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American Morning

Fight for Iraq: New Top Commander Speaks Out; Gonzales Aide Takes the Fifth

Aired March 27, 2007 - 07:59   ET

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

SOLEDAD O'BRIEN, CNN ANCHOR: A developing story we're watching. Some new concerns overnight that the number of dogs and cats poisoned by toxic pet food is much worse than first thought.
JOHN ROBERTS, CNN ANCHOR: Brutal beating. Another savage attack on an elderly person caught on tape. Now police looking for the robber and your help.

O'BRIEN: Mistaken identity. There are reports of Americans unable to get jobs, loans, even rent an apartment because they share the name of a terrorist.

ROBERTS: And super-sized surprise. A freak of nature down under that also packs a poisonous punch.

We're live from Baghdad, Washington, D.C., and New York on this AMERICAN MORNING.

O'BRIEN: Welcome back, everybody. It's Tuesday, March 27th.

I'm Soledad O'Brien.

ROBERTS: I'm John Roberts, in for miles O'Brien.

Thanks for joining us.

I always love Chad, because it's kind of the situation where, well, if you think it's bad, wait, I can make it worse.

O'BRIEN: Hey, he's right about that pollen, though, man. That kills you as you go outside in the summer.

I'm with Chad on this one.

(NEWSBREAK)

O'BRIEN: It was a blistering response to the Pentagon overnight from the family of Army Ranger Pat Tillman, still unhappy with that report about his death by friendly fire. They say, the family members, they want Congress to investigate.

The family is accusing the Army of criminal negligence, malfeasance, evidence tampering, and much more. Here's part of the statement they put out last night.

They say, "Our family will continue to pursue the full truth about the circumstances of Pat's death and the so-called missteps of the Army, the Department of Defense, and this administration."

You'll remember Tillman quit the NFL after 9/11, joined the Army. Killed in Afghanistan, but it was more than a month before his family members were told that he was killed by friendly fire.

To Baghdad now, where the new head of the U.S. Central Command is getting his first look at the war zone. Admiral William Fallon talked with CNN's Kyra Philips overnight about just what Iraqis have been telling him and whether he sees a civil war on the ground in Iraq. Also, about the influence of Iran.

Kyra's in Baghdad for us this morning.

Hey, Kyra. Good morning.

KYRA PHILLIPS, CNN CORRESPONDENT: Hi, Soledad.

That's right, I did ask him about Iran. I said, "What are you going to do about this country? They're aiding militias in Iraq, they are helping the insurgency, they're bringing weapons and tactics into this country." He said, "I am going to deal with them, but I'm just not going to do it by going to war."

(BEGIN VIDEO CLIP)

ADM. WILLIAM FALLON, U.S. CENTRAL COMMAND: Iranian behavior has been not only unhelpful, but detrimental to peace and progress. Now, Iran sits in a neighborhood of other countries. And my intention is to go around and meet the leaders of these countries in the region, and I'm going to talk to them about this.

Two things on my agenda, if you would. One is to get help from these countries for this place, for Iraq. The other one is to help us to deal with this Iranian behavior, to try to see what we can do to make these folks realize they've got to -- they have aspirations to be somebody big? You've got to act like a -- like a big boy.

(END VIDEO CLIP)

PHILLIPS: Well, as you know, the admiral's former job was the head of Pacific Command, PACOM, out of Hawaii, before he took this position, head of CENTCOM. That means he oversaw the carriers and a lot of action in the Persian Gulf waters.

There are two carrier battle groups out there right now, not far from Iran, the USS John Stennis, and also the USS Dwight Eisenhower. And Soledad, I've been asked a lot about the operations that are going on, on these carriers right now.

I don't want to make a big deal out if it, because it's standard operating procedure. They're carrying on flight operations. But that second carrier out there that joined Eisenhower is definitely a way of saying to Iran, look, we have eyes on you, we're watching your behavior, and we will do what is necessary to "keep you inside the box." O'BRIEN: Kyra, on the table in the House, on the table in the Senate are timetables, definitive timetables when the forces, U.S. forces, should withdraw from Iraq. Did he talk about that?

PHILLIPS: I'll tell you what, this seems to be the $50 million question -- When will U.S. troops be able to come home? And the point is, especially after being here on the ground, no matter who you ask, what general, what admiral, what commander, there is just no way that you can get a timetable from these leaders right now.

It's too chaotic. And it goes in cycle.

Baghdad is safe, and then you see an increase in violence. Then you go to the outskirts of Baghdad, certain areas calm down. And then you see the violence increase.

So, until the U.S. military can help get the Iraqi police and the Iraqi military trained, and they can truly take over this country, there is absolutely no way to set a timetable -- Soledad.

O'BRIEN: Kyra Philips in Baghdad for us.

Thank you, Kyra -- John.

ROBERTS: An Australian terrorist is going home to serve his sentence. David Hicks is the first detainee at Guantanamo to plead guilty to terrorism charges. He was captured in Afghanistan back in 2001. He could be sentenced later this week and sent home some time this year.

A key figure in the firings of eight U.S. attorneys has decided not to talk to Congress. Monica Goodling will instead exercise her Fifth Amendment rights.

Savannah Guthrie from Court TV back with us again to explain this move.

You spoke with her attorney, John Dowd. And we should point out you used to work with him.

SAVANNAH GUTHRIE, COURT TV: I worked with him very closely. I think I understand his strategy here.

She went out and hired herself a criminal lawyer. That's someone who's not concerned about politics, not concerned about P.R. He doesn't want to put her in a situation where he feels she's exposed potentially to a perjury charge down the road, a false statement charge down the road. And so he said she's asserting the Fifth Amendment, she's not going to testify, and that's the end of that.

ROBERTS: But here's the thing. When she asserts her Fifth Amendment rights, which every American has the right to do under the Constitution, it makes things look really suspicious here, particularly when Kyle Sampson, the attorney general's chief of staff, is going to the Hill to testify on Thursday. You can hear from the chief of staff, but you can't hear from the liaison to the White House?

GUTHRIE: Well, that's the -- that's the point. There's a perception problem. People think, rightly or wrongly, that if someone asserts the Fifth Amendment not to incriminate themselves, they are hiding something, they've got something to hide.

Now, under the law, that's not true. They cite a Supreme Court case that says even an innocent person can assert the Fifth Amendment. But it does set up this dichotomy -- one guy's talking, this gal isn't.

What's really clear here is that the White House isn't controlling them, the Department of Justice isn't controlling them. They've gone out, hired their own lawyers, and different lawyers come to different conclusions.

ROBERTS: The Democrats are having a field day with this, though, Savannah -- oh, something must have been wrong because she's taken the Fifth.

Is this going it put more pressure on the White House to accede to this idea of testifying on the Hill even through subpoenas?

GUTHRIE: Well, I think that the White House will say, look -- they sort of capitalized on what Monica Goodling's lawyer did by saying, see how poisonous the atmosphere is up there on Capitol Hill? Nobody gets a fair shake, good public servants feel like they can't testify.

So they're using it, their spinning it to their advantage. Democrats are spinning it to their advantage. Nothing new there.

ROBERTS: What's your sense? Is Gonzales going to stay?

GUTHRIE: You know, it's hard to say. I mean, I thought that when President Bush came out and supported him so strongly, I thought this could be the turning point where we say, all right, he has weathered the storm. But if there are additional revelations, I think he's still in some jeopardy, and we'll obviously have to wait and see how it plays out.

ROBERTS: Yes. The ground is getting a little shaky under his feet, I think.

Savannah Guthrie, thanks again. Always good to see you.

GUTHRIE: Nice to see you.

ROBERTS: Soledad.

O'BRIEN: It looks like New York City's subway superhero -- remember that guy -- he is headed to court. Wesley Autrey became famous after he saved a young man who fell on to the subway tracks in New York. Now he is suing his lawyer. He says she tricked him into signing away the rights to his name and his story. The lawyer says, oh, no, no, no, Autrey is just trying to get rid of her because somebody else has made him a better offer.

Top stories ahead this morning.

He's big, he's ugly, he's breaking records, too. Have breakfast with Toadzilla this morning.

You're watching AMERICAN MORNING. The most news in the morning is right here on CNN.

(COMMERCIAL BREAK)

(WEATHER REPORT)

O'BRIEN: This week the Senate's going to vote on the Democrats' plan for Iraq. The big question is, will Congress require a pullout of combat troops come 2008?

A woman who knows Democratic foreign policy better than almost anybody we know joins us this morning.

Madeleine Albright, of course, was President Clinton's secretary of state. And her new book, which is called "The Mighty and the Almighty," is now out in paperback.

Nice to see you, Madame Secretary, as always. Thanks for talking with us.

MADELEINE ALBRIGHT, FMR. SECRETARY OF STATE: Great to see you, Soledad.

O'BRIEN: So the Senate's going to vote. The House passed a version, $124 billion, included $4 billion on what everybody calls pork. That's the extra stuff that has nothing to do with Iraq funding.

For example, $74 million in peanut storage, $25 million in spinach growing, $252 million in milk subsidies, $3.3 billion in crop and livestock losses. And there's some people who say it's a vote on something so important, why isn't it just a straightforward vote without the other stuff added in?

Do you think it's appropriate to add all that pork?

ALBRIGHT: Well, I think there's been a lot of discussion about how to vote on this war. Congress, in fact, has had the most recent election. They are the ones that are trying to reflect the feelings of the people about the fact that this war needs to end. And one of the things that's also going on is people would like to make sure that there is additional funding for veterans and for hospitals, et cetera.

I think, unfortunately, there always are such additions, as you're talking about. But the main problem here is that the White House is not really listening to what the people said in the election in November. And so, what you've got is an executive legislative confrontation which, I think, is unfortunate, because the White House should be listening to what the members of Congress are saying about the war.

O'BRIEN: The White House might say this, the same thing that the Iraqi ambassador to the U.S. has said. When it comes to the part of this bill that calls for troops out by August of 2008, they might say and they have said, why not circle that date on the map and show it to the terrorists?

Here is the Iraqi ambassador.

(BEGIN VIDEO CLIP)

SAMIR AL-SUMAIDAIE, IRAQI AMB. TO THE U.S.: If we set out a date now for a complete withdrawal, you can bet your bottom dollar that the terrorists are going to be waiting for that date and attacking and launching their biggest attack on civilians.

(END VIDEO CLIP)

O'BRIEN: So, the bill that the Senate is debating says August 2008 is that date.

Doesn't he have a point? And other people who agree with him, don't they have a point?

ALBRIGHT: Well, they're talking about a goal of getting out. And I think what's very interesting, Admiral Fallon has just been speaking, and he's the one that's now in charge of all the troops, as saying that there have to be quicker results, and that there needs to be a schedule. And so, I think there is a general sense that we have to make clear that we're not there permanently, that there's a goal of getting out. And I think that...

O'BRIEN: So, you think a goal is significantly better than having a date set firm like the House version that was passed?

ALBRIGHT: Well, they talk about a goal. I think a date certain, I have always said I'm not personally for a date certain. But I am for a goal of getting out, because otherwise there is no sign that this is going to end.

And the Iraqis have to, in fact, get a political solution. That's what we're talking about now, and that there needs to be some pressure on the government of Prime Minister Maliki to develop a political solution, because otherwise there is no ultimately military answer to this.

O'BRIEN: Let's turn and talk a little bit about Iran, which has, unfortunately, been in the news a fair amount the last couple of days. You always said the U.S. needs to engage Iran, but there are many people who say the person -- the guy you were dealing with at the time is not Ahmadinejad. They're two different people, and maybe engaging isn't going to work in this case.

ALBRIGHT: Well, I think it is going to work. We don't have to specifically talk to Ahmadinejad. I think that there are other people. What I find interesting, Soledad, is that there are signs of division within the Iranian government. And I think we ought to be trying to figure out how to get to the right people. But what is evident to me and has been all along is you never get anything done if you decide you're not going to talk to the people you don't like.

O'BRIEN: So you aren't suggesting you talk to Ahmadinejad, you are saying talk to other people.

ALBRIGHT: Yes. I think there are other people, and I think there are -- there's the foreign minister, there are various representatives. And I -- that's one of the reasons that I thought that the meetings in Baghdad of the regional powers with the United States involved in that with Iranians there is something that's positive, that we have to look at a renalinal solution to this.

The Iranians, I don't think anybody would deny this, are at the moment those that have benefited the most from the war in Iraq. And we absolutely have to talk to them.

O'BRIEN: Madame Secretary, always nice to see you. Thanks for talking with us this morning.

ALBRIGHT: Great to be with you, Soledad.

O'BRIEN: Former Secretary of State Madeleine Albright joining us -- John.

(NEWSBREAK)

(COMMERCIAL BREAK)

ROBERTS: The most news in it morning is here on CNN.

America's top commander in the Middle East talking to CNN overnight in Iraq. Admiral William Fallon says Iraq is not in a civil war, but U.S. troops might be on the ground for years to come.

And a new report out this morning. Veterinarians say more than 100 pets may have died from that poisoned pet food. The FDA only confirming 14 dogs and cats dead.

O'BRIEN: If you're driving to work 20 miles or so, it's going to cost you 10 bucks. No, no, no, I'm not telling you about the tolls. Ten bucks.

AAA has done the math. An average car owner pays over 52 cents a mile when you drive. That's counting gas, insurance, your car payments, your maintenance. AAA says ditch the SUV, get a smaller car if you want to save some money.

Sprint trying to save some money, too, I guess, for folks, cutting the fees for its music downloads. And it's the end of life as we know it, as they say.

Almost 25 minutes past the hour. Stephanie is "Minding Your Business" for us.

Good morning.

STEPHANIE ELAM, CNN CORRESPONDENT: Good morning.

Yes, let's talk about this. It seems that Apple has changed the way even we're looking at -- some of the phone companies are looking at getting your money for music.

Starting off with Sprint and Nextel, they're going to cut their digital music download costs to 99 cents, which is right in line with iTunes. And it includes a copy for the user's desktop computer.

It currently charges $2.49 a song. And they said that they figured people would -- were willing to pay a premium for a song they could get on the go. That may not be the case. We've looked at the fact that Sprint has sold 50 million wireless download songs, whereas if you look at iTunes, they've sold more than two billion.

So, it kind of shows you who's winning there.

Moving on from there, "LIFE" magazine, it's going away.

O'BRIEN: Oh, that's sad. My next door neighbor's husband's family started that years ago.

ELAM: Really?

O'BRIEN: Yes.

ELAM: Well, that's the interesting thing, because a lot of people are like -- it says it started in 2004, but that's not really the case.

O'BRIEN: No, no -- the original.

ELAM: What has happened here, in case you're confused -- because it became a magazine insert, "LIFE" did, in 2004. But it began in 1936 and shut down in '72, came back in '78, and then shut down again in 2000.

So it's had an interesting life. Of course, I should point out that Time Inc. is a unit of Time Warner, which is the parent of CNN. But they're saying...

O'BRIEN: They have the most beautiful photographs.

ROBERTS: Oh, yes.

(CROSSTALK)

ROBERTS: Including the very famous one after World War II, right?

O'BRIEN: Yes. ELAM: And the photos will still be around. They will be online for free and personal usage. All 10 million images will be there. So they're not going. But the last issue is April 20th.

O'BRIEN: Oh, that's sad.

ROBERTS: That's a shame.

(NEWSBREAK)

(COMMERCIAL BREAK)

O'BRIEN: Good morning. Welcome, everybody, Tuesday, March 27th.

I'm Soledad O'Brien.

ROBERTS: And I'm John Roberts, in today for Miles O'Brien.

Thanks very much for joining us.

Ahead this morning, a story that affects thousands of us every day. More and more planes close to colliding on the nation's runways. The technology is there to keep us safe, but for some reason it's never taken off. We'll find out why.

O'BRIEN: Also the story that's putting smiles on some people's faces this morning -- pizza, the newest cancer fighter. That is good news, but of course, as always, there's a hitch.

ROBERTS: Let's hope that they never put it in pill form.

And an early look at the road to road. Swimmer Michael Phelps made the big splash at the Athens Olympics. He mad history again in a big way overnight. We'll tell you about that.

O'BRIEN: Let's start, though, with close calls on the runway. Believe it nor not, they happen more often than you might think. Already this year, the FAA is reporting nine runway close calls. They called them incursions. Thirty-one last years. 2005, 29.

Thirty years to the day after the world's deadliest plane accident. That was back on the Canary Islands. Two jumbo jets collided on the runway, killing 583 people. That anniversary is today. Still, 30 years later officials are trying to figure out what to do about planes running into each other on taxiways and runways.

CNN's Kathleen Koch is at Reagan National Airport for us.

Hey, Kathleen, good morning.

KATHLEEN KOCH, CNN CORRESPONDENT: Good morning, Soledad. And yes, on this anniversary federal officials decided to get together and really take a hard look at this problem. They have the best mind in the business meeting here in Washington today, taking a look at, among other things, new technology that could help keep the runways safer and prevent some of these frightening close calls that are happening far too often.

(BEGIN VIDEOTAPE)

KATHLEEN KOCH, CNN CORRESPONDENT, (voice over): A Frontier AirBus A-319 is about to land in Denver. But as this just released National Transportation Safety Board animation of the January incident shows, it doesn't know a small plane has strayed on to the runway.

UNIDENTIFIED MALE: Frontier 297, go around (ph).

KOCH: The planes miss colliding by just 50 feet.

UNIDENTIFIED MALE: 4216, where you at again?

UNIDENTIFIED MALE: (INAUDIBLE) 4216. Yes, we made a wrong turn there.

KOCH: Nearly every day on the nation's runways, a plane gets too close to another aircraft, building or vehicle on the ground. One in 10 runway incursions is serious, like this one in Los Angeles in 2004 when a controller cleared two planes to use the same runway.

UNIDENTIFIED MALE: Southwest 440, cancel takeoff clearance, hold in position.

KOCH: But federal safety officials are at odds over how to fix the problem. The Federal Aviation Administration Friday announced what most see as an interim step. Quick approval of technology to give pilots a moving map display in the cockpit, similar to GPS used by drivers.

MARION BLAKEY, FAA ADMINISTRATOR: Which runway am I on is the basic question. Where am I going? And this is very valuable information that the device will provide.

KOCH: But it has drawbacks. The unit won't show where our planes are or alert pilots if a collision is imminent. The NTSB has been pushing for that type of system for more than a decade.

MARK ROSENKER, NTSB CHAIRMAN: Runway incursions are serious threats to aviation safety. We believe that the FAA must do something and do something quickly.

KOCH: The FAA says such technology is years away and that any improvement is just that.

BLAKEY: Well, following the NTSB's recommendation, it seems the technology exists, which it does not at this point. KOCH: Pilots agree the moving map system, while not perfect, will increase safety. They also say it shouldn't have taken so long.

UNIDENTIFIED MALE: It's very frustrating. The fact is that the technology has existed for many years.

(END VIDEOTAPE)

KOCH: Now, these new systems that pilots would carry onboard the aircraft, they would plug right into the control panel, costs about $20,000, but it's going to be up to the airlines to decide whether or not to invest in them. The FAA is not going to require them -- Soledad.

O'BRIEN: Kathleen Koch for us this morning at Washington Reagan National Airport, thank you.

(NEWSBREAK)

ROBERTS: An aide to Attorney General Alberto Gonzales says she is going to take the Fifth Amendment and refuse to testify about her role in the firings of eight U.S. attorneys. For a look at the potential political fallout, A.B. Stoddard, associate editor of "The Hill" newspaper joins us now from Washington.

Hey, A.B.

A.B. STODDARD, ASSOC. EDITOR, "THE HILL": Hi, John.

ROBERTS: The White House is encouraging Department of Justice employees to cooperate with congressional investigations, and yet here Monica Goodling, who was the DOJ liaison with the White House, is saying I'm taking the Fifth here. Maybe she didn't do anything wrong, and people are allowed to take the Fifth, but in a town, in a particularly issue where perception is nine-tenths of what is going on, it just can't help but look bad.

STODDARD: I can't think of anything that will charge the engines of Senator Chuck Schumer and chairman Pat Leahy more than this. I mean, we're talking to the top aide to the top law enforcement officer in the nation admitting that she fears legal jeopardy if she tells the truth about her conduct in her job. And I think at this point, you just can't -- the Justice Department itself knew this wouldn't look good. That's why they said they'd have everyone comply fully.

ROBERTS: Yes, I mean, the fact that she is saying she doesn't want to implicate herself in a criminal investigation when there isn't a criminal investigation going on would seem to suggest that that there's a lot more behind the curtain than people have been alluding to.

STODDARD: Well, at this point the problem, of course is the cover-up and not the crime. Monica Goodling was the liaison for the White House and the Justice Department. If there was some serious meddling here and the decisions were made for political purposes, she's going to know the most how much the White House was involved. And so, you know, I can see why, if something is up here, she needs to plead the Fifth. But for the purposes of the committee, at this point, it just couldn't -- it couldn't fire them up more. They're going to be looking, of course, to talk to Kyle Sampson, and then, of course, the attorney general later.

But there are so many confusing, conflicting facts about why they came to this decision, it continues to look worse and worse for the Department of Justice.

ROBERTS: It's just what Washington needs, isn't it, another Monica scandal. And as you said, Kyle Sampson, he's testifying on Thursday. He was the chief of staff to Attorney General Alberto Gonzales. He has since resigned in the heat of this whole scandal. He was the one who was in heavy contact with the White House about which attorneys they were thinking of pulling the trigger on. So he's going to be up there testifying and, yet, she's not. So, I mean, the perception game again here is just not looking good.

STODDARD: And also, just if you take a look at -- this is the perfect probe for the Democrats, John. If you take a look at this. This is not a retroactive fishing expedition about the CIA leak case and a Libby trial. This is not looking at which companies got rich off of reconstruction efforts in Iraq. This is about the integrity of the Justice Department, and the Democrats have sunk their teeth in, and they're not going to let go until they have a bite.

ROBERTS: Hey, just before we go, take a look, quick couple of poll numbers -- Americans by a margin of 3-1 think Congress would be right in subpoenaing officials from the White House to testify under oath.

But take a look at this, as well, the Democrats risk getting dinged by this. Nearly the same number, nearly 60 percent, rather, of Americans believe that the Democrats are doing this all for political advantage, to which any Washington veteran would say, no kidding. But let's say it looks like they have some people on their side, but also a little bit of skepticism as well.

STODDARD: It's fine line to balance.

ROBERTS: Yes, all right. A.B. Stoddard, associate editor of "The Hill" newspapers. Thanks for joining us. Appreciate it -- Soledad.

STODDARD: Thanks.

O'BRIEN: Also on Capitol Hill today, more grilling over just what went wrong in the high-risk subprime mortgage market. A House Financial Services Subcommittee is going to question regulators. Critics say the loans are predatory. They target people with bad credit.

CNN's Deb Feyerick introduces us to one couple who says they were duped into getting one of these loans.

(BEGIN VIDEOTAPE) DEBORAH FEYERICK, CNN CORRESPONDENT (voice-over): When Ana and Radamus Rosado went to buy their first home in the Bronx two years ago, they didn't get what they had bargained for.

ANA ROSADO, HAVING TROUBLE PAYING MORTGAGE: There's an amended stamp on the top where the actual application was amended.

FEYERICK (on camera): So when you went to the closing, these were not the terms that you had originally agreed to?

ROSADO: Exactly. We were forced to sign this.

FEYERICK: When you say you were forced, why not just delay the closing?

ROSADO: Well, we had -- I had already turned in my apartment. We were packed. I just had a baby.

FEYERICK (voice-over): And they say they risked losing a $25,000 down payment. The Rosados say they had agreed to a fixed rate loan guaranteeing they would pay the same rate every month for 30 years. But at the closing, here's what they say they were told.

ROSADO: Oh, I'm sorry, the banks didn't approve this loan. Here's another loan. Then right before closing, that loan supposedly didn't go through and we got stuck with the loan we have.

My attorney said this is not the worst. And you can refinance in two years. So, you know, we swallowed it, took the loan and saved for the past two years to have enough money to refinance again.

FEYERICK: That loan cost them $2,800 a month for two years at a rate of 6.75 percent. But then as written in the mortgage, that lower rate jumped nearly $700, raising to 9.9 percent this past January, or roughly $3,500 a month.

ROSADO: We should have went to the mob for a loan. That's the bottom line. I think the mob would have given us a better loan. Because it was -- they were all in cahoots, it looks like.

FEYERICK: The Rosados claim they were victims of a scam, a classic bait and switch. They were promised one loan but got another. Their loan application was prepared by Alliance Mortgage Banking Corporation. A company vice president says the was no bait and switch, telling CNN, quote: "I find it hard to believe that she was turned down for one loan but approved for another."

ROSADO: This is my son's room.

FEYERICK: Fremont Investment and Loan, the company which actually gave the Rosados their loan to begin was recently ordered by the government to stop providing high-risk subprime loans to people who can't afford to pay once the rates go up. Critics have called the practice predatory as it often targets people who are financially vulnerable. DOUG DUNCAN, MORTGAGE BANKERS ASSOCIATION: There is no question that in the last couple of years, some lenders have lowered the threshold for qualifying for a loan.

FEYERICK: The Rosados have hired a new lawyer to help them refinance.

(on camera): When you look at this, how bad is this? How bad is the Rosados' case right now?

DANIEL KATZNER, ROSADOS' ATTORNEY: This is the absolute definition of a predatory loan, which has generally led to the current distress in the mortgage market.

FEYERICK (voice-over): Fremont Investment and Loan, one of the country's biggest subprime lenders last week announced it is getting out of the high-risk subprime business. A company spokesman would not comment about the Rosados' case, but tells CNN Fremont has retained service professionals to help customers who have questions or concerns about their loans. As for the Rosados, until they can refinance, they're borrowing money from family so they don't lose their home.

Deborah Feyerick, CNN, Bronx, New York.

(END VIDEOTAPE)

O'BRIEN: That's a tough story.

ROBERTS: Good rule of thumb, though, with anything -- if it sound too good to be true, it probably is.

O'BRIEN: Yes, but you know, they're stuck because at the closing you walk away and you leave $25,000, which you scrimped to put down for your down payment. Do you leave that and walk away in the closing? That's kind of a tough call.

ROBERTS: I remember the first house that I bought, the interest rates were really high. My first mortgage was 15 percent. My second was 20.

O'BRIEN: That's ridiculous.

ROBERTS: Now you look at it compared to that.

O'BRIEN: Their story, of course, multiplied.

ROBERTS: Yes, it could be a huge problem and with all these people defaulting on their mortgages and all these houses going into foreclosure, could affect the economy as well. People talking about the big 'r' word.

O'BRIEN: Recession.

Coming up this morning, spring is blooming, and so are your allergies, according to Chad. We've got some advice to help you make it through what's expected to be a tougher than unusual sneezing season.

And "American Idol" meet "jailhouse rock." We'll take you behind bars to find out why some of these caged birds are singing.

You're watching AMERICAN MORNING. The most news in the morning is right here on CNN.

(COMMERCIAL BREAK)

(NEWSBREAK)

O'BRIEN: The trees and the flowers are all in bloom, and that means it's time to page Dr. Gupta about spring allergies. Forty million Americans suffer from seasonal allergies, and as Sanjay tells us, it's going to be a rough season ahead.

(BEGIN VIDEOTAPE)

UNIDENTIFIED FEMALE: The stuffy head, get a headache, the runny nose, the itchy eyes, you just swell up.

GUPTA (voice-over): Spring is in the air, quite literally, and that means pollen wind up in our sinuses.

UNIDENTIFIED MALE: The scratchy throat, cough a little bit, you know, runny eyes.

GUPTA: Allergy experts say this could be a particularly rough year.

DR. ALPEN PATEL, ENT/ALLERGIST: The trend is with global warming and shorter winters that our allergy season is becoming longer.

GUPTA: So how do you know if it's allergies or a spring cold? A good rule of thumb, colds produce a runny nose that's yellowing, along with a low-grade fever. Allergies are usually colorless. There's not accompanying fever, and itchy eyes, nose and throat. If it's allergies, how do you treat them?

UNIDENTIFIED MALE: I take Nasacor. I have to take that. I have to take Allegra, Sudafed, you name it.

GUPTA: Sorting out the various prescription and over-the-counter antihistamines, decongestants and nose sprays can be overwhelming.

PATEL: The best home water is using salt water spray and just irrigating and cleaning out the nose.

GUPTA: Prescription and over-the-counter medications can help relieve symptoms, but they're no cure. Regardless of where you live, some people are simply predisposed to having bad allergies because of heredity.

PATEL: If you have one parent who suffers from allergies, the chance of an offspring suffering from allergies is nearly 33 percent to 50 percent. If you have two parents, it can be 50 percent to 65 percent.

GUPTA: Of course living in a high-pollen area can make your allergies worse. To check on the local pollen count, go to the American Academy of Allergy, Asthma and Immunologies Web site at aaaai.org, and don't forget the tissues.

Dr. Sanjay Gupta, CNN, reporting.

(END VIDEOTAPE)

O'BRIEN: Here's a little bad news for you. One researcher says we can expect a super burst of tree pollen this year. They're already seeing it in Atlanta. Just talking to Chad about that. We'll see how that's going to affect on all of your allergies.

ROBERTS: Speaking of Atlanta, "CNN NEWSROOM" is just minutes away. Heidi Collins at the CNN Center, inside, away from that high pollen, with a look at what's ahead.

Hey, Heidi.

HEIDI COLLINS, CNN ANCHOR: Yes, but it is all over my car, that's for sure. Hi there, John.

That's right, we have these stories coming up on the "NEWSROOM" rundown today, only our CNN. Our Kyra Phillips talks with Admiral William Fallon in Baghdad, the new CENTCOM boss, now in charge of the Iraq War.

Plus, taking fire, dodging bullets. On patrol with troops in Afghanistan, how they handle the Taliban, shoot and scoot strategy.

And gas prices up sharply. So, why aren't sales figures for those gas-stingy hybrids? So our guest we'll be explaining that it's all about your wallet and your comfort.

Tony Harris is going to join me in the "NEWSROOM." We get started at the top of the hour right here on CNN -- John.

ROBERTS: All right, we'll see you soon, Heidi. Thanks.

Coming up, the first American to bring home eight medals in one Olympiad is making waves all over again. We'll fill you in.

Stay with us on AMERICAN MORNING.

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ROBERTS: Looking ahead, way ahead to the Summer Olympics in Beijing next summer. We've got your first line of the favorites to watch, an old favorite in this case. Olympian gold medalist, swimmer Michael Phelps broke a six-year-old world record at the world championships overnight in Australia, beating the record of the Thorpedo, Australian Ian Thorpe's old record by 0.02 second in the 200-meter freestyle. Just by a hair, but enough to do it.

O'BRIEN: Yes, he's now the man to beat, comes Beijing.

ROBERTS: He is.

O'BRIEN: "American Idol" can make or break a wannabe super star's dreams. We all know that. But what if you're an inmate?

CNN's Gary Tuchman listens in.

(BEGIN VIDEOTAPE)

GARY TUCHMAN, CNN NATIONAL CORRESPONDENT (voice over): Talk about a captive audience. And this jailhouse, or jail yard, to be precise, an "American Idol" type competition to help increase inmate's self-esteem. This contest at the Maricopa County, Arizona, lockup, is billed at "Inmate Idle," spelled I-D-L-E.

UNIDENTIFIED MALE (SINGING): Oh, how you sang to me.

TUCHMAN: Six inmates in the finals. Their musical choices running the gamut.

UNIDENTIFIED MALE (SINGING): Sitting in the morning sun...

TUCHMAN: The inmates singing like canaries.

UNIDENTIFIED CROWD (SINGING): ... I've got friends in low places.

TUCHMAN: "Friends in Low Places," sung by a man with a sense of irony, Gary Fisher (ph), behind bars for auto theft and aggravated DUI. The judge is an Elvis impersonator, a real rock legend, Alice Cooper, and the county sheriff, Joe Arpaio.

SHERIFF JOE ARPAIO, MARICOPA COUNTY, ARIZONA: Great song that you picked.

UNIDENTIFIED MALE (SINGING): Can you take me higher...

TUCHMAN: The contestants worked their fellow inmates into a frenzy because the winner's jail section would share the first prize.

UNIDENTIFIED MALE (SINGING): I guess you'd say...

TUCHMAN: Corey Brothers (ph), serving time for violating probation...

UNIDENTIFIED MALE (SINGING): ... what can make me feel this way? My girl...

TUCHMAN: ... his version of "My Girl" brought down the house.

ALICE COOPER, MUSICIAN: Now, I'm from Detroit, you know, so that's Motown. I know my Motown.

UNIDENTIFIED MALE: You're a winner, Mr. Corey (ph).

TUCHMAN: Gary Tuchman, CNN, Atlanta.

(END VIDEOTAPE)

O'BRIEN: What was the prize? Deliveries from Pizza Hut and McDonald's. But of course the whole area won it, not just a single winner.

ROBERTS: You know Simon Cowell should have gone to judge that.

O'BRIEN: He would have had the you-know-what kicked out of him if he had given a negative review. I think those are some big, big guys, don't you think?

ROBERTS: No, it would have been perfect.

O'BRIEN: That would have been a toughie.

ROBERTS: Here's a quick look at what "CNN NEWSROOM" is working on for the top of the hour.

TONY HARRIS, CNN ANCHOR: See these stories in the "CNN NEWSROOM," only on CNN. Our Kyra Phillips talks with a new boss at Central Command. Admiral William Fallon in charge of the war in Iraq.

A high school play about the Iraq war. Why did the principal pull the plug?

An inquest begins today in the death of Daniel Smith. A coroner rules his mother, Anna Nicole Smith, died of an accidental overdose.

You're in the NEWSROOM, 9:00 Eastern, 6:00 Pacific.

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