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American Morning

Battle for Tripoli; Obama To Gadhafi: "Get Out"; Gold Prices Keep Rising; Libyan Rebel Forces Surround Gadhafi Compound; Rebel Leader Interviewed

Aired August 23, 2011 - 08:00   ET

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

(COMMERCIAL BREAK)

CHRISTINE ROMANS, CNN ANCHOR: Breaking news on the war in Libya.

I'm Christine Romans.

CNN confirms Gadhafi's compound is under attack right now. New details of what could be Moammar Gadhafi's last stand.

CAROL COSTELLO, CNN ANCHOR: Hurricane Irene picking up speed.

I'm Carol Costello.

Right now, the storm is tearing along a path that could bring it to the southeastern United States. We are tracking the storm live from the CNN hurricane headquarters.

ALI VELSHI, CNN ANCHOR: And Goldman Sachs CEO hires a hot shot lawyer.

I'm Ali Velshi.

Lloyd Blankfein has not been charged with anything. So, find out why he is seeking counsel -- on this AMERICAN MORNING.

(MUSIC)

ROMANS: And good morning, everyone. It's Tuesday, August 23rd.

Hurricane, big hurricane moving up the coast now. Also, big developments in Libya right this minute.

VELSHI: Right now.

COSTELLO: Gunfire breaking out around that hotel where Western journalists are staying. And we are following breaking news a few miles away, too, near Moammar Gadhafi's compound. Opposition fighters telling CNN that Moammar Gadhafi's compound is now under attack.

Arabic TV network al Arabiya says NATO jets have been spotted flying low over the compound which has been bombed several times before this conflict.

VELSHI: Right now, Gadhafi remains at large. No one knows for sure where he is, but his son came out and said his father is safe and in Tripoli.

Arwa Damon is live for us from Tripoli's airport.

Two things going on at the same time right now, Arwa. We understand that the hotel, as Carol said, that Western journalists are in -- there's gunfire going on right around the hotel and then this issue of this compound. Tell us what you know.

ARWA DAMON, CNN INTERNATIONAL CORRESPONDENT: Well, rebel commanders here at the Tripoli International Airport are telling us that there has been a renewed assault on Colonel Gadhafi's Bab al- Aziziya compound. Now, there has been some pretty intense fighting, both there and around that Rixos Hotel where international journalists are staying, ever since the rebel fighters launched their assault into Tripoli.

Here at the international airport, we have been hearing the sound of gunfire, explosions for around an hour and a half. Rebels captured the strategic location at around mid-day yesterday. This is especially critical it's effectively a straight shot from here up to that Bab al-Aziziya compound. It's around 15 miles away.

But there are a number of significant military installations that rebel fighters are going to have to bypass. They have been trying to push forward up that strategic highway ever since they arrived here, but they say they are encountering stiff resistance. They want to try to send reinforcements to those that are fighting at the compound.

VELSHI: What do we know, Arwa, about -- Saif al-Islam, his son, is saying that he is in Tripoli, but we don't really know. What's the significance of the compound right now? It's been attacked several times before. Is it possible? Is it a bunker? Is it symbolic? What do we think is going on there?

DAMON: Well, most certainly, it's the key position that the rebel fighters want to try and capture, because of the symbolism behind it, because there is a widespread belief that if they are able to capture the Bab al-Aziziya compound, that most certainly would deal a defeating blow to Gadhafi's forces.

Of course, the opposition fighters are trying to figure out for themselves where Gadhafi may be hiding.

I'm sure you can still hear the gunfire going off around me. There's also explosions in the background.

There is shooting at Gadhafi forces in the distance, I am hearing right now, as they continue to battle along that highway that is running from where we are right now to the north straight to the compound. There are also clashes we have been hearing about earlier happening to east of here.

So, most certainly, we are seeing this intensifying assault as these rebel fighters really try to push through and capture that compound that they believe will then lead them to have the capability of capture all of Tripoli, and eventually, they hope to secure the entire country.

VELSHI: All right. And we see you're wearing your bullet-proof vest. I know it's hard to stay safe at this point. We are actually trying to get Matthew Chance who is at that hotel where he says the hotel is not necessarily under attack.

Stand by. Arwa, we have him right now.

COSTELLO: We should go to Matthew Chance right now.

VELSHI: Fighting going on there at that hotel.

Matthew, what's going on where you are?

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT (via telephone): Well, yes, I'm in this hotel, the Rixos Hotel, in the center of Tripoli, very close to that compound of Moammar Gadhafi. And all morning, there's been ferocious clashes, gunfire, explosions taking place in the direction of that compound. You can't see the compound from our vantage point here. In fact, at one point, all of the journalists that are gathered in the hotel moved downstairs into the basement because we felt there was some sort of incoming artillery shells striking areas very close to where the hotel is.

There has been a lot of outgoing artillery as well and, clearly, there is a huge battle underway at the moment between the rebels and the Gadhafi loyalists who we now know to be holed up, to some extent, at least, inside that Gadhafi compound in the center of Tripoli.

And so, that's the situation, as I see it, at the moment from our very limited vantage point.

COSTELLO: Matthew, I just wondered. Saif -- you ran into Saif Gadhafi last night. It was kind of a surprise meeting. He was supposed to be, you know, in the custody of the opposition.

How involved might he be in what's happening right now in Tripoli?

CHANCE: Well, clearly, he is a senior figure -- one of the most senior figures in the Gadhafi regime. I mean, it's topped by his father obviously. And so, the assumption, I suppose we must make, is that, you know, what is happening now is basically coming under the command of Moammar Gadhafi and his son Saif Gadhafi.

It was a very interesting meeting, a surprise meeting that we had last night. Of course, we'd all been told by the rebels and even by the International Criminal Court, who have an indictment on Saif al-Islam Gadhafi, that he had been taken into custody when these rebels moved into Tripoli. He came to this hotel in an armored convoy of about three or four Land Cruiser vehicles just to show himself, just to show the international media who gathered here that that's not the case.

And I have to say, it was a bit of a P.R., too, for the Gadhafi loyalists because it shows that, you know, not everything the rebels say can be entirely trusted.

ROMANS: Matthew, who is at the hotel with you now? Is there still a presence of loyalists to Gadhafi? They were heavily armed yesterday, you told us. And have you seen members of Saif Gadhafi entourage or they disappeared after last night?

CHANCE: No, they disappeared after the lat last night. In fact, I got some questions in to Saif Gadhafi. I asked him where his father was. He said he was in Tripoli, like all of his family. He said that, you know, the rebels coming into Tripoli had been a trick and now they had broken their backbone and given them a hard time. And then, you know, the doors closed and the convoy drove off.

Here in the hotel, we got about 35 journalists that are kind of sticking together through this as much as possible. There are also, you know, obviously, Gadhafi gunmen in the lobby, you know, loyalists. They say that they are here to protect us. One of them said to us earlier, "Don't worry, we have got your back."

But, of course, we are not permitted to leave the hotel, according to the government's loyalists, the Gadhafi loyalists we have spoken to, that's because that is for our own protection. But, you know, for many, many hours, in fact, the electricity is on and it's one of the reasons why I can talk to you on this telephone. But for many, many hours, we have been sitting in pitch blackness.

And, obviously, the kitchen is not working. The air condition has not been working. We're running short on supplies on food and water. And so, we're doing what we can to kind of gather up the various things that are lying around the hotel, so we can sit this out, if necessary, for several days. But beyond that, I think we're going to have a problem.

VELSHI: Matthew, there was some talk, as these rebels in the city start to rise up, that there might have been people inside the city ready to get the signal to go and that somehow they'd be in coordination with NATO so that when you started to see NATO jets flying over the compound, that would be a coordinated effort.

Do you know anything about that? Is this -- do we -- the reports -- first of all, do you hear the jets, seen the jets flying over the compound? And does it give you some sense of a coordinated effort between the rebel cells in the city and NATO?

CHANCE: You know, it's interesting you ask that question, because I was discussing it with my colleagues earlier. We are not hearing, at the moment, any NATO jets in the skies over Tripoli. But we are hearing explosions and what we are assuming those explosions are are artillery shells being exchanged between the two sides in this area of the Gadhafi compound.

But what we are not hearing, the kind of heavy air strikes that we witnessed in this city, in the area of Tripoli the past several weeks and particularly in the past several days and we're not hearing aircraft in the skies over the Gadhafi compound and over this hotel. I know that this area of Tripoli which clearly still in the hands of Gadhafi's forces

And so, it's difficult for me to -- you know, admittedly, it's difficult for me to, you know, give a very comprehensive assessment of what the military situation is like outside because, at the moment, I'm lying on my belly in a hotel room, hoping we don't get hit by a shell.

But, you know, obviously, the assumption would be, I suppose, there would be a degree of coordination between NATO and the advancing rebels. They seem to have been supporting the rebels throughout essentially clearing the road for the rebels into Tripoli. You'd expect, wouldn't you, that they'd be talking to the rebels right now as well, but I have no idea whether they are or not.

COSTELLO: Matthew, you've been to that compound in the past, probably many times. If Moammar Gadhafi is inside that compound, could he safely hide somewhere with the type of artillery fire that is being levied at that building right now?

CHANCE: Well, it would be difficult to say. I mean, clearly, you know, if he is, indeed, in that compound, we don't know whether he really is, presumably, he had some sort of bunker system there -- we know that the compound, over the past couple of months, has been repeatedly struck by NATO air strikes, many of the buildings have been very badly damaged indeed.

But Saif Gadhafi -- didn't actually say that they were in the compound. But, you know, the assumption was that that's where they were at and that's why there is such a fight for control of that compound right now. I mean, presumably, you know, Colonel Gadhafi is a very, you know, kind of canny leader and has managed to survive 42 years of that because of that as the leader of Libya. And, presumably he would have built a network of bunkers where, you know, in anticipation of something like this, that he could be hiding out with his family.

Again, we don't know whether that's the case. We don't know whether he is in that compound or whether he is somewhere else in the city or in the country.

But, you know, I think we have to work on that assumption.

ROMANS: All right. Matthew Chance on his belly in a hotel room in Tripoli.

VELSHI: Stay safe, Matthew!

ROMANS: Stay safe, please.

We want to go quickly to something happening right now as well. NATO holding a press briefing right now on the war. Let's listen to that. (JOINED IN PROGRESS)

COL. ROLAND LAVOIE, NATO SPOKESPERSON, OP. UNIFIED PROTECTOR: -- military ability to a point that they come in and control capabilities are severely affected, that they have severely reduced logistical capabilities, mobility capabilities because they don't control many access within the country and they have a lot of senior leaders who have either defected or have been captured. So, basically, let's be clear here. Despite the noise that could be making today in Tripoli, the Gadhafi regime has passed the tipping point and is going done -- down, sorry. So for us, it's more a matter of when than if it's indeed, the case.

REPORTER: I would still like to understand. I understand you are protecting civilians. But I still would like to know how you are doing it now in Tripoli, where there are, I think, many people around this bunker where Gadhafi is supposed to be and what are the military charges that NATO can have if so many people around? What are you doing there?

LAVOIE: As I mentioned, I command current operation as we are conducting them now, but what I could tell you is there is still weapons out there and there's still targets that we could -- it -- if we have any signs that it could represent a threat to the civilian population. No later than later than yesterday, we took out, for example, two who were firing in the direction of Brega from the west of the city. So, these weapons were actually firing when we engaged them.

Of course, in the urban city of Tripoli, the situation is far more complex, but we still do have the precision munition that could allow us to take some targets if, again, we believe that there is the threat against the civilian population. We have done so in the past. We have taken some facilities, buildings, pieces of artillery, radar sites with very accurate precision. So, we have the capability to do so. And, believe me, we will do so if there is any threat against the population.

UNIDENTIFIED FEMALE: James?

REPORTER: Yes. Two questions. Unless Tripoli falls quickly, the rebels are going to need close air support. Is -- has NATO categorically ruled out that option? Providing it, that is. And secondly, the NATO nations are debating today and later on the renewal of a mandate. Do you foresee any need for the use of combat aircraft after mid-September? Thank you.

LAVOIE: I will only talk about the first part which is about close air support. We do not provide close air support, and let's keep in mind that the institution in greater Tripoli is very complex. We talk here about urban, urban fighting so, basically, being engaged directly beside combatant would not -- would naturally be practical.

What we're doing is more to look at what is -- I can't go into the details, but, essentially, we're looking at what is going on on the ground and what we could identify as -- (END LIVE COVERAGE)

VELSHI,: All right. We are listening in, and we will continue to monitor this NATO news conference as Col. Roland Lavoie, he is answering questions about what is going on in NATO. You just heard our conversation. We talked to Arwa Damon and Matthew Chance. We're now getting word now from our crews in Tripoli that people are streaming out of Tripoli now toward the city of Zawiya.

So, there is definitely some sense that there are developments, again, conflicting developments. We've heard there were NATO jet flying low over Gadhafi's compound.

ROMANS,: Matthew Chance is not hearing -- he's not hearing aircraft --

VELSHI: But he hears a lot of gunfire.

ROMANS: But a vigorous fight under way in that Gadhafi compound. You know, as this confusion and uncertainty sort of reign this morning in Tripoli, rebel leaders are battling for control of that city. The whereabouts of Libya's leader, Moammar Gadhafi, is still unknown. Two of his sons reportedly captured over the weekend. They are now both free.

Even so political leaders in the U.S. and Great Britain are saying it's only a matter of time before Gadhafi's regime is defeated, what's next for Libya? A look at this morning's opinion pages where this is the topic of conversation. It shows comparisons being made between the situation in Libya and what happened in Iraq after the U.S. invasion.

The main concern that loyalists to Gadhafi to could unleash an insurgency and plunge that country into chaos. "USA Today" in editorial says, Libya is entering a period of high stakes uncertainty, quote, "What will the new Libya look like? It surely won't be western-style democracy, and in the end, it might not even be one country. Fracturing instead along historical tribal lines.

In "The Washington Post," an opinion piece looks what it will take to help Libya become a stable nation. Libyan capacity to organize themselves should not be underestimated, but Tripoli may require international peacekeepers to keep order at least in the initial phase.

And, of course, any kinds of comparisons to Iraq makes everyone very, very nervous because, of course, that insurgency and what happened after that initial invasion really caught the U.S. by surprise and many, many people, thousands of people, lost their lives.

COSTELLO: Well, of course, in Iraq, there was no post-war plan. I think what people have to keep in mind is that what we consider democracy won't necessarily seem like democracy if something like democracy is put into place in Libya. They kind of have to come up with their own thing, but they are being helped out by American officials, at least, one, as far as we know, has gone to visit and talk with the opposition leaders.

ROMANS: Right.

COSTELLO: And we'll see what happens.

ROMANS: And the European influence will be very great in this, too, because the investment in the oil fields, the investment in infrastructure of the country already coming from long established European ties as well.

COSTELLO: And I think it's safe to say that most Americans don't want the United States heavily involved in Libya, you know, after the NATO mission ends.

ROMANS: Politically, it's impossible, don't you think?

COSTELLO: Yes.

VELSHI: We're continuing to cover the situation on the ground. We've got our CNN teams with up to the minute information. We're also following that NATO press conference. It is 19 minutes after the hour. We will be right back.

(COMMERCIAL BREAK)

COSTELLO: Twenty-one minutes past the hour. We are following breaking news on several fronts in the battle for Libya. Opposition forces now telling that Gadhafi's compound under attack right now. At the same time, our Matthew Chance is reporting heavy gunfire around a Tripoli hotel where many western journalists are stuck including Matthew Chance.

The CNN crew on the ground also reporting car loads of people streaming out of Tripoli right now as the battle for control of the entire country intensifies. Rebels also reporting Gadhafi forces are posing as rebels in Tripoli.

VELSHI: A lot of conflicting information coming out of there, but I think we can confirm there's a lot going on in Tripoli this morning.

President Obama calling on the missing Moammar Gadhafi to resurface. Speaking yesterday, the president said the Libyan leader's regime has coming to an end and that Gadhafi could stop the killing by making one final gesture.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I want to emphasize that this is not over yet. As the regime collapses, there's still fierce fighting in some areas, and we have reports of regime elements threatening to continue fighting. Although, it's clear that Gadhafi's rule is over, he still has the opportunity to reduce further bloodshed by explicitly relinquishing power to the people of Libya and calling for those forces that continue to fight to lay down their arms for the sake of Libya. (END VIDEO CLIP)

ROMANS: And there's new evidence that next year's presidential election could be too close to call. Of course, because it's really far away still. That, according to a new Gallup Poll, President Obama is running neck and neck with the top four Republican presidential candidates. He is ahead of Congresswoman Michele Bachmann by about four percentage points, 48-44.

He is tied with Texas governor, Rick Perry at 47 percent. The president leads Congressman Ron Paul by two percentage points 47 to 45, and the president actually trails former Massachusetts governor, Mitt Romney, by two percentage points, 46 to 48.

COSTELLO: The fact is nobody is very excited about any of the presidential contenders.

ROMANS: Is it 400 days to go? We still have 400 days to go. A lot can happen even in three days in election --

VELSHI: Yes.

COSTELLO: Talking about the excitement factor, though, here's your chance to talk back on one of the big stories of the day, specifically that. The question for you this morning, why isn't America more excited about its presidential contenders? Marching toward 2012 and the first Republican primary, some of the most talked about candidates are those who are not even running. You want proof?

Young gun Republican, Congressman Paul Ryan to the chagrin of many in the GOP, the architect of the Republican budget that would cut federal spending by $6.2 trillion has issued a definitive no. Ryan says while humbled by the encouragement, I have not changed my mind and, therefore, I am not seeking our party's nomination for president. The desire for alternative blood is as fresh as it ever was when supporters were begging New Jersey governor Chris Christie to run, and they continue today even after Christie made his lack of desire crystal clear.

(BEGIN VIDEO CLIP)

GOV. CHRIS CHRISTIE, (R) NEW JERSEY: I said what do I have to do sort of suicide to convince people I'm not running? Apparently, I actually have to commit suicide to convince people I'm not running.

(BEGIN VIDEO CLIP)

COSTELLO: Why can't Christie and company just be? Because in a recent CNN/ORC poll, only 14 percent of Republican voters say they're very satisfied with the field. Ouch! It's not like Democrats are jumping up and down either. Twenty-eight percent of Democrats would rather see a candidate other than President Obama nominated. A record high or low for him. There have even been calls for Hillary Clinton to run in 2012.

It makes you wonder. Is there anyone out there who could inspire the entire country, anybody who would want to be president when the economy is in the toilet and two wars continue to drag on? So, the talkback question today, why isn't America more excited about its presidential contenders? Facebook.com/americanmorning. Facebook.com/americanmorning. I'll read your comments later this hour.

ROMANS: I still maintain because people aren't excited about their opportunities right now.

VELSHI: Right. Your comments have said that (ph).

All right. Coming up next, Wall Street's bumpy ride on an upswing right now. We're going to check the morning markets.

ROMANS: Yes. Plus, gold prices on a tear, but these milestones are coming so fast. $1,900 an ounce! Some experts are starting to worry, hey, this could be a bubble popping. I heard that 752 (ph), by the way. It's 26 minutes after the hour.

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VELSHI: Twenty-nine minutes after the hour. "Minding Your Business" this morning. Right now, U.S. stock futures are trading higher ahead of the opening bell. Investors looking ahead to Friday for fed chief, Ben Bernanke's big speech in Jackson Hole Wyoming. Wall Street hoping for hints at the fed's future plans to try and help out the struggling economy.

And gold prices just keep going up. Another record last night, $1,900 an ounce. That's up a hundred dollars in the past two weeks. The week over week rise for gold has got some analysts a little worried that this could be a bubble ready to pop, but investors still flocking to the precious metal for security in the shaky economy.

The president of Standard & Poor's is stepping down. S&P's parent company, McGraw Hill announced that Deven Sharma will leave his post by the end of the year. The agency, by the way, is being investigated by the justice department for allegedly overrating mortgage backed securities at the height of the housing bubble.

Goldman Sachs CEO, Lloyd Blankfein, has retained council related to an investigation by the justice department. A senate subcommittee said in April that the bank had misled clients and Congress about its housing market activities. A lot of buzz about this because lawyer, Reid Weingarten, also represented WorldCom CEO, Bernie Ebbers during his downfall.

Still ahead, breaking news from Libya. Moammar Gadhafi's compound under attack right now and gunfire outside the hotel where American journalists are staying. AMERICAN MORNING back right after this break.

(COMMERCIAL BREAK)

ANNOUNCER: This is CNN breaking news. CHRISTINE ROMANS, CNN ANCHOR: Breaking news in Libya. Opposition forces telling CNN that Moammar Gadhafi's compound is under attack right now. Arabic TV network el Arabiya says NATO jets have been spotted flying low over the compound. Right now Gadhafi remains at large. No one knows for sure where he is, but his son came out and said his father is safe and is in Tripoli.

VELSHI: Just minutes ago, NATO gave us an update on the war and agreed with the opposition it's time for Gadhafi to come out of hiding and face facts.

(BEGIN VIDEO CLIP)

CARMEN ROMERO, NATO DEPUTY SPOKESPERSON: For the Gadhafi regime, this is the final chapter. The end is near, and events are moving fast. What's clear to everybody is that Gadhafi is history, and the sooner he realizes it, the better.

(END VIDEO CLIP)

COSTELLO: Moammar Gadhafi's son is making a surprise appearance at a Tripoli hotel last night, that same hotel filled with western journalists. He was taunting opposition forces who claimed he has captured him a day earlier. As Christine said, he said his father is safe and sound in Tripoli. Another one of his siblings, Muhammad Gadhafi, escaped on Monday. That's according to the Libyan ambassador to the United States.

ROMANS: Update to the video we showed you yesterday. Libyan rebels say they have arrested this television anchor who you see here waving a gun on state television on the air yesterday. She is apparently nabbed in her car near a coffee shop. In the video which was originally aired over the weekend, guys, and you can see the anchor warning rebels she and her colleagues, they will become martyrs. They will die for their country and for their leader to defend the station. She was taken without incident, but it shows you the sort of, I guess, the theatrics of state television in Libya.

VELSHI: All right, we have on the phone right now joining us live from the Libya Tunisia border is Mahmoud Shammam. He is the minister of information for the transitional national council, which is the opposition or revel force in Libya.

Mr. Shammam, thank you for joining us. We are getting a great deal of conflicting information right now out of Tripoli. We have heard that there are NATO planes flying over the compound. We hear there is a rebel attack underway at the compound, and there is fighting in the streets. Our Matthew Chance has heard mortar shells being exchanged. What is the information you have about what is underway in Tripoli right now?

MAHMOUD SHAMMAM, TRANSITIONAL NATIONAL COUNCIL, LIBYA: The opposition forces are attacking the Bab al Aziziya, the last strong hold of Gadhafi. It is confirmed now that they achieved to enter one of the main gates and they are fighting Gadhafi forces, and they are surrounding them from many gates. And NATO interfered 10 minutes ago by hitting some targets inside Bab al Aziziya. We are determined to take him over.

ROMANS: Do you think Gadhafi is in that compound, sir?

SHAMMAM: I'm not sure that Gadhafi is in that compound. There are some reports he might be near the border, but I'm not ruling out anything.

COSTELLO: Also we just wanted to ask you about Saif Gadhafi. I think people are confused because, you know, we thought that he had been arrested and was on his way to a criminal court, and then last night, we find out he's free.

SHAMMAM: That situation was confusing. We admit our communications was not clear. I know the prime minister was talking with convoy and he did not confirm that Saif is under arrest. Benghazi confirmed that Saif was under arrest.

You understand we entering a big capital, a big city and we have many, many operation rooms in the city, and sometimes, conflict reports like this happen. So what Saif Gadhafi, we don't know if he had been arrested but he escape, but we have to confine this with the leaders who are engaging in fighting there.

They try to change the subject from the real battle. We are taking Tripoli and like to chase the subject away as any movie, that he is free and et cetera, et cetera, et cetera. We are going to get him later today or maybe tomorrow. There is no way he can escape from us. And also I have to mention, very important. I will instruct all our troops to be very -- to be very -- very, very, very nice with all people. We don't like a bloodshed and --

VELSHI: OK.

SHAMMAM: And I think some of our problem we did not follow the law enough for those criminals.

VELSHI: Let's talk about that for a second. You're saying you've entered the compound through one of the main gates. We are getting reports from Al Jazeera. These are hard to confirm. They say Gadhafi troops are retreating from Tripoli.

Tell me what the situation is. You want your troops to be good to those who they are capturing. Have you been taking prisoners? Have you taken Gadhafi troops as prisoners? Where are they being held? We did hear of another escape of one of Gadhafi sons. How are you holding these people if you're asking your troops not to kill them?

SHAMMAM: We are holding these people according to the district they have been arrested. OK, we trust our forces that will treat them well, so we give them full authority. We cannot control a huge city with over 1.7 million people in one day or in two days. You have to understand this.

Also we are -- we have a lot of arresting people from various places. We have Gadhafi from high leader. So we are dealing with leadership we have no instruction in Tripoli right now and let us do this with very, very lawful ways. OK, we'd like to have a state of law and order and we'd like to do this in a very order. So we have some gaps here and there. It might be used by Gadhafi.

Again, I'm -- against this. I'm saying go to the whole picture. We are taking a move now. We are moving toward there. The next battle in Sirte, the home city of Gadhafi. We are moving south. So we are fighting in three or four fronts right now.

ROMANS: Sir --

SHAMMAM: Don't forget at all that our troops are limited, but we are trying to finish the job. If I came to you a few days ago and said we are going to get Tripoli in 24 hours, nobody would believe us. Now we are doing it. So this is --

ROMANS: Sir, sir, any way --

SHAMMAM: -- victory over Gadhafi.

ROMANS: Sir, is there any way for you to know how much of Tripoli is under rebel control?

SHAMMAM: I'm sure it's -- I have -- I have concern with estimation. I will say 85 percent Tripoli is under our control.

ROMANS: Let me ask you how closely you're coordinating with the Americans, Europeans, NATO in particular. Our reporters are in the Rixos hotel and they are hearing mortars being exchanged. They don't know how much coordination there is between NATO and the rebels and concerned how close this fighting is. Can you tell us how closely you're coordinating with NATO for your offensives?

SHAMMAM: We have joint operation rule. We are full coordination of Tripoli operation was coordinated with NATO, a meeting in Paris and other agents of the war with both our operation room and their staff, and everything is coordinated with them fully.

And now we have full coordination. We -- we -- we give them the situation on the ground. They -- they -- they plan and they are according to that situation. So we have the most possible coordination and such -- this is street fighting. The coordination would be very difficult for NATO and us, so we are trying to do our best. This is a battle in the streets. This is not a regular war or a traditional war.

VELSHI: So this is a good point you make. You're right. It's not a normal war. You're saying that maybe you have 85 percent of Tripoli. NATO has just said that Tripoli is no longer under control of Gadhafi forces. So the question now becomes, who then, if you are controlling most of Tripoli, who then takes charge? Will there be a centralized command? Is there someone who will be in charge of Tripoli?

SHAMMAM: The prime minister formerly of security which will be taking control of Tripoli. It will be in place in very short time so this is the way. I have to admit that quick victory in Tripoli, we will -- we are not fully prepared for taking the political situation under control -- under control that fast, that fast. So give us few days so we can organize ourselves.

And again, again, we are admitting we are doing some mistakes. We are lacking some experience. But we are trying to honestly do our best. And we are doing our best according to the situation on the ground. This is very -- Gadhafi controlled Libya for 42 years. We have no institution. We have no organized forces. So we have -- we have to do that while we are fighting. And we are doing this while we are fighting.

COSTELLO: Having said that, sir, and if you track down Moammar Gadhafi, when you have him in custody, is there an order out about how to treat him?

SHAMMAM: We are going to, according to the instruction that all regime forces have from the -- and directory, that we have to treat those people according to international standards and we have to protect them. And this has been with Hassan Muhammad. We are trying to protect him. And because we nip him staying in his home with his family, he leaves.

OK, so we are paying high price for trying to go international standard with the people who cannot understand international standards and this is what happened. We give in to our war and we get him in his house and if we and Bab al Aziziya. So from now on maybe people will be scared to do this again and I hope that will strain themselves from doing anything or harm anybody. This is what we are trying to do right now, just to go with international standards and protect our enemies.

ROMANS: Are you encountering much, I guess, allegiance to the Gadhafi family? Saif Gadhafi is still on the loose, Muhammad is still on the loose. His wife, some daughters, still don't know where they are right now And Moammar Gadhafi, we don't know where he is. Are you concerned about the potential for an insurgency trying to protect him, or people who are waiting before they strike back at rebel forces?

SHAMMAM: Yes, yes. We have real concerns about that because they struggle (ph) it. Once they can get that and he goes on TV and build this Hollywood scene. Ok, people will get angry in the streets. And I cannot guarantee his safety if -- somebody spot him in any Tripoli street.

You have to understand that he is trying to do these things and these things will harm him in the end, ok. We are still committed to go with the international standards. We are committing to give them a fair trial and fair justice, but they are -- they are acting as a gang, not as responsible people, and -- and maybe they will pay high price for that.

VELSHI: Mr. Shammam, have you got some agreement with NATO as to what happens when you find Moammar Gadhafi? I mean, if you -- if a fire fight ensues, are you going to kill him?

SHAMAMAM: Hello?

VELSHI: Are going to -- what are you going to do when you find Moammar Gadhafi?

SHAMAMAM: Hello.

VELSHI: Have you got an agreement with NATO as to goes in and apprehends him? Are your people empowered to go in and get him and -- and have they got orders --

(CROSSTALK)

SHAMAMAM: No, no. This is our -- this is our responsibility, not NATO's responsibility. The NATO has no -- no affiliates on the ground. We are controlling the ground. We are -- we are going to arrest him, we're going to boot him and we are going to protect him if we got him in our hands and we're going to give him a fair trial. This is what promise people to do and this is what we're going to do.

COSTELLO: Sir, it does look like Tripoli is certainly going to fall and soon you'll have control of the entire country. What kind of help do you need from the United States?

SHAMAMAM: First, we are very grateful for the United States helping, for the international community, for our allies in Europe especially for our brothers in Qatar and United Arab Emirates, we are grateful for everybody. And -- and -- and we are also -- we are always seeking their support and their -- their help in many areas.

And that the help that we need right now to facilitate with some of our funds so we can finance the -- the difficult situation we are facing here. We need a lot of money to -- to run the electricity, to run the television, to run everything. And if they can handle the mechanism that will provide us with some of our money that would be a great help.

ROMANS: Yes Mr. Shammam, let me ask you about the Rixos Hotel; it's still under the control of Gadhafi forces. There are gunmen in the lobby and around the grounds and that is where much of the international media is focused right now.

What can you tell us about the situation there and do you have any efforts under way to, I guess, liberate that hotel from the Gadhafi control?

SHAMAMAM: Ok. We pledge -- we pledge to protect the people over there and -- and you know, attacking hotel is very easy. It's not a military target but because this hotel are -- if -- if this control -- they are using this hotel as a control and command and we know that and we know that most of them are there most of the time, but we are not -- we cannot attack place where he has some other civilians and other innocent people --

ROMANS: Sure.

SHAMAMAM: And has most of the -- the journalist. So we are very careful to -- to do anything harm those people over there and we are continuing to do that.

ROMANS: But you say that the Gadhafi regime is using that hotel as its command and control?

SHAMAMAM: Yes, yes, yes. I'm sure about that. And your journalists might tell you they are not -- I'm not referring and the whole -- what his name -- Mahmoudi (ph), Moussa Ibrahim (ph) and most of the time Saif are there.

ROMANS: Ok.

VELSHI: As that fight gets closer to that hotel, though, are your -- are your troops in a position to -- to protect the journalists that are there? Because the Gadhafi troops are saying that they are protecting the journalists.

So we are concerned that the journalists are going to get caught in the cross-fire between two sides who both say they are protecting the journalists.

SHAMAMAM: No, I hope -- they are not going to be in the cross- fire. We are not going to move military toward this hotel, we are -- the protection of journalists is -- is our priority. Protecting the civilians is our priority. Believe me we're not going to do anything to harm them.

The only thing that I'm -- I'm really worried about is the Gadhafi forces try to -- to take revenge against those journalists. This is something I cannot control.

ROMANS: Tell me about civilian casualties quickly. We have taken so much of your time and we know it's -- it's chaotic there but what have -- what do you know of civilian casualties in Tripoli at this hour?

SHAMAMAM: We don't have exact figure of that. And we're -- we know that -- that the number of a -- of killings are -- that people are high around 200 number as of last night. We have many civilian casualties but not that -- that many. And we are not doing the counting right now. We are trying to provide the shelters who are bringing -- to hospital to Tripoli maybe today or -- or tomorrow.

And we are trying to facilitate Tripoli with more ambulance and the -- doctor's crews. We are doing our best on -- on poor environment and Gadhafi did not leave us with -- with much option.

VELSHI: All right, Mahmoud Shammam, thank you for taking your time to tell what is going on in Tripoli right now. Mahmoud Shammam, he is the Minister of Information for the National Transitional Council, that is the -- the rebel group, the opposition in Tripoli.

I -- I found most fascinating thing that he told me is that they -- they were not expecting Tripoli to come down this fast.

ROMANS: So quickly and they're going to need a few days to establish a security council to control Tripoli. VELSHI: Yes.

ROMANS: Also you've been hearing our Matthew Chance hunkered down with western journalist in the Rixos Hotel.

(CROSSTALK)

VELSHI: On his belly.

ROMANS: And to hear that that's of the command of control for the Gadhafi.

COSTELLO: Well, at least according to him.

ROMANS: According to the rebels.

COSTELLO: We don't know that for sure.

ROMANS: Exactly.

COSTELLO: But for sure, it's an unsure situation. And you remember Tripoli is what -- two million people.

VELSHI: Yes.

COSTELLO: So it's a big city.

VELSHI: Yes.

ROMANS: Right.

COSTELLO: So it's -- it's just realistic to believe it's not going to fall in a day.

VELSHI: Yes.

ROMANS: That's right.

VELSHI: All right it is 51 minutes after the hour. We'll be right back.

(COMMERCIAL BREAK)

COSTELLO: It's 53 minutes past the hour. Here are your morning headlines. Breaking news out of Libya: The opposition telling CNN that Moammar Gadhafi's compound is under attack right now. And al- Arabiya says NATO jets have been spotted flying low over the compound.

Right now, Gadhafi right now remains at large and no one knows for sure where he is but his son did come out and said his father is safe and in Tripoli.

U.S. markets open in 45 minutes. Stock futures trading higher ahead of the opening bell. Investors looking ahead to Friday for Fed Chief Ben Bernanke's big speech in Jackson Hole. Hoping for him to (INAUDIBLE) future plans to help out America's struggling economy. The center of Hurricane Irene is right passing just north of the Dominican Republic. Irene is then expected to grow to a Category 3 storm or even stronger as it approaches the southeastern United States later this week.

A 24-year-old woman injured in that devastating stage collapse at the Indiana state fair has died. Megan Toothman had been on life support since the August 13th accident. Six other people were killed when the stage collapsed.

A 5.3 magnitude earthquake hit southern Colorado, near the New Mexico border overnight. There were reports of rock slides along a highway and some damage to structures.

And next year's presidential election could be a real nail-biter. According to a new Gallup poll President Obama is in a statistical dead heat when pitted against Mitt Romney, Rick Perry, Ron Paul and Michele Bachman. That's the news you need to start your day.

AMERICAN MORNING be back after a break.

(COMMERCIAL BREAK)

COSTELLO: A pitched battle over the compound in Tripoli -- at the Gadhafi compound there. Earlier this hour NATO gave an update on the war and agreed with the opposition that it's time for Gadhafi to come out of hiding and face facts.

(BEGIN VIDEO CLIP)

CARMEN ROMERO, NATO DEPUTY SPOKESPERSON: For the Gadhafi regime, this is the final chapter. The end is near. And events are moving fast. What is clear to everybody is that Gadhafi is history and the sooner he realizes it, the better.

(END VIDEO CLIP)

COSTELLO: Barbara Starr is live at the Pentagon; she has more information for us. Barbara, you heard the interview from Mahmoud Shamman, the minister of information for the national transitional council. Everybody is concerned about these weapons that Gadhafi has. And whether they might fall into the wrong hands.

Did anything Mr. Shammam say concern you? I'm asking you in terms of the Pentagon.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, look, they are watching this very carefully. Let's be very clear. It is not just the Pentagon. The CIA, the U.S. Intelligence community has eyes, as they say, eyes on Libya 24/7 right now. Very concerned about weapons, where they are, whose hands they may fall into in the coming days.

The Transition National Council, we are told, is going to be held accountable for these weapon stocks and what happens to them. You know, the fact that the government forces, the Gadhafi forces can still wheel out their scud mills and fire them, causing no harm, but yet still dealing with those weapons, that's a concern.

But I think in the coming hours today, something very important to watch is what the NATO press conference talked about and the fighting around Gadhafi's compound in downtown Tripoli. In the coming hours today, that is going to be the focus of a lot of attention as the rebels and the government forces fight it out.

NATO said -- the NATO spokeswoman said that NATO would not be providing what they call close air support. That means the aircraft overhead are not going to be bombing to try and support the fighters on the ground. They are going to be watching. They are going to be looking at what is going on, but that compound now is really the center of what everyone is looking at.

ROMANS: You know, Barbara, our Sara Sidner's reporting now that residents are fleeing the city.

VELSHI: We have those reports, we have Matthew Chance saying that there is gunfire going on outside the Rixos Hotel. He is hearing mortar fire and Arwa Damon at the airport says she's hearing mortar fire. Residents fling and the information minister is saying they are surprised by the speed with which they are taking control.

COSTELLO: This may be the tipping point. This may be it.

VELSHI: This may be it.

He says 85 percent of the city under their control.

All right our coverage of this continues. "CNN NEWSROOM" with Kyra Phillips begins right now -- Kyra.