people.

And the U.S. chicken is out, France, sort of. Though it's said to be impossible to get bird flu from properly cooked poultry, the U.S. is suspending all poultry imports from the region where the deadly virus turned up last week.

Has bird flu reached the Bahamas? Well, Reuters reports health experts are being summoned to the island of Inagua, where more than a dozen flamingos and several other birds have been found dead the past few days. The island is the world's second largest breeding ground for flamingos outside of Africa.

A Bahamian official says that he's never seen such a large number of bird deaths at one time.

The news keeps coming. We'll keep bringing it to you. More LIVE FROM after a break.

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