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The Situation Room
New Al Qaeda Tape; Enron Trial Set to Proceed; Senate Votes to End Debate on Alito Nomination
Aired January 30, 2006 - 17:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
WOLF BLITZER, CNN ANCHOR: It's 5:00 p.m. here in Washington and you're in THE SITUATION ROOM where news and information from around the world arrive in one place at the same time.
Happening now, it's 1:00 a.m. in Baghdad. A chilling new videotape showing kidnaped American journalist Jill Carroll clearly distressed. She makes an emotional plea.
It's 3:00 a.m. in Pakistan and al Qaeda's number two man says U.S. missiles missed him this month but killed many others. In a new tape he calls President Bush a butcher and he issues a new warning to Americans.
And on Capitol Hill, it's 5:00 p.m. A filibuster fight fizzling out. Is it clear sailing now for Supreme Court Nominee Samuel Alito?
I'm Wolf Blitzer. You're in THE SITUATION ROOM.
We begin with a developing story. Wearing a white Muslim head scarf and clearly very upset, the kidnaped American journalist Jill Carroll has just appeared on a new video aired about an hour ago on the Arabic network al-Jazeera. Let's go straight to Baghdad. CNN's Aneesh Raman is standing by with all the details.
Aneesh.
ANEESH RAMAN, CNN BAGHDAD CORRESPONDENT: Wolf, good afternoon.
CNN has seen the entire 30 second video which aired on al- Jazeera. We are not going to re-air it in its entirety. We will show you a freeze frame from the video. As you say, Jill Carroll, wearing a white veil, clearly distraught. In the video she is sobbing as she makes an emotional appeal. Al-Jazeera did not air any audio from Jill Carroll, but they said she called upon the American public, as well as the world community, to get involved in her situation and beseech U.S. forces to release all female Iraqi prisoners.
Now also on the tape the date January 28th is burned in. It's, of course, impossible for CNN to verify if that is, in fact, when this tape was made but it will provide some hope for the family of Jill Carroll that she is still, in fact, alive. Now the last time we saw Jill Carroll was on January 17th, ten days after she was abducted near the capital. Then we heard from the group holding her, the Brigades of Vengeance, that they were giving a 72 hour deadline for the release of all female Iraqi prisoners. That deadline on January 20th came and went and there was no word on the situation for Jill Carroll. Six days later, though, there were some five female prisoners released. Unrelated, Wolf, to the calls of the kidnappers, we were, told by the U.S. military.
Wolf.
BLITZER: Aneesh Raman in Baghdad with the latest on this heartbreaking story. Aneesh, thank you very much.
Let's turn now to our CNN "Security Watch." He dodged a bullet, more accurately missiles, fired in a recent U.S. air strike. Now al Qaeda's number two man is taunting the Bush administration in a new terror tape. Let's go live to our National Security Correspondent David Ensor.
David.
DAVID ENSOR, CNN NATIONAL SECURITY CORRESPONDENT: Wolf, taunting is right. Al Qaeda's number two calls the president of the United States a liar, a butcher, and a loser on this latest tape.
(BEGIN VIDEOTAPE)
ENSOR, (voice over): Seventeen days after the CIA air strike on Damadola, Pakistan, meant to kill him, a defiant videotape from Ayman al-Zawahiri.
AYMAN AL-ZAWAHIRI, AL QAEDA'S DEPUTY LEADER, (through translator): The American airplanes, in collaboration with their agents of the Jews and crusaders Musharraf, launched an air strike on Damadola near Pishower (ph) around the Eid holiday, during which 18 Muslims., men, women and children were killed.
PETER BERGEN, CNN TERRORISM ANALYST: And they needed to show that their top leadership was alive and well after the strike in Pakistan. We've had one audio tape from bin Laden. Now this videotape from Zawahiri. They want to say, we're still live, we're still well and we're still in the game.
ENSOR: A U.S. counterterrorism official said the tape was fully expected after word came Zawahiri had survived the attempt on his life and that he seems agitated on it. The goal, officials say, is to gain some propaganda advantage from the American failure to get him. I will meet my death when God wishes, Zawahiri says, but if my time has not come, you and all earthly forces cannot change it even by a second. Zawahiri talks too about killing Americans.
AL-ZAWAHIRI, (through translator): The lion of Islam, Sheikh Osama bin Laden, offered you a decent exit from your dilemma but your leaders, who are keen to accumulate wealth, insist on throwing you in battles and killing your souls in Iraq and Afghanistan and, God willing, on your own land.
BERGEN: This is, you know, Islamic jurisprudence suggests that you should offer, you know, a truce to people before you attack them. So we've had one from bin Laden and now Ayman al-Zawahiri in this videotape referring to that.
(END VIDEOTAPE)
ENSOR: The U.S. has already said it will not negotiate with terrorists. And an unaired portion of this tape has another offer from al Qaeda that the U.S. is certain to ignore. Al-Jazeera tells us that al-Zawahiri says if Mr. Bush becomes a Muslim then all will be forgiven.
Wolf.
BLITZER: I suspect that's not going to happen, David. Thank you very much. David Ensor reporting.
Stay tuned to CNN day and night for the most reliable news about your security.
Another direct harshly worded challenge of al Qaeda to President Bush. Let's find out what the Bush administration is saying about that. For that we'll turn to our White House Correspondent Dana Bash.
Dana.
DANA BASH, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, the reaction here at the White House is going to sound quite familiar to you. They are saying simply that this is not surprising and that al Qaeda is a dangerous enemy if it wants to strike the United States again. And that is why the United States is pursuing the leaders of al Qaeda and other terrorist organizations.
That isn't surprising to you because, of course, that is the kind of thing we have been hearing from the White House. We heard from the president himself all week last week, particularly in trying to defend and explain why his domestic spying -- domestic surveillance program is necessary and should continue. And that is, Wolf, something we are definitely going to hear tomorrow night when the president gives his State of the Union Address.
BLITZER: Are you getting any other nuggets, what we expect to hear tomorrow night, Dana?
BASH: Well, it's interesting. This kind of plays into one of the major themes that Bush aides tell us is going to be in the president's speech tomorrow night, which is the need to stay engaged around the world. Both in terms of national security, which this new tape would play into, and terrorism, but also in terms of the economy. And that the president will talk about in terms of U.S. jobs. The need to stay competitive. The need to maintain leadership in terms of innovation and knowhow around the world. So the president will have some new initiatives on that.
But as you know, Wolf, the president is going to go before Congress and a country at a time where he is still very low in the polls. And he is going to go before a Republican Congress very skittish about their prospects at the polls this election year. So he's going to really try to reach out to the American people about issues. The White House thinks that they care about their daily concerns. A list of something that the White House Counselor Dan Bartlett told us earlier today.
(BEGIN VIDEO CLIP)
DAN BARTLETT, WHITE HOUSE COUNSELOR: People don't like it when the gas prices go up and people don't like it when they can't find healthcare. Those are two common responses to challenges we're facing. What they want to hear from the president tomorrow night is that you have a strategy to deal with it. And he does have a strategy. It's one that trusts people more than trusting government. We have seen too many examples in the past where government has failed to get the job done. But by empowering people, they do get the job done. And he will have policies that reflect that.
(END VIDEO CLIP)
BASH: So there you heard Dan Bartlett explaining two of the main domestic issues, energy and healthcare, that the president will put forward very much in line with the president's thinking with Republican, sort of philosophy, which is giving more benefit to businesses and giving more -- giving the individual more ability to deal with what they have to deal with, with both of those issues, particularly healthcare.
Wolf.
BLITZER: Dana Bash, thanks very much.
And to our viewers, please stay with CNN for complete coverage of the State of the Union Address. Our prime time coverage begins 7:00 p.m. Eastern with a special edition of THE SITUATION ROOM. I'll be joined here by Paula Zahn. That's followed by our live coverage of the speech 9:00 p.m. Eastern. Then Anderson Cooper brings you immediate reaction and Larry King hosts a riveting hour of insight and analysis. All coming up tomorrow night.
Another developing story we're following right now. The final battle over the Supreme Court Nominee Samuel Alito. Some Democrats have tried to stall the confirmation process with a filibuster but the U.S. Senate has been voting on whether to cut off that debate. Let's go live to Capitol Hill. Our Congressional Correspondent Ed Henry has the very latest.
Ed.
ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: Wolf, the vote is over. They are still tallying it up officially, so the results are unofficial. But the headline is that Judge Alito has cleared this procedural hurdle. He's clearly going to get the at least 60 votes he needs to end this filibuster and move on to the next stage, a confirmation vote tomorrow morning.
The key is, unofficially about 14 Democrats have voted for cloture. That means they voted to end the debate. They broke ranks with John Kerry and Ted Kennedy. So at least about 14 Democrats. You add to that 55 Republicans who were against the filibuster. You have about 69 or so votes for cloture. Again, they only needed 60 to end this filibuster. They have about 69 or 70. And, again, that clears the hurdle.
We're waiting for the official result. It still has not been tallied. We'll give you that number in a couple of minutes. But the bottom line is he's going to clear it with a few votes to spare. A final confirmation vote tomorrow morning, 11:00 a.m. In fact, Judge Alito could be sworn in as Justice Alito, the 110 justice to the Supreme Court, in time for the State of the Union. Wolf.
BLITZER: And I know a lot of political experts will be looking at those 14 Democrats to see who bolted from Kennedy and Kerry. Who didn't. We'll get back to you on that when we get the final vote. Thanks very much, Ed Henry reporting.
Let's go to Jack Cafferty in New York. He's standing by with The Cafferty File.
Jack.
JACK CAFFERTY, CNN ANCHOR: Record profits for the country's biggest oil company. Exxon Mobil raked in $10.7 billion in the fourth quarter last year. They actually had a very good year last year. Net income $36 billion. That means that in 2005, the three largest oil companies made more than $63 billion.
Some lawmakers have been calling for a windfall profit tax. That would make the companies invest more in new production and refining capacity. In its earnings statement, Exxon Mobil said it recognizes that consumers need affordable energy and said, "our strong financial results will continue to allow us to make significant, long-term investments required to do our part in meeting the world's energy needs."
A little defensive. Here's the question. What should be done about skyrocketing oil company profits, if anything? You can e-mail us at caffertyfile@cnn.com.
Wolf.
BLITZER: I guess, Jack, with oil price per barrel $60 to $70 per barrel, skyrocketing profits not only for American oil companies, but think how much the Iranians, the Saudis, the Russians, the Venezuelan, the major oil producing countries out there are raking in right now. Think about it, Jack.
CAFFERTY: And think about what they're not doing with all that money in places like the Middle East where they've been raking it in for decades. What do they spend it on? It sure ain't the quality of life of the citizens, is it?
BLITZER: Well, that's something to think about in the future Cafferty File. Thanks very much, Jack. We'll check back with you soon. Up ahead. Some are calling it the trial of the century. It concerns the largest bankruptcy in corporate history. The Enron trial. We'll have a live report on what's happening right now.
And we're learning new details of the government's response to Hurricane Katrina. And new details on how some officials bungled the response effort.
And the condition of ABC News Anchor Bob Woodruff, his cameraman Doug Vogt. They suffered major injuries after an attack in Iraq. We're going to give you the latest on what's going on. Stay with us.
(COMMERCIAL BREAK)
BLITZER: There's a development happening in the Enron trial. I want to go right to our Ali Velshi. He's standing by in Houston. He's got the very latest.
What is happening, Ali?
ALI VELSHI, CNN ANCHOR: Just now the judge in the case has said that despite the fact that all of the jurors in the room, all of the potential jurors have not been interviewed, he has said now that the court has questioned enough jurors to go ahead and select a jury in the Enron trial. Now the judge had put down a rule that jury selection was going to be done today. That surprised a lot of people. Ninety-six people walked into this building behind me early this morning and they have been going at it all day. They have whittled that 96 down to 38 perspective jurors who have passed at least the judge's litmus test. As far as the judge is concerned, those 38 people are qualified to stand as jurors.
Now each side of this trial has six peremptory eliminations. Which means they can eliminate six people without cause from that group. You take that 38 down to 26.
Out of that 26, they just need to come up with 12 jurors and four alternates. And according to Judge Simeon Lake, that will be done before the close of business today, Wolf, and tomorrow morning this trial will begin with opening arguments.
Now we caught up to Ken Lay on his way in to court early today. We asked him, this jury matter has been a contentious one. Can he get a fair trial in a city where Enron was such a big name, on the buildings, on the sports fields, with so many thousands of employees? Here's what he had to say to us.
(BEGIN VIDEO CLIP)
KEN LAY, FORMER ENRON CHAIRMAN: We'll see how it goes.
UNIDENTIFIED FEMALE: How are you feeling prior to this?
LAY: I'm feeling fine. All we're hoping for today is that we pick a fair jury that will give me a fair shake. And the outcome will be fine. (END VIDEO CLIP)
VELSHI: We understand that within about half an hour the challenges to any of those 38 jurors will take place. The judge again saying he intends to finalize jury selection by the end of today and start this trial in earnest tomorrow. Wolf, expected to go about four months.
BLITZER: All right. We'll be watching, Ali, thanks very much. Ali Velshi is going to have a lot more coming up at 7:00 p.m. Eastern right here on THE SITUATION ROOM on this Enron trial.
The Enron defense team has long argued that it cannot get a fair trial in Houston. Let's go to our Internet Reporter Abbi Tatton. She's been doing some digging online.
Abbi, what have you found?
ABBI TATTON, CNN INTERNET REPORTER: Wolf, the Enron defense team did not want this to take place in Houston. This is a motion that you can find online that was filed to try and get a different venue. What the defense team did is they got a series of questionnaires, court approved questionnaires that were sent to potential jurors. When they were asked to describe their feelings about the Enron case, they noted that certain words came up a lot from these potential jurors. Look at this, greed, crook, fraud were the top three. Liar and variations of that word followed close behind.
The potential jurors were also asked to describe the way they felt about certain players involved in this case. Look at this one. Mr. Skilling is the biggest liar on the face of the world. That was one of them. Another one for Ken Lay. Ken Lay is a crook but I believe I could be a fair and impartial juror. That's one. You can find this motion online, Wolf.
BLITZER: Abbi, thank you very much. Abbi Tatton reporting.
Coming up, Kraft Foods announces big cutbacks. Lots of people about to lose their jobs. We're going to have details.
Plus, her story captivated the world. Baby Jessica rescued from a Texas well 18 years ago. You might be surprised at what she's doing right now.
You're in THE SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: Let's go to CNN's Zain Verjee at the CNN Center in Atlanta for a closer look at other stories making news right now.
Hi, Zain.
ZAIN VERJEE, CNN ANCHOR: Hi, Wolf.
The nation's largest food manufacturer joins the list of companies set to lay workers off. Today, Kraft Foods announced that it will cut 8,000 jobs. Now that's about 8 percent of Kraft's workforce. The company said it will close up to 20 production plants. Kraft says that it's part of an ongoing effort to help save the company more than $1 billion.
Iraq has a new woe. A confirmed case of the deadly strain of bird flu. Iraq's health minister says that a 15-year-old girl who died on January the 17th had the H5N1 strain of the disease. The northern Kurdish region of Raniya has been cordoned off and a mass killing of birds has begun. Her girls uncle also died and two other people have gotten sick but it's not confirmed if they have bird flu.
Today in Nigeria, kidnappers set free American oil worker Patrick Landry and three of his co-workers. The group had been held hostage for two weeks. They're now said to be doing quite well. Their release came after appeals from a Nigerian leader. The kidnappers had demanded money from oil companies as a way to spread the wealth to poor villages in Nigeria's oil-rich regions.
And many are mourning the death of a celebrated playwright. Wendy Wasserstein died of lymphoma today in New York. Friends said that she'd been ill for several months. Her most famous works including "The Heidi Chronicles" and "The Sisters Rosensweig." Wasserstein was 55 years old.
Wolf.
BLITZER: Zain, thank you very much. Zain Verjee reporting for us.
We're also learning new details right now of the glaring failures in the federal response to Hurricane Katrina. Jeanne Meserve from CNN's American bureau is joining us now live. She's got more.
Jeanne.
JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: Wolf, it was a day of jaw dropping testimony about shortcomings in Katrina search and rescue efforts.
(BEGIN VIDEOTAPE)
MESERVE, (voice over): No doubt lives were saved by federal, state and local rescuers, as well by private volunteers. The death toll from Katrina was far less than had been predicted. But where there short comings? You bet.
CAPT. TIM BAYARD, NEW ORLEANS POLICE: We could not coordinate with any state, local or federal agencies who are not prepared logistically. Most important, we relocated evacuees to two locations where there was no food, water or portable restrooms. We did not have food, water or fuel for the emergency workers. We did not have back- up communication systems.
MESERVE: The list goes on. The day before the storm hit, the Louisiana Department of Wildlife and Fishery sent an urgent request for FEMA or the Department of Defense, to provide 300 rubber rafts. Though 20 rafts and 27 hard hulled boats were sent in, federal procurement officials in far away Texas had decided the larger number of rafts would not be useful because of debris.
LT. COL. KEITH LACAZE, LA DEPT OF WILDLIFE AND FISHERIES: I believe that the rafts would have been beneficial, especially in the early stages. Because in the situation we were in, we could have used the rubber rafts in tow with the small motor boats that we sent in to the neighborhoods and we could have loaded additional evacuees.
SEN. SUSAN COLLINS, (R) MAINE: He just gave a very good reason why, at least this initial version of the request, should have been granted. What troubles me is, don't you all talk to one another?
(END VIDEOTAPE)
MESERVE: The answer, quite clearly, was quite often, no. The New Orleans police commander on the panel today said he didn't have any communication with FEMA until four weeks after Katrina hit.
Wolf, back to you.
BLITZER: All right, Jeanne, thanks very much. Jeanne Meserve reporting.
Coming up, you pay more for gas, the oil companies make record profits. That's how it works. Because you are helping fuel that. What do you think? Jack Cafferty has your e-mail.
And in our 7:00 p.m. Eastern hour, how badly hurt are ABC News Anchor Bob Woodruff and his cameraman. They were injured in Iraq over the weekend. We'll talk with our Senior Medical Correspondent Dr. Sanjay Gupta. He'll have a medical assessment.
Stay with us.
(COMMERCIAL BREAK)
BLITZER: ABC News Anchor Bob Woodruff and his cameraman Doug Vogt are in a military hospital in Germany after being seriously wound by a roadside bomb in Iraq. Doctors are trying to determine whether they can be flown back to the United States now for further treatment. Our Senior Pentagon Correspondent Jamie McIntyre is standing by. But let's begin our coverage of this important story with CNN's Chris Burns. He's joining us from Landstuhl, Germany.
Chris.
CHRIS BURNS, CNN CORRESPONDENT: Wolf, today doctors were busy examining and testing the two patients. Also their family members have arrived. All putting their heads together along with an ABC executive as to what the next step should be. Also tomorrow the hospital tells us that the doctors will be busy cleaning some of the wounds. All part of a very long process of recovery.
(BEGIN VIDEOTAPE) BURNS, (voice over): At Landstuhl U.S. Military Hospital, two more cases that are all too common here. Victims of a roadside bomb in Iraq. ABC News Anchorman Bob Woodruff and his Emmy-winning Cameraman Doug Vogt arrived here with breathing tubes and heavily sedated. They're suffering from head wounds and broken bones after Sunday's blast in which a so-called improvised explosive device blew up outside the Iraqi military vehicle they were driving in. Standing in the open hatch, they were hit by shrapnel and whatever else the bomb kicked up despite their body armor and helmets.
LT. COL. GUILLERMO TELLES, LANDSTUHL REGIONAL MEDICAL CENTER: These are foreign bodies that can cause tremendous amount of injury to flesh and bones.
BURNS: So you've seen this pretty often then?
TELLES: Unfortunately, yes.
BURNS: After U.S. military doctors operated on them in Iraq, they underwent CAT scans and other testing here. The hospital says doctors saw good early signs of reaction. Signs of slow improvement. How long it may take for them to recover is even hard for Landstuhl's commander to say. And he did reconstructive surgery during the first Gulf War.
UNIDENTIFIED MALE: There's still a lot of assessment and reassessment about their wounds and about the care that they will need to follow on. So, you know, in my experience, it's too early to say.
BURNS: Thousands of American troops have gone through this medical center, the biggest of its kind outside the U.S. -- each soldier a tragedy for at least one family.
(END VIDEOTAPE)
BURNS: And two more casualties among thousands, but that one of them is beamed into millions of homes across America every night makes it even more real how dangerous and violent Iraq remains -- Wolf.
BLITZER: Chris Burns reporting from Germany for us -- thanks, Chris, very much.
The ABC team was wounded while riding in an old Iraqi military vehicle. Were they just too vulnerable?
Let's head over to the Pentagon. Our senior Pentagon correspondent, Jamie McIntyre, has been looking into this part of the story -- Jamie.
JAMIE MCINTYRE, CNN SENIOR PENTAGON CORRESPONDENT: Well, Wolf, these days, Iraqi insurgents are attacking Iraqi troops far more often than American troops in their better -- with their better armor and better equipment.
And by trying to document the capability of the Iraqi military, Woodruff and Vogt put themselves squarely in the crosshairs. (BEGIN VIDEOTAPE)
MCINTYRE (voice-over): According to U.S. military officials, Bob Woodruff and Doug Vogt were riding in a Soviet-made armored vehicle like this one, which Iraqi forces proudly demonstrated for CNN military analyst retired Major General Don Shepperd last year.
MAJOR GENERAL DONALD SHEPPERD, CNN MILITARY ANALYST: We are at the 9th Division Headquarters at -- at Taji, and looking at the -- their efforts to refurbish their equipment.
MCINTYRE: Shepperd shot this video last October while on a Pentagon-sponsored inspection tour of Iraq. He says the Iraqis, desperate for the kind of armor used to protect U.S. troops, were patching up 1970s-era MTLB amphibious armored personnel carriers left over from the regime of Saddam Hussein.
SHEPPERD: These are not new vehicles. They are old Iraqi vehicles that have been rehabilitated or brought out of storage, ones that were not destroyed during the war or ones that they have pieced together.
MCINTYRE: The Cold War-era APCs offer good protection against small-arms fire, but not against roadside bombs. That might not have been a factor in this case, however, considering both Woodruff and his cameraman were said to be standing up, exposed in the turret, while videotaping a segment for their television report.
SHEPPERD: He was out on an operation filming it. And the problem you got, as a reporter, is, if you're going to film something, you have got to stand up, you got to stay steady, and you got to film it. And that's an invitation to get whacked over there.
(END VIDEOTAPE)
MCINTYRE: Woodruff and Vogt were operating in Taji. It's one of the most dangerous areas in Iraq. Just a week ago, two U.S. airmen who were on convoy patrol were killed in a very similar ambush. Wolf, it's an area where, sometimes, even the best armor that the American military has isn't enough to save your life.
BLITZER: Our thoughts and prayers are with both of those journalists. We wish them a speedy recovery.
Jamie McIntyre, thanks very much.
The vote is now over on Capitol Hill.
Let's head over to our congressional correspondent, Ed Henry, standing by with the vote on the nomination of Judge Samuel Alito. Democrats sought to go forward with the filibuster.
Ed, apparently, they failed.
ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: That's right. And, in fact, the Republicans needed 60 votes to break that Democratic filibuster. They got a lot more. They got 72 in the end -- the final tally, 72-25. That means only 23 lawmakers, 23 Democrats, joined John Kerry and Ted Kennedy in supporting the filibuster, supporting continued debate.
What's interesting, you have about 17 Democrats who broke ranks with Kerry and Kenned and actually voted to cut off debate here -- not a -- a lot of surprises in there, mostly Democrats from the gang of 14 moderates who we have heard about, but also some Democrats like Maria Cantwell, for example, she could be facing a tough reelection in Washington state. She's expected to -- to vote against Alito's confirmation, probably, but decided to vote for cloture to end a filibuster -- but, again, a lot of moderates, Joe Lieberman, Mary Landrieu, a lot of expected names on that list -- Wolf.
BLITZER: All right. It's all over on that front. And, presumably, at 11:00 a.m., when they vote on confirmation, it will be all over that time as well.
Ed Henry, thanks very much.
Still to come, Hamas is asking for help. It wants the world community to keep making aid payments to the Palestinians. Will the U.S. let the money keep flowing in?
Also, a new terror tape and a taunt and a threat from the al Qaeda number-two man -- does President Bush have an answer?
Stay with us.
(COMMERCIAL BREAK)
BLITZER: The militant Islamic group Hamas, now the Palestinian power broker, today called on world leaders to continue financial support to the Palestinians. But President Bush is calling on Hamas to give up its arms and to give up terrorism.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The Hamas party has made it clear that they do not support the right of Israel to exist. And I have made it clear, so long as that's their policy, that we will not support a Palestinian government made up of Hamas.
(END VIDEO CLIP)
BLITZER: The United States and the European Union list Hamas as a terrorist organization. And it's illegal for their citizens to give money to Hamas. While Hamas has not yet taken power, Palestinian leaders say funds are running out and government employees could soon lose their jobs.
There was a high-level huddle in London today, as the United States discussed with the Europeans, the Russians, and the United Nations how to handle Hamas. Joining us now, a key member of CNN's Security Council, our world affairs analyst, the former Defense Secretary William Cohen. He's chairman and CEO of The Cohen Group here in Washington.
It's -- I guess it's easier said than done to cut off all aid to the Palestinians. What -- I mean, how do you see this situation playing out?
WILLIAM COHEN, CNN WORLD AFFAIRS ANALYST: Well, the fancy word is conundrum. We have got a real problem. And so does Hamas and the Palestinians.
There are roughly 140,000 civil servants in the Palestinian Authority. They now run the risk of losing their jobs. Most of them are associated with Fatah. Fatah is now at odds with Hamas. So, we have a situation in which Hamas has said, we won't give up our pledge to seek the destruction of Israel.
Under those circumstances, the United States -- and I assume the E.U. and others -- cannot afford to then say, the money will continue to flow into the Palestinian Authority. You now have the head of the government, so to speak, who is a peacemaker, or seeking peace. You have the body, the parliament now, which is destined to wage war against the Israelis. So, you have a real conundrum there and a real problem for Hamas and for the Palestinians and the Israelis.
The key, in my judgment, again, is going to be Iran, which folds neatly into the situation now confronting all of us, Iran's development of -- or attempt to develop nuclear weapons, potentially, Iran also supporting Hamas in terms of providing money that may be cut off by the United States and others.
BLITZER: The secretary of the United States, Condoleezza Rice, was in London, meeting with allies and others earlier today. And she said this.
Let me read it to you. She said: "I've asked why nobody saw it coming, and I hope that we will take a hard look, because it does say something about perhaps not having had a good enough pulse on the Palestinian population."
By all accounts, this was an intelligence blunder, the fact that Hamas won this landslide.
COHEN: Well, it was a failure, to be sure, but a failure virtually on the part of everyone.
I know that I had talked to a number of experts who had just returned from the region. They thought, perhaps, Hamas would get 30 percent, possibly a little more, but between 20 and 30 percent. And they had just been recently in the region. They were familiar with the Palestinian Authority and -- and Hamas. But that was their judgment.
So, I think it was clearly a lack of access to the right people to understand the degree of rejection on the part of the Palestinian people toward Fatah, and the corruption level that has existed for some time.
BLITZER: I spoke with the co-founder of Hamas yesterday, Mahmoud al-Zahar. And he made it clear that the state of -- the new state of Palestine that they envisage is going to be an Islamic state, and anything but a secular state.
Listen to what he said.
(BEGIN VIDEO CLIP, "LATE EDITION")
MAHMOUD AL-ZAHAR, CO-FOUNDER, HAMAS: Secular system allows homosexuality, allows corruption, allows the spread of the loss of natural immunity, like AIDS. We are here living under Islamic control. Nothing will change. Islam is our constitution.
(END VIDEO CLIP)
BLITZER: Those are pretty strong words, that this is going to be, in effect, a theocracy that these Hamas leaders want, although there are plenty of Palestinians, as you and I know, who are very secular.
COHEN: Well, it's going to be a choice that the Palestinian people, they have made to date. They will now have to live with it, to see whether or not they are going to be supporting Hamas in the future.
To the extent that Hamas says it is going to be an Islamic theocratic state, then we are looking for heartbreak continuing at a much more violent level, it seems to me, between Israel and the -- the Palestinian people. This is not a good situation.
BLITZER: Let's talk about Ayman Al-Zawahri, the al Qaeda number two. He taunted the president today in this latest -- latest videotape. The U.S. tried to kill him 17 days ago along the border between Pakistan and Afghanistan.
And he shows up today and says: I'm alive and well. And maybe you won't be.
I'm paraphrasing.
COHEN: Well, he's alive and well. And perhaps it was -- became very close, that he has got to be aware that there's an intensification of the hunt for him, there is more intelligence being gathered.
The fact that the U.S. and other forces came close to getting him, according to reports, should be a sign for him that the United States is not going to cease and desist from its efforts to either capture or kill him. So, he can, at this point, thumb his nose at the United States. But the reality is, he's going to have to be on the move. And the United States and others intend to keep him on the move.
BLITZER: William Cohen, our analyst, thanks very much for joining us.
COHEN: Pleasure.
BLITZER: Up next, an arrest in the case of that giant drug tunnel from Mexico to the United States -- we will have details -- also, an exclusive look inside.
And this note: Coming up in our 7:00 p.m. Eastern hour here in THE SITUATION ROOM, major changes in the trial of Saddam Hussein -- we will talk about them with one of his lawyers, the former United States Attorney General Ramsey Clark. He's here. He will be here in THE SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: Welcome back.
You can get an early read on the president's State of the Union address by looking at the audience. His special guests often are chosen to back up his words.
On the eve of the president's 2006 speech, our Dana Bash caught up with one family showcased by the Bush White House last year.
(BEGIN VIDEOTAPE)
DANA BASH, CNN WHITE HOUSE CORRESPONDENT (voice-over): His dress blues hang in the hall, near the flag that draped his casket. You may not remember Sergeant Norwood, but you were introduced to him this time last year.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Byron Norwood of Pflugerville, Texas, who was killed during the assault on Fallujah.
BASH: His parents were VIP guests, as the president read a letter from mom, Janet.
BUSH: "He just hugged me and said, 'You've done your job, Mom."
JANET NORWOOD, MOTHER OF SOLDIER KILLED IN IRAQ: "It's my turn to protect you now."
I was just floored. You know, it was pretty unreal.
BASH: So was this embrace with an Iraqi woman, Safia.
(APPLAUSE)
J. NORWOOD: The expression in her eyes was an expression that Byron had described to us as the look of hope. I couldn't have stopped myself from hugging her.
BASH: Safia keeps in touch with e-mails from Iraq.
J. NORWOOD: We seem to have a whole lot in common, just as women, as mothers. BASH: E-mail from Byron had been so precious, Janet put a baby monitor next to her computer to hear the knocking sound at night when he logged on.
One night, it sounded different. She woke her husband, Bill.
J. NORWOOD: You know, he was going to go to the computer. And I said, no, Bill, it's not the computer. I could see the brass buttons reflecting the light of the -- a sight I will never forget. You know, there's something inside of me still says to this day, if we just hadn't opened the door.
BASH (on camera): So, this table is always like this?
(voice-over): Fourteen months later, his memory is everywhere, picture, scrapbooks, letters. Bill reads his son's journal.
BILL NORWOOD, FATHER OF SOLDIER KILLED IRAQ: "They did it for us in the other wars, World War II and such. And now it is my turn."
BASH (on camera): How does that make you feel?
J. NORWOOD: Incredibly proud.
B. NORWOOD: Just incredible.
BASH (voice-over): We called the Norwoods last summer, when another mom dominated the news. They wanted no part of it.
(on camera): When you hear somebody like Cindy Sheehan saying, my son died in vain, what does that make you think?
J. NORWOOD: It makes me angry, because our son did not die in vain, and I don't believe her son did either.
BASH (voice-over): Part of coping is writing to Byron's comrades back in Iraq for a third tour. This is also where Janet mailed her White House letter, a post office now named for her son.
J. NORWOOD: This is the one that's modeled after Byron.
BASH: And they helped build a war memorial in a park where Byron played as a boy and dreamed of being a Marine.
J. NORWOOD: I love seeing his face.
BASH: They come here often to remember -- so hard to let go.
Dana Bash, CNN, Pflugerville, Texas.
(END VIDEOTAPE)
BLITZER: And stay with CNN for the State of the Union address tomorrow night. Our prime-time coverage begins 7:00 p.m. Eastern, a special edition of THE SITUATION ROOM. I will be here with Paula Zahn. That's followed by our live coverage of the president -- of the president's speech at 9:00 p.m. Eastern.
Then Anderson Cooper brings you immediate reaction. Larry King hosts a special hour of "LARRY KING LIVE" at midnight -- lots of insight and analysis on "LARRY KING LIVE" tomorrow night.
We are following the developing story of Jill Carroll being held hostage in Iraq.
Our Internet reporter, Jacki Schechner, is about to show us what kind of support her family is getting online -- Jacki.
JACKI SCHECHNER, CNN INTERNET REPORTER: Wolf, Jill Carroll was freelancing for "The Christian Science Monitor."
And they continue to have running updates, as they get more information at the same time as we do, about Jill Carroll's situation in Iraq, where she is being held captive.
The other thing I wanted to show you is regular blogs who deal with things like trends and culture online are also posting about Jill -- and a lot of them pointing to this blog in particular. This is a woman who is a Jordanian journalist. She's a friend of Jill's. She posted this photograph of Jill at her bridle shower, talking about how she can barely stomach the news.
Of course, the new video we heard about today, she is saying she can barely stand it. This is the blog, "Mental Mayhem," that a lot of people are going to find out really emotion and, really, just -- just raw, raw emotion from her friends and family -- Wolf.
BLITZER: All right, we are getting a statement in, also, Jacki, from "The Christian Science Monitor." We are going to bring that statement to you momentarily.
But let's go to CNN's Zain Verjee first at the CNN Center in Atlanta for a quick look at some other stories making news -- Zain.
VERJEE: Wolf, in California, a follow-up to the discovery of the longest secret tunnel ever found between the United States and Mexico -- a Mexican citizen is being held on drug charges. Two tons of marijuana were found in the tunnel last week. Tonight, on CNN's "ANDERSON COOPER 360," Anderson is going to be live near San Diego with an exclusive tour of the tunnel. That's at 10:00 p.m. Eastern.
It could have gone horribly wrong, but, instead, it has a happy ending. All 72 people trapped in a mine in western Canada over the weekend are now safe and sound. The last miners were rescued this morning. The group spent 24 hours underground, trapped by a fire that broke out yesterday. Officials say they took refuge in several safe rooms that were stocked with oxygen, food and water, and that -- that was while the crews were extinguishing the blaze.
Baby Jessica McClure has come a long way since being rescued from a well in 1987. CNN carried the dramatic story live. The 18-month- old youngster was trapped for 58 hours, after falling down a narrow pipe. Jessica is 19 years old now. People magazine reports that she just got married at a church outside Midland, Texas. She reportedly met Daniel Morales at the day care center where she works -- Wolf.
BLITZER: Zain, thank you very much.
And I want to read the statement that we are getting in from "The Christian Science Monitor," Richard Bergenheim's statement. He's the managing editor.
"Anyone with a heart will feel distressed that an innocent woman like Jill Carroll would be treated in a manner shown in the latest video by Al-Jazeera. We add our voice to those of Arabs around the world and especially those in Iraq who have condemned this act of kidnapping. We ask that she be returned to the protection of her family immediately" -- that statement just coming in from "The Christian Science Monitor" in the aftermath of this latest Al-Jazeera video that was released showing her weeping, pleading -- a very distraught Jill Carroll.
Up next, your answers to our question of the hour -- what should be done about skyrocketing oil company profits? Jack Cafferty standing by with your e-mail.
(COMMERCIAL BREAK)
BLITZER: Today, CNN begins a year-long look into the future at developments that could be just around the corner.
Here's CNN's Miles O'Brien.
(BEGIN VIDEOTAPE)
ANDREA MILLER, FOUNDER AND PRESIDENT, TANGO MEDIA: My name is Andrea Miller. I'm 34. And I'm the founder and president of Tango Media. I'm in a great career. But, nevertheless, I really feel that ticking clock.
Right now, I probably average about 16-hour days. When I thought about being a mom, it was one of these things that you just feel, like, well, of course I'm going to be.
But I'm one of these people, I think, like a lot of women, who, frankly, hadn't planned. And suddenly you're 34 and you're trying to have a child and the doctors are saying, hey, guess what?
I think our lifestyle timeline has gotten out of sync with our fertility timeline. So, my wish for the future would be for science to advance to the point where women had many more options and had more control of their fertility.
MILES O'BRIEN, CNN CORRESPONDENT: Andrea represents an entire generation of working women who want to further their careers and yet someday still have kids. How close are we to the day when they can have it all?
(voice-over): This man believes he has the answer. Dr. Alan Copperman is a fertility specialist at New York's Mount Sinai Medical Center. Every day, he sees patients just like Andrea, whose careers may be rising, but whose prospects for pregnancy are falling fast.
DR. ALAN COPPERMAN, DIRECTOR OF REPRODUCTIVE ENDOCRINOLOGY, MOUNT SINAI MEDICAL CENTER: Most of that is really related to a decline in egg quality with aging. When you're 21, 90 percent of your eggs are chromosomally normal. And when you're 41, 90 percent of the eggs are chromosomally abnormal.
O'BRIEN: For a woman who wants to postpone pregnancy, in-vitro fertilization is an option. And thousands of babies have been conceived from frozen embryos. But what if you don't have a partner and want to wait until you do to conceive? Copperman says, this is the future, freezing a woman's actual eggs.
COPPERMAN: We can thaw them out, fertilizing them by taking a singular sperm and putting them right through this egg which, has been frozen and thawed, and then implanting them.
O'BRIEN: But does it work? Worldwide, fewer than 200 babies have been born from frozen eggs, though several recent clinical trials suggest the success rate is growing.
COPPERMAN: Ten years from now, it's my hope that I could sit there with a patient, like Andrea or anybody else, and say that it is safe and it's effective.
(END VIDEOTAPE)
BLITZER: And let's go right to Jack in New York with "The Cafferty File" -- Jack.
CAFFERTY: Record profits, Wolf, for the nation's biggest oil company. Exxon raked in $10.7 billion in the fourth quarter. Total for the year, $36 billion in net income. That means the three largest oil companies last year raked in over $63 billion.
The question this hour, what should be done about skyrocketing oil company profits?
Libby in Burnsville, Minnesota: "Vote in a windfall profits tax, use half the proceeds to develop alternative energy sources, and the other half to rebuild New Orleans."
John in Lynnfield, Massachusetts: "Time to have a debate on nationalizing the oil companies in this war on terrorism."
David writes from Oceanside, California: "Nothing should be done. Americans should buy more fuel-efficient cars if they want to punish oil company executives or the oil-producing companies."
Bobbi in Charlotte, North Carolina: "The oil companies should set up a fund to help those who are struggling to pay for their home heating costs. There are people who need to make a choice every day between eating and heating their homes."
And Sammy writes from west Des Moines, Iowa -- I used to work in Des Moines, Iowa -- "It's all about supply and demand. More people are buying gas-guzzling SUVs and using more fossil fuels than ever. It's no wonder that fuel prices are increasing. Exxon doesn't control the industry. They're just a company well-equipped to take advantage of America's gasoline gluttony" -- Wolf.
BLITZER: See you in one hour back here in THE SITUATION ROOM, Jack.
CAFFERTY: OK.
BLITZER: Thank you very much.
And to our viewers, we are here in THE SITUATION ROOM weekdays 4:00 to 6:00 p.m. Eastern, back at 7:00 p.m. Eastern for one hour. I will be back tonight. Ramsey Clark, he's back in Washington. He will be joining us to talk about the Saddam Hussein trial.
Lou Dobbs getting ready for his program. Lou standing by in New York -- Lou.
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