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American Morning

Controversial Port Deal on Hold; In Iraq, Daytime Curfew Called as Fears of All-Out Civil War Increasing

Aired February 24, 2006 - 07:00   ET

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

SOLEDAD O'BRIEN, CNN ANCHOR: Good morning, everybody. I'm Soledad O'Brien.
MILES O'BRIEN, CNN ANCHOR: And I'm Miles O'Brien. The controversial port deal on hold right now. The president still showing support for the idea, though.

S. O'BRIEN: And nearly empty Baghdad streets. A daytime curfew has been called as fears of an all-out civil war is increasing.

Protesters are clashing with the police in Philippines. There might be something more sinister going on, though. We'll explain just ahead.

M. O'BRIEN: And the beloved BlackBerry could be going bye-bye. Say bye-bye, BlackBerry, Soledad. Today a judge moves closer to a final decision on the fate of the instant e-mail device you rely on.

S. O'BRIEN: And a surprise on ice, a new ice princess. I told you we come up with all those phrases, ice queen, ice princess. Well. whoever. There she is. She's beautiful. And she is crowned at the Winter Olympics. That story ahead on AMERICAN MORNING. We're back in a moment.

M. O'BRIEN: And we begin with the CNN Security Watch. That controversial seaport deal, Dubai Ports World, is saying it will delay taking control of six major U.S. ports. The company a state-run business from the United Arab Emirates.

White House correspondent Elaine Quijano at the White House now with more on this.

Elaine, tell us what happened.

ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: Good morning to you, Miles.

Well, what happened was there was enormous pressure, essentially, coming from Capitol Hill on the White House, not just from Democrats, but even members of the president's own party who came out hard against President Bush on this particular deal.

Now, some lawmakers had argued that the deal could threaten national security, while President Bush said that the deal had been properly vetted, so it looked like it was headed for a showdown. Some lawmakers saying that they would pass legislation to block the deal. President Bush threatening to use his veto power if that happened. Then the president's top political adviser, Karl Rove, signaled yesterday that the White House might accept a delay in order give lawmakers what he called a comfort level. Then, of course, finally, overnight, word late last night from the company itself, Dubai Ports World, that it was going to hold off on the U.S. part of the transaction.

In a statement issued last night, a spokesman said, quote, "We need to understand the concerns of the people in the U.S. who are worried about this transaction and make sure they are addressed to the benefit of all parties. Security is everybody's business."

But, Miles, no word on how long company officials plan to hold off on this deal -- Miles.

M. O'BRIEN: Well, I don't think we've heard the end of this one, have we, Elaine?

QUIJANO: Probably not.

M. O'BRIEN: All right, Elaine Quijano at the White House. Thank you very much.

New York Republican Congressman Peter King, chairman of the Homeland Security Committee. He's been a vocal opponent of this whole idea of the United Arab Emirates company taking control and managing those ports. We'll ask him about the latest development in about 10 minutes from now -- Soledad.

S. O'BRIEN: An extraordinary step in Baghdad to stop a wave, or at least try to stop a wave of sectarian violence as the government calls for a very unusual day time curfew.

Let's get right to CNN's Aneesh Raman. He's there this morning for us in Baghdad.

Kind of calm, but what about the rest of the country, Aneesh?

ANEESH RAMAN, CNN CORRESPONDENT: Yes, Soledad, as you say, in Baghdad, a welcome period of calm really throughout the country at the moment amidst that surge of the sectarian strife that has left at least 132 people dead according to Iraqi police, some 80 bodies found in Baghdad itself. The government imposing a daytime curfew reminiscent of what we saw during election periods. It runs for another hour. Some people have been allowed onto the streets. Noon prayers on Friday, the most important players for Muslims. So they've allowed some people to leave their homes.

Iraqis on the street are starting to voice that they need their government to do more to get this situation under control. At the same time, they seem to be preparing for the worse.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE (through translator): We demand that the government and the religious authorities find a solution to this crisis.

UNIDENTIFIED MALE (through translator): Sectarian strife and war will happen, and we're expecting that.

(END VIDEO CLIP)

RAMAN: Now these are tense times here. In the past two days, the violence has erupted throughout the country. The government trying to urge calm. The security forces out in force in Baghdad. All of the mosques, we're told, are being protected by Iraqi security forces.

Again, though, the curfew ends in an hour. We'll see if demonstrations then begin in the capital -- Soledad.

S. O'BRIEN: And more calls for peace at the same time from important Shia leaders. Are those calls working?

RAMAN: We've heard just in the past hour or so from Abdel Aziz Hakim, the head of the Shia alliance. It's the backbone of this government, calling for unity, saying that the country cannot be dragged into civil war. It seems for the moment to be working, but again, we're also under a lockdown situation.

The big question that has confronted this country is whether the anger on the streets in terms of the Shia response will erupt, despite the call to moderation by their religious and political leaders. And that is what we're still waiting to see in the days to come -- Soledad.

S. O'BRIEN: Aneesh Raman in Baghdad for us this morning. Aneesh, thank you.

Coming up in about 25 minutes, we're going to talk to two Iraq experts, talk about any potential for civil war in that country.

Now to a developing story in the Philippines we've been talking about, an alleged plot to overthrow the president. A top general says protests against President Gloria Arroyo were used as a cover for a coup actually. Now President Arroyo has declared a state of emergency. Under arrest today, a general who is in charge of elite military unit. Police are also looking for a marine colonel. Oddly enough, that colonel appeared on Philippine television, saying he didn't know anything about any coup plot. It gets weirder and weirder to some degree there.

M. O'BRIEN: A dramatic 7-hour standoff in Phoenix overnight. An armed man took nine people hostage in a Phoenix high-rise. Negotiators were able to talk him into surrendering peacefully a little after midnight Eastern Time.

CNN's Kareen Wynter live for us from Phoenix this morning.

Kareen, how did police talk him out of this?

KAREEN WYNTER, CNN CORRESPONDENT: Miles, it was quite a risky move, but police granted the suspect's request to see his loved ones. They brought them right up to the 18th floor of this building behind me. Forty-two-year-old George Curran was taken into custody last night, turned over to the FBI. He will face federal charges.

But as for the standoff, officials say it was a long, intense night of negotiations.

(BEGIN VIDEO CLIP)

SGT. ANDY HILL, PHOENIX POLICE: He kept making demands that we would meet, but he would add things to them that would make it harder, so we had to go several times on certain issues, so we ended up having to have his wife and his sister there. And those last few moments were very tenuous and very dangerous.

(END VIDEO CLIP)

WYNTER: Miles, I had a chance to speak to the girlfriend of a man who was held hostage inside this building. She said at no time did he feel that his life was in danger, that the hostages were even allowed to use cell phones to call their loved ones to make sure they were OK -- Miles..

M. O'BRIEN: Kareen, what do we know about the hostage-taker examine what his motives might have been?

WYNTER: Police say they don't have a lot on him right now, except to say that he doesn't have a real criminal history. What he was doing on the 18th floor of this building still also remains a mystery, but they do say, Miles, that his wife is going through some issues, some problems regarding her employment, so they believe that may have played a part. But again, still too soon to tell -- Miles.

M. O'BRIEN: Kareen Wynter in Phoenix, thank you very much.

(WEATHER REPORT)

S. O'BRIEN: A reminder to everybody, you want to stay with us in our 9:00 hour today, we've got a special health series. It's called "30, 40, 50." Those are ages. We're talking about men's and women's health issues, including heart health, fertility, memory. So if you've got a question, you can send us an e-mail. Our Web site is CNN.com/AM. Or you can just Instant Message us. AOL Instant Message us at CNN AM. Our medical team of Dr. Sanjay Gupta and Elizabeth Cohen are going to be on hand to answer your questions, all of your questions. That's coming up.

M. O'BRIEN: Coming up, Dubai drops anchor for now. That controversial port deal is on hold. We'll talk to a Congressman who has been trying to kill it, see what he's going to do next.

S. O'BRIEN: Also a big court hearing today on the future of the BlackBerry and what it means for the millions of us who rely on them.

M. O'BRIEN: And a gold medal not in the cards for Sasha Cohen. We'll go live to Torino for a look at what literally tripped her up. Stay with us.

(COMMERCIAL BREAK)

M. O'BRIEN: CNN Security Watch time. That United Arab Emirates- owned company that sought to take over management of six major U.S. ports backing off for now. It says it will delay the deal.

Republican Congressman Peter King introduced an emergency bill in the House that would have blocked the deal. He joins us now with his take on all this.

Congressman King, good to have you with us. What's your take on this? What do you think?

KING: Good morning, Miles.

Well, I think it's a positive step. I think it's very positive that the company realizes there are very serious questions being raised. Also, after listening to Karl Rove yesterday, it became obvious that the administration realizes that a number of issues have to be answered.

Now, my legislation calls for a 45-day investigation, because that's my main concern, that there was never an investigation. And if the company just thinks that by explaining the deal, or the administration thinks by explaining the deal that Congress is going to get on board, I don't think so. Because the more I learned about the deal and the more I learned about the process, the more concerned I became, because there's been no full investigation yet of this company, of its relationship to the government, and whether or not there could be any Al Qaeda influence, whether or not any of the people involved in the company were involved, for instance, with the pro-Taliban movement that was in the government.

So my real concern here is about the company itself, and that can only be resolved, I believe, by a full investigation by our intelligence agencies.

M. O'BRIEN: So you would like to move forward with your legislation, then?

KING: Again, I want to see what the details are over the next several days. If there's going to be the opportunity for the company to be investigated before a final decision is made, then I don't know if we have to go ahead with the legislation. We can put that on hold. But if it's just going to be a so-called cooling off period with these briefings given on the details of the contract, I don't see how that's enough, because the underlying question has to be whether or not this company with be trusted, and that can only be done by the same type of investigation that any federal employee would get, certainly any sub- Cabinet official, if they wanted a job in the federal government. There has to be a full vetting.

That was not done, and that's where the people in the administration who talk about this full investigation is just wrong. There was never an investigation of this company.

So, again, I want to see what happens between now and next Monday and Tuesday when we're back in session.

If there is going to be a full analysis, an investigation, I think we can certainly hold on the legislation. If there's not going to be, then I think the legislation has to go forward. M. O'BRIEN: Let's talk about that full analysis. What do you need to hear? What reassurance do you need in order for this deal to move forward?

KING: Well, to see exactly who makes up this company, what their relationship is with the government, what their hiring practices are. Are there any people, for instance, involved in the company who are considered pro-Al Qaeda or pro-Taliban?

Remember, this was one of only three governments in the world that recognized the Taliban. The government owns this company, so, therefore, were there elements of Taliban forces in the government that also are involved in this company? Do they have sympathizers in the company that could be used within our ports?

I mean, there's so many questions here about the security risks -- and that could only be done, again, by having a full-scale investigation, the same you would do -- again, if a company was getting a sensitive federal contract you would have to know exactly who's there, what they do, what the procedures are going to be.

M. O'BRIEN: The president's point is this: We're talking about an ally in the war on terrorism. You would never suggest legislation like this if it was a company controlled by Great Britain.

Is there a key difference here, and is this sending a bad message to allies?

KING: First of all, there's a real moral distinction between the government of Great Britain and the government of the United Arab Emirates. I concede -- very pleased that in the last several years UAE has been more supportive of our policies, but the fact is prior to September 11 they were very hostile, and many of those same elements are still active in UAE today.

So how do we know, for instance, that this is a permanent conversion, or is it just a conversion of convenience and those elements are still within the government?

So I think it's really wrong -- it's an unfortunate moral equivalency to compare Great Britain to Dubai. Dubai is coming along -- so is Pakistan, but I wouldn't necessarily trust a Pakistani company at this stage to be running our ports because we know this is still an Al Qaeda presence in Pakistan.

So we have to vet it out. We have to see just how separated this company is, how -- there's no elements of Al Qaeda in there that are a threat to us. That's what has to be done. The president -- I don't think it serves a purpose to be saying that this somehow is anti-Arab or anti-Middle East. It's a real concern about a company which comes out of a country which had the strongest pro-Taliban leanings in the world prior to 9/11, and also in many ways refused to cooperate with us in the war against terrorism until recently. These are real issues that have to be addressed.

M. O'BRIEN: Republican Congressman Peter King of New York, thanks for being with us.

And be sure to stay with CNN day and night about the most reliable news about your security -- Soledad.

S. O'BRIEN: A tax service trusted by millions of Americans goods on its own taxes. Andy is "Minding Your Business" just ahead.

Plus, Sasha Cohen settles for silver at the Olympics. We're going to take a look at what literally tripped her up. Those stories ahead on AMERICAN MORNING.

We're back right after this short break.

(COMMERCIAL BREAK)

(MARKET REPORT)

S. O'BRIEN: Let's talk Olympics. American Sasha Cohen literally fell short of her Olympic dream, and that opened the door for another skater who walked through in historic fashion.

Let's get right to CNN's Larry Smith. He's live in Torino this morning.

Hey, Larry, I was watching this way too late last night. Everybody was waiting for Sasha to get the gold. Not going to happen, though. And the Japanese woman who woman who won, just remarkable.

LARRY SMITH, CNN CORRESPONDENT: She was fantastic, Shizuka Arakawa. She's 24 years old. She won the world championship in 2004, and actually considered retiring after that. We're glad she didn't, because she was phenomenal last night.

But take nothing away from Sasha Cohen. That slip early. She said she was stunned. She couldn't believe it, but she held it together, got it together, and still brings home the silver, her first Olympic medal. At 21 years old, it's not out of the realm of possibility that she'll be back to try once again for the gold when she's 25 years old in 2010 when the Games will be held in Vancouver.

S. O'BRIEN: You know, it's my favorite event, this figure skating, because I watch it with my girls and they love it, then they skate around the living room.

But we're moving on. It's over. And now it's women's skiing. What happens now? SMITH: Yes, maybe your girls will watch the skiing, too, because it's really interesting. Some bad weather right now in the women's giant slalom. After the first run, they tried to hurry things up. They shortened the giant slalom course. They were getting the skiers out as fast as possible. Now we can say that Julia Mancuso leads after the first run. Second run began at the top of the hour. Out of the first 10 that went out, four didn't finish. The times are much worse in the second run, and so we'll see if Mancuso is going to come up here very shortly, if she can hold, steady that lead and get a gold medal, which will be only the second medal for the U.S. here in the alpine events here in these Games.

S. O'BRIEN: That will good to watch. All right, Larry, thanks.

Ahead in our next hour, we're going to get much more from the figure skating finale from NBC Olympic analyst and gold medalist himself, Scott Hamilton will be joining us to talk about the highs, and some of the lows as well -- Miles.

M. O'BRIEN: All right, thank you very much, Soledad. You just heard Andy railing about BlackBerry, and RIM and NTP, the big check that RIM will ultimately probably write. They've just been rope-a- doping this thing, right? That's basically it.

SERWER: Could be.

M. O'BRIEN: Coming up, we'll look at what it could mean for millions of people who use the device should the dreaded shutdown occur. I don't think it's going to happen, but that's just me.

Plus, this year's Mardi Gras. It's going to look a little different because of Katrina as we look at some live pictures at some of the floats that will be making their way through the older parts of the Crescent City. Obviously, it's a mixed bag on this Mardi Gras. We're going to talk to one guy who plays a big part in the celebrations. His family has built floats, including the one you see there, for more than 70 years.

Stay with us.

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