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India Train Blasts; New Rules For Gitmo; Budget Deficit; Tunnel Tragedy; Gruesome Video

Aired July 11, 2006 - 10:05   ET

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

DARYN KAGAN, CNN ANCHOR: But we are also following breaking news. A big story out of India. We're going to get to that right now.
Good morning everyone. I'm Daryn Kagan.

Looking at explosions that are now being heard around the world. These are some of the first images from the site. It is near India's financial capital of Mumbai. Dozens are dead and injured after several blasts rocked commuter trains at rush hour. Our correspondent, Seth Doane, is heading to the scene and he joins us by phone with the latest.

Seth, what can you tell us?

SETH DOANE, CNN CORRESPONDENT: Hi, Daryn.

Well this, as you mentioned, happened at a very busy time of the day for residents of Mumbai. Most of these blasts happening in the western suburbs of Mumbai, which is India's financial capital. CNN IBN, the local Indian affiliate of CNN here, is reporting that six blasts were heard. We can directly confirm five through the director general of police in Mumbai confirming five separate blasts. These all have happened within the last just about hour here, hour or so. Right now it's 7:35 here in India. So it was -- these bombs were hitting at a key time for commuters.

KAGAN: Anybody claiming credit for these explosions?

DOANE: Not yet. There were also a series of blasts earlier in the day in Kashmir and the home secretary here said that there is no connection between, at least it's assumed at this time, no connection between the blasts in Kashmir and the blasts in Mumbai. We're also getting some reports of casualties from our CNN news representatives in the field in Mumbai, reporting eight dead from one station and one hospital. That's according to a CNN representative on the ground in Mumbai.

KAGAN: What has been the tension level there? What is the environment in terms of terrorism in Mumbai?

DOANE: Well, there was -- there's a history in Mumbai. Back in 1993, there were a series of coordinated bombings with many dead. But this is -- we're getting reports of true chaos on the street there and trying to get through we're having an issue getting in just on the phone lines. It is certainly unexpected and quite a shock to those there in Mumbai.

KAGAN: Well, we are looking at these first pictures and they are very dramatic indeed. Seth, we're going to let you go and collect some more information and we'll bring our viewers that in terms of information and pictures as they come in to us.

But once again, a series of explosions rocking Mumbai's commuter rail network during the evening rush hour, ripping apart train compartments, which you see from these pictures, and reportedly injuring dozens. That is according to police there in Mumbai. More pictures and more information as that becomes available from India's financial center.

Meanwhile, news right here in the U.S. Today the Pentagon changing the rules at Guantanamo Bay. Sources telling CNN that from now on detainees will receive protections under the Geneva Convention covering prisoners of war. The move gives some basic legal rights to detainees. Among them, suspected al Qaeda members. It's a reversal for the Bush administration and it comes after last month's Supreme Court ruling that trying terror detainees in military tribunals as they were designed is illegal.

Let's take a closer look at what the new rules mean for the war on terror. Our senior legal analyst, Jeffrey Toobin, joins me on the phone now from New York.

Jeff, good morning.

JEFFREY TOOBIN, CNN CORRESPONDENT: Hi, Daryn.

KAGAN: Do you believe that this comes directly from as a result of what the Supreme Court ruled just recently?

TOOBIN: Oh, absolutely. This certainly would not have happened if the court had not essentially forced the Bush administration's hand. It really dramatically changes what kind of trials these detainees will have and really complicates the business of trying them because the Geneva Conventions are tougher requirements.

KAGAN: Over and over again when you read about this you hear about something called Common Article III. What does that mean? And how does that apply?

TOOBIN: Well, basically there are several Geneva Conventions, which are treaties signed by many governments, including the United States government. But Article III is common to several of these Geneva Conventions. And it is basically the bedrock principle of the Geneva Conventions and that's the one that the court focused on with an opinion last month and that's the one that the administration now has to deal with.

KAGAN: And is this going to affect how they're actually treated there by all accounts?

TOOBIN: Not so much. KAGAN: This is really about how do you try these men.

TOOBIN: Exactly. I mean . . .

KAGAN: Which no one's been able to figure out so far.

TOOBIN: Right. The administration has said all along that it is complying with the requirement of humane treatment and not torturing them. That, of course, is a matter of some controversy because representatives of the detainees have said some have been tortured. But certainly the Bush administration has said all along, we don't torture, we comply with the Geneva Conventions on the treatment issue.

The difficult, harder issue is things like, do the detainees get to be present at their trials? Do they get to see all the evidence against them? The Geneva Convention says they have to see the evidence. They have to be present. And the policies put in place by the Bush administration that were challenged said they didn't. Those are the kind of issues that could result in a big change if the details of this policy suggests that they are going to start complying with the convention.

KAGAN: Jeff, an aspect of this story that hasn't been covered quite as much. The last time around when the Bush administration trying to figure out how you do these military tribunals. Something was made of that the top military attorneys were not really included in coming up with that. Do you think that would change? And how would that change with the comes (ph) up with (ph)?

TOOBIN: Well, I think one of the things that is starting to change about the Bush policy is, instead of giving responsibility to highly political people in the Justice Department, true believers in the vice president's office, the responsibility may be shifted more back to the Pentagon, to career officials, to people who have had long-term responsibility for these issues. That is one shift.

But, you know, it really doesn't matter who comes up with the policy. What matters is whether the court's approve it. And now the Supreme Court has said twice that the Bush administration has violated our laws in terms of the treatment of these detainees just last month and two years ago. We'll see whether the next one passes muster.

KAGAN: Jeffrey Toobin our senior legal analyst. Jeff, thank you for your insight on this new development.

TOOBIN: OK, Daryn.

KAGAN: You heard Jeff mention the Pentagon. We will also be hearing from Barbara Starr a little bit later in the broadcast.

Also, we are crunching numbers, crushing debt. The president say there is good news in the government's overspending. But not everybody is celebrating. Our Andy Serwer breaks it down. What do these new numbers mean for you?

Also, concrete panels crashing down in a Boston tunnel, killing one person and disrupting traffic for miles. This is not the first problem plaguing this money pit of a road project. We actually expect to hear more from officials in Boston in about 15 minutes. You'll see that live here on CNN.

And a lot more about what's happening in India. A series of explosions along the commuter rail in India's financial center of Mumbai. You'll hear more about that just ahead on CNN, the most trusted name in news.

(COMMERCIAL BREAK)

KAGAN: We are carefully watching this breaking news store out of India from Mumbai where at least six blasts rocked commuter trains at rush hour today. This is in India's financial capital. Dozens of people injured in the blast. At least 15 people killed. Happened during the middle of rush hour, as I was mentioning. At least one train was split in half by the explosion. This subway system was put on red alert in Mumbai after these explosions in the city's western suburbs. Also the capital of New Delhi is on heightened security and airports all across India on high alert as well. More on that as it develops.

On to now your money and your taxes and our taxes and the president's two cents. Just minutes ago, Mr. Bush celebrated what he described as good news on the nation's projected budget deficit. At least that's his bottom line. Others a bit more skeptical. Let's take a look at those numbers.

The White House had a forecast of a deficit of $423 billion. President Bush says his tax cuts have stirred growth and helped trim that estimate to about $300 billion. Is that something to celebrate? Andy Serwer joining us with a closer look at what this means.

Andy, let's start with a little 101, the budget deficit and that big fat number. Why is it important to the economy and to each of our own bottom lines?

ANDY SERWER, CNN CORRESPONDENT: Well, first of all, it's a little counter intuitive to cut taxes and have the budget deficit go down. How does that work? And what the president's saying is he cut taxes and that spurred growth which produced more tax revenue which then lowered the deficit, Daryn. The deficit is still pretty high, obviously, around $300 billion.

And really, as the president suggested, it's much like an individual homeowner, like an individual family. You know, when the government has a lot of debt, that's not a positive thing. It kind of puts them in a bit of a bind.

The president did point out, however, that that $300 billion budget deficit, when you compare it to the overall size of the economy, that it's not that big historically. Right around 2 percent. And he is absolutely right that that is a very critical measure, that it's not just the absolute size of the budget deficit, but it's the size relative to the overall economy. And, historically, that's not way out of line at all. KAGAN: Well, and if you want to do history books, though, some people will look and say, well what about that big surplus that existed just a few years ago.

SERWER: True enough.

KAGAN: And how does that play into it if you're going to make that comparison?

SERWER: Well, you know, I think that, obviously, we'd all love to have a surplus. Very hard to cut taxes, fight a war on terror and then have something like Hurricane Katrina happen. And I think that's the scenario that we're looking at.

You know the president has pledged to cut the budget deficit in half by 2009. He now says we're a year ahead of schedule. And I think that there are people, including members of his own party, who say it's irresponsible for the government to run such a large budget deficit. That we're really trying to have our cake and eat it, too.

And, Daryn, when we talk about how this impacts consumers and people out there at home, you're talking about a higher budget deficit creating higher interest rates. There are some that say that those two are linked. And, in fact, interest rates, as anyone can tell you, have been ticking up. The Fed funds rate is now at 5.25 percent. The Federal Reserve has been raising interest rates to prevent the economy from overheating.

You know, overall, the economy is really kind of chugging along just fine. You can see here, you know, interest rates have really come up tremendously over the past two years. But that really is a reflection of the health of the economy. The GDP, the economy's been growing about 5.6 percent. You can see there we are the latest quarter, which is pretty good. And the unemployment rate about 4.6 percent.

Many people say the president should talk more about the economy, particularly members of his own party, that it's a real positive. And as we head towards midterm elections, he should be highlighting the fact that the economy is on firm footing here. Be interesting to see now with a new Treasury secretary, Hank Paulson, whether or not he highlights the economy as we move towards the fall.

KAGAN: Andy Serwer. Andy, thanks for the perspectives. Appreciate that.

SERWER: Thanks, Daryn.

KAGAN: Let's move on to Boston where tragedy and a traffic nightmare have taken place. Three ton ceiling panels in a highway tunnel fell last night crushing a car and killing one person. The tunnel is not expected to reopen for at least another 24 hours. This is all part of that $15 billion 15-year big dig project which has been plagued by construction problems and cost overruns. Six employees of a concrete supplier were arrested in May and charged with delivering substandard materials. And in April 2005, debris fell from an overhead vent. There also have been several big water leaks. Steve Cooper of our affiliate WHDH has more on last night's tunnel tragedy.

(BEGIN VIDEOTAPE)

STEVE COOPER, CNN CORRESPONDENT, (voice over): A stunning scene unfolding here in Boston overnight when several panels fall from a tunnel connected to the Massachusetts Turnpike. And this is a pretty rare sight because this stretch of the highway, a busily traveled highway at the time of the day, is all shut down while this investigation is just getting underway.

This is the Mass Pike that connects the eastbound lanes to the Ted Williams Tunnel and then on to Logan Airport. This happened around 11:00 last night. Turnpike officials telling us that a 40-foot section of the ceiling fell to the roadway below crushing a car. Now it appear a steel tieback that holds the panels to the ceiling for some reason let go. The male driver crawls out of the car. The female passenger was pronounced dead.

Federal highway administration officials have now been summoned to the scene here in Boston to assist in this investigation. And all the while it appears that this stretch of the Mass Pike will be closed at least through tomorrow and it may go well beyond that as this massive investigation is just getting underway.

From Boston, Steve Cooper, for CNN.

(END VIDEOTAPE)

KAGAN: And we do expect to learn more about that accident coming up. A news conference is scheduled for about nine minutes. You'll see it right here on CNN.

Also the latest on those series of train blasts in India.

Chilling words and graphic pictures on the web. A new videotape showing the al Qaeda leader, Osama bin Laden, claiming to show the ugly aftermath of the killings of two U.S. soldiers in Iraq. More straight ahead. You're watching CNN, the most trusted name in news.

(COMMERCIAL BREAK)

KAGAN: Following a breaking news story out of India in Mumbai. A series of at least seven blasts rocking a commuter train at rush hour. This was in India's financial capital of Mumbai. At least 15 dead are reported. Also dozens of people injured in these blasts. No one's taking credit for the explosions at this time. This has put the rail system in India and airports there on high alert. We'll continue to follow that as information becomes available out of India.

Meanwhile, other news.

The U.S. military condemning a video posted on Islamic websites, along with a voice and pictures of Osama bin Laden. It claims to show the aftermath of the killing of two U.S. soldiers in Iraq. Our senior international correspondent Nic Robertson filed this report from Baghdad. (BEGIN VIDEOTAPE)

NIC ROBERTSON, CNN CORRESPONDENT: The insurgent video begins with a statement claiming that it is from the Mujahideen al Shura, the council of Mujahideen associated with al Qaeda, claiming that this is a videotape of the two kidnapped Americans, the two American soldiers kidnapped after a shoot-out about just over three weeks ago in the Mahmoudiya area, Yusufiya area south of Baghdad. That video then continues with a message from Osama bin Laden that has been extracted from his most recent message and it says what makes Muslims happy is to see Americans attacked and that's when the very graphic and bloody pictures of what appear to be two American soldiers begins.

The video lasts about five minutes. A small box appears on the screen. It has a picture of Abu Musab al-Zarqawi, the former al Qaeda leader in Iraq who was killed in the beginning of June. The message from him that you have to continue to attack American soldiers.

But along the bottom of this, the banner gives away perhaps the most important information. It essentially says that the killing and abduction of these two soldiers is in retaliation for the alleged rape of a young Iraqi woman, Abeer al-Jinabi (ph), in March in the town of Mahmoudiya. It say this is revenge for the dishonor of our sister by soldiers of the same brigade. The 502nd Parachute Infantry Regiment attached to the 101st Airborne.

The videotape very, very graphic. Very, very bloody. It's not possible to know at this stage whether or not it was really al Qaeda that shot the video. The video is very shaky. But it is claimed by al Qaeda. It is claimed to be revenge for the alleged rape of Abeer al-Jinabi back in March in Mahmoudiya.

Nic Robertson, CNN, Baghdad.

(END VIDEOTAPE)

KAGAN: News from here in the U.S.

Part of the concrete ceiling in a Boston tunnel gives way crushing a car and killing a woman.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: The tunnels are safe. What we have found right now is that we're looking at about 200 feet of tunnel.

(END VIDEO CLIP)

KAGAN: The latest on the continuing investigation, including a news conference live from Boston, just in a couple of minutes from now. You'll see it right here on CNN, the most trusted name in news.

(COMMERCIAL BREAK)

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