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Allegations Israel Used American-Made Cluster Bombs Against Targets in Civilian Areas of Southern Lebanon; Israeli Public Fuming Over Outcome of Indecisive War Against Hezbollah; Tropical Storm Ernesto Strengthens; Donald Rumsfeld Says More U.S. troops Can Limit Violence in Iraq, Suggests Iraqis Have to Handle More Security; Iranian Nobel Laureate Warned to Halt Activities; Oprah Winfrey Builds School for Girls in South Africa

Aired August 25, 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: And to our viewers, you're in THE SITUATION ROOM, where new pictures and information are arriving all the time.
Standing by, CNN reporters across the United States and around the world to bring you today's top stories.

Happening now, just moments ago tropical depression five became a full-fledged tropical storm, and they're calling it Ernesto. It could be a hurricane headed for the Gulf Coast.

Should Americans be bracing for the worst? I'll ask Max Mayfield, the director of the National Hurricane Center. He'll join us live this hour.

Is Defense Secretary Donald Rumsfeld too rosy in his assessments of the war in Iraq? Senator Hillary Clinton thinks so.

It's 5:00 p.m. over at the Pentagon, where they are launching a P.R. counteroffensive, and some of his best friends are U.S. foes.

It's 5:00 p.m. in Venezuela. Is President Hugo Chavez replacing his friend Fidel Castro as the major thorn in America's side?

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

It was on this very afternoon last year that Katrina had just become a hurricane. Hours later, it made landfall in south Florida before ravaging the Gulf Coast. Now there is a new tropical storm gathering strength in the Caribbean.

Let's go to our meteorologist, Reynolds Wolf. He's at the CNN weather center with the latest forecast.

(WEATHER REPORT)

BLITZER: New Orleans' hurricane protection system must be dramatically overhauled for the city to be safe from another Katrina- like disaster. That warning today from a panel of engineers and scientists analyzing the damage from Katrina. The report says the devastation caused by Katrina was the result of widespread failure at all levels. They warn that progress has been extremely slow since then.

We're going to have much more on how ready New Orleans is for another hurricane. That's coming up here in THE SITUATION ROOM, 7:00 p.m. Eastern, later today.

Efforts to boost the Lebanon peacekeeping force may be bearing fruit. After talks with European foreign ministers today, the U.N. secretary-general, Kofi Annan, says Europe will provide what he calls the "backbone" to the force.

There are some 2,000 peacekeepers in the existing U.N. force in Lebanon. The U.N. Security Council wants to raise that to 15,000.

So far, Italy has pledged up to 3,000 troops. France pledging another 2,000 troops. A European diplomatic source saying there are new pledges coming in from Spain, Belgium, Poland and Finland. Other European nations are offering naval support, at least for now.

The State Department says the United States is looking into allegations that Israel used American-made cluster bombs against targets in civilian areas of southern Lebanon, a possible violation of a secret agreement with the United States on the use of such munitions. Israel insists its use of the weapons was legal.

Let's turn to our senior Pentagon correspondent, Jamie McIntyre. He's looking into this story -- Jamie.

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Well, Wolf, you know cluster bombs are controversial, but add cluster bombs and U.S. weapons sales to Israel and possible targeting of civilians, and you've got a controversy that has the State Department looking for answers.

(BEGIN VIDEOTAPE)

MCINTYRE (voice-over): In southern Lebanon, bomb disposal units are finding and disarming thousands of unexploded cluster munitions that litter the landscape after the recent 34-day Israeli offensive.

UNIDENTIFIED MALE: From what we're seeing on the ground, there is tens of thousands of cluster bombs everywhere, scattered everywhere.

MCINTYRE: U.N. workers and human rights groups report many of the unexploded bomblets come from American-made cluster bombs provided to Israel which could violate the conditions under which they were sold.

BONNIE DOCHERTY, HUMAN RIGHTS WATCH: Well, the United States had a special agreement with Israel in the '70s that said that Israel was not allowed to use these weapons in populated areas. It violated those rules in its earlier invasion of Lebanon, and that moratorium was extended.

MCINTYRE: In the '80s, the U.S. banned sales of cluster bombs to Israel because of how they were used in the 1982 invasion of Lebanon. But the State Department won't discuss the strings attached to the recent sales.

A State Department spokesman told CNN simply, "What we are looking to see is if they were used... how they were used, who were the targets..."

Because cluster bombs have a five to 10 percent failure rate, dug (ph) bomblets can kill and maim long after the fighting stops.

MAJ. GEN. DON SHEPPERD (RET.), CNN MILITARY ANALYST: One of the problems that the human rights people have is that kids come out after the war, after the attack, and they find these things and try to pick them up, and they go off unfortunately at that time, producing injuries of civilian casualties that you're not looking for.

MCINTYRE: A U.N. report cited Lebanese army figures that 12 people had been killed and 51 injured from unexploded ordnance, including cluster bombs, since hostilities ended. U.N. workers have located 288 sites across Lebanon where cluster bombs were used, mostly, they say, in the three days before the cease-fire.

A statement from the Israeli Defense Forces says, "All the weapons and munitions used by the IDF are legal under international law, and their use conforms with international standards."

(END VIDEOTAPE)

MCINTYRE: An office in the State Department that oversees foreign military sales will conduct a review. Meanwhile, a spokesman at the Israeli embassy told CNN today that so far there has been no formal inquiry from the U.S. government -- Wolf.

BLITZER: When I was in Israel in recent weeks this issue of cluster bombs came up and what the Israelis said, Israeli military and political leaders, was that when they use cluster bombs, they use it just as the U.S. military would use cluster bomb munitions, whether in Iraq, or Afghanistan, or earlier in the Balkans.

What are the ground rules for the U.S. use of cluster bombs? Why does the United States use cluster bombs?

MCINTYRE: Well, they say they are an effective weapon for an area of attack, and to deny an area to the enemy. And they say that they are used against legitimate military targets.

The question here is, do you use them in an area where there are going to be a lot of civilians? And that's what they are looking at, how they were used.

And, of course, human rights advocates claim that even if you only use them against military targets, they're still an indiscriminate weapon because they can explode days or even months later when innocent people come by and pick them up. They equate them to landmines.

BLITZER: Jamie McIntyre, thanks very much.

Jamie McIntyre reporting from the Pentagon.

In Israel, meanwhile, the public is fuming over the outcome of the indecisive, very difficult war against Hezbollah. And political leaders there in Israel may have to pay a political price.

CNN's Chris Lawrence joining us from Jerusalem -- Chris.

CHRIS LAWRENCE, CNN CORRESPONDENT: Wolf, it's the kind of number no leader would like. Seventy-one percent of Israelis polled by a top newspaper think the prime minister is no longer competent to hold office.

(BEGIN VIDEOTAPE)

LAWRENCE (voice-over): Some say Prime Minister Ehud Olmert's biggest problem is perception. A lot of Israelis feel he did not accomplish two main objectives: disarm Hezbollah and bring home two Israeli soldiers Hezbollah captured last month.

MIRA SLASKY, BEREAVED MOTHER: My heart is bleeding, together with the rest of Israel.

LAWRENCE: Mira Slasky is one of the mothers who lost a soldier son in south Lebanon. As for the current government, she wants to clean house.

SLASKY: The situation in the country is desperate. And we would like to change all our leadership. We feel that they all failed. All of them have to go home, from the prime minister, to the army, chiefs of the army. Everyone has to go home.

LAWRENCE: A poll taken by a top Israeli newspaper produced bad news for Israel's prime minister. Sixty-three percent think Ehud Olmert failed in managing the war and should resign. Only 29 percent believe he should continue to lead. It also showed Olmert's Kadima party would lose half its seats in the Knesset if new elections were held.

Supporters say it's too soon to pass judgment. The prime minister is touring the areas of northern Israel hit hard by Hezbollah rockets. He says the government's central goal is rehabilitating those cities. And as reconstruction money starts pouring in, Olmert's approval rating could rise.

(END VIDEOTAPE)

LAWRENCE: But those protests by reservists coming back from the battlefield show no signs of slowing down. And now even some high- ranking officers, colonels, are walking straight off the front lines to the picket line -- Wolf.

BLITZER: All right, Chris.

Chris Lawrence reporting from Jerusalem.

Thank you. Jack Cafferty has the day off. He'll be back with "The Cafferty File" next week.

Still to come here, is Defense Secretary Donald Rumsfeld too rosy in the picture he's painting of the war in Iraq? The Pentagon answers allegations from Senator Hillary Clinton, among others.

And Venezuela's Hugo Chavez takes his show on the road and sticks it to the United States again. We're going to tell you about his latest tirade.

And a new tropical storm forming in the Caribbean now. Could it soon be roaring toward the U.S. coast as a hurricane?

I'll speak live with Max Mayfield, the director of the National Hurricane Center.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: As we mentioned, as the one-year anniversary of Hurricane Katrina approaches, there is now a new tropical storm gaining strength in the Caribbean, Tropical Storm Ernesto, heading for the Gulf of Mexico.

Joining us now, the National Hurricane Center director, Max Mayfield, who made a major announcement of his own earlier today. More on that coming up.

Max Mayfield, thanks very much for joining us.

Give us the latest, first of all, on Ernesto. What do we know about this tropical storm?

MAX MAYFIELD, NATIONAL HURRICANE CENTER DIRECTOR: Wolf, it's not very strong right now, but the bad news is that if it survives the next couple of days, it will likely continue moving through the Caribbean here and will likely end up somewhere in the Gulf of Mexico. It will likely be entering the Gulf of Mexico on Tuesday.

And, you know, we've got plenty of time to watch it. But any time you have a developing storm southeast of us in the peak of the hurricane season, we need to pay attention.

BLITZER: And right now, the waters in the Gulf of Mexico are very warm, and that would be like fuel for this storm. It would -- it would increase its power.

MAYFIELD: That's right. There is no problem with the sea surface temperatures in the Gulf. The inhibiting factor is going to be these upper-level winds that you see here out of the west.

If those winds were to stay there, this would actually weaken, and maybe even dissipate. Unfortunately, we think from the computer projections that this upper-level low that you see right here is going to move westward in the Gulf and conditions may become a little more favorable here with time.

BLITZER: Because when I saw you draw that line originally into the Gulf of Mexico, it almost looked like you were aiming towards New Orleans once again. Is it too early for people along the Gulf Coast, whether in Texas, Louisiana, Alabama, or Florida, any place to start worrying about this?

MAYFIELD: Wolf, it's too early to pinpoint one specific location, but I think message is, especially to the folks that are in temporary housing, these 115,000 families, mostly in these FEMA trailers, they need to, you know, watch this carefully. We've got some time. We don't want people to, you know, get too excited about this, but they certainly need to be watching it. And the fact that it's a Friday afternoon, we don't want them to go the whole weekend without -- without paying attention.

BLITZER: So are you already talking to authorities in those states, whether in Texas, Louisiana, Florida? Are you already in the initial contact stages?

MAYFIELD: Absolutely. We're already -- here at 5:15, we're talking to the state of Florida. That will be the closest state that it gets to initially, in the Keys.

And then at 5:30, we have a hurricane liaison team briefing with FEMA. Our local forecast offices, you know, do that handholding with the local officials. So there is a tremendous amount of coordination already going on.

BLITZER: It may be way premature right now, but at what point do you start making recommendations about evacuations from the coast?

MAYFIELD: Well, that is usually a local or a state call, but as they -- we certainly don't want to do that until it gets, you know, into the Gulf of Mexico. And we'll see how strong it is there and see how the track shapes up at that time. But the main message here is that we do have a developing storm headed in the general direction of the Gulf of Mexico and we need to pay attention.

BLITZER: When you add that cone of uncertainty that we're all so familiar with now, how reliable -- the science at this point, how reliable is it in terms of four, five, six days out making some projections?

MAYFIELD: Well, we've got good news. The cone is getting smaller every year as the forecasts improve.

The not so good news is that it's still -- you know, the forecast in five days is about 300 miles. So that's why you don't want to single out any one individual location. But if it does hold together and survives the next two or three days, we should have a system entering the Gulf of Mexico that we'll need to pay very close attention to.

BLITZER: Here's what you said the other day in an interview with Reuters. You said, "I think the day is coming. I think eventually we're going to have a very powerful hurricane in a major metropolitan area, worse than what we saw in Katrina, and it's going to be a mega- disaster, with lots of lost lives."

When I read that story in Reuters, I said, Max Mayfield is a very cautious scientific expert, and that sounds like a real, real source of alarm.

MAYFIELD: And Wolf, those words have been said by every director of the National Hurricane Center before me going back through Jerry Jarrel, Bob Sheath (ph), Neil Frank, Robert Simpson. They have all said the same thing.

And I had the honor of going to many of the state hurricane conferences this -- during the springtime in the off season. And I have tried to share that, as bad as things were last year with the tremendous loss of life and the tremendous damage, it could have been worse.

You know, that core of Katrina could have been even closer to New Orleans. Rita could have hit Galveston and Houston, instead of, you know, easing in there in the extreme western portion of Louisiana. Wilma could have gone up into the Fort Myers or Tampa area.

So, believe it or not, things could have even been worse.

BLITZER: I noticed when we were talking about a hurricane forecast for this hurricane season back in May you were projecting 13 to 16 named storms. In August you revised that, August 8th, to 12 to 15 named storms.

This is -- this is Tropical Storm Ernesto right now. There hasn't been a hurricane yet at this point. Last year we were already at K, Katrina, as all of our viewers remember.

What, if anything, does this mean in practical terms?

MAYFIELD: I don't think it means very much yet, Wolf. It -- and by the way, nobody is complaining to me that we haven't had a hurricane. But, you know, this is really about the third inning of a nine-inning ball game here. We've got a long way to go and we don't want to let our guard down now.

BLITZER: When we heard earlier today your announcement that you're retiring, a lot of us were surprised because we've come to rely on you for so many years for your excellent work.

Tell our viewers how this decision came up and what your personal plans are.

MAYFIELD: I've been talking about this with my wife for a long time. Actually, for a few years. And I told my bosses at the National Weather Service back in -- at the end of July about the decision.

And by the way, this is after this season. It's going to be on January the 3rd. So I'm still going to be here for several months, but it takes the government some time to fill a position like this. And I -- one of the nicest thing I could do for the nation's hurricane warning program is to let them know that now so they will have time to have a smooth transition here and get a successor in near the time I leave.

BLITZER: And as you get ready to retire, as you leave this critically important job, what's your biggest concern for the American public right now?

MAYFIELD: This national hurricane survival initiative, a public- private partnership that we have, this survey that they took near the beginning of the hurricane season said 60 percent of the people in coastal areas still do not have a hurricane plan. After the last two hurricane seasons and after Katrina, I don't understand that.

My message is the very consistent message we've been saying for years. We want every individual to take personal responsibility and know what to do before the next hurricane comes.

BLITZER: Max Mayfield, we wish you a happy retirement, you and your wife, of course. But we'll be speaking many, many times, I'm sure, before that day come January. We'll be watching Ernesto very closely with you.

Thanks again.

MAYFIELD: Thank you, Wolf.

BLITZER: Moving on to other important news we're following, Iraqis looted a major coalition base in Iraq today shortly after it was abandoned by British troops. There had been frequent attacks on the base in Amara, a mainly Shiite city 200 miles southeast of Baghdad.

U.S. troops fired at a mosque in the Sunni insurgent stronghold of Ramadi, meanwhile, today. The U.S. military saying troops had come under heavy fire from militants inside. The mosque was seriously damaged in the process.

Defense Secretary Donald Rumsfeld says more U.S. troops can limit the violence but suggest Iraqis will have to start handling more of their own security. He spoke as Iraq's deputy prime minister was visiting the Pentagon earlier today.

Let's go live to CNN Pentagon Correspondent Barbara Starr -- Barbara.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Wolf, commanders say the violence actually is down a bit in certain parts of Baghdad, but at the Pentagon there is plenty of worry still about public perception.

(BEGIN VIDEOTAPE)

STARR (voice-over): In Baghdad, U.S. and Iraqi forces continue the massive security sweeps that commanders believe are working. DONALD RUMSFELD, SECRETARY OF DEFENSE: We're seeing a reduction in the levels of violence and in the numbers of attacks in the areas particularly that the forces have been able to clear.

STARR: But if this success is a result in part of the additional 3,500 U.S. troops on the streets, wouldn't even more troops help the security situation?

RUMSFELD: It's correct, it does do it for a period. But the important thing is to have the entire process go forward. The political, the economic, as well as the security.

STARR: Military commanders know violence is likely to return when the troops leave any area. So Rumsfeld's political operatives are laying the groundwork.

This new memo to reporters details the secretary's sober public comments. It's a memo aimed at one senator in particular.

SEN. HILLARY RODHAM CLINTON (D), NEW YORK: We hear a lot of happy talk and rosy scenarios, but because of the administration's strategic blunders and, frankly, the record of incompetence in executing, you are presiding over a failed policy.

STARR: The Pentagon memo counters. This is one example mentioned.

RUMSFELD: I don't want to be accused of suggesting that it's a rosy picture out here. It isn't.

STARR: The memo then details in March 2003, when Rumsfeld said the war would be "tough business" and "not a cakewalk." But this political memo does not talk about the time Rumsfeld referred to the looting and violence as "stuff happens." And it doesn't mention this three-year-old comment...

RUMSFELD: ... accurately portrayed that the major combat has been concluded.

(END VIDEOTAPE)

STARR: But now, Wolf, three years later, grim news from the Army today. They have announced they are going to review 1,700 death cases, soldiers who died in Afghanistan and Iraq since 2001. They are going to go back over all of those records and have another look at them. They want to make sure, they say, that the families of those soldiers have been told the accurate information about how their loved ones were lost on the battlefield -- Wolf.

BLITZER: What a wrenching issue that is.

Thanks very much, Barbara.

Barbara Starr reporting.

And the secretary of defense was meeting with the deputy president of Iraq, not the deputy prime minister.

One more note about Iraq. On "LATE EDITION" this Sunday, I'll be speaking with the prime minister of Iraq, Nouri al-Maliki. He'll be my guest. This is an exclusive interview on "LATE EDITION". It airs Sunday morning, 11:00 a.m. Eastern.

"LATE EDITION," the last word in Sunday talk.

Coming up, satellite TV or terrorist TV? Prosecutors in New York are pressing charges against a channel that promotes Hezbollah. We're going to take a closer look at that and the controversy.

And ready or not. A new report on New Orleans hurricane protection one year after Katrina.

And as a new tropical storm gathers strength, we'll have a report from New Orleans. That's coming up in our 7:00 p.m. Eastern hour right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Welcome back to THE SITUATION ROOM.

I'm Wolf Blitzer in Washington.

Let's check in with Zain once again for a quick look at some other important stories making news.

Hi, Zain.

ZAIN VERJEE, CNN ANCHOR: Hi, Wolf.

An American Airlines plane bound from England to Chicago is diverted to Bangor, Maine, because of an unspecified security threat.

And in Houston, police are questioning a college student who had a stick of dynamite in his luggage. The Continental Airlines jet was en route from Argentina to Newark, New Jersey, when it made a scheduled stop in Houston.

A legal victory for beleaguered Northwest Airlines. A federal judge in New York tells the airline's flight attendants that they cannot go on strike tonight. The judge issued the temporary restraining order while he continues the attendants' case against the airline.

Northwest filed for bankruptcy last year. It says a strike could force it to close. Former President Gerald Ford is said to be resting comfortably after his second heart procedure in a week. Today doctors at the Mayo Clinic in Minnesota placed stints in two blocked arteries in Ford's heart. On Monday, the 93-year-old former leader received a pacemaker at the clinic. It's the fourth time Ford's been hospitalized since December. He's the nation's oldest living president.

The prospects for Sunday's launch of the Space Shuttle Atlantis are more cloudy. Weather officials now expect storms in the launch area hours before the scheduled lift-off. The 23-mile area around the launch pad has to be clear of thunderstorms at the time of launch in case the astronauts need to make an emergency landing -- Wolf.

BLITZER: Zain thank you. What's called Hezbollah TV, beamed from a New York residential neighborhood. Federal prosecutors have now charged a New York man with violating an antiterrorism law. Let's bring in CNN's Allan Chernoff, he's watching this story. Allan?

ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: Wolf, a very interesting legal case over here involving an entrepreneur in New York offering satellite TV services. Except the government claims he was trying to sell a channel that promotes terrorism.

(BEGIN VIDEOTAPE)

CHERNOFF (voice-over): A yard packed with satellite dishes, from this home in New York's Staten Island, and a storefront in Brooklyn, federal prosecutors charged Javed Iqbal was allegedly providing satellite television broadcasts of Al Manar, the TV station run by Hezbollah which airs programming glorifying Hezbollah's military.

U.S. law considers both Hezbollah and Al Manar to be terrorist entities. The criminal complaint unsealed in federal court Thursday says Javed Iqbal allegedly tried to sell Al Manar programming to a customer at the Brooklyn store.

A violation of antiterrorism law. The customer happened to be a government informant. Iqbal allegedly said why don't you watch Al Manar? According to a government affidavit, Iqbal went on to explain different service packages that would allow the confidential informant to receive Al Manar broadcasts. Iqbal's attorney says prosecutors are picking on a small businessman who did not break the law.

MUSTAPHA NDANUSA, JAVED IQBAL'S ATTORNEY: He believes that he's been set up. My client believes that he just simply offered someone an opportunity to have cable -- I'm sorry, satellite TV service.

CHERNOFF: But was there actually an agreement for him to provide Al Manar?

NDANUSA: My client did not conspire or did not agree with the confidential informant to provide Al Manar services to him.

CHERNOFF: There was no agreement?

NDANUSA: Which is what ...

CHERNOFF: But there was some discussion?

NDANUSA: There might have been discussion, the name might have been thrown out there, but in terms of a specific agreement, no, my client denies having that.

CHERNOFF: If convicted of providing the service, Iqbal could face up to five years in prison. (END VIDEOTAPE)

CHERNOFF: The judge set bail at $250,000 and Iqbal's attorney hopes to have him out on bail by Monday. Wolf, by the way, an arraignment has been scheduled for September 25.

BLITZER: Allan thank you very much. Allan Chernoff reporting. Environmental groups are worried that the oil spill along the Lebanese coast could do some devastating damage to wildlife and the economy. Israel air strikes hit a power station south of Beirut last month, spilling thousands of tons of fuel into the Mediterranean. How difficult will the cleanup effort be? Our internet reporter Jacki Schechner has the latest. Jacki?

JACKI SCHECHNER, CNN INTERNET REPORTER: Wolf, Greenpeace put this video online of what it says is the floor of the Mediterranean Sea caked in oil off the Lebanon's coast. You can even see dead fish floating around the effects of that oil. Now this is, we're talking about 150 kilometers of coastline here, that's about 90 miles. You can see Beirut right there.

The next step in all of this is an aerial survey using helicopters, that's going to get started in the next couple of days, to find out just how much oil we're talking about. The effort being spearheaded by the Lebanese ministry of the environment and they and the United Nations have figured out the initial cost of this is going to be about $50 million euros. That's more than $60 million.

The world conservation union went down to the area, took a look at one particular reserve off the coast of Tripoli. They're not only concerned about the fish but they are concerned about the toxins affecting things like migrating birds, loggerhead turtles, even the monk seal, which is already critically endangered. They're also worried Wolf about the ecosystem in general. The fishing industry relies on the health of that.

BLITZER: Thanks very much Jacki. Coming up, is Venezuela's Hugo Chavez becoming America's new Fidel Castro? Mr. Chavez's angry allegations about the U.S. And Oprah Winfrey stuns delighted school girls in South Africa. How she's making good on a promise to Nelson Mandela. That's coming up as well, right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Venezuela's President Hugo Chavez is once again grabbing the spotlight on the world stage. Let's bring back Zain Verjee, she's following his latest outburst. Zain?

VERJEE: Wolf, his friends are America's worst enemies, Cuba, Iran, North Korea. But Venezuelan President Hugo Chavez will go anywhere to attack his enemies. He's in China now.

(BEGIN VIDEOTAPE)

VERJEE (voice-over): The globetrotting Venezuelan leader in China making a big deal about an oil deal lashing out at his favorite foes, the U.S. and Israel.

PRES. HUGO CHAVEZ, VENEZUELA: I believe a genocide has occurred.

VERJEE: Chavez condemns Israeli military action in Lebanon.

CHAVEZ: These fascist acts should be stopped. Israel criticizes Hitler as do we, but what they have done is similar, maybe even worse than what the Nazis did to half the world. This is fascism, as sure as bread is bread and wine is wine.

VERJEE: The fiery authoritarian has increasingly aligned himself with Arab states, selling himself as a leader who will stand up against the U.S. and Israel.

UNIDENTIFIED MALE: Anti-Israeli, of course, allows him to appear as something of a champion in the Middle East.

VERJEE: Chavez recalled his ambassador from Israel winning him even more Arab fans. He recently traveled to Iran where he was given the red-carpet treatment.

UNIDENTIFIED MALE: He's something of a showman. Venezuela was too small a stage for him. Being anti-U.S. is one way to generate support in many countries of Latin America.

VERJEE: Being anti-American today scores Chavez some big points.

CHAVEZ: The United States has imposed a universal dictatorship. The greatest threat to democracy in the world is called the United States.

VERJEE: Chavez is irritated that the U.S. is blocking his bid for one of the temporary seats on the United Nations Security Council. So, he's turned to China for backing. In exchange, he's feeding Beijing's big appetite for oil. Venezuela plans to pump in a million barrels a day in the next 10 years.

(END VIDEOTAPE)

VERJEE: One expert we spoke to says Chavez wants to undermine the U.S. and deny it access to Venezuelan oil. Now the U.S. is Venezuela's main oil market right now and Mr. Chavez could be gunning for China to be its replacement -- Wolf.

BLITZER: Zain thank you. Zain Verjee reporting. A human-rights advocate finds that the Nobel Peace Prize may not count for much in Iran. In fact, it may be an invitation to persecution. Let's bring in CNN's Aneesh Raman, he's the only U.S. television network correspondent in Iran right now. Aneesh?

ANEESH RAMAN, CNN CORRESPONDENT: Wolf, she is a Nobel laureate, she faces arrest and she is now worried that the world will turn a blind eye.

(BEGIN VIDEOTAPE) RAMAN (voice-over): She is the only woman from the Middle East to win the Nobel peace prize. A face known worldwide as a champion for human rights. But back home stature gives way to simplicity and it is on this nondescript street in Teheran, where you find this small sign that this is the office of Shirin Ebadi. She met me for a rare interview fearing that she herself would soon become a casualty of her own struggle.

SHIRIN EBADI, NOBEL PEACE PRIZE WINNER: There is a recent order from the interior ministry which says that if we continue our work, we will be subject to persecution.

RAMAN: Ebadi's work is defending those jailed she says for no reason, many kept in prison on charges of espionage for expressing descent. Now her group has been deemed illegal. The interior ministry says it doesn't have a permit. The co-founder of the group has been sentenced to five years in jail on charges of disclosing confidential information and opposing the state. And Ebadi now faces arrest at any time. It is for her a familiar prospect.

EBADI: I have been jailed before, before the Nobel Prize and after I was summoned to court as a defendant, and on one occasion, because I had shaken hands with a French president.

RAMAN: In Iran it is forbidden for women to shake hands with men. Ebadi is undeterred by this latest threat, surrounded in her office by like minded activists. This, a picture of her with two other Nobel winners. But her fight these days is growing more difficult, with the world focused on Iran's nuclear program, on its relationship with Hezbollah. She tells me that attention has turned away from her struggle for human rights. It has been, she says, forgotten. Left Iranians to fight as best they can.

EBADI: Iranians hate violence and they are not satisfied with their situation. But they express their demands in a nonviolent way. The people of Iran are reformists.

RAMAN: Iran has long faced international pressure over its human rights record and now with the country's leading human rights activist facing arrest, Ebadi can only hope that the world now seemingly preoccupied elsewhere will once again take notice.

(END VIDEOTAPE)

RAMAN: And Wolf, as of tonight, Ebadi has not been arrested but we will stay on this story and let you know what comes in the days ahead. She says arrest could come at any time -- Wolf.

BLITZER: We'll watch this together with you, Aneesh, the only American television network correspondent in Iran right now. Thank you. Still to come, a U.S. senator star turn in Africa, it's a very personal journey for Senator Barack Obama. And one year after Katrina, a new tropical storm brewing as New Orleans braces for a painful anniversary. Is the city ready for the worst if it happens again? Our special report coming up in our 7:00 p.m. eastern hour, right here in THE SITUATION ROOM. (COMMERCIAL BREAK)

BLITZER: Here she is, Zain Verjee, let's check in with her for some other important stories. Hi Zain.

VERJEE: Hi Wolf, an Austrian teenager who this week escaped eight years of captivity is being questioned by police and psychologists today. DNA tests confirm that the teenager is 18-year- old Natascha Kampusch. She was kidnapped as she walked into school with a friend. On Wednesday she managed to run to a neighbor's house while her abductor was busy with a phone call.

Now there are four people being questioned in connection with a plot to bomb German trains. Police picked up two men today, one in Lebanon and one in Germany. They join the two people already in custody. Two suitcases containing homemade bombs were found on German trains on the 31st of July. The devices did not explode and no one was injured.

U.S. Senator Barack Obama is a rock star in Kenya greeting survivors this day of the 1998 U.S. embassy bombing in Kenya. The Illinois democrat arrived in his father's homeland yesterday as part of an African tour. Today, as you see here, he laid a wreath at a memorial to the bombing victims.

Tomorrow he visits the village where his father grew up and where his grandmother still lives. He's going to be going to Kasumu, which is about 200 miles away from Nairobi. It's a sleepy little town Wolf, just on the shores of Lake Victoria.

BLITZER: And you know this area well, right Zain?

VERJEE: Yes, I do. Actually my mother was born there so we've been going there on numerous times over the years. There is a big brewery there. The most famous export of ours, Tusca Beer, is located there. There is a lot of fishing and agriculture and industry there, but a lot of HIV AIDS exists in that area. And Obama will be taking an HIV test there tomorrow.

BLITZER: Zain thank you very much. Zain Verjee reporting. Up ahead, Oprah Winfrey's new production. We'll give you an inside look at how she's trying to help girls learn and lead. At any point in the storm, gadgets that could help hurricane survivors now on display. Is the future now? Stay with us.

(COMMERCIAL BREAK)

BLITZER: Oprah Winfrey is making good on a promise she made to former South African President Nelson Mandela. And in the process the talk-show host is brightening the future for dozens of school girls in South Africa. CNN Africa correspondent Jeff Koinange has more on Oprah Winfrey's very personal mission.

(BEGIN VIDEOTAPE)

JEFF KOINANGE, CNN AFRICA CORRESPONDENT (voice-over): Oprah has been coming to South Africa for the past several years, determined to fulfill a promise she made to former president Nelson Mandela or Madeva to most here.

OPRAH WINFREY, TALK SHOW HOST: So I said to Madeva, I would like to build a school and I would like to commit $10 million. This was five years ago. And he said, yes.

KOINANGE: And just like that the two broke ground for a girl's school just outside Johannesburg in what began as a $10 million project. It's since grown to $40 million and counting.

(on camera): Less than four years later this is the result, the Oprah Winfrey Leadership Academy for Girls. Set on more than 50 acres of land, it houses more than two dozen buildings and Oprah says she was personally involved in the design and layout of most of them.

WINFREY: The dream for me was to create a school that I would most want to attend. So from the very beginning I sat down with architects and I said, we have to have a library in the fireplace so that the girls can, it can be a place of learning as well as living for them. We have to have a theater because this is a school for leaders and in order to be a leader you have to have a voice. In order to have a voice you need oration. So the idea for the school came about based on what I felt would be an honor for the African girls.

KOINANGE (voice-over): And all this for free. Free uniforms, free books, free meals. Everything is free at Oprah's school. Oprah insisted on personally interviewing all the prospective students from schools around the country. Her requirements were simple, the girls had to have better than average grades and they had to come from under privileged homes, much like she did.

WINFREY: I look in their faces I see my own. The girls who came from a background just like my own. I was raised by a grandmother, no running water, no electricity, but yet because of a sense of education and learning I was able to become who I am. And I want to do the same for these girls and so I think there's no better place than Africa because a sense of need, the sense of value for education and appreciation for it could not be greater.

KOINANGE: And in true Oprah fashion, she invited all the finalists to what was supposed to be an informal get together and dropped this bombshell.

WINFREY: I brought you all here today to tell you that you will be a part of the very first class of the Oprah Winfrey Leadership Academy. And just like that, 150 young lives were transformed in an instant. What does this mean, this moment right now, what does it mean?

WINFREY: It is a complete full circle moment in my life. It is -- I feel like it's what I was really born to do. And that's what all of that fame and attention and money was for. It feels like the complete circle of my life.

UNIDENTIFIED FEMALES: We love you, Oprah.

KOINANGE: Jeff Koinange, CNN, Johannesburg.

(END VIDEOTAPE)

BLITZER: Good work Oprah Winfrey. Up next, a new tropical storm churning right now in the Caribbean heading for the Gulf of Mexico. We'll be right back.

(COMMERCIAL BREAK)

BLITZER: In our "Welcome to the Future" segment entrepreneurs want to keep you safe during a hurricane but are the innovative gadgets they are coming up with worth your hard earned bucks? CNN's John Zarrella takes a look.

(BEGIN VIDEOTAPE)

JOHN ZARRELLA, CNN CORRESPONDENT: It's called a zerolet and it's not just any toilet.

So you're telling me that solid waste literally becomes this?

UNIDENTIFIED MALE: Powder.

ZARRELLA: Powder.

UNIDENTIFIED MALE: Sterile powder.

ZARRELLA: Heating elements in the tank do the trick. The water comes from this tank. No dependence on city water and sewer that might be out after a storm. The $3,000 zerolet was one of hundreds of new products on display at a hurricane conference in Fort Lauderdale. There is a sandbagger, and --

UNIDENTIFIED MALE: This is an alternate to a sandbag. The company that makes it actually calls it the door dam.

ZARRELLA: In the aftermath of last year's mean season, companies have discovered there are big bucks in products designed to make life easier and emergency response better during and after a hurricane. The breakdown in communications was a major issue after Katrina.

EVAN KAGAN, GLOBAL SATELLITE: I think after we saw with Katrina and we saw the failures that were taking place, everyone sees the need for it now.

ZARRELLA: Now the market is flooded with high-tech satellite communications equipment, from hand-held to SUV mounted.

BILL WAGNER, MONROE CO. EMERGENCY MGR.: You look around and you say, boy I need this, and boy I need that. And hopefully we can get some of that.

ZARRELLA: For the average consumer there is a $25 light that can stay bright for 75 hours on one LED battery. GREG KENNEDY, LAZERBRITE: You can flip the heads around and now you have a powerful wide angle flashlight.

ZARRELLA: For insurance purposes, Arkiva will document and store a visual record of all of your possessions, even photo albums.

BRUCE ROBERSON, ARKIVA: People during Katrina in the Gulf Coast states, places like Waveland, Mississippi, lost all of their memories.

ZARRELLA: Hurricanes have suddenly spawned an emerging market of products and devices to make getting through the storm a little less painful. John Zarrella, CNN, Ft. Lauderdale.

(END VIDEOTAPE)

BLITZER: Now let's go to "LOU DOBBS TONIGHT", Christine Roman's filling in for Lou -- Christine.

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