Return to Transcripts main page

Live From...

ExxonMobil Reports First-Quarter Profit of $8.4 Billion; Iranian Opinion Towards Americans?; FEMA Changes

Aired April 27, 2006 - 15:00   ET

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

FREDRICKA WHITFIELD, CNN CORRESPONDENT: One eight, one four, and eight -- count them -- eight zeros. Put them together, and you have got $8.4 billion, the first-quarter profit reported today by ExxonMobil, the world's biggest oil company.
It is sure to heat up debate over who is responsible for soaring gas prices, but the oil industry says it is not being greedy. It says the price spike comes from supply and demand. So, what can be done to get prices lower?

Let's bring in Ali Velshi from New York.

If there was a simple answer, I imagine we would have this problem fixed, right?

ALI VELSHI, CNN CORRESPONDENT: Well, there is a simple answer. You can walk or take the bus or carpool.

(LAUGHTER)

WHITFIELD: OK.

VELSHI: Or do things like that.

The other -- the -- sort of the more serious issue that I think we need to think about is that we have not had a new refinery in this country for 30 years.

WHITFIELD: Mmm-hmm.

VELSHI: Fred, we talked about this a little bit earlier.

The -- it's very hard to get a new refinery. So, what happens is, we use all the gas that all of the refineries in this country produce. And, as a result, it's -- you know, we have a finite commodity coming out of those refineries. And there's -- there's competition to get that gas, which is why the price of gasoline, not just oil, the price of gasoline is creasing.

So, we sort of try to find out what it takes to build a new refinery. Well, it takes a lot. It takes local permits, state permits, EPA testing. And, in fact, not many people want to do this, because it takes years and years to get this.

We spoke to a company in Arizona called Arizona Clean Fuels, who has been at this since 1989, trying to build a refinery. They got -- they have finally been given approval, at least on the local and state level. They think that, if they get this thing going, they will have a refinery that can process 150,000 gallons of gas a day by 2010.

So, it's -- you know, that -- it -- it takes four years to build a refinery. It's probably hundreds of millions -- at least $100 million to build -- build a refinery. And nobody really wants to do that.

But either we need to create more gasoline or we need to use less gasoline. That's pretty much the only way you're going to see lower gas prices. At least for next few months, we are not seeing lower gas prices, because demand increases over the summer -- Fred.

WHITFIELD: Right. And -- and we're not necessarily seeing from people who are being asked while they are at the pump whether they are really changing their habits. The majority of folks still need their cars. They still need the gas. Not everyone is in a position like in the city like yours...

VELSHI: Right. Right.

WHITFIELD: ... where public transportation is just so much more accessible.

VELSHI: That's exactly right.

So -- so, that means that we have to, on one level, start really emphasizing the technologies that will -- will replace or reduce the amount of gas that we use in cars, whether it's a shift to hydrogen or those hybrids, or new fuel economy standards, just getting our fuel -- our cars more fuel-efficient.

WHITFIELD: But that's a ways off, isn't it?

VELSHI: Well, it could be tomorrow.

WHITFIELD: I mean, there are few hybrids available now...

VELSHI: It could be tomorrow if...

WHITFIELD: ... but people are not going trade in their vehicles, you know, tomorrow or next week, right away.

VELSHI: I -- I don't know what the price is that's going to cause people to do that. Is it $3 a gallon? Is it $3.50 a gallon...

WHITFIELD: Right.

VELSHI: ... on an ongoing basis?

I got to tell you, I mean, I -- we all drive -- those of us who drive, we make those choices. It wasn't a compelling decision for me to get a car that was much more fuel-efficient. But I got to tell you, if I were buying a car today, for the amount that I drive...

WHITFIELD: Right. You be thinking... (CROSSTALK)

VELSHI: ... I would reconsider that.

WHITFIELD: Right.

VELSHI: I would really do that.

WHITFIELD: Hmm, interesting.

VELSHI: It's the consumer's dollar that -- that talks, right? If the consumer is tired of paying $3...

WHITFIELD: Yes.

VELSHI: ... and -- and higher for gas...

WHITFIELD: Yes.

VELSHI: ... they will make a decision to -- to spend less on gas.

And, you know, as we buy less of the gasoline, the -- the pressure comes off. The prices could come down.

WHITFIELD: But, bottom line, it sounds like we're talking about long-term fixes...

VELSHI: Sure.

WHITFIELD: ... not necessarily short-term ones.

VELSHI: For the next few months, you can expect it.

WHITFIELD: So, everybody has to be comfortable -- uncomfortable for a bit longer.

VELSHI: That's absolutely right. And it might get more uncomfortable, because the prices only go higher. Listen, we have got to worry about hurricane season.

WHITFIELD: Mmm.

VELSHI: We have to worry about outages at those refineries, because they are running at 100 percent capacity. They have to come down for maintenance, or repairs, or getting struck by lightning, like we saw, or fires, like we saw last year. All of that puts pressure on the price of gasoline. Fasten your seat belt.

WHITFIELD: Yes.

VELSHI: It is going to be quite a ride, Fred.

WHITFIELD: We are in for a bumpy ride.

VELSHI: Yes. WHITFIELD: All right, thanks so much, Ali.

VELSHI: OK.

Well, while Congress and the nation fume over fuel prices, one small county in southern Texas is taking action. Bee County, population 33,000, it's planning a boycott.

Angela Vierville of CNN affiliate KSAT has that story.

(BEGIN VIDEOTAPE)

JUDGE JIMMY MARTINEZ, BEE COUNTY, TEXAS: Well, it's time to stop. It's time to stop and get some good, clear answers to the American people, and particularly to my county.

ANGELA VIERVILLE, KSAT REPORTER (voice over): Bee County Judge Jimmy Martinez is passionate about a new resolution just passed by county commissioners asking for a boycott of ExxonMobil, to begin on May 1, and last until a gallon of gasoline costs $1.30 or less.

MARTINEZ: I want to know, you know, why people are getting in the millions for salaries and bonuses, when, look, I have got people in my county that can't even travel to Corpus Christi to get services, health services.

VIERVILLE: Martinez is referring to a $400 million retirement package given to an Exxon executive and record-breaking oil company profits.

UNIDENTIFIED FEMALE: The summer's coming up and you can't, you know, go on vacation, because it's so outrageous.

VIERVILLE: But the three Beeville convenience stores carrying Exxon gasoline are locally owned. Owner Leticia Munoz (ph) says such a boycott won't bring down the cost of gasoline, but only hurt their small business.

UNIDENTIFIED FEMALE: We are independent. We are not affiliated with ExxonMobil. Therefore it's not going to -- they won't probably even know that this is going on down here.

(END VIDEOTAPE)

WHITFIELD: And that was Angela Vierville of CNN affiliate KSAT. She reports that Bee County officials are encouraging other counties to join in their boycott.

More heartrending details of the Sago Mine disaster from the only man alive who knows. In a letter to the families of his co-workers, Randal McCloy says at least four of the air packs the miners were depending on to save their lives did not work.

He says he and the other men were forced to share the air packs that did work, as they battled to avoid suffocation. The mine's owner, International Coal Group, says federal investigators tested the air packs and found them in working order. McCloy was the only survivor among 12 miners trapped in the West Virginia mine last January.

In his letter, he describes watching his friends die -- quoting now -- "The last person I remember speaking to was Jack Weaver, who reassured me that, if it was our time to go, then God's's will would be fulfilled. As my trapped co-workers lost consciousness one by one, the room grew still, and I continued to sit and wait, unable to do much else" -- still quoting now -- "I have no idea how much time went by before I also passed out from the gas and smoke, awaiting rescue."

Well, whether it's labeled a hate crime or a sex crime, what happened to a Texas teenager last weekend was a violent crime, by any standard. The teen lingered in criminal condition today, while his alleged attackers, two older teens, faced a judge.

Some of the details in this case are unspeakable.

CNN's Ed Lavandera is in Houston with more -- Ed.

ED LAVANDERA, CNN CORRESPONDENT: Hi, Fredricka.

Well, we are closely monitoring the situation of the 16-year-old victim in this case, who prosecutors and -- and investigators say has a 50/50 chance of surviving what they say is a brutal, heinous attack over the weekend.

There are two men in custody, an 18-year-old and 17-year-old here in -- in the Houston area -- and this is the northern suburb of Spring, Texas -- who police say started beating the 16-year-old up at a -- at a party, stomping on his head with steel-toed boots.

And, then, the worst part of the attack is what has apparently caused the -- the most injuries to -- to this 16-year-old victim. They say that a -- he, the -- the young man was sodomized with a PVC pipe, and that it was kicked into him, rupturing and -- or causing internal damage to his vital organs inside his body.

And that is why this teenager is in criminal condition. The two -- two teenagers so far have been arrested and charged with aggravated sexual assault. But investigators say they will waste no time in filing capital murder charges, which, in the state of Texas, comes with the death penalty if convicted, if -- if this 16-year-old victim were to die, that they will immediately file capital murder charges against them.

One of -- one of the suspects, the 17-year-old, was in -- in court today. His name is David Henry Tuck. He did -- he did not say anything before a judge. It was just a -- a very preliminary hearing. The other suspect is expected to make a court appearance in the next -- in the next few days as well.

But they say that the -- the victim was also -- that the attack had happened at 11:30 at night, and that no one at this party that they were at had bothered to call the authorities until 10 hours later. It wasn't until almost 10:00 the next morning that police -- 911 was called, and then an ambulance was sent out to -- to help the young man.

WHITFIELD: Oh. Well, a lot of things went wrong here. And, Ed, what was the justification that these suspected are using?

LAVANDERA: Well, that's what we're trying to get to the bottom of right now.

Authorities say what -- what they have said so far is that the 16-year-old boy had made an attempt to kiss a -- a younger girl at this party, and that this angered a couple of the -- the other members at this party, and that they -- because of that, they dragged him out to the backyard and started beating -- to beat him up.

Authorities have also said that, in -- in the course of all of that, that the two suspects who were beating up the -- the 16-year-old victim that they had were -- were yelling racial epithets -- racial epithets at a -- at the -- the young victim. And, so, there -- there's a slight -- a little bit of -- of a racial aspect to the story.

However, because of these charges, prosecutors say it's very unlikely that hate crime charges will be -- will be filed, because what they already have on them on the books carries the -- the stiffest penalty. So, they will -- they will stick with those charges.

WHITFIELD: Horrible and disturbing all the way around.

Ed Lavandera, thank you so much for that report.

LAVANDERA: Thank you.

WHITFIELD: Operation Falcon II, clipping the wings of wanted sex offenders -- as we told you earlier, the Justice Department today announced results of a weeklong effort, targeting fugitives across 27 states. More than 1,000 sex offenders are among more than 9,000 criminals and suspects rounded up. The U.S. attorney general calls it a big success.

(BEGIN VIDEO CLIP)

ALBERTO GONZALES, ATTORNEY GENERAL: For the week beginning April 17, more than 9,000 fugitives were arrested, and more than 10,000 felony warrants were closed.

The Marshals Service, joined by many federal, state and local partners, targeted the worst-of-the-worst fugitive felons in the country. Among those arrested were more than 1,100 fugitives wanted for committing felony sex offenses or violent sexual assaults or for failing to register as sex offenders.

(END VIDEO CLIP)

WHITFIELD: The operation was patterned after an effort last year that focused on fugitives wanted for violent crimes. Still to come: FEMA's future. Should the nation's disaster agency be ditched? We will discuss what some people want to do about it.

The news keeps coming. We will keep bringing it to you -- more LIVE FROM next.

(COMMERCIAL BREAK)

WHITFIELD: Well, take a look at that. Remember, just less than an hour ago, we told you about the search out on the West Coast in the Westlake Village area of Los Angeles, the search for a bear?

Well, there's new video right there. That happens to be the bear that they are looking for, apparently because it's very close to a fairly populated area. We don't know any more about the circumstances, as to, you know, why they are looking for this bear, if it's just because someone sighted it and because it got into something and has made somebody mad. But that's the latest video right now of the bear romping around in that high grass, tall grass there in the Westlake Village area, outside of L.A.

Now on to our "Security Watch" -- changing times at airport checkpoints. Earlier last year, the Transportation Security Administration announced, screeners would spend more time on serious threats and less time sweating the small stuff. That appears to exactly what happened.

The number of passengers fined for carrying banned items fell 54 percent last year. These days, traveling is -- or, rather, travelers committing minor infractions are more likely to get warnings.

FEMA, too flawed to fix? That's the conclusion of a Senate committee which recommends ditching the disaster agency, creating a new one, and giving the new director a direct line to the president in times of disaster.

A short time ago, Homeland Security Chief Michael Chertoff spoke with students at George Mason University in Virginia.

The moderator, CNN special correspondent Frank Sesno, who is also a professor at George Mason.

And, Frank, before we get to you, let's hear what Chertoff had to say about today's FEMA headlines.

(BEGIN VIDEO CLIP)

MICHAEL CHERTOFF, HOMELAND SECURITY SECRETARY: Clearly, we have a circumstance now where the name FEMA has made its way into "Jay Leno" or "David Letterman." And if, at the end of the day, slapping a fresh coat of paint on makes people feel we have, you know, done something different, I don't know that I'm going to march up San Juan Hill to fight that.

But I think the substance is -- is the important thing. And the important substance we have done is used the kind of 21st century tools that are available to start rebuilding and enhancing the organization that we have.

(END VIDEO CLIP)

WHITFIELD: And, so, Frank, did you or people there get a sense that he was very candid or rather cautious?

FRANK SESNO, CNN CONTRIBUTING CORRESPONDENT: Both.

I mean, I think there were times when he was actually very candid. Clearly, he knows he's got a problem. But Michael Chertoff, he picks his words very carefully.

WHITFIELD: Yes.

SESNO: And he did that here, too.

When he said, "I'm not going to march up San Juan Hill," you know, that was about the name FEMA. But the fundamental charge, you know, that Susan Collins made, the senator from Maine, the Republican senator from Maine, that -- that FEMA is discredited, dysfunctional, and demoralized, you know, he doesn't really buy into that.

He says: We're rebuilding it. But I thought it was very interesting he said: I'm not going to march up San Juan Hill to fight the name change, if that's what people really want.

The fact is, it goes deeper than a name change. This business about where it's going to get its authority, how it's organized is -- is really a -- a pretty big disagreement. He's going to try embrace what -- what he's on board with, and they have done some of that.

WHITFIELD: And I remember hearing his response to your question, when you really were citing that there is criticism saying that this agency is discredited . He said that, yes, there were problems, but don't blame the employees. Instead, blame that many of the tools that are at their access just were simply not used.

SESNO: That's right.

I mean, we know what went wrong, whether it's radios. But, you know, he -- he -- it was very interesting. I mean, he had some very harsh words for Michael Brown, the former FEMA director. And I know you have got that in your back pocket.

But he also said, one of the big messages now is that people are going to have to be more responsible for what is happening in their own lives. And that was in response to a question I asked him about, if another Katrina slams into New Orleans now, a year later, with all the problems they have got, is there going to be any New Orleans left to tell the story?

And he said, you know, yes, because some of it is still above sea level -- not much.

WHITFIELD: Right.

SESNO: But what he's really also trying to do is say, hey, you know, folks, you have got some responsibility in your own future here.

WHITFIELD: Well, you prompted it. Let's hear, more specifically, what Chertoff had to say about the chain of command.

(BEGIN VIDEO CLIP)

CHERTOFF: One of -- one of the main criticisms, one of the startling criticisms, and one of the most unfortunate criticisms, to come out of this report is the insubordination by the -- by the then head of FEMA.

And the lesson there is, when the then head of FEMA decided to go outside the chain of command and operate like the lone ranger and try to call into the White House, what he did is, he deprived himself of all of the tools of the department.

(END VIDEO CLIP)

WHITFIELD: All right. And there he is, explaining.

SESNO: Well, what -- yes. What he's trying to do -- and it's very interesting and very smart, politically, but also an important message -- is, he's trying to personalize this, that this was about leadership and, in particular, it was about Michael Brown.

And he is saying that, if it happens again, if there's another hurricane, A, we have learned from our mistakes, but, B, the chain of command will work this time, because there are better people. And he's saying, effectively, I'm in control.

WHITFIELD: Mmm-hmm.

SESNO: So, you know, he's -- he's putting himself out there. We will see if he delivers, if they really have the problem.

WHITFIELD: All right. And you also asked him, hurricane season just over a month away. This is what he had to say.

(BEGIN VIDEO CLIP)

CHERTOFF: We have identified in advance those people who will be representing the federal government on the ground. We have gotten together with the governors and the emergency managers. And they are working together, training and exercising together.

We have built a communications capability now that would let us put people into the field who could be eyes and ears for the leadership of the department. We have created a -- an emergency communications capability we can put into the field if all of the regular communications go down.

SESNO: So that what happened last time, where the mayor is not able to talk to anybody because everything is down, that won't happen again?

CHERTOFF: Right. That -- that -- right. We have now got the tools in place to prevent that from happening again.

(END VIDEO CLIP)

WHITFIELD: So, he's trying to convince coastal states, officials, jurisdictions, that there will be no repeat.

SESNO: You heard it here first, you know: We have got the tools in place, so that won't happen again.

And that's as direct as he can be. He needs to be that direct, because, as -- as we know from the Senate report and all this other discussion, there's a gigantic crisis of confidence in FEMA and in the Department of Homeland Security, and the -- and the United States government to do what needs to be done in an emergency to save lives, get people out of harm's way.

WHITFIELD: Well, it looks like you had pretty close to a full house there with that conversation with Michael Chertoff. Very interesting.

Thanks so much, Frank.

SESNO: Yes, it was fun. And I -- I -- I...

WHITFIELD: Yes.

SESNO: And I did ask him if he's going anywhere. He says he doesn't plan on going any place.

WHITFIELD: Uh-huh.

SESNO: He's not planning to quit.

(LAUGHTER)

WHITFIELD: Staying put. All right, thanks so much, contributing correspondent here for CNN and also a professor there at George Mason University. I know your students love you.

SESNO: Well, I don't know about that. It all depends...

WHITFIELD: Oh...

SESNO: ... on how they grade.

WHITFIELD: ... I'm sure they do.

(LAUGHTER)

WHITFIELD: It's so rare that a college instructor is also still, you know, in the business and -- and, you know, cranking it out with his craft. And it's good to talk to you. And I know the students there appreciate what you do. SESNO: It's good fun.

WHITFIELD: All right. Thanks, Frank.

Well, hear what Michael Brown has to say about it all. The former FEMA director who resigned under fire for all the government miscues after Katrina joins Wolf Blitzer in "THE SITUATION ROOM." That's at 7:00 p.m. Eastern, right here on CNN.

Well, perception is reality. That's why Aneesh Raman hit the streets of Tehran to find out what Iranians think of Americans. I will speak to him live next.

The news keeps coming. We will keep bringing it to you on LIVE FROM.

(COMMERCIAL BREAK)

WHITFIELD: A day before the U.N. deadline for Iran to stop enriching uranium, Iran's president told a crowd, no one can make Iran give up its nuclear technology. Mahmoud Ahmadinejad also said the U.S. and its European allies would regret any effort to -- quote -- "violate the rights of the Iranian nation."

Enriched uranium can be used to make fuel for power plants. It also is used in concentrated form for warheads.

CNN's Aneesh Raman is reporting from Iran this week. He joins me now from Tehran -- Aneesh.

ANEESH RAMAN, CNN CORRESPONDENT: Fredricka, good afternoon.

A standoff seems to be brewing. Iran, a day ahead of that deadline, as you say, is show nothing indication it will suspend its civilian nuclear program. Today, the country's president, Mahmoud Ahmadinejad, said essentially that again, as you mentioned, warned against any action.

Iran is saying, if the U.N. takes any action on the country because of what it says is a peaceful civilian program, the U.N. will lose all credibility and Iran will cease cooperation with the U.N.'s nuclear watchdog.

Meantime, the U.S., through the secretary of state, Condoleezza Rice, said, if the U.N. doesn't take action, it will lose credibility in the Americans' mind-set. So, essentially, it is hard to see how any diplomatic dialogue can exist within those two parameters. Tehran is showing no indication that its nuclear program is on the table.

The only thing they are willing to discuss is allowing inspectors into the country to make sure they don't veer off that civilian nuclear path towards a weapon -- Fredricka.

WHITFIELD: And, so, Aneesh, you have hit the streets. You have talked to a lot of people there, ordinary citizens. What does the typical Iranian citizen seem to think about Americans or the American government? Do they see them as one in the same?

RAMAN: They do not, by and large.

Amid the rising rhetoric between U.S. and Iranian officials, we went to talk to the average Iranian on the streets of Tehran. By and large, those we spoke to and those who would speak to us -- it was about 50/50, those who choice not to speak and those who did -- said they separate the American government from the American people.

They had only laudatory things to say about Americans as a whole. There are, though still remnants of a sordid past between the U.S. and Iran. A big mural hangs just off a main highway here that says, "Down with America," an American flag that has bombs and skulls.

Also, one man we spoke to said that he does think, when it comes to the government, death to America, but separates it, again, from the American people -- Fredricka.

WHITFIELD: So, then, what does that mean about what they think about President Bush?

RAMAN: Well, it's interesting.

Many of them lump President Bush, of course, as a figurehead of the American government that they are antagonistic towards. But there was one man we spoke to off camera who said that he liked President Bush, because he had gotten rid of Saddam Hussein. Of course, Iran had an eight-year war with Saddam Hussein, where many were killed, not big fans of Saddam here.

But, then, when we turned the camera on, he didn't want to say that, because of the political pressure that exists here today. So, it's tough to tell exactly what the Iranians are thinking when they speak to us. But, in terms of President Bush, aside from that incident, by and large, they said he is a man pushing the antagonism against Iran from the world community -- Fredricka.

WHITFIELD: Aneesh Raman, in Tehran, Iran, thank you so much.

Gunmen in Baghdad shot and killed a sister of Iraq's new vice president today, just two weeks after the vice president's brother died the same way. Police say four attackers in a BMW opened fire on Maysoon al-Hashimi and her driver. And both were killed.

Just yesterday, Tariq al-Hashimi, a prominent Sunni, held a news conference to call for an end to insurgent violence.

Well, it's a refreshing movie about an 11-year-old girl, but it has a lesson for all of us.

(BEGIN VIDEO CLIP, "AKEELAH AND THE BEE")

KEKE PALMER, ACTRESS: When I put my mind to it, I can memorize anything. And I don't need help from a dictatorial, truculent, supercilious gardener.

(END VIDEO CLIP)

WHITFIELD: Whew, with a sharp tongue at that. "Akeelah and the Bee" is inspiring audiences everywhere. I will talk with actor/producer Laurence Fishburne and his co-star, Angela Bassett, straight ahead.

(COMMERCIAL BREAK)

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com