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Israeli Explosion; Florida Residents In Long Lines; CIA Leak Case; Stuck In Cancun; Fighting Inflation Tips

Aired October 26, 2005 - 10:00   ET

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

DARYN KAGAN, CNN ANCHOR: Israeli coastal city of Hadera. Israeli radio giving that report. Right now let's go to our John Vause who is standing by in Jerusalem.
JOHN VAUSE, CNN CORRESPONDENT: Hello, Daryn.

This suicide bombing, well apparent suicide bombing at least according to the Israeli media, happened just a short time ago in that Israeli coastal city of Hadera. About 40 miles north of Tel Aviv.

Right now the emergency services here in Israel report that there are 20 casualties. Now we don't know how many people have been killed, if any at all, in that toll (ph) of 20 so far, but this is still very early. This explosion just being reported within the last few minutes.

Now this is the latest suicide bombing since July. There was one in Antania (ph) which left five or six Israeli dead. Then, of course, there was another suicide bombing in February at the Stage (ph) night club in Tel Aviv. But security services here in Israel have been on relatively high alert ever since the death of an Islamic jihad leader in the West Bank. He was buried yesterday.

And the militant group, Islamic jihad, has been vowing revenge for the death of the Islamic jihad leader. Not knowing at this stage if this bombing in the town of Hadera is connected to the death of the Islamic jihad leader. It could well be. We do not know that yet. But security services have been on high alert.

What we know right now, an explosion in the marketplace in Hadera. A busy marketplace in a city about 40 miles north of Tel Aviv. According to the emergency services, 20 casualties reported so far.

Daryn.

KAGAN: And tell us a little bit more about Hadera. As you said, it's north of Tel Aviv on the coast.

VAUSE: Yes, it's a fairly small town. Maybe about 50,000 to 60,000 people live there. It was founded by Jewish settlers. It's a historic town. It's near some ruins in the northern part of Israel. It's a tourist town, if you like, in many ways. But, you know, a sleepy town like many towns in Israel are. But as often is the case, they, too, have been the targets of these kind of terrorist attacks over the last five years here. Daryn.

KAGAN: John Vause, live from our Jerusalem bureau. We'll be back to you with more information about this. Thank you, John.

Right now, let's go ahead and take a look at what else is happening in the news on this Wednesday morning.

New England, you are still feeling the effects today of a powerful nor'easter. The storm lashed the coastline with gusts nearing hurricane strength and heavy rain. It also brought the first snow of the season to inland areas. At the height of the storm, about 200,000 homes and businesses were without power. The nor'easter pulled some energy from the remnants of Hurricane Wilma.

South Florida is coming back slowly from Hurricane Wilma's impact. Thousands of people waited in line for hours in Miami yesterday. They were looking for ice and bottled water. The crowd became angry when the scheduled distribution was delayed for five hours. Long lines formed in other areas for supplies. About 6 million people are still without electricity. It could take weeks for all the power to be restored.

A draft U.S.-French resolution on Syria is making the rounds of the U.N. Security Council. The draft calls on the Syrian government to detain anyone suspected of involvement in a Beirut assassination. A U.N. report has implicated top Syrian intelligence officials in the killing of former Lebanese Prime Minister Rafik Hariri in February. The U.S.-French draft threatens sanctions if Syria does not cooperate.

And let's go ahead and take a look at the aftermath of Hurricane Wilma in Florida. The Homeland Security Chief Michael Chertoff will be in South Florida today. He is touring the damage caused by the hurricane and he's also going to survey the government's relief efforts.

President Bush will do much the same tomorrow. One of the biggest frustrations for many people has been long lines for basics such as ice, water, food and gasoline. FEMA's Acting Director David Paulison says that hundreds of trucks are on the way with supplies.

A small army of utility workers has been deployed to restore electricity. Florida Power and Light says the lights should be back on sometime today in Manatee, Sarasota, Charlotte, Desoto and other northern Brevard counties.

The insurance industry estimates that losses across the state will total at least $6 billion, possibly going as high as $10 billion. For the latest, let's go to our Allan Chernoff. He is in Oakland Park, just north of Ft. Lauderdale.

Allan, hello.

ALLAN CHERNOFF, CNN CORRESPONDENT: Hello, Daryn, good morning.

And the truck behind me arrived here at midnight. The driver contracted by FEMA. And just a moment ago, the final pallet of ice was removed from the truck. They started off with 22 pallets of ice, filling this entire 18-wheeler. Now it's all out. They're still handing it out.

And over here you can see people walking up. Everyone getting two bags of ice each. It's been moving pretty quickly. So people getting their ice at this one location, where they're walking up. And on the other side of the park, they're also driving up to receive two bags of ice each as well down by the roadside over there.

This is a dramatic difference from the situation here yesterday. The local media had reported that ice and water would be handed out beginning at 11:00 in the morning. People were lined up. The truck didn't actually show up yesterday until just before 4:00 p.m., so some folks were waiting for five hours, and it was getting pretty frustrating.

(BEGIN VIDEO CLIP)

CLAUDIA PATTLE, OAKLAND PARK RESIDENT: It was mass chaos. Mass chaos. We had lines going all the way around the corner.

(END VIDEO CLIP)

CHERNOFF: Well, this is not a one-shot deal. Keep in mind, the longer that the power is out, the longer that people are going to have to be getting their ice, because they have no power in this area, no refrigeration whatsoever. The lines, though, that we're really seeing this morning are at some of the gasoline stations. Early this morning, we were in Sunny Isles, right along the beach. There were two gas stations open. One gas station had a line of 80 cars. The other, 90 cars. And honestly, for the 15-20 minutes that I was there, it didn't even seem as if the lines were even moving.

So, Daryn, I'm sure there's going to be a tremendous amount of frustration at gas stations and many of them remain closed because so many areas still do not have power.

KAGAN: And running water and, as you said, power. Lots of work still to do there in South Florida.

Thank you, Allan.

The effects of Wilma are being felt across much of the northeast today in the form of wintry weather in some places. Check out the snow. This is video from the mountains of Western Maryland which got up to a foot of snow. About 13,000 people lost power. Most of them are in Garret County. The local utility company says that service should be restored by Friday.

Well, we are well-serviced today in the weather department. Chad Myers is with us.

Chad, great to see you.

(WEATHER REPORT) KAGAN: To Washington now. All eyes are on a grand jury and an announce that could thunder through the White House. There are signs that the prosecutor may seek criminal charges in the public outing of CIA Operative Valerie Plame and two top administrative insiders could be in the cross-hairs. CNN National Correspondent Bob Franken is outside the courthouse where the grand jury has been meeting. And then our Dana Bash is at the White House.

Bob, we'll go ahead and start with you.

BOB FRANKEN, CNN CORRESPONDENT: And, Daryn, we have to add the possibility that he will decide not to seek criminal charges. It's an investigation that's been going on for almost two years. And when Patrick Fitzgerald came this morning, he was the only one who could really say whether he was going to seek grand jury indictments.

And the names that we hear more often than not at the top levels of the White House include Karl Rove, deputy White House chief of staff. Of course, the long-time chief political adviser of the president, who left in front of the ever-present cameras outside of his house this morning. Also the other name that is so frequently mentioned, whose name has come up in testimony repeatedly, is I. Louis "Scooter" Libby. He's the vice president's chief of staff, somebody else whose name has come up repeatedly as I pointed out. There has also been disclosure that the special prosecutor, during this investigation, has repeatedly asked whether Vice President Cheney had any involvement.

Now there possibilities include some indictment on the underlying espionage act which makes it illegal to willfully give out the name of somebody who is undercover. In this case, identifying Valerie Plame who in July of 2003 was identified in the wake of her husband's criticism of the administration. Another possibility, one of the false statement charges, perhaps perjury, perhaps obstruction of justice, if the grand jury would determine that somebody had given false information or conspiracy charges. All of those speculative. And we don't know if the grand jury is going to act today or if it's going to act in secrecy.

So you can see, Daryn, that there are a lot of riddles ahead. What we do know is that the grand jury's deadline, it expires on Friday. Of course, even that is shrouded in a little bit of mystery because there is a possibility that the prosecutor could seek an extension. So we're waiting to see with indications that something is eminent.

KAGAN: All right, Bob, we'll be checking back with you. Thank you.

So the White House can take little solace in the public's perception of the probe. Let's look at the latest CNN/"USA Today"/Gallup Poll. Seventy-eight percent of Americans believe that any alleged administration role in the leak was either illegal or unethical. Looks like we have a different poll number up there. But one in 10 believe the administration did nothing wrong. What you see up on the screen, the Bush administration could we put that back up because that didn't match what we were just talking about. Dana, hold on.

DANA BASH, CNN CORRESPONDENT: Sure.

KAGAN: Bush administration officials role in the leak. So 39 percent think that something they did something illegal and 39, unethical and 10 percent say they did nothing wrong.

All right, now to our Dana Bash.

Dana, I'm sure they're watching things very closely there at the White House.

BASH: You can say that again, Daryn.

And, you know, when it comes to those numbers, the one thing that they maybe can take some solace in, maybe, is the fact that they'll likely change if and when there are any announcements, any finality to this two-year investigation. But as Bob Franken just very clearly pointed out, nobody really knows how exactly that will fall out, even now at what appears to be the 11th hour.

Now we have had our morning briefing this morning with the White House press secretary and, Daryn, you're probably not going to fall off your chair when you hear that the only comment essentially was no comment still because its an ongoing investigation. Saying that they are still all of the White House aides are trying to focus on what they can, that is their day-to-day jobs. And we certainly saw that with the two top aides that appear to be at the center of this, the president's top political adviser, Karl Rove, the vice president's chief of staff, Scooter Libby. They were both up and out before the sun was up this morning, as usual. They were both here for the regular 7:30 a.m. senior staff meeting. Both actually later this morning walked across the driveway in full view of the cameras, showing us that they are here, they are doing their jobs.

But at the truth of the matter is, no matter how hard all of the top aides try to do what they have to do, whether it's put a finishing touch on a speech the president will give later today, whether it's working on their Supreme Court nominees revised questionnaire to go up to Capitol Hill, there is no question that there is intense stress around here knowing everybody knows that things could change dramatically for the day-to-day life here very soon.

Daryn.

KAGAN: Dana Bash live at the White House, thank you. Once again, we'll be checking in with you and Bob Franken, who is at the federal courthouse.

We are keeping our eye on what is happening in Israel. The historic coastal town of Hadera. There is some word of a suicide bomber with a large number of casualties. Our John Vause is tracking that situation and we will bring you the latest and latest pictures as they become available.

Also, they were trapped in paradise, or at least what was once paradise. Ahead, it's almost a week after Hurricane Wilma hit Cancun. A lot of tourists are still stuck there. Low on food and water and patience. We're going to talk with one American woman who just wanted to get home. That's just ahead.

Also, an entire town emotionally involved in the story of one woman going off to war. The truth behind her tale is a different story, however.

And the latest on efforts to identify an airman found in the frozen mountains of California after 60 years and the sisters who hope their long lost brother will finally come home.

(COMMERCIAL BREAK)

KAGAN: Let's bring you the latest information now on the suicide bombing taking place in the historic coastal town of Hadera in Israel. Our John Vause standing by from Jerusalem with the latest.

John.

VAUSE: Yes, hi, Daryn.

We got a few more some more information, rather, to bring you. We've just learned from Gaza, from our producer in Gaza, that the militant group Islamic jihad has claimed responsibility for this bombing in the marketplace in Hadera. Now according to emergency services, at least 30 people have been wounded in this blast. We have some new video just in from outside the main hospital in this city of Hadera.

The Israeli Channel 10 now reporting that as many as four people have been killed in this suicide or, sorry, in this blast, which we do not know at this stage if it was, in fact, a suicide bombing. That coming from Channel 10. It's yet to be confirmed by the Israeli emergency services.

So once again, according to Israeli media, four people have been killed in this blast. But CNN has learned that the militant group, Islamic jihad, has claimed responsibility for this explosion.

We don't know if it was, in fact, a suicide bombing. There have been reports that there may have been a bomb left in the bag in the marketplace. Apparently this marketplace had been a target before, during this five-year conflict between the Israelis and the Palestinians.

A short time ago, we heard from Saeb Erekat, the chief Palestinian negotiator for the Palestinian Authority, condemning this attack and calling on all parties to stick to the cease-fire, this very, very shaky cease-fire, which has been in place since February. We have yet to find out what the Israeli response will be. But given that the Islamic jihad militant group in Gaza has claimed responsibility, we will probably, in all likelihood, see some kind of Israeli military action in Gaza. That has been the pattern over the last couple of weeks. Whenever there has been military action coming from the Gaza Strip from the militant groups, the Israeli army, the Israeli air force have launched some very severe campaigns in the Gaza Strip as retaliation.

So, Daryn, right now, 30 casualties, according to Israeli media, at least four people have been killed.

Daryn.

KAGAN: Let's talk about the cease-fire that you describe as shaky, even before this latest incident. Tell us a little bit more about that, John.

VAUSE: Well, back in February of this year, at Sharm El-Sheikh in Egypt, there was a cease-fire agreed to by the Palestinian Authority and Israel. Now before that, all of the militant groups in Gaza, Hamas, Islamic jihad, al Acis Amarters (ph) brigades, all of those groups agreed to maintain what they called a period of calm. Now according to the militant groups, their take on that was if there was a period of calm, they would respond with calm. But they also, in their words, said that they would respond to Israeli aggression.

So what we've had here over the last 48 hours is the death of a senior Islamic jihad leader in the West Bank and now we've had Islamic jihad claiming responsibility for this blast in Hadera, which we have just confirmed has now left at least four people dead. So we can confirm those reports, which went to air a short time ago on the Israeli media that say that four people have been killed in this blast in Hadera.

And what we've seen, Daryn, since the announcement of that cease- fire, the violence here has eb and flowed but that cease-fire has pretty much held, even though it's being tested to the limits at times over the last few months.

Daryn.

KAGAN: John Vause in Jerusalem. We'll come back to you as you get more information. Thank you for that.

Still ahead, we're going to tell you the story of one woman in Colorado. She tells her story of being in the military and going to Iraq to radio listeners. They respond. Turns out the whole thing was a hoax. That story just ahead.

(COMMERCIAL BREAK)

KAGAN: So we're going to turn back the clock a little bit here. Before Hurricane Wilma struck Florida, it did a number on the popular Mexican resort of Cancun. Days later, a lot of tourists are still stranded there amid some pretty miserable conditions. Citizen Journalist Ilsa Bruner and her husband have just returned from Cancun and she joins us by telephone from Racine, Wisconsin.

Ilsa, hello. ILSA BRUNER, CITIZEN JOURNALIST: Hello. I'm here.

KAGAN: I imagine this started out as a dream vacation, going to a lovely place like Cancun.

BRUNER: We yes, we had gone down with some friends. It was their second anniversary. That was our celebration with them. And we were actually south of Cancun in Riviera Mile. We were about 20 miles south.

KAGAN: And having a great time until Wilma showed up?

BRUNER: Yes. Actually, yes, we were. We started our evacuation on Thursday at 8:00 p.m.

KAGAN: And how was it just to go through that storm?

BRUNER: The storm was it was frightening because the building we were in, the Iberastar (ph) Hotel had already prepared the evacuation center. So the windows and doors were properly shored up. So we could not see anything. We could only hear it. And that was frightening, to not be able to see it but hear the rumbling and the banging and the noises were frightening.

KAGAN: So you probably thought, you make it through that, you make it through the night and the storm and you're going home.

BRUNER: Exactly. We thought . . .

KAGAN: But it didn't work out that way.

BRUNER: No. And they, too, I think, believed we would only be in there for maybe probably overnight and it would be gone. I don't think anybody thought that this storm would sit and move about one or two miles an hour.

KAGAN: And so how long were you in there total?

BRUNER: We were in the shelter -- I think we calculated about 52 hours. But again, the Iberastar Hotel team has a disaster plan that's beyond compare. They were prepared. They kept things sanitary. They had people stationed in all the bathrooms. Had food. Believe it or not, hot food prepared for all three meals, water, juice, coffee, security everywhere.

KAGAN: So, Ilsa, that's a lot better than a lot of people had it. But still, you had a tough time getting out of there.

BRUNER: Oh, terrible. Getting out was difficult. But again, you couldn't be mad at anybody because there was nothing anybody could do about it. There were no phone lines, no there's no electricity, other than generator. The gas supply is slowly dwindling. So I don't know how they're going to drive buses anywhere. There are no landline phones.

KAGAN: So how did you finally get out? BRUNER: We finally -- the Apple Tour Group has their own flight their own planes and we were able to they were able to touch down, pick us up and take off. And that was yesterday.

KAGAN: So good to go on vacation but I bet even better to get home on this trip.

BRUNER: It is. But I guess our concern right now is there are still a lot of U.S. citizens that are not getting home and we really need our government to help get our U.S. citizens home. There are a lot of people there that are not getting home. The British are getting their people out. The French are getting their people out. The Dutch, the Germans, but our U.S. we're not helping our people.

KAGAN: So you'd like to call attention to that.

BRUNER: Exactly.

KAGAN: To your fellow vacationers that are still stuck there. I'm sure they really appreciate that. And we're glad to hear you got home safely to Racine, Wisconsin.

BRUNER: Well, thank you very much.

KAGAN: Ilsa Bruner on the phone. A former hurricane tourist at this point. Thank you, Ilsa.

Remember all those Cadillacs that were taken from a dealership by New Orleans police in the wake of Hurricane Katrina? Well, there is follow-up from the incident. The details ahead on that.

And we also have Gerri Willis.

GERRI WILLIS, CNN CORRESPONDENT: Hey there, Daryn.

Gas, home heating oil, electricity, you've got it right, prices are going up. We'll show you how to cut the budget. "Five Tips" is next.

(COMMERCIAL BREAK)

KAGAN: Let's talk your wallet right now. Those soaring energy prices that helped fuel the strongest surge in wholesale prices in 15 years. Yes, we are talking inflation in today's "Top Five Tips." Our Personal Finance Editor Gerri Willis showing us how we can better insulate ourselves against inflation. We're fighting back.

Good morning, Ger.

WILLIS: Can you believe it, inflation again. Daryn, good to see you.

First of all, you've got to take advantage of energy conservation perks. Here's the good news. You can actually get a tax credit for saving money on energy by buying energy efficient products that carry the energy star label. That tax credit, $500. And once you buy these energy-star goods, they're going to save you 30 percent on your energy bill. So it's a win-win situation for consumer.

Daryn.

KAGAN: Talk to those parents out there who are concerned about paying for college for their kids.

WILLIS: Well, you can lock in tomorrow today's college prices for your child who is in grade school today by buying pre-paid college tuition. So imagine if you're paying $10,000 today for college tuition for a single year, you can pay that now for junior, who's not going to school for another two decades. And the cost of inflation for college education is incredible, Daryn. So it's a good idea.

KAGAN: Yes, hard to think that these prices would be considered a bargain, but moving forward they probably will be.

WILLIS: Yes, that's right.

KAGAN: Let's talk about health savings and health care.

WILLIS: Well, you really want to think about the flexible spending account if your employer offers you one. This allows you to set aside pre-tax dollars to spend on things like visits to the doctor, co-pays, going to the pharmacy, you name it. It's a great way to save a little money at the margin, even though you're setting money aside early.

KAGAN: What about your investment portfolio? How should that change given the changes in inflation?

WILLIS: You know, this is tricky, but what you can do in that retirement account is buy some called TIPS. And I don't mean "Five Tips," I mean Treasury Inflation Protected Securities. These are essentially bonds. And what the Treasury Department does is they tops off your return by the same amount that inflation grows. So as inflation goes up, so does your return on these bonds. It's important because bonds often suffer when inflation rises.

KAGAN: OK. But something like that might not be available in your company's 401-K. So how do you reevaluate that?

WILLIS: That's true. Good point, Daryn. Well, what you should do is think about maybe dialing back a little on your bond allocation and your 401-K because bonds typically don't do very well in a high inflation environment. Stocks do a little better and tech probably does the best of many of the different stock sectors. So you've got to reallocate that 401-K a little bit and save money where you can.

Daryn.

KAGAN: Gerri Willis, thank you. Great to see you.

WILLIS: Good to see you.

KAGAN: Let's go ahead right now and take a look at what's happening "Now in the News." And we are following a developing story about an explosion in the Israeli coastal city of Hadera. CNN has learned that the militant group Islamic jihad has claimed responsibility for the apparent suicide bombing. Israeli medical services report at least four people have died. About 30 people were wounded.

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