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'USA Today': Secret Program Amassing Record of All Calls; Priest Convicted; Tax Cut Reality Check

Aired May 11, 2006 - 14:00   ET

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

KYRA PHILLIPS, CNN ANCHOR: New revelations of homeland surveillance and another defense by President Bush on tactics in the war on terror. He was responding today to a claim (ph) over a reported government database of almost every phone call in America, yours included.
With more on the story, CNN's Elaine Quijano. She's covering President Bush today in Biloxi, Mississippi -- Elaine.

ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: And Kyra, President Bush is on his way here to Mississippi. He'll be delivering the commencement address here at Mississippi Gulf Coast Community College. This is a college that was battered by Hurricane Katrina nine months ago.

But back in Washington, questions swirling on a different issue, the NSA's domestic surveillance program. That is a program, of course, reported in "USA Today" that the government is now collecting the phone records of tens of millions of Americans.

President Bush today wasting no time in pushing back against the story. Before he left Washington, he spoke briefly about the issue, insisting the program is lawful and protects Americans' privacy.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The privacy of ordinary Americans is fiercely protected in all our activities. We're not mining or trolling through the personal lives of millions of innocent Americans. Our efforts are focused on links to al Qaeda and their known affiliates.

(END VIDEO CLIP)

QUIJANO: And the president took no questions. He spoke for just a couple of minutes before heading off to board Marine One and travel down here to Biloxi, Mississippi. But the president's quick response certainly a sign that the White House is perfectly willing, in fact, eager to engage on this issue.

This is a program that the White House has dubbed the "Terrorist Surveillance Program," and the political calculus here is that this is an issue that the White House feels it has the public support on. And if Democrats try to challenge this too much and go too far, it will simply show them as being weak on national security. National security, of course, an issue that the Bush administration has traditionally been very strong on -- Kyra.

PHILLIPS: Elaine Quijano in Biloxi, Mississippi.

As soon as the president gives that commencement speech we will take that live.

Well, you don't need a secret database to know this is a talker on Capitol Hill. And with that part of the story, Congressional Correspondent Andrea Koppel -- Andrea.

ANDREA KOPPEL, CNN CONGRESSIONAL CORRESPONDENT: Kyra, the reaction here on Capitol Hill has been fast and furious. The Republican chairman of the Senate Judiciary Committee, Arlen Specter, immediately saying that he's going call for hearings on this issue. He's going to call up some of the heads of the major telecommunications companies who reportedly were involved in this program.

You've also had, of course, Democrats pouncing on this issue. You've had some raise questions as to whether or not the Bush administration again sees itself as being above the law. Others saying Congress is supposed to be all about oversight, rehashing the issues that we've been hearing about for the last number of months. Then again, you've had some Republicans like Jon Kyl saying, come on, guys, don't overreact, let's put things in perspective.

(BEGIN VIDEO CLIP)

SEN. JON KYL (R), ARIZONA: This is nuts. We are in a war, and we've got to collect intelligence on the enemy. And you can't tell the enemy in advance how you're going to do it. And discussing all of this stuff in public leads to that.

(END VIDEO CLIP)

KOPPEL: Now the question, of course, on many minds is, what will the impact of this story be on the nomination of General Michael Hayden to head up the CIA? Confirmation hearings are supposed to happen next week before the Senate Intelligence Committee.

General Hayden has been up here knocking on doors, making courtesy calls, but also facing tough questions as to whether or not -- not only is he going to be able to keep some sort of objective distinction between his military background and heading a civilian agency like the CIA, but also questions about his role in developing that controversial NSA warrantless wiretap program, defending it, also when the White House asked him to go out there.

So you've had people like Dianne Feinstein, who just met with General Hayden yesterday and actually was seeming to indicate she was favorably disposed to his nomination, today sort of raising question marks about that.

(BEGIN VIDEO CLIP)

SEN. DIANNE FEINSTEIN (D), CALIFORNIA: I happen to believe we're on our way to a major constitutional confrontation on Fourth Amendment guarantees of unreasonable search and seizure. And I think this is also going to present a growing impediment to the confirmation of General Hayden. And I think that is very regretted.

(END VIDEO CLIP)

KOPPEL: One footnote to all of this, Kyra. General Hayden was supposed to be up here on the Hill again. He was supposed to be meeting with, among others, Senator Rick Santorum of Pennsylvania, but Senator Santorum's office says the meeting -- they were just called by the White House this morning to say the meeting was off, no explanation given. Obviously, reading between the lines there, the White House concerned that if General Hayden were to come up here, then folks like us would have an oppojunity to ask him some pretty tough questions -- Kyra.

PHILLIPS: Andrea Koppel on the Hill.

Thanks, Andrea.

And will that controversy connect with the rest of the country? Keep in mind President Bush's approval rating is at a personal low.

Let's bring in Bill Schneider, our senior political analyst.

Quick reaction by the White House, almost immediately, Bill.

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: That's right. They clearly saw some political damage here, and they wanted to try to nip it in the bud.

The president, in his remarks, insisted that there was no eavesdropping on conversations, they're just collecting data about phone calls that were made from one number to another, but they did not eavesdrop on any conversations. And he also pointed out so far we've been very successful, the president said, in preventing another attack on our soil, meaning that's the major justification for this program.

PHILLIPS: And Bill, everybody's been chiming in since this broke. And just recently, we heard from Senator John Kerry. Let's take a listen. I'll get your response.

SCHNEIDER: OK.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D), MASSACHUSETTS: We witnessed the CIA being bullied by the Rumsfeld Pentagon and the Cheney White House into shredding its credibility with unfounded claims of slam-dunk intelligence from mythical evidence of weapons of mass destruction. Now that the president has tapped the chief defender of his warrantless wiretapping program to become CIA director, we need to demand a full and vigorous debate over the nomination of Michael Hayden to head this wayward agency.

(END VIDEO CLIP)

PHILLIPS: I'll tell you what, Bill, those confirmation hearings are going to be pretty interesting.

SCHNEIDER: They are indeed. And, you know, this is Washington. And people here suspect that the leak of this information to "USA Today" had a lot to do with the Hayden confirmation hearings. It may have been done by someone who wanted to complicate those confirmation hearings and throw an extra issue into that debate, in which case they succeeded.

This issue that was revealed today is different from the warrantless wiretapping that was revealed last December. These are domestic telephone calls, and those the president defended by saying they were calls involving people suspected of terrorist activities. These phone call records are of ordinary Americans.

On the other hand, the president said there was no eavesdropping, no one listened to the conversation. It's just a record of what phone calls were made.

So this debate is going to be even hotter now.

PHILLIPS: Senior Political Analyst Bill Schneider.

Thanks, Bill.

Missed opportunities, mass casualties. The U.K. House of Commons reveals intelligencing agents knew of two men who took part in last summer's deadly bombings in the London underground, but a new report concludes that agents were more focused on what's described as other known plans to attack Britain. The investigation reaches no conclusions about what, if any, role al Qaeda played in the suicide attacks that killed 52 people.

It was a brutal crime on Easter weekend, a crime that haunted Toledo, Ohio, for more than a quarter century. Today, 26 years after a nun was found murdered in a hospital chapel, a priest is convicted of killing her.

CNN's Keith Oppenheim joins us now with all the details -- Keith.

KEITH OPPENHEIM, CNN CORRESPONDENT: Hi, Kyra.

It took the jury just six and a half hours over last couple of days to conclude that Father Gerald Robinson killed sister Margaret Ann Pahl 26 years ago. Take a look at some of the video from the courtroom as Father Robinson was taken out of the courtroom in handcuffs. At that time, some of his family members were in tears. The father has been taken to a county jail, and in the next couple of days we believe he will be transferred to a state prison.

A quick background on the case.

It was in 1980 that Sister Margaret Ann Pahl, her body, was found dead in the chapel of Toledo's Mercy Hospital. At the time, Father Robinson was a hospital chaplain. He was questioned but never charged, not until about 24 years later, when cold case investigators believed they found a match between a bloodstain at the crime scene and a dagger-shaped letter opener that prosecutors said was the murder weapon belonging to Father Robinson.

After the verdict, lead prosecuting attorney Dean Mandross explained why he was so confident about the state's case.

(BEGIN VIDEO CLIP)

DEAN MANDROSS, ASSISTANT PROSECUTOR: We always believed in the arguments that we were making. We always believed that we were prosecuting the right individual. We always believed that that letter opener was clearly the murder weapon. We always believed that he lied to the police about his whereabouts and that there wouldn't be any -- any reason for him to make the lies that he made unless he was trying to protect himself.

(END VIDEO CLIP)

OPPENHEIM: Defense attorneys tell us that they will be making an appeal. They have 30 days to do so.

At the news conference with defense attorneys, I asked the lead attorney, Alan Konop, whether or not he's concerned about his client, Father Robinson, going to prison. This is what he had to say about that.

(BEGIN VIDEO CLIP)

ALAN KONOP, DEFENSE ATTORNEY: That's a real, real serious concern, yes.

OPPENHEIM: Can you elaborate on that in any way?

KONOP: Well, he's in -- he'll be in an environment that's a pretty rough environment. And it can be very, very difficult for him.

(END VIDEO CLIP)

OPPENHEIM: One of the things, of course, that you want to know when you're covering a story like this is, how did the jurors come to their conclusion, what was their thought process during the six hours that they deliberated? But the jurors did not speak, Kyra. They left the courtroom in a big hurry.

Back to you.

PHILLIPS: Keith, did we learn anything more about their relationship? Were they friends? I know you mentioned that she was very strict and he didn't necessarily like that.

OPPENHEIM: That's right. I mean, keep in mind that prosecutors did not -- they weren't legally required to provide a motive, but during closing arguments yesterday, Dean Mandross talked about that relationship. He said that Father Robinson had indicated clearly to people that he saw Sister Margaret Ann Pahl as dominant, and the way he described that relationship was that he felt pushed around by her, that he didn't want that to happen anymore. And so, from his point of view, as the prosecutors told it, he did what he had to do to stop that from happening.

PHILLIPS: Keith Oppenheim, thanks.

Tears of remorse from the defendant, screams of outrage from the gallery, all part of the sentencing of Daniel Biechele to four years in prison for 100 counts of involuntary manslaughter in the Station Nightclub fire of 2003. Biechele was tour manager for Great White. He lit the band's fireworks which ignited highly flammable sound- proofing inside the club.

It was the deadliest fire in Rhode Island history.

(BEGIN VIDEO CLIP)

DANIEL BIECHELE, DEFENDANT: I know that there's nothing that I can say or do that will ever undo what happened that night. Since the fire I've wanted to tell the victims and their families how truly sorry I am for what happened that night and part that I had in it. I never wanted anyone to be hurt in any way. I never imagined that anyone ever would be.

(END VIDEO CLIP)

PHILLIPS: Biechele's lawyer sought mercy, saying he had no way of knowing how hazardous the club was. The club owners are still awaiting trial on manslaughter charges.

(BEGIN VIDEO CLIP)

CATHERINE CALLAWAY, CNN ANCHOR: Hello. I'm Catherine Callaway in Atlanta with the latest on a developing story that we've been following.

Flight 592, ValuJet, a DC-9, apparently went down just wet of the Miami International Airport. What we do know is that it crashed in a marshy area of Dade County, according to the FAA. Flight 592 was en route from Miami to Atlanta. It was about 30 miles just north of the Miami International Airport when it apparently experienced a...

(END VIDEO CLIP)

PHILLIPS: That was 10 years ago today, and that's how CNN reported the crash of ValuJet Flight 592. The plane went down in the Florida Everglades, as you can see there, shortly after takeoff in Miami. All 110 people on board were killed. That crash was later blamed on a fire in the cargo hold.

ValuJet was forced to stai stand down for months. Eventually, it merged with AirTran. And now the airline is thriving while many bigger competitors struggle. A memorial is being held today in Miami for the victims of the 1996 disaster. It's cap and gown day on the Mississippi coast. President Bush delivers a commencement speech there next hour. We'll have his remarks live right here on LIVE FROM.

(COMMERCIAL BREAK)

PHILLIPS: Straight live to the Hill. Senator Frist speaking about what we're hoping to hear, more on NSA controversy and that story that came out in "USA Today" today.

SEN. BILL FRIST (R-TN), MAJORITY LEADER: Well, we're going to keep taxes low. When we focus on dividends and capital gains and whether or not somebody falls into that alternative minimum category, well, the choice is going to be clear. And I predict that we will be successful on keeping the pro-growth tax policy of President Bush solid and strong.

That policy in the past has resulted in the creation of over 5.3 million jobs over the last 31 months, unemployment that is down now to 4.7 percent, which is lower than the average of the '60s and lower than the average of the '70s and the '80s and the '90s. Homeownership up. Minority homeownership up at all-time highs.

These pro-growth tax policies work. They're working. And today in the United States Senate we will propel them forward and prevent any increase in those taxes.

Let me turn to Secretary Snow.

Secretary Snow, thank you for being with us.

JOHN SNOW, TREASURY SECRETARY: Thank you, Leader.

Let me commend you and your colleagues, Senator Grassley -- Chairman Grassley, who is on the floor right now, for moving forward on this important legislation which -- which will avoid a tax increase on millions and millions of American families and keep in place the policies that are so clearly working to promote growth, promote investment and promote jobs and rising real wages in America.

Some of you may have seen yesterday's report from the Treasury Department, Senator, on the surging federal revenues that are also being seen. A direct result of a growing and expanding economy with more people working, more people owning homes, rising real wages and equity markets responding -- approaching -- approaching all-time -- all-time highs.

The well-conceived policy embraced in the jobs and growth bill which we're coming up on the third anniversary of, clearly -- clearly has worked. This is a defining day. The vote today will tell the American people who supports lower taxes and who doesn't.

Thank you very much.

FRIST: Thank you, Mr. Secretary.

The last people to step forward.

PHILLIPS: You just heard from Secretary -- Treasury Secretary John Snow, also Senator Bill Frist, majority leader, talking about what we have been talking about throughout the day, and that is the Senate expecting to follow lead of the House and give the president and fellow Republicans a victory by approving that $70 billion package of tax cuts. The president's come forward hoping that he would able to sign this bill into law so he could stop a massive tax hike that he says would be disastrous to small business.

We'll continue to follow this live event here to see if anyone comments on the NSA story that we've been talking about and that massive database of Americans' phone calls and the controversy over that today. If you want to listen to these live comments, you can go to CNN.com/pipeline, of course.

But meanwhile, let's talk about this tax bill and what's in it for you. Well, it depends almost entirely on what you earn and what you pay now.

CNN Senior National Correspondent John Roberts runs all of the numbers for us.

(BEGIN VIDEOTAPE)

JOHN ROBERTS, CNN SR. NATIONAL CORRESPONDENT (voice over): Another giveaway to the rich is how Democrats put it.

REP. ALCEE HASTINGS (D), FLORIDA: That amounts to just a little bit more than a tank of gas.

ROBERTS: Just the tonic the economy needs, according to Republicans.

REP. DENNIS HASTERT (R), HOUSE SPEAKER: It's something that's important to keep this economy coming.

ROBERTS: So who is right? According to the moderately liberal Tax Policy Institute, low-income earners, $20,000 to $30,000 a year, will have their taxes reduced by about $9; $50,000 to $75,000, $110; $100,000 to $200,000, just shy of $1,400. But if you make over $1 million, you'll save a whopping $42,000.

LEN BURNHAM, TAX POLICY INSTITUTE: You'd expect, of course, the tax cut to be bigger for higher income people. But even as a share of income, it grows. The higher the income is, the larger the tax cut is as a share of income.

ROBERTS: So, are tax cuts good for the economy? Congress has been slicing tax rates for five years. GDP is humming along. The Dow is flirting with record territory.

BURNHAM: Well, the stock market was last in record territory in the late 1990s, when tax rates on capital gains were higher than they are now. ROBERTS: But what has even nonpartisan observers really ticked off is what they call a revenue-raising gimmick to keep the cost of the bill below $70 billion, a price tag Republicans could pass with a simple majority. It would allow investors to convert traditional IRAs funded with pre-tax dollars into so-called Roth IRAs by paying taxes on the account's investment gains. The bill's supporters say it will raise almost $6.5 billion over the next 10 years, but because Roth IRAs grow tax-free, in the decades after that, critic say, it will cost the government some $35 billion.

STEVE ELLIS, TAXPAYERS FOR COMMON SENSE: This is all about taking care of the now and forgetting the future. This is denying future generations some of the tax revenue that they were anticipating to help pay for the cost of government then.

ROBERTS (on camera): How does that tax cut break down across the country? The liberal National Women's Law Center says just two-tenths of one percent of all American households will get back that $42,000. The vast majority, more than 77 percent, 113 million households, will get back an average of 30 bucks.

John Roberts, CNN, Washington.

(END VIDEOTAPE)

PHILLIPS: And for more stories about your money, watch "LOU DOBBS TONIGHT" every weeknight, 6:00 Eastern.

So how would you like a bird's eye view of the Grand Canyon?

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: It's just something that you can probably only dream of, to be able to look right straight down and see below your feet. It's like -- it's like walking in the air.

(END VIDEO CLIP)

PHILLIPS: Yes, for some a dream. For acrophobes, well, a nightmare at 4,000 feet. Stick around. LIVE FROM is taking a walk on the wild side.

(COMMERCIAL BREAK)

PHILLIPS: Four thousand feet in the air, only glass between you and a free fall to the Colorado River. Would you have the guts to take this walk?

The Hualapai Indian Tribe hopes it will lure plenty of daredevil tourists to the skyway, $30 million of glass, steel and chutzpah suspended high atop the Grand Canyon. The horseshoe-shaped structure just out about 70 feet from the rim. Engineers say it will be sturdy enough to hold 71 fully-loaded 747s and withstand 100-plus mile-an- hour winds.

The project has been delayed many times, but it's set to be finished sometime between August and the end of next year.

When people buy cars they consider a lot of different factors: style, power, gas mileage. But what about patriotism? Susan Lisovicz is live from the New York Stock Exchange to tell us about a brewing public relations battle.

(BUSINESS REPORT)

PHILLIPS: Well, he preaches from the pulpit every Sunday. Today he's sharing lessons learned from mama. Bishop T.D. Jakes joins me next with a new book on how moms make a difference in our beliefs, our values, and, of course, our ultimate success.

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