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American Morning

Going Green: A Look on Plug-in Electric Cars; Is the Energy Crisis a Bigger Threat to America Than Terrorism? Reducing Foreign Oil Dependency; Setting Up Diplomats in Tehran; Dieting Safely and Effectively

Aired July 17, 2008 - 07:00   ET


JULIAN BOND, CHAIRMAN, NAACP: We want whoever wins to be a president who cares about justice, fairness and equality, who enforces the civil rights laws, who ensures that racial discrimination goes away. And any president who does that will be fine with us.
JOHN ROBERTS, CNN ANCHOR: Do you think -- does making history change history?

BOND: Oh, I'm sure it does. In fact, I know it does. You know, other black candidates have run for president before. Jesse Jackson, Al Sharpton, most prominently Shirley Chisholm, who really broke the mold.

None of them succeeded but each of them made it possible for the next one. And Obama is opening a realm of possibilities for people of color. And at least if you're a Democrat, a Republican, independent, you've got to be proud of that.

ROBERTS: Julian Bond, chairman of the NAACP, thanks for being with us this morning, sir. Good to see you.

BOND: Thank you.

KIRAN CHETRY, CNN ANCHOR: It's 7:00 a.m. here on the East Coast. Some stories we're following for you.

Breaking news. The U.S. reportedly ready to send diplomats to Iran for the first time since the hostage crisis almost 30 years ago. "The Guardian" newspaper says the State Department will announce plans for establishing a U.S. interest section in Tehran, a way of exercising diplomacy without opening an embassy.

The failure of IndyMac Bank now the focus of a fraud investigation. The FBI looking into home loans the bank made to risky borrowers. The investigation could focus on whether the bank used false information such as inflated appraisals to give loans and on possible securities fraud. IndyMac's closure is the second largest bank failure in U.S. history.

And today is the 12th anniversary of the crash of TWA Flight 800. Two hundred thirty people were killed in that crash. New rules were announced yesterday to prevent fuel tank explosions like the one that brought down that flight. Airlines have as long as 10 years to implement the new regulation. And your safety in the skies. Pilots are accusing a major airline of sacrificing safety to save on fuel. They say that U.S. Airways intimidated them in an effort to make them fly sometimes over the ocean with less fuel than they feel was safe. U.S. airlines say they were merely -- U.S. Airways rather says they're merely pulling training sessions on the issue and that no one was intimidated.

CNN's Deborah Feyerick is following the story for us this morning.

A lot to sort out about.

DEBORAH FEYERICK, CNN CORRESPONDENT: Oh, a lot to sort out in a big way.

Well, you know, U.S. Airways says that it's going to pay $2 billion more in fuel costs this year than it did last year. So the question is, though, is the airline so concerned about cost that they're putting passengers at risk? Well, a small group of pilots says yes.


FEYERICK (voice-over): The U.S. Airline Pilots Association took out a full page ad in "USA Today" accusing U.S. Airway's management of pressuring captains to reduce fuel levels in order to save money. Eight pilots filed the complaints with the Federal Aviation Administration, as did the pilots union. They accused the airline of trying to infringe on the captain's authority by making them fly with less fuel than they're comfortable with. The Department of Transportation says fuel levels are always up to the pilot.

MARY PETERS, TRANSPORTATION SECRETARY: The pilot is the last authority that determines how much fuel that plane takes. And pilots have that discretion and are routinely given that discretion. So if a pilot doesn't feel that a plane has enough fuel in it for the trip that he or she is about to make, then they have the discretion of not flying that flight.

FEYERICK: Prior to filing the complaints, the eight pilots, all senior captains who normally fly international flights, were called in by U.S. Airways to do fuel conservation training. The union says the pilots were carrying 10 to 15 minutes worth of extra fuel and caused the training intimidation and harassment.

The U.S. Airways says the eight pilots were way above average in terms of the amount of fuel they had when the planes landed. A spokesman for the airline says it's a balance between having enough to travel safely, but also fly efficiently.

In a statement released the U.S. Airways spokesman says, "We are absolutely not employing intimidation tactics to pressure pilots," and says "fuel amounts on average are more than twice the FAA minimum standards."

(END VIDEOTAPE) FEYERICK: Now, the FAA is looking into the matter. But one airline insider says this is less about safety and more about contract negotiations to pressure the company. That it stems from a merger struggle between pilots for U.S. Airways and pilots for America West to see who gets seniority.

CHETRY: As I understand it, the pilots will tell you this training sometimes is the first step before, what, being let go?

FEYERICK: Well, that's exactly right which may have been why this ad was placed a little bit preemptively. U.S. Airways says, look, this was not punishment. This was simply about teaching them about fuel conservation, that their careers are safe.

CHETRY: Deb Feyerick looking into it for us. Thank you.

And a soaring price of jet fuel, passing the buck to the flyer. And an "AM EXTRA" right now.

In just the past year, American Airlines has watched jet fuel prices rise 53 percent since the middle of last year. Since January we're paying 20 percent more on average for an airline ticket. And U.S. Airways says an average round trip flight is costing about $300 worth of fuel per passenger.

ROBERTS: Back to our top story breaking this morning. A British newspaper reporting the U.S. is set to open a diplomatic office in Iran for the first time in almost 30 years.

Our Elaine Quijano joins us now live from the White House. Elaine, they've been talking about this for some time. Do we know anything more about the timing of it?

ELAINE QUIJANO, WHITE HOUSE CORRESPONDENT: Well, you know, we're still waiting to get official word. The White House isn't actually commenting on this "Guardian" report right now. But it is interesting timing.

This idea as you noted has been out there for a few weeks. And when the White House was asked about this a few weeks ago they did not deny that the U.S. is considering this possibility. We're talking about something called an interest section. This would not be unprecedented.

In fact, U.S. has an interest section in Cuba and Iran, interestingly. Here in Washington, as you know, has its own interest section that's housed within the embassy of Pakistan. But essentially this is a kind of de facto embassy. Not quite a full embassy but it enables the government to deal with visas and people who want to travel to the United States.

The idea, officials say, would be to enable the United States to reach out and have more direct contact with the Iranian people while keeping contact with the actual Iranian regime to a minimum. But you're right. The timing certainly is interesting. On Saturday, a top U.S. diplomat is heading to Geneva to sit in on a meeting with Iran's top nuclear negotiator and the foreign policy chief of the European Union. At the same time, of course, hanging over all of this, the fact that the United States is really trying to exert diplomatic pressure on Iran to try to curb its nuclear ambitions -- John.

ROBERTS: Elaine Quijano working her sources at the White House for us this morning. And joining us now on the telephone, CNN senior international correspondent Christiane Amanpour.

Christiane, as Elaine said, this would fall short of a full diplomatic relations that would see the opening of either a consular office or an embassy. But how significant is it that they could open an interest section, I guess much like the one that we have in Cuba there in Tehran, first time since the hostage crisis?

VOICE OF CHRISTIANE AMANPOUR, CHIEF INTERNATIONAL CORRESPONDENT: Well, obviously it would be very significant. It would be the first time in 30 years that U.S. diplomats would be placed in Iran if and when this actual interest section is open. It's different than the current state of affairs where the U.S. interests in Iran are represented by the Swiss Embassy and, for instance, any Iranians who want to travel to the United States need to go to Dubai in the Persian Gulf to have their visas processed at the U.S. consulate over there.

So in that regard, it would be significantly different both physically and in terms of a policy shift by the Bush administration. I have not been told by any of my sources about any deadlines. Simply from both the United States, Europe, and Iran, I'm told that this is being discussed. That Iran has accepted it in principle. That the Iranian president went on television just this week to say that if such a thing were to happen, Iran would welcome it.

And the Europeans have said, specifically those who engaged in the nuclear negotiations with Iran, that if in fact the United States decides to do this, Iran should look at this, read the signal very carefully and respond positively because it is something that Iran has wanted all these years. Despite the Bush administration wanting to isolate Iran, Iran has wanted direct contacts with the United States.

What's clear is that this is an initiative from Secretary of State Condoleezza Rice, and that this is something the State Department is obviously behind but what seems to be a continuing struggle within the administration to get it fully agreed. As I say, it would not be a full embassy, but it would, if it does happen, be a significant departure from current diplomacy, from current isolation, and would put Iranian, a few U.S. diplomats in Tehran for the first time since the hostage crisis, John.

ROBERTS: And again, so far the administration still remaining fairly coy about all of this particularly on the timing.

Christiane Amanpour for us this morning. Christiane, thanks.

CHETRY: And while we're just getting started, here's what we're working on for you this morning. At 18 after, plugged in and powered up for travel. Going green on the highway in an electric car. Our Miles O'Brien on what could be the next big thing at your local car dealership.

ROBERTS: And at 34 minutes after the hour, crucial state, crucial voters. How McCain and Obama are fighting in Florida for the Latino vote. Who has the better plan?

CHETRY: At 41 after the hour, American troop levels. Our Barbara Starr with some new information this morning on plans for Afghanistan. We're tracking this story live from the Pentagon.

You're watching the "Most News in the Morning."


CHETRY: Well, the Beatles opened it and the "piano man" is now closing it. Billy Joel playing to 55,000 fans at Shea Stadium last night. The two sold-out concerts will be the last at the ballpark. And the question for me, am I personally talking over the national anthem?

I feel very -- I feel like I really shouldn't be. But in the interest of time, I'm sorry. His other concert is tomorrow night. The New York Mets will move into a brand-new stadium right next to Shea next year.

ROBERTS: I think as long as your hand is over your heart you can be forgiven for that.


ROBERTS: There you are.

Ali Velshi here this morning. Not going to talk about the reasons why oil is coming down.

ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: Right. I was telling you a little earlier that oil has dropped about 10 bucks in two days. In fact, yesterday we saw quite a drop, $4.14. It settled at $134.60. And markets were very robust as a result of that.

The Dow was up 2 1/2 percent. So was the S&P 500. The Nasdaq was up even more than that, about three percent, which is kind of weird because earlier I was saying there are a few reasons why oil might be down.

And John was giving me that look that he often gives me. I don't know if you can capture that look. But it's that sort of puzzled smirk that says oil's down because the economy is in some degree of ruin. And that's kind of what it is.

ROBERTS: I think I said the tank.

VELSHI: The tank. Ben Bernanke had been testifying before Congress and he'd said that the economy has got some rough spots to it and oil started coming down. And then we got an inventory report that said that Americans are using less oil because it's costing more. The gasoline is costing more.

So we got more oil supply and as a result prices came down a little bit. And markets really -- it's very interesting how quickly markets react to these things. Maybe it's because they've been pummeled so much that when there's a little bit of good news about the price of oil coming down markets charge higher. But we are getting earnings from the banks in the next couple of days. The big investment banks. We'll have to see how markets respond to that.

ROBERTS: That's like when you've been in jail for 20 years and they open your cell just a little bit, you think, oh, freedom.

VELSHI: That's the kind of what it is on the market, yes.

ROBERTS: Thanks, Ali.

CHETRY: Thanks, Ali.

Well, we have Rob Marciano tracking some heavy rain for us in Florida and also a brewing heat wave in the northeast. That's why you can't wear your jacket. Heat wave in Atlanta.

ROB MARCIANO, AMS METEOROLOGIST: I had no idea that John was in the slammer for 20 years.


VELSHI: I was going to say that. I just figured -- I don't know, I've never been in jail. I wouldn't know what that felt like. Maybe there's something we don't know about John.

MARCIANO: Let's get that breaking news better up for that bad boy. Hey, guys. Watching Florida. We have got thunderstorms that are developing across the northern part of the state there. And a little bit of a twist.

National Hurricane Center looking at this. Low probabilities of it developing. But nonetheless, it's swirling. You got the gulf stream there. Temperatures in the water are kind of juicy. Certainly because it's so close to land things will get a little bit concern.

Speaking of heat, 99 Dallas, will be 92 today in New York, 94 degrees in D.C. as well as Nashville. So this heat will begin to build. Not quite that humid, actually. It's pretty dry. Dew (ph) points are in the 60s, so it won't feel that oppressive but as we go through tomorrow, Saturday and Sunday, I think, places from D.C., Philly, New York and Boston will begin to feel that typical July type of heat with the humidity.

All right. This area of disturbed weather was investigated by a National Hurricane aircraft when they check things out and decided that it was not a tropical depression or tropical storm yet, but it may develop still. Here's Tropical Storm Bertha now diving to the southeast. Winds at 60 miles an hour. This storm just doesn't want to go away. Two storms out in the Pacific. We've got Elida (ph) which is moving rapidly that way. This is our brand-new tropical storm this morning, Tropical Storm Fausto. And he is expected to roll westward and probable not affect the Baja of California.

That's the latest from the weather department. Back to Kiran and inmate John.

ROBERTS: Just to be absolutely clear, I've never been in jail though I do end up in the dog house an awful lot.

CHETRY: Close enough. Thanks, Rob.

ROBERTS: Is the energy crisis a bigger threat to America than terrorism is? Coming up at about 10 minutes, one lawmaker says so. Republican Pennsylvania Congressman John Peterson on his claim and whether we should be spending as much on that problem as we are in Iraq and Afghanistan.

CHETRY: The fight for Florida. McCain and Obama set up shop in a crucial battleground, where one voting block could turn the tide.


UNIDENTIFIED MALE: We've got a lot of opportunities here.


CHETRY: You're watching the "Most News in the Morning."


ROBERTS: Top videos right now on Most popular, the so- called "World's Greatest Dad" snagged in a sex sting.

33-year-old Daniel Allen Everett of Michigan wearing a t-shirt that said "World's Greatest Dad" to an alleged meeting for sex with what he thought was a 14-year-old girl. Everett was in court yesterday on multiple charges.

Also, "Barenaked Ladies" singer and guitarist Steven Page facing a cocaine possession charge after his arrest while visiting two women at their suburban Syracuse apartment. Page was charged with criminal possession of a controlled substance which could send him to jail for 15 years.

And Topeka, Kansas, in the annual 75th annual Fiesta Mexicana. That, of course, meant that there was a jalapeno eating contest. Each contestant had to eat a jalapeno in 60 seconds then let it settle for a minute. After that, it was 69 seconds to eat as many as possible. In the end, Jose Bernardo ate 21 peppers, won 500 bucks.

That will pay for plenty of Maalox. That's what's the most popular on You're watching the "Most News in the Morning." We are back in 90 seconds.


ROBERTS: Twenty minutes after the hour. Here's what we are working on this morning.

In about an hour and a half, the Emmy nominations are going to be announced. This year's faves, "30 Rock," "The Office" and "Curb Your Enthusiasm."

At 10:00 Eastern, there he is, former Attorney General John Ashcroft is going to be in the hot seat about his role in approving and implementing aggressive interrogation techniques of suspected terrorists. CNN, of course, will have live coverage of the hearing on air and online.

We are also covering this morning the funeral of Tony Snow. The service will be at the National Shrine of the Immaculate Conception Catholic Church in Washington. The former White House spokesman lost his battle with cancer last weekend. President Bush will be among those attending the public service.

The president then flies out to California to view the widespread damage. Around 2:00 this afternoon, he's going to be briefed by the U.S. Forest Service and then take an aerial tour of the devastation there. And that's what we are following this morning -- Kiran.

CHETRY: Well, it's a car that never stops for gas. Sounds pretty good in these times, right?

One San Francisco man plugs in his car and then he sails right by the rest of us that are paying 4 bucks or more a gallon. No word on his electric bill, though.

Miles O'Brien took a ride with him. Miles joins us live from Powder Springs, Georgia, today. And you're in that car right now, Miles? How's the ride?

MILES O'BRIEN, CHIEF TECHNOLOGY CORRESPONDENT: I am. I am, Kiran. Yes. By the way, the guy in San Francisco uses solar power. And a lot of electric car enthusiast, like the guy who owns this one, do just that. They install solar panels because while you can't make your own gasoline you certainly can supply your own electricity for something like this.

This is the sparrow. This is kind of the electric car that you would imagine. One seat, and it's about all you could buy new in this country. They are $35,000. They're not making many of them. For electric car enthusiast, this is a big bone of contention.


O'BRIEN: Start it.

MARC GELLER, ELECTRIC CAR OWNER: I forget sometimes if it's started or not started. O'BRIEN (voice-over): Once you get Marc Geller started on the subject of electric cars, there is no stopping him.

So it really doesn't inconvenience you?

GELLER: There's definitely no inconvenience. And there's a tremendous amount of pleasure in passing gas stations and watching the price rise.

O'BRIEN: Marc's been breezing by gas pumps in San Francisco for seven years. This is his second all electric car, a used plug-in Toyota Rav 4. Used because right now there isn't a new practical electric car on the U.S. market.

O'BRIEN (on camera): Is it frustrating?

GELLER: It's incredibly frustrating. It's frustrating because every day I meet people who would like to be driving this car.

O'BRIEN (voice-over): Ten years ago, Detroit seemed positively plugged in.


NARRATOR: The electric car is here.


O'BRIEN: General Motors built and leased about 1,000 of the fabled EV1s, after a California law mandated sales of zero emission vehicles.

UNIDENTIFIED MALE: I think it's the future. I'm happy.

O'BRIEN: But by 2003, California backed down. GM repoed the EV1s and destroyed them amid protests. Marc was among the protesters. So why does he think Detroit pulled the plug?

GELLER: I would say because they are fearful of how disruptive plug-in cars will be and how unattractive their old product line will appear.

O'BRIEN: Marc says a fully charged battery takes him 120 miles. Normally a charge overnight at home is more than enough to get him through the day. And here is the kicker. Marc works for a solar power company. His own roof is covered with solar cells.

GELLER: As soon as I got the car, I realized, now I understand why this makes sense. I can create my own electricity.

O'BRIEN (on camera): Would you call yourself an electric car zealot?

GELLER: A zealot might be a little strong. But I truly believe that this is an option consumers ought to be able to purchase.


O'BRIEN: Now, I'm in a Rav 4 now. We're in Powder Springs, Georgia. To get one of these things, there are only a few of them, a few hundred of them. You have to go on eBay. And there was one that sold recently, Kiran, for $65,000.

So there's clearly some demand out there. I can't get out of here. How do I get out of here? There we go. All right. It has power locks too.

But check this out. I want you to see, this is Steven Taylor's collection units in the Marietta area. He's got more than a half dozen electric cars. Look at this thing.

But the point of the matter is that enthusiasts here say while there's all this talk about fancy new batteries, technology like this, which is 10 years old, will give them 100, 120 miles of range. So the fact is electric car technology is here. The enemy of the good, I guess in some cases, is the perfect -- Kiran.

CHETRY: That's unbelievable. It's unbelievable that for 135 -- you can go 135 miles plugging it in. A lot of talk about where you're going to put these plug-in places. You can just do it from home, and he generates his own electricity.

O'BRIEN: Exactly.

CHETRY: It's fascinating. Fascinating stuff, Miles. Maybe, you know, we'll see a resurgence sometime soon. Thanks.

O'BRIEN: I hope so. All right.

ROBERTS: 25 1/2 minutes after the hour. And still to come, Congressman John Peterson says the current energy crisis is a bigger threat to the United States than terrorism. Why does he say that and more importantly, what's his plan to fix it? We're going to ask him right after the break.

And once and for all. A new study two years in the making shows the diet that works. You're watching the "Most News in the Morning."


ROBERTS: Twenty-eight minutes after the hour. Welcome back to the "Most News in the Morning."

Our next guest says our country's energy crisis is "more important and threatening to America's future than terrorism." Pennsylvania Congressman John Peterson joins us from Washington this morning.

Congressman, that's a pretty, pretty striking statement. What's the rational for that conclusion?

REP. JOHN PETERSON (R), PENNSYLVANIA: well, it's destroying the middle class that made this country strong. You know, we're a country that has a huge middle class, working people who make a good living and have a quality of life. We're going to become -- in my rural district, we're going to become rich poor.

The middle class are being destroyed. They've been struggling to drive their cars with current prices. Many have found out that their heating costs are going to be doubling this year. And what they don't know is that natural gas prices that nobody's talking about, and we've had the highest natural gas prices in the world for eight years. Nobody talks about that. That's destroying the economic face.

Dow Chemicals spent $8 billion for natural gas in 2002. They now spend $8 billion for natural gas every quarter. They were 64 percent on shore back then. They're now 34 percent on shore.

One reason. Those jobs have been exported offshore because of natural gas prices. There's no sense of urgency in Washington about energy prices. We know it's a problem. We know the public's unhappy. But natural gas is the killer of the middle class.

ROBERTS: Well, let me ask you this question. You know, you said that this is more of a threat to the United States than terrorism. We launched a global war on terror that we've dumped billions and billions of dollars into. May come up to be more than a trillion dollars by the time all is said and done. Do we need a similar mobilization effort on energy?

PETERSON: Yes, we do. We need to do all of the above. We need to conserve. We need to help people be more fuel efficient in everything they do. We need to assist people with tax breaks and tax credits to phase out their old furnaces, to get rid of their old cars, to get rid of -- stop wasting energy.

We waste a lot of energy in this country.


PETERSON: And then we need to fund all the renewables. But we need to get offshore and promote. Offshore there's tremendous reserves. I've been pushing that for 10 years. Offshore can give us the royalties from offshore, can fund renewables. But we need to get offshore and promote. Offshore there's tremendous reserves. I've been pushing that for ten years. Offshore can give us the royalties from offshore - we can fund renewables, we can fund conservation.

ROBERTS: All right. Let me hold you right there, though. Because on the democratic side of the fence, Senator Barack Obama says, hey, it's going to be at least seven years before we see a drop of oil coming off of any offshore leases. Democrats are also saying there's 68 million acres of federal land under leased to these oil companies that they are not exploiting quickly enough.

PETERSON: Our prime fields are not open. 85 percent offshore is locked up. Those are our best fields. And in the gulf on the east and west coast, if we stay close to where there's current production, we can have energy in a couple years. In California we still have 27 platforms out there that were grand fathered. If we get next to them we can be producing energy quickly. When we open up, we'll take some of the fear factor out of the market. We need to do all the above. Yes. We do need a war on energy. We need to show the American public, I mean, we're just not a competitive nation. When you're not competitive, we don't have a future. You lose your middle class, that's not the country you and I were born in.

ROBERTS: So, Congressman, you were trying to forge a bipartisan consensus on this.

PETERSON: That's right.

ROBERTS: If the answer is a lot more drilling, how are you ever going to do that?

PETERSON: Oh, I think we're close. We've always been close. We've always been just a few votes short. We have a bipartisan group, half republicans, have democrats. We hope to merge with the Senate next week and have a plan that will point out to the American public, and it will be strong on conservation, it will be strong on helping incentives to use less energy in this country. It will be strong on renewables. But the basis of the bill will be to open up offshore. I'd like to see us open up the shale oil in the west that we locked up last year. We've locked up our resources. We're a country that has decided we're going to phase out fossil fuels before we have a replacement. I'm for the replacement but we've got to use fossil fuels until we have a replacement. And we can fund the research on the replacement by taking royalties from offshore and funding them.

ROBERTS: Well, we'll keep on watching your efforts, Congressman, but I would suspect thought that opening up the offshore part is going to be a difficult sell. But we'll keep watching. Appreciate it.

PETERSON: Well, thank you. Help us tell the public.

ROBERTS: Thanks for being with us this morning.

CHETRY: Thirty-two minutes past 7:00 here on the East Coast. Top stories we're following for you, the U.S. is reportedly ready to send diplomats to Iran. It would be the first time since the hostage crisis nearly three decades ago. "Guardian" newspaper out of England says that the State Department will announce plans in the next month for establishing a U.S. interest section in Tehran which would allow for diplomatic efforts but without creating any official embassy.

Well, another holdup may be on the way for a housing rescue bill. This time many republicans are splitting with the White House over a plan to prop up mortgage giants Fannie Mae and Freddie Mac with taxpayer money. Lawmakers from both sides grilled Treasury Secretary Paulson over why they should give him "blank check." The White House hopes Congress can pass legislation including help for thousands of homeowners by next week.

And the FBI now investigating Indymac for possible mortgage fraud after the second biggest bank failure in U.S. history. Justice correspondent Kelli Arena joins us from Washington with more on what they're possibly looking into. Kelli. KELLI ARENA, CNN JUSTICE CORRESPONDENT: Good morning, John. Good morning, Kiran. Now, the FBI has been investigating mortgage fraud for months. If it weren't looking into IndyMac, that would be an even bigger story.


ARENA (voice-over): IndyMac was taken over by regulators last week. And now we learn it's being investigated for possible fraud. Sources with knowledge of the investigation tell CNN the FBI is looking into whether any crimes were committed when IndyMac made home loans to risky borrowers. The FBI would not comment. But one source says the investigation is focused on the company and not individuals at this time.

JOSH HOCHBERG, FMR. JUSTICE DEPT. PROSECUTOR: I would suspect that looking at bad appraisals, bad underwriting, which would mean false statements on loan applications.

ARENA: And now that the bank has been taken over by regulators experts say it'll be easier for the Feds to get their hands on what they need to conduct their probe.

HOCHBERG: There's been so many issues associated with the mortgage failures and the subsequent losses that the question is whether the FBI has enough resources working these cases.

ARENA: The bureau says it's made investigating mortgage fraud a priority and assigned nearly 200 agents. In all it's investigating 21 companies. Officials won't offer any details, but CNN has previously confirmed that the nation's largest mortgage lender, Countrywide Financial, is part of that probe.

ROBERT MUELLER, FBI DIRECTOR: Our mortgage fraud case load has doubled in the past three years to more than 1,400 pending investigations. We have engaged each of our 56 field officers to focus on this criminal priority.


ARENA: It's really not clear how long the Feds have had their eye on IndyMac. But these investigations do take a lot of time. John, Kiran.

CHETRY: IndyMac Bank was back in business Monday under federal control and most of its depositors were fully insured by the government. John.

ROBERTS: 35 minutes after the hour. Hispanic voters in Florida will be a key group in a crucial state come November. So the presidential candidates are already campaigning back and forth. That yellow stripe there across the central part of Florida, the i-4 corridor. A new CBS News-"New York Times" poll shows that John McCain has got some work to do with Barack Obama leading him by almost 40 points among Hispanic voters. Our Susan Candiotti explains how the candidates are targeting these voters. And she's with us now. SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT: John, Kiran, could Florida be the make or break state for the presidency like it was in 2000? It could come down to which way the Hispanic vote swings. Republicans and democrats have opened what just might be their most important offices in the state. Located right here in central Florida.


CANDIOTTI (voice-over): Laptops. Check. Data banks. Check. It's no accident that Senator Barack Obama's Florida campaign is headquartered in a brand-new war room in Tampa.

STEVE SCHALE, OBAMA FLORIDA DIRECTOR: This is the battleground area of the state. I mean, something like 60 percent or 70 percent of the swing vote in the state lives in this media market. It just makes sense.

CANDIOTTI: One look at these homemade signs and you get the picture. The battles intensifying for Hispanic voters. Especially those who live along the interstate 4 corridor that cuts across central Florida.

SCHALE: I think basically as i-4 goes, so goes the state. And I think when you look at the changing demographics in Florida, the growth of Hispanic vote along the i-4 corridor. I think we feel we've got a lot of opportunities here.

CANDIOTTI: No wonder. In Florida more new Hispanic voters are registering as democrats than republicans. You can't lump Hispanics all together, can you?

LOURDES MARIA FERNANDEZ, MCCAIN SUPPORTER: You really can't. Because we're all so different.

CANDIOTTI: Florida's Maria Fernandez isn't fazed by the Obama hoopla. McCain's her man. Of Puerto Rican heritage she's joining other republican volunteers working that same i-4 corridor stumping for McCain.

FERNANDEZ: The most thing that Barack Obama has put into this campaign here in Florida is money and that's wonderful. But I need more than money. I need time. I need your dedication.

UNIDENTIFIED MALE: Governor Kris last night contacted you about working to help elect John McCain in the republican ticket in November --

CANDIOTTI: Republican strategists predict McCain's experience will trump Obama's promise of change among Hispanics living in central Florida.


CANDIOTTI: Republicans won central Florida in 2004. This year their success or failure might depend on whether a huge number of Hispanics registering as independents will swing McCain's way. John, Kiran.

CHETRY: And straight ahead, is menthol the secret ingredient that helps hook kids on smoking? We have a shocking new report coming out in about ten minutes. Also the Atkin's diet, could it be just as healthy as a low fat diet? New research shedding some light on dieting. But don't start grilling the bacon yet. Why something may have been missing from the study. You're watching the most news in the morning.


ROBERTS: It's 40 minutes after the hour. In Chicago, Illinois, where almost every day since the 26th of June a child has been shot. Governor (Rob Blagojevich has had enough. Now, he's thinking about calling in the National Guard. The governor says the violence is "out of control" and he thinks that National Guards and men in helicopters could help patrol the city's hot zones.

In Prince George County, Maryland new developments this morning in the case of that 19-year-old accused cop killer who was found dead in solitary confinement two weeks ago. Lawyers for the guards at the county jail say the inmate's death was not a homicide and that the guards did not kill him. They also claim that the state medical examiners conclusion that the inmate had broken bones in his neck and was strangled was "rushed judgment."

CHETRY: Also Denver, Colorado. The Democratic National Committee along with some of the city's homeless organizations plan on giving the city some 4,000 homeless people free movie tickets and passes to cultural attractions during the convention. That plan is coming under fire. Some are saying whisking homeless off the streets into movie theaters is hiding, not helping.

Also, in D.C. today residents can start applying for handgun permits following a Supreme Court ruling last month that struck down the 32-year-old ban on handguns in the district. The council approved new legislation this week. City officials say the permit process could take weeks or months.

ROBERTS: We're learning new details this morning about the attack that killed nine U.S. soldiers in Afghanistan. The single deadliest fire fight for U.S. forces since the start of the war there and pushed the U.S. death toll for July to 15. With violence in Afghanistan increasing, there are new calls to increase troop levels. Our Barbara Starr is live from the Pentagon for us this morning. Just got the latest on this investigation with the deaths of these nine troops, what are you finding out, Barbara?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, John, first off, there is now a full-fledged formal military investigation into what happened. What U.S. commanders want to know is how this disaster occurred. One of the central questions is the intelligence failure. How could some 25 young U.S. troops be put into this remote area and nobody knew there were 200 insurgents hiding out in the same region poised to attack. This investigation is expected to take some time, but they are going to go through it with a fine-toothed comb. This is a real question of whether U.S. counterinsurgency operations getting into the villages with these small counterinsurgency teams are such a risky operation that they're going to continue in this fashion. Second, more troops for Afghanistan. Listen to what Defense Secretary Robert Gates had to say about this at a press conference yesterday.


ROBERT GATES, DEFENSE SECRETARY: We are clearly working very hard to see if there are opportunities to send additional forces sooner rather than later. No decisions have been made. No recommendations have been made.


STARR: U.S. military officials tell me this morning they do not have available any brigade combat teams to actually send to Iraq any time before the end of the year. What Secretary Gates is now apparently talking about is, perhaps, a very small number of forces, security teams, reconnaissance teams, that sort of thing. They don't have the troops to send. They are still way too tied down in Iraq to turn around any troops for Afghanistan in large numbers. John.

ROBERTS: That's a big problem. Barbara Starr for us at the Pentagon this morning. Barbara, thanks.

CHETRY: Well, here's what we're working on for you for the next hour. 24 past, political punch lines. Taking aim at Obama and McCain. Comedian Andy Borowitz joins us in the next hour to talk about whether or not more humor is off limits for some reason this political season.

Also at 43 after, your chance to own a little piece of the godfather of soul. Christie's set to auction some personal items from the late James Brown. Our Lola Ogunnaike will have that story.

And at 50 past the hour, Dr. Sanjay Gupta joins us as we open up his mailbag, answering your health questions. Some of the topics today - does drinking water help you lose weight? And also what's the ideal room temperature to keep a baby in? You're watching the most news in the morning.


ROBERTS: At 48 minutes after the hour, our medical news this Thursday morning. In a show of support for the White House, the democratic led Senate agreed to triple the spending for AIDS relief in Africa from $15 billion to $48 billion over the next five years. Senators gave President Bush credit for coming up with the program saying it has saved thousands if not hundreds of thousands of lives.

A Salmonella free state? Florida's tomato growers are asking the FDA to stamp all of the state's tomatoes safe to eat. They say they want to stop the stigma after the FDA implied that Florida tomatoes may have been the source of those Salmonella infections. The FDA has since pulled back on those reports.

A new study says that tobacco companies sucked in young smokers by manipulating menthol levels. Researchers at the Harvard School of Public Health say the menthol formula ranged from mild to high. A 1987 memo implies that low menthol levels were used to hook young smokers who usually didn't like cigarettes at first.

CHETRY: Well, a new study tries to put an end to diet wars. Researchers set out to find which diet works best, comparing a low fat with low carb plan and the so-called Mediterranean diet that uses a lot of nuts and olive oils. The result of the study is published in the "New England Journal of Medicine" is very interesting. And medical correspondent Elizabeth Cohen joins us live from the CNN Center to break it down for us. Good morning, Elizabeth.


CHETRY: Was there a clear winner in any of these diets?

COHEN: Actually, Kiran, there are kind of three clear losers. The weight loss on all three of these diets was really quite unimpressive. Let's take a look at the actual numbers. When folks went on these three different diets they started out at 200 pounds. And after two years the folks on the low fat Atkin's style diet were down six pounds. That's really not very much considering they started at 200.

Folks on the Mediterranean or on the low carb diet - I'm sorry the first was not Atkin's. I said that wrong. On a low fat diet, they lost six pounds. On the Mediterranean or on an Atkins- style diet they lost ten pounds. Six pounds, ten pounds, doesn't matter. That's really not a whole lot of weight to lose when you're starting at 200 lbs.

And Kiran, I know it's July but it feels like Groundhog Day. Because many studies have found what this one did, when people start on a diet they actually do pretty well but then over the months that follow, they tend to gain much of the weight back. Kiran.

CHETRY: How do you know what type of diet to try if you want, you know, do something to try to lose weight?

COHEN: You know what the key is, Kiran? You find a diet that you can stick to and when you start to lose weight, think what can I do that I can stick with, not what can I do for a month or two or even six months. What can I do that I can keep doing so I can keep that weight off.

CHETRY: Yes, you know, I thought of something this morning. I have an egg wrap, I just took this much of the bread off of it. I'm going to throw this part out, Elizabeth and just eat less of the wrap. See, moderation.

COHEN: Portion control. What you're doing really is portion control and if you can keep doing that, gosh, you're thin, not that you need to lose so much weight but if you can keep doing that, and that for you, is a good diet.

CHETRY: You know, I still need to cheat. I still can't eat just all healthy all the time. I know that's hard for a lot of people.

COHEN: Right.

CHETRY: Throw in a little exercise I'm sure is a recommendation.

COHEN: Of course, of course, absolutely.

CHETRY: Good to see you, thanks.

COHEN: Thanks.


CHETRY (voice-over): Scrimping in the sky, pilots say a major airline is saving fuel at the expense of your safety.

Bombs in the back yard. More than 100, buried under a school. People who say they were suckered into buying next to an old World War II range.

UNIDENTIFIED FEMALE: This is not my little American family dream that we had.

CHETRY: You're watching the most news in the morning.


ROBERTS: An explosive find in suburban Orlando, Florida. Old bombs uncovered from backyards and school grounds. The Army Corps of Engineers is going to detonate those bombs today. Our John Zarrella tells us it's little comfort for homeowners who feel stuck with property that nobody wants.


JOHN ZARRELLA, CNN CORRESPONDENT: Search teams scour backyards. Flags show where metal is detected, perhaps just a food can, but that's not all they're finding. To the shock of people here, these teams are finding bombs. How can there be bombs under this quiet suburb of Orlando?

FRANK KRUPPENBACHER, ORANGE COUNTY SCHOOL BOARD: I have no explanation for this. It is incomprehensible.

ZARRELLA: School board council Frank Kruppenbacher is furious. The first bomb was found last summer next to a middle school track. 126 rockets and bombs with high explosives found on school property and tons of military debris. The Army Corps of Engineers is cleaning up.

KRUPPENBACHER: Before they get to walk away and claim we're done, we're going to have a real day of reckoning and assurances.

ZARRELLA: And it's not just the school. Thousands of homes are built next to a 12,000-acre World War II bombing range.

DANETTE LAMB, HOMEOWNER: What am I going to do with this? Nobody wants to touch this neighborhood. I'm stuck, so it's kind of, it's not, this is not my little American family dream that we had.

ZARRELLA: How could this happen? Keeping them honest, we asked the school, home builders and the Army. Mike Ornella heads the Army's corps $10 million cleanup of the Pine Castle Jeep Range.

MICHAEL ORNELLA, U.S. ARMY CORPS OF ENGINEERS: It was known this was a demonstration area for war fighting.

ZARRELLA: People knew it and you told them?

ORNELLA: People knew it and the information was available, absolutely available.

ZARRELLA: The Army published reports but there's no record it told anyone, even while the school was being built. A 1994 report says, "the site is a possible danger to the public." A 1997 report cites, "strafing, practice bombing, air to ground rocket firing, some high explosive bombing." Did the army corps raise enough flags, you think, about what was going on here?

ORNELLA: I believe the Army Corps followed the process that we're required to follow.

ZARRELLA: Ornella says the Army isn't required to tell anyone even though records show it expected development. The school board builders, engineering firms all say they didn't ask because they had no idea it was an old bombing range. The land developer won't comment. Lawsuits have been filed. John Overchuck is suing one builder, Lenar.

JOHN K. OVERCHUCK, PLAINTIFF'S ATTORNEY: They're the ones that made the profit. They're the ones responsible because they got these people suckered into these houses.

ZARRELLA: Lenar says he said it relied on studies that made no mention of a military range and the military did not show up on property ownership records because "it had leased the land." But it was no secret. Nearly two decades ago, local governments said a planned development would have to stop if hazardous military materials turned up.

LAMB: You thought you bought in a good area.

ZARRELLA: Danette Lamb can't believe no one knew there might be bombs in the ground.

LAMB: Somebody knew something. A lot of somebodies turned their heads and tried to make a quick buck.

ZARRELLA: No one knew. Now everyone does. John Zarrella, CNN, Orlando.


CHETRY: Wow. Well some breaking news this morning, NATO and Afghan troops say at least ten insurgents were killed during air strikes on a cell in western Afghanistan today. NATO also announcing a senior Taliban commander was killed in fighting over the weekend, the commander was said to have been fighting bombs and other weapons that have killed Afghan and allied forces during recent increases in violence in the region.

Three Islamic militants were convicted of the 2002 Bali nightclub bombings are one step closer to execution. A court in Indonesia rejected their appeals, this morning was their last chance to avoid a death sentence, and would be to admit wrongdoing and appeal to the president. They say they're not going to be doing that.

Also breaking this morning, a British newspaper reporting the U.S. is set to open a diplomatic office in Iran. This would be the first time in almost 30 years. Elaine Quijano joins us live from the White House with what she's been able to find out. Good morning, Elaine.

ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: Good morning to you, Kiran. Well, this morning, officials here at the White House are saying that they don't have anything to announce and they're not commenting on that article in the British newspaper "The Guardian" but we have reported several weeks ago in fact that this idea was certainly being considered over at the State Department, of being looked at, it's called an interest section and basically what we're talking about is a kind of de facto embassy that would house U.S. diplomats in Tehran, to help with things like visa and to facilitate travel for Iranians who want to come to the United States. Now, the benefit for the United States would be the ability to more directly reach out to the Iranian people while keeping contact with the Iranian regime to a minimum.

Now, the idea is not unprecedented. The U.S. does have an interest section in Havana, Cuba and Iran, in fact, maintains its own interest section here in Washington housed within the embassy of Pakistan. But the timing of this news is interesting, coming just days before a top U.S. diplomat is set to sit down and attend a meeting in Geneva, Switzerland, this weekend with Iran's top nuclear negotiator and the foreign chief policy of the European Union coming at a time, of course, when the United States has been trying to ration up the diplomatic pressure on Iran, to try to curb that country's nuclear ambitions, Kiran.

CHETRY: Elaine Quijano for us at the White House this morning, thanks.

ROBERTS: Barack Obama brings in big bucks this month. The campaign reports Obama raised $52 million in June. What makes this even more interesting is that the average donation was just $68 and it doubled what he raised in May. Nonetheless though when you combine the campaigns and the party committees, Obama is still behind John McCain. Right now Obama and the DNC have $72 million in cash. John McCain and the RNC, $95 million.