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CNN Live Today

Iraq Troop Reductions; Troops Charges; Iraq Troops Vote; President Bush In Hungary; Crash In Los Angeles; Western Wildfires; Out of ARMs Way

Aired June 22, 2006 - 10:00   ET

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

SOLEDAD O'BRIEN, CNN ANCHOR: That's it. We're out of time. Daryn Kagan is at the CNN Center. She'll be with you for the next couple of hours on CNN LIVE TODAY.
Hey, Daryn.

JOHN ROBERTS, CNN ANCHOR: Good morning.

DARYN KAGAN, CNN ANCHOR: You and David Hasselhoff going for coffee now, Soledad?

SOLEDAD O'BRIEN: I used to love "Knight Rider."

KAGAN: I know.

SOLEDAD O'BRIEN: I know I'm dating myself, but I loved "Knight Rider." He is a handsome, handsome man.

KAGAN: Kiss and makeup. Thank you.

SOLEDAD O'BRIEN: We're like this, me and David, he loves me. Don't be ridiculous.

KAGAN: Yes. Absolutely.

ROBERTS: Everything is fine.

KAGAN: Good. As calm as a day on "Baywatch." You guys have a great day in New York City. It will be interesting to listen to. Thank you.

We have a lot to get to unfolding this hour.

Troop levels in Iraq. We're getting word of a plan to reduce the numbers. Live to the Pentagon for that developing story.

Wildfires rage across the west. Tens of thousands of acres in flames. We'll show you the biggest challenges for firefighters.

And President Bush calls on Iran to make up its mind. We go live to Budapest where the president is scheduled to speak this hour. You'll see it live right here on CNN, the most trusted name in news.

We're going to begin this hour with troop reductions in Iraq. With the political clamor loud and frenzied in Washington, we're getting word of this new development. The commander of U.S. forces may be ready to recommend lower troop levels. Pentagon Correspondent Barbara Starr is following the story and she joins me live now with details.

Barbara, good morning.

BARBARA STARR, CNN CORRESPONDENT: Good morning to you, Daryn.

The first thing to emphasize is, if there is a recommendation to reduce troop levels, it will be a very modest reduction according to military officials speaking on background. Now, General George Casey, the top commander in Iraq, is in Washington today. He and Secretary Rumsfeld have been on Capitol Hill all morning. They are expected to conduct a news briefing here in the Pentagon later this afternoon.

Sources telling us that Casey is now looking at an option for a very modest reduction at most. A reduction of maybe one to two brigades. That's 6,000 to 10,000 troops.

But even there, there may be less to it than meets the eye because there may be -- it may be achieved by simply postponing the deployment of some troops. Some units that were expected to go to Iraq by the end of the year. Some of those simply may be held at home. Held at their home bases for some period of time. And even so, some of those units may still have elements go to Iraq.

So all of this at best, sources saying, a very modest reduction with lots of wiggle room for General Casey to make adjustments along the way. To send those troops if they are need. To send them depending on how he sees the security situation evolve over the coming months.

Daryn.

KAGAN: And then, Barbara, the latest on the story out of Camp Pendleton where seven Marines and a Navy corpsman have been charged with some very serious allegations.

STARR: Yes. Yesterday the announcement was made official at a pres conference out at Camp Pendleton, California. Seven Marines and a Navy corpsman now charged with murder in connection with the death of an Iraqi man earlier this year. The indications are, according to the charge sheets, according to the charges filed against these troops, that they murdered this Iraqi man and then planted a shovel and an AK-47 rifle near his dead body, trying to make it appear that he was planting IEDs.

A lot of controversy about these very disturbing charges. Already the family members of the Marines saying they are innocent. But in Iraq, this investigation came after Iraqis went to the U.S. troops and said something had happened here. A very lengthy investigation conducted. And based on that, the charges were filed yesterday.

KAGAN: Barbara Starr at the Pentagon. Barbara, thank you. And I want to tell our viewers we will have live coverage of the Pentagon briefing by Defense Secretary Donald Rumsfeld and General George Casey. That's 3:30 Eastern on LIVE FROM with Kyra Phillips.

Speaking, though, of troop reductions. The Senate is nearing a showdown over Iraq. A vote expected this morning on two resolutions by Democrats to bring troops home. The difference is the deadlines. And there's one of the men who's proposing one of the amendments. That's Senator John Kerry of Massachusetts. Congressional Correspondent Dana Bash live from Capitol Hill with the latest on what the different Democratic proposals are and what this means in the world of politics.

Good morning.

DANA BASH, CNN CORRESPONDENT: I'm sorry, politics?

KAGAN: Yes.

BASH: It's all about politics and I don't think anybody here could say it with a straight face that a major part of this debate is with an eye towards November. But you talked about the Democratic plans and the divisions among the Democrats. That is really the issue that we are seeing on display on the Senate floor as we speak.

Over two competing ideas over what to do about a specific issue. Whether or not there should be a date certain for troops to be pulled out of Iraq. John Kerry, his proposal says that there should be. And that is about 12 months from now. July 1, 2007, he said, combat forces should be out of Iraq. He says that is the only way that you can force the Iraqis to take security upon themselves.

Now, many Democrats, though, Daryn, they think that that just goes to far and they are going to support probably an alternative measure that says that there should be phased redeployment that begins this year. And that is something that makes that a suggestion to the president. It is non-binding. Rather symbolic.

Now, Republicans, how are they factoring into this? They're really downright giddy. They see this as an opening to replay a strategy that they say worked pretty well for them in 2004, which is to try to turn dissatisfaction over Iraq to their advantage by painting Democrats as weak on defense.

Now that is playing out on the Senate floor. Republicans are playing out that election strategy. Democrats are trying to call them on it.

(BEGIN VIDEO CLIP)

SEN. JOHN CORNYN, (R) TEXAS: It appears that they have no unifying position and they have no plan to lead the victory in Iraq or to lead the American people during one of the toughest fights that our nation has ever endured. It is indeed a time for testing for our nation and we must pass the test. SEN. HILLARY CLINTON, (D) NEW YORK: They choose to tar all who disagree with an open-ended, unconditional commitment as unpatriotic, as waving the white flag of surrender. They may not have a war strategy, but they do have an election strategy. This is the road they took America down in 2002. It was a dead end for our country then, and it's a dead end now.

(END VIDEO CLIP)

BASH: Some Democrats, though, are not so sure Hillary Clinton is right. Those at least that are really in charge of trying to take Congress back from Republicans this November are concerned that the whole approach that Democrats have to this debate has been frankly misguided from the beginning. And that is that they allowed this to be fought on the issue that divides them, which is whether or not troops should come home and when, instead of issues that they think play well in the election -- play well to the electorate. That is, electric Democrats to take over Congress that way there can be some accountable oversight in terms of this administration.

Daryn.

KAGAN: Dana Bash on Capitol Hill. Dana, thank you.

Let's go to international news and check in on Budapest this morning. That's where President Bush is and calling for a decision on Iran's nuclear plan. Mr. Bush commemorating the 50th anniversary of Hungary's failed revolt against the Soviet Union. Our White House Correspondent Elaine Quijano is traveling with the president.

Elaine, hello.

ELAINE QUIJANO, CNN CORRESPONDENT: Hello to you, Daryn.

And yesterday in Vienna, President Bush said that late August was too long to wait for an answer from Iran in looking at when to join the nuclear talks. Today, in fact a short time ago, Stephen Hadley, the president's national security adviser, briefed reporters here in Budapest. He said the Bush administration believes that it would be helpful and useful if Iran would respond to the offer of incentives to come back to the nuclear talks by the start of the G-8 Summit. World leaders meet in Russia on July 15 and foreign ministers meet on June 29.

Now at the same time, Stephen Hadley was very carefully to say that the United States is still looking at weeks, not months. He said the Bush administration is looking for an authoritative response from Iran.

Meantime here in Budapest, it's already been a full day of events for President Bush. Just a short time ago the president, along with First Lady Laura Bush, laid flowers at the eternal flame here in Budapest. Now the president's visit here is really meant to pay tribute to the thousand of Hungarians who rose up against the Soviet communist rule in October of 1956. The president will highlight the sacrifices of the Hungarian people in the weeks that followed the start of that uprising. At least 25,000 Hungarians were killed. Nearly a quarter of a million Hungarians fled the country.

So this morning the president was welcomed by Hungary's president in an arrival ceremony at Sandor Palace. Later he met with top officials, including the prime minister. In about 30 minutes or so, President Bush will delivery remarks centering on freedom and democracy. His aides say that it will not be a policy speech. But, of course, as you know, Daryn, this is coming at a time when the president is certainly trying to bolster support for Iraq's fledgling democracy.

KAGAN: All right, Elaine Quijano in Budapest. We will be listening in to part of the president's speech when he speaks later this hour. Thank you.

Now we have a developing story out of California. Fredricka Whitfield has details on that.

Fred.

FREDRICKA WHITFIELD, CNN CORRESPONDENT: Well, Daryn, in Los Angeles, huge accident causing major backups on Route 5. Let's show you some of the pictures taken earlier.

What happened? Two tractor trailers collided. One overturned. You're looking at that. That one overturned vehicle was carrying crushed vehicles and scrap metal. The other tractor trailer that it crashed into apparently has been split in half.

So, needless to say, it's a really mess there and just the cleanup, in addition to the backup that has been caused there on the Five. The interchange between Golden State and Santa Ana are closed. Miraculously, no reported injuries even though the debris looks terrible and the accident pretty widespread there, Daryn. That taking place in Los Angeles.

KAGAN: Good thing to hear there's no injuries or fatalities there. But, boy, is that going to be a nasty rush hour.

WHITFIELD: It is.

KAGAN: 7:10 a.m. in southern California. Fred, thank you for that.

Let's go live now to the floor of the U.S. Senate. Senator John Kerry speaking. His proposal would withdraw all U.S. troops from Iraq by July of next year.

SEN. JOHN KERRY, (D) MASSACHUSETTS: The United States and the world and we deserve to take the position here that supports our troops by getting this policy right.

KAGAN: Well, we caught him just as he wrapped up there. We'll continue to follow the story as it develops. We do expect a vote in the Senate later today. And again, we'll continue to monitor that.

Ahead, homes in danger. A fire out of control. The situation in the west. A number of fires still burning out of control. We will check in, in Colorado and Arizona.

And he's one of the most powerful men in America. This morning he sat down with CNN's John King and no one else. Vice President Dick Cheney's candid thoughts coming up on CNN, the most trusted name in news.

(COMMERCIAL BREAK)

KAGAN: Heat and dry weather and lightning strikes, that combustible combination is fueling several major wildfires burning across the west. Our Rick Sanchez filed this story for "A.C. 360."

(BEGIN VIDEOTAPE)

RICK SANCHEZ, CNN CORRESPONDENT, (voice over): In Oak Creek Canyon near Sadona, Arizona, more than 500 homes had to be evacuated.

UNIDENTIFIED MALE: We did activate our siren system.

SANCHEZ: Twenty-five hundred acres have burned in the state so far, fed by gusting winds and scorching temperatures. And though no homes have fallen victim to the flames, residents given just a half hour to evacuate Sunday are worried.

UNIDENTIFIED MALE: We wish we could actually go up there and have a look. But, obviously, we're in danger if we do so.

SANCHEZ: So dangerous the governor has declared an emergency.

GOV. JANET NAPOLITANO, ARIZONA: This is a difficult fire because the terrain and the location. But you've got a great type 1 crew here working on it. You've got air assets here working on it. And you've got support both at the municipal level, the county level, the state level and the federal level. I do want to say, for informational purposes, I did issue a state declaration of emergency based on this fire.

SANCHEZ: In Colorado, 9,000 acres have burned. The governor there issued strict restrictions on camp fires and fireworks.

GOV. BILL OWENS, COLORADO: I'm going to be signing an executive order and we're going to be doing that later today, banning open fires on state lands.

SANCHEZ: The drought in southern Colorado has made containment difficult as parched pines ignite, filling the sky with giant plumes of smoke. And in California, helicopters are dousing the flames burning perilously close to this subdivision in Rancho Palosberde (ph), south of Los Angeles.

UNIDENTIFIED MALE: It's hot out there. It's hot out there, thus making the fire conditions kind of unpredictable.

SANCHEZ: Firefighters are worried the flames could spread over the mountains into the protected San Raphael Wilderness. In New Mexico, lightning started at least four fires earlier this month in the Hela National Forest (ph) and more than 60,000 acres have burned across the state.

Back in Arizona, even those whose homes aren't in danger are wondering how much worse it could get.

UNIDENTIFIED FEMALE: I walked my dog in the forest today it was so eerie, you know, it just felt -- it felt weird having all the smoke and there was ashes coming down. So I packed up a bunch of things that I wanted to keep just in case.

SANCHEZ: And caution may be the best protection. Fires have swept across more than 3 million acres nationwide this year. That's four times the amount this time last year.

Rick Sanchez, CNN, Sedona, Arizona.

(END VIDEOTAPE)

KAGAN: And that story aired on "Anderson Cooper 360." Tonight at 10:00 on "A.C. 360," whether it's a break-up or the loss of a loved one, the stress and grieving could cost you your life. New research on how to mend a broken heart. CNN tonight at 10:00 Eastern.

And let's check in on weather because weather is such a big part in fighting those fires across the west.

And what kind of dial do you have there behind you, Chad?

(WEATHER REPORT)

KAGAN: Want to go back and listen to a little bit of what happened on the floor of the Senate just a few minutes ago. Senator John Kerry presenting his proposal. He would like to see U.S. troops pulled out of Iraq by, at the latest, July of next year. Here's how he explained why he believes his plan would work.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY, (D) MASSACHUSETTS: The only question here is how do you most effectively support them? The best way to support the troops is to get this policy right. That's how you support the troops.

There's nothing more disappointing than being a troop in the field and seeing that you're doing missions that don't make sense or that the overall strategy doesn't make sense. And the record here, as the senator from Wisconsin has just said in quoting Robert Kennedy about past error justifying sort of a perpetuation of the same, the record here is not good. Prediction after prediction after prediction has been wrong. Policy choice after policy choice after policy choice has been wrong.

Young men and women in the United States armed forces have been wounded and killed because of bad policy decisions. And it's not enough just to come to the floor of the United States Senate and insist, oh we have to stay the course because otherwise what our troops are doing would be lost or be in vain. What would be lost and be in vain is not to look and think about what's really happening over there and adjust appropriately.

Our troops want us and deserve for us to get this policy right. And what Senator Feingold and I are offering, along with Senator Leahy and Senator Boxer, is a plan that gets it right. That helps us to be able to get on a path where we demand accountability and where we still support Iraq.

The fact is, sure, you can muddle along with this course. None of us have come to the floor and said the cause is lost. None of us have suggested that you just have to walk away and leave chaos. That's not what this plan does. This plan honors the investment of our troops. And, in fact, what it does is provide a better way of not only empowering the Iraqis, but of empowering the United States of America to fight a more effective war on terror.

(END VIDEO CLIP)

KAGAN: You have Democrats offering two different plans. Republicans agree on one thing. They don't like either plan. Here's Senator John Warner.

SEN. JOHN WARNER, (D) VIRGINIA: And I think others have given that serious thought to our colleague on his amendment. But I strongly oppose it. Unlike last year where I sat down, was able to work out with him a conciliatory, bipartisan amendment which got three-quarters of the votes in the Senate, it just, in the form he presented it, was not an option this time. And therefore, regrettably, we approached these critical and important votes with far greater partisanship than I had hoped. I had hoped we had had a greater bipartisanship.

But my basic message to America and to my colleagues is that we have put an enormous investment in these conflicts both in Iraq and Afghanistan. We're focusing today on Iraq, but we have to look at the other. Two thousand, five hundred plus Americans have lost their lives and left families grieving and loved ones.

Eighteen thousand have survived their wounds and are working to re-establish themselves. Many going back into uniform or having never left uniform but remaining in which is to their everlasting credit. But others receiving the love and the care of their families and their communities in which they live. Enormous sacrifice we have dollars incalculable in amounts.

But also, Mr. President, what we have on the line is the credibility of the United States of America. The voice of this Senate will be recorded momentarily.

KAGAN: So we've heard from both sides now. We heard from Senator John Kerry and now Senator Warner against both of the Democratic proposals to pull troops out of Iraq. A vote expected on those amendments later today. We'll continue to have coverage from Capitol Hill with our Dana Bash.

Meanwhile, we're going to talk your mortgage. A lot of people went for those adjustable rate mortgages. Boy, there was a time when that was a sweet deal. That time has come to a close and Gerri Willis is going to tell us more about that.

Gerri.

GERRI WILLIS, CNN CORRESPONDENT: Weren't those the good old days?

KAGAN: That was like 3 percent. That was great.

WILLIS: Yes, loved that. Loved that.

Do rising interest rates have you up in arms? Coming up, we're going to tell you what you need to know about your mortgage and your home equity line of credit. "Five Tips" is coming up.

(COMMERCIAL BREAK)

KAGAN: Let's check the markets. Not looking as good as they have at this time of day in recent days. You can see the Dow is down 38 points. The market's been open almost an hour. Nasdaq headed that same southerly direction. It is down just over 15 points.

Speaking of points, let's talk about your mortgage. And for a lot of homeowners, it's time to get out of A.R.M.'s way. That's a-r- m-s, adjustable rate mortgages. Our Personal Finance Editor Gerri Willis is here with her "Top Five Tips" on that.

And, Gerri, get this, we're going to do all five tips today. I'm not going to skip over one.

WILLIS: Yes. Good news.

KAGAN: I brought my whole brain to work today.

WILLIS: You always do, Daryn.

KAGAN: Yesterday, not so much.

WILLIS: Well, yes.

KAGAN: But anyway, tip number one.

WILLIS: Tip number one is you have to know the stakes. Look, the bottom line here is that rising interest rates means ballooning monthly payments. This year it's estimated that $330 billion worth of adjust rate mortgages will adjust upward this year. And for a homeowner with a $200,000 mortgage loan, that means you could be paying over $200 more a month if your rate goes up just 2 percent.

KAGAN: So you want to make some changes probably.

WILLIS: Yes, you want to make some changes. First off, buy it some time. If you have a mortgage with a rate that's going to move higher, you want to start thinking about refinancing. You could get into a five or a seven-year hybrid adjustable mortgage which would give you some breathing room.

And, don't forget, 30-year fixed rates are still below long-term averages. The thing to keep in mind though here, refinancing is not cheap. It can cost you thousands of dollars. So you sort of have to weigh which of the options makes more financial sense. Do your homework.

KAGAN: What about that home equity line of credit that a lot of homeowners have?

WILLIS: You know, people got addicted to this cheap money. You know, three years ago home equity lines of credit, which is what people call HELOCs, they were the darlings. People wanted to use them to make home improvements, to pay for everything including the flat panel TV. But that was 16 rate hikes ago. Today, HELOCs are expensive since they're tied to the prime rate. And they're going to get even more expensive. So refinance all of that mortgage debt into a single 30-year fixed loan. And if possible, at all, you could just pay off the HELOC. Prepayment penalties can be high though. As much as $6,000.

KAGAN: Whoa!

WILLIS: Yes. It can be ugly. So you need to know if there's a prepayment penalty. Ask how much it is. And one thing we found out this week. Look, lenders are coming up with new products. If you want to do that improvement to the house, that are like HELOCs only a little different. They lock in rates for a period instead of adjusting all the time. So you might want to ask about that too.

KAGAN: So do you want to consolidate everything or are there certain things you don't consolidate?

WILLIS: Well, you know, I know people love to roll all their debt into some of these loans. And it can be a bad idea, particularly if you're talking about debt for things that are not going to last a long time. The flat panel TV. The vacation. That's something that you don't want to pay over 30 years. You want to pay it over a short period of time. So use this money wisely because, at the end of the day, it's your equity that will make the difference in your saving.

KAGAN: Now PMI. This gets a lot of, especially first time homeowners.

WILLIS: Right. If you didn't put 20 percent down when you bought your house, you may well be page private mortgage insurance. And this is just an extra cost that is born by the homeowner. And you pay it for a long time until you own 20 percent of your house in equity.

Now if you've been in your house for a while and prices have gone up over time, chances are you're already at the limit. But, you know, Daryn, sometimes the lender forgets to tell you about that. So it's up to you to contact them, get the ball rolling.

And, of course, we want to hear from your viewers, Daryn. Send us questions to 5tips@cnn.com. And, of course, if you missed anything at all on "Five Tips," check out the Web site, cnnmoney.com/5 tips.

KAGAN: Well, as long as we're talking houses, why don't we talk the "Open House" show. It's coming up on Saturday.

WILLIS: That's right, Saturday morning right here on CNN, 9:30 a.m. Eastern. Real estate price fixing, high-tech surveillance and gardening with Lidia from "Lidia's Table." We've got a lot coming up on the show.

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