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CNN Live Sunday

Tracking Alberto; Threats from al-Zarqawi's Followers; Flooding and Landslides in China; Sergeant Reacts to Haditha Accusations

Aired June 11, 2006 - 17:00   ET

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

FREDRICKA WHITFIELD, CNN ANCHOR: Hello, I'm Fredricka Whitfield. Ahead on CNN LIVE SUNDAY, tracking Alberto. The first-named storm of the season is churning in the Gulf of Mexico. Find out where it might be headed.
And we're now hearing from the sergeant in charge of U.S. marines accused of a massacre in Iraq. Were the rules of engagement followed? Then, higher gas prices add up to pink slips in one school district. All that and more after this check of the headlines.

More threats via the Internet from Abu Musab al-Zarqawi's followers. They say they'll continue the fight, even without their leader. A top U.S. general stationed in Iraq doesn't doubt the insurgents intentions. More on their threats in one minute.

But be sure to join us tonight at 8 p.m. Eastern for the latest "CNN PRESENTS" special, "World's Most Wanted," right here on CNN, the most-trusted name in news.

Two hundred and thirty detainees from Iraq's Abu Ghraib prison and two other lock-ups are free today; 2,500 prisoners in all will be released, most of them minority Sunnis. Iraq's new prime minister hopes the move will fuel the tensions that have fueled sectarian violence around the country.

The U.S. military is calling yesterday's prisoner suicides at Guantanamo Bay an act of warfare by a weakened enemy. A naval criminal investigation continues into the three deaths. Tonight at 10 p.m. Eastern, join us for some straight talk with a former U.S. Army chaplain who was stationed at Guantanamo. That's tonight at 10:00 Eastern right here on CNN.

Tropical storm Alberto, the first named storm of the season, appears headed for the Florida coast. We'll update you with the very latest on the storm in one moment.

We'll start now with Iraq and an eyewitness account of an alleged Marine massacre. What we've heard up to now is that Marines reacted to a fatal roadside bombing with a rampage against Iraqi civilians. According to the sergeant who led the operation in Haditha, that's not how it happened. Today, he's getting his story out for the very first time. CNN's Jamie McIntyre reports.

(BEGIN VIDEOTAPE)

JAMIE McINTYRE, CNN CORRESPONDENT (voice-over): The lawyer for the senior Marine at the scene of the killing says the Marines followed the standard rules of engagement last November and that the 24 civilians who died were just in the wrong place at the wrong time.

NEAL PUCKETT, ATTY. FOR STAFF SGT. FRANK WUDERICH: It's clear that innocent civilians died that day, but they died according to what we call the fog of war.

McINTYRE: Neal Puckett represents then sergeant, now Staff Sergeant Frank Wuderich, the leader of a four-man team that killed the occupants of two houses that day. He's told his attorney several Marines witnessed hostile fire coming from inside the house.

PUCKETT: That door was kicked in. A frag grenade was thrown inside and immediately following that, the lead man in the stack went in firing his weapon and killed everyone inside.

McINTYRE: Puckett, a retired Marine lieutenant colonel insists that was the standard procedure for clearing a suspected insurgent hideout and that the first Marine in, who was not Wuderich had done it before in Fallujah.

PUCKETT: There was very little experience on the ground that day, but the one Marine who did have experience in Fallujah and who had cleared houses the very same way, was that first man through the door. And that was what he was trained to do.

McINTYRE: It was Sergeant Wuderich's first real combat says Puckett and he believed he was in hot pursuit of enemy fighters.

PUCKETT: They finished with that room and there's no one else in the house. And Sergeant Wuderich noticed that the back door is wide open. He presumes that the guys who were firing had escaped out the back. So they went back out the front door, stealthily went around the house. The most likely house that they could possibly be in during the fallback position was cleared the same way.

McINTYRE: Puckett says Wuderich fired no shot at either house but he did fire on five men in a car after they refused orders in Arabic to lie on the ground and instead took off running. He says the Marines thought the car might have contained another bomb and didn't know the men were unarmed. The Marines say they shot others that day too. According to Puckett, in one case, unarmed civilians were shot after they were spotted running from the scene of the attack. And in another a third house where one man had an AK-47 was cleared by a different group of Marines who shot everyone inside. But Puckett argues it was all done by the book.

PUCKETT: Sergeant Wuderich does not believe that he did anything wrong on that day. He followed the rules of engagement as had been instructed to him by professional instructors, by his chain of command and everything he understood he was supposed to do he did. They were in houses that were suspected insurgent hiding places from which the Marines were taking fire.

McINTYRE: How does Sergeant Wuderich feel about what happened? PUCKETT: He's incredibly sorry that innocent civilians were killed, but he knows that he relied on his Marine Corps training to protect his men that day.

McINTYRE: Puckett says if anything was to blame for the deaths, it was the rules of engagement that didn't provide enough protection for innocent civilians. He's hopeful his client, a 26-year-old father of two, won't be charged with anything as serious as murder once the investigation wraps up later this summer. Jamie McIntyre, CNN, Washington.

(END VIDEOTAPE)

WHITFIELD: Al Qaeda in Iraq is vowing today to avenge the death of its leader. It's the group's first statement since the attack that killed Iraq's most notorious terrorist Abu Musab al Zarqawi.

(BEGIN VIDEOTAPE)

WHITFIELD (voice-over): With the promise of large-scale operations that will quote, shake the enemy and rob them of sleep, a group calling itself al Qaeda in Iraq sent the message. Despite the death of their leader, they will continue to attack their enemy. While CNN cannot verify the authenticity of the statement, it was posted on a Web site that has carried messages from the group in the past.

MOWAFFAQ AL-RUBAIE, IRAQ NATIONAL SECURITY ADVISER: They are trying to make up for the huge loss and the disorientation they are suffering from because there is a huge vacuum of power now within al Qaeda.

WHITFIELD: The statement mentioned no replacement for Abu Musab al Zarqawi, but the posting claimed the group would continue attacks and renewed allegiance to Osama bin Laden.

JIM WALSH, SECURITY ANALYST: Whether Zarqawi was dead or alive, they'd still be trying to mount a big attack against U.S. forces or more likely against the Shiite Muslim community with the purpose of trying to encourage a civil war.

WHITFIELD: The statement also warned that the group will not be acting alone, but will coordinate with other members of the Mujahadin council to launch future operations.

CAROLINE FARAJ, CNN CORRESPONDENT: I think this is very important because they are here (INAUDIBLE) that they're not only the Zarqawi group if you like, quote, unquote, they are also some other militants who are supporters of Zarqawi.

WHITFIELD: The White House has been cautious about what impact al Zarqawi's death may have, but the expectation is further attacks are inevitable.

(END VIDEOTAPE) WHITFIELD: And the president is calling some of his top advisors to Camp David this week. Those advisors and military commanders will consider what is next for America's Iraq strategy. White House correspondent Ed Henry explains.

(BEGIN VIDEOTAPE)

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: As President Bush gathers his top advisors for two days of high level talks on Iraq strategy at Camp David, the Iraqi national security adviser is predicting U.S. troop levels will drop below 100,000 by the end of this year.

MOWAFFAQ AL-RUBAIE, IRAQ NATIONAL SECURITY ADVISER: By the end of next year, most of the multinational forces would have gone home. And by the middle of 2008, we will not see a lot of visibility neither in the cities nor in the town of the multinational forces.

HENRY: President Bush is down playing expectations of U.S. troop cutbacks while touting the death of Abu Musab al Zarqawi as a major blow to al Qaeda.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: He killed a lot of people. And it's a big deal to have brought him to justice. Having said that, I don't want the American people to think that a war is won with the death of one person, that we have still more work to do.

HENRY: The top U.S. commander in Iraq, who will participate in the Camp David talks by video conference, suggests U.S. forces will come home over time.

GEN. GEORGE CASEY, US COMMANDER IN IRAQ: I think as long as the Iraqi security forces continue to progress, and as long as this national unit government continues to operate that way and move the country forward, I think we're going to be able to see continued gradual reductions of coalition forces over the coming months and into next year.

HENRY: Experts say the death of Zarqawi coupled with the filling out of a new Iraqi cabinet sets the stage for more progress at Camp David.

PAUL BREMER, FMR. US AMBASSADOR TO IRAQ: The opportunity now is to design a military strategy to defeat the insurgency which is the core of the problem in Iraq. And once that is done, once a strategy is in place, it makes it possible to deal with the problems of the Shia militia, the problems of reconstruction of the economy and so forth.

(END VIDEOTAPE)

HENRY: A senior administration official said the president wants to leave this summit feeling that every level of the U.S. government has a specific strategy to help the Iraqi government succeed. Fred? WHITFIELD: And Ed, we know the Danish prime minister has been meeting with the president at Camp David already throughout the weekend, but why will he be part of the summit as well?

HENRY: Well, instead the president is going to be focusing on dealing directly with Iraqi officials. As you noted on Monday, there will be a lot of high level U.S. officials specifically from the president's cabinet who will be there all day Monday, a series of meetings. But on Tuesday the president by video conference is going to bring in the new Iraqi prime minister as well as key members of his cabinet. So I think that is going to be the focus. Fred.

WHITFIELD: Interesting, all right, Ed Henry, thanks so much from the White House.

With a new chief at the helm, the U.S. Supreme Court has been unusually united. But with most of its contentious cases still undecided, that agreement could be a thing of the past. We'll take a closer look.

Plus paying the price at the heartland, how suburban families are adjusting to high gas prices. And in our look across America the search for a missing former diplomat in Maryland's Chesapeake Bay.

More now on tropical storm Alberto. It's churning in the Gulf of Mexico and will soon be affecting the U.S. Let's go to meteorologist Jacqui Jeras. Jacqui

JACQUI JERAS, CNN METEOROLOGIST: Fredricka, new this hour the tropical storm watch have just been posted for Florida's west coast from north of Bonita Beach extending all the way up to Steinhatchee. And what this means is that tropic storm conditions with winds of 39 miles per hour or greater are possible within this area in about 36 hours. The storm still remains very lopsided. It's all on the east side of the storm that we're seeing the convection, got a little bit of blossom up here in this area of the Gulf. But you can see those clouds covering a good portion of the state. It's still tough to really pick out that center of rotation, somewhere in this vicinity here.

And the storm has also started to turn more up to the north. It's moving to the northwest all day long today. And now we're seeing more of the northerly pull. The models not in complete agreement as to exactly where it's going. Most of them, though, the consensus, will be pulling it up to the northeast and heading toward the big bend area of Florida. But we're still going to have to wait and see. The next 24 plus hours are going to be pretty critical as to what is going to be happening.

Rainfall certainly in the forecast in the picture here for much of Florida's peninsula and we have been seeing some heavy rainfall at times across the region. We're going to go ahead and show you a little closer into south Florida just offshore some heavier thunderstorms. You head on up to Naples and you're just getting some light showers at this time. There you can see the tower cam from the Naples area, 76 degrees is your temperatures and the winds are relatively moderate at 76 miles an hour.

The forecast track now as to where this is going, it is expected to stay steady as a tropical storm. Now we just got word in that the hurricane hunters are going to be going back into the storm, about a half an hour. They are expecting to leave and they'll be taking measurements and finding out whether some of the suspicions that it could be weakening a little bit are true or not. So we'll bring that to you once we have it available. And the official forecast track doesn't (ph) have it crossing the peninsula sometime on Tuesday. Fredricka, we'll continue to watch this and let you know if it's going to change

WHITFIELD: Thank you so much, Jacqui.

Tonight at 6:00 p.m. Eastern, "CNN PRESENTS: Sudden Fury in Katrina's Deadly Wake." Brace yourself for nature at its worse as we hear some amazing survival stories right here on CNN.

Ahead on CNN LIVE SUNDAY, for many Americans Somalia conjures up memories of the 1990 Blackhawk down tragedy. Now lawlessness, the only country in the world without a government. We'll take you to the capital city of Mogadishu straight ahead.

Plus this.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: There's a lot of focus on the lessons that they learned and a lot of focus on the upcoming hurricane season yet we're still sitting here 95 percent substantially destroyed trying to find a way to fix this puzzle.

(END VIDEO CLIP)

WHITFIELD: Waveland, Mississippi's "Catch-22." What is standing in the way of recovery?

And later how gestures can speak louder than words. You're watching CNN, the most trusted name in news.

(COMMERCIAL BREAK)

WHITFIELD: A Coast Guard search is under way for a newspaper publisher. Philip Merrill, who went missing in Maryland's Chesapeake Bay. Authorities believe 72-year old Merrill, a former diplomat may have fallen overboard. His sailboat was found adrift with no one on board and its engine running.

Two people who ditched their small plane into the ocean off Hawaii are safe aboard a container ship bound for China. The Coast Guard says the plane reported engine trouble about a thousand miles into a flight from Santa Barbara, California to Hilo in Hawaii. The passengers were picked up by that ship after their ocean landing.

It is party time in New York. A huge parade throughout Manhattan marked Puerto Rican day today. Celebrities like Jennifer Lopez, her husband Marc Anthony and New York Mayor Michael Bloomberg led this year's parade. The annual Puerto Rican day parade has grown to be one of the city's largest celebrations.

Harmony on the high court, that could describe John Roberts first term as chief justice, but with some of the most contentious cases yet to be decided, might that harmonious tune change? Gary Nurenberg now on Roberts' freshman year.

(BEGIN VIDEOTAPE)

GARY NURENBERG, CNN CORRESPONDENT (voice-over): It's been a year of changes for the new Chief Justice John Roberts.

JOHN ROBERTS, CHIEF JUSTICE: I don't tell lawyer jokes anymore.

NURENBERG: And with Roberts as the new chief, it's been a year of changes at the Supreme Court.

HELGI WALKER, FMR. CLARENCE THOMAS CLERK: The work of the court is going very, very well in terms of getting decisions out, getting opinions out.

NURENBERG: Legal author Edward Lazarus is a former Supreme Court clerk.

EDWARD LAZARUS, FMR SUPREME COURT CLERK: I think Justice Roberts is really trying to assert himself as the leader of this court. You're seeing a lot of unanimous decisions.

NURENBERG: On a court that has been so markedly divided in recent years, 32 of the 48 cases decided since Roberts became chief have been by unanimous decision, a remarkable two thirds. It's something Roberts strives more.

ROBERTS: Unanimity or near unanimity promote clarity and guidance for the lawyers and for the lower courts trying to figure out what the Supreme Court meant.

NURENBERG: But that harmony may be threatened by the tough cases the court has left in the remaining three weeks of its term.

SEN. ARLEN SPECTER (R) JUDICIARY CHAIRMAN: I do not expect him to maintain unanimity when it comes to the highly controversial cases.

NURENBERG: On the list, the legitimacy of President Bush's plan to try suspected foreign terrorists in military tribunals, a politically explosive challenge to Republican redistricting in Texas, limits on the death penalty.

WALKER: The reason those cases have not issued yet is because they are the most difficult ones. They may be cases in which several justices are writing their own opinions, dissents, concurrences

LAZARUS: So I suspect the unanimity is going to prove to be a relatively short-term phenomenon.

NURENBERG: Lazarus says dissent help the law evolve.

LAZARUS: There's a wonderful tradition of dissent at the Supreme Court and many of those dissents have ultimately become the majority view in the next generation. You wouldn't want to give that up.

NURENBERG: With the contentious cases ahead, Roberts' court unanimity may prove to have been a short-lived trend. Gary Nurenberg, CNN, Washington.

(END VIDEOTAPE)

WHITFIELD: It's a math lesson. Learn the hard way how high fuel costs add up to layoffs in the classroom. They are paying the price in the heartland next. And boots on the ground, the U.S. commander talks about troop reductions.

And later, was Pixar able to speed to the bank with their latest cinematic offering? This weekend's box office results straight ahead.

(COMMERCIAL BREAK)

WHITFIELD: Rising gas prices. They are not only hurting big city commuters and suburban soccer moms, but they're also putting a squeeze on folks in rural America. CNN's Dan Lothian has two reports. First, a look as how families are coping and then the effects of high gas prices on schools. It's part of his series, paying the price in the heartland first shown on "AMERICAN MORNING."

(BEGIN VIDEOTAPE)

DAN LOTHIAN, CNN CORRESPONDENT (voice-over): It's a beautiful drive through rural Iowa, farms, wide open fields, and a real bear that's become a big local attraction. But for commuter Kim Firebaugh every mile along this scenic route is getting more expensive.

KIM FIREBAUGH, RURAL COMMUTER: I've got to go to my job and everything. One morning I will leave and it's a certain price and I come home at night and it increased another dime.

LOTHIAN: The high price of gas is also pinching her husband Stewart's wallet.

STEWART FIREBAUGH, RURAL COMMUTER: It has. It has. I mean I guess you don't notice it. We know we're cutting back.

LOTHIAN: The Firebaugh's live here in Panora (ph), population about 1200 but they work in the Des Moines area. This is the road most traveled. For Kim and her Grand Am it's a 90-mile round trip to a job at the farm bureau. For Stewart and his Cavalier it's 70 miles round trip to the plumbing company he works for. We drove along with both of them on part of their long and expensive commutes.

KIM FIREBAUGH: I think the gas bills have doubled for the month what it used to be compared to the last six months and a year ago.

LOTHIAN: How much has it cost the Firebaugh's each month? KIM FIREBAUGH: $720.

STEWART FIREBAUGH: $720.

LOTHIAN: That's the total on the family's gas card which they use not only for their cars, but to fill up 16-year-old daughter Ashley's Sunfire.

ASHLEY FIREBAUGH, DAUGHTER: I went to the orthodontist today.

LOTHIAN: How many miles was that?

ASHLEY FIREBAUGH: About 30 miles.

LOTHIAN: They recently paid off her car and were looking forward to the extra cash each month. Not any more.

KIM FIREBAUGH: We don't see that extra money, because it's gone basically to pay for the gas and everything.

LOTHIAN: So this family of four has made some changes.

STEWART FIREBAUGH: I park my truck, I guess, was the biggest thing.

LOTHIAN: Oh, yes, this is what Stewart Firebaugh used to drive to work, a 12 mile per gallon pickup before he downsized several weeks ago to the Cavalier. The big hog has to stay.

STEWART FIREBAUGH: Yeah.

LOTHIAN: ..has to spend more time at home.

STEWART FIREBAUGH: Yes.

LOTHIAN: They've also cut spending and pay more attention to where their money is going. Gas may not be as expensive out here as it is in some big cities across the country. But every cent counts when everything is so far away and moving is not an option.

KIM FIREBAUGH: The kids being in school, they don't want to move out of the school district. I grew up out here. This is my hometown. I lived here all my life. It's something I have got to live with and everything, I guess.

LOTHIAN: It's a math lesson learned the hard way, 34 school bus routes, covering 225 square miles. Factor in higher fuel costs and it all adds up to layoffs in the classroom.

TIM DOSE, SUPERINTENDENT,, N. SCOTT SCHOOL DISTRICT: It's just kind of like the straw that broke the camel's back. It just has thrown our budget way out of balance.

LOTHIAN: The north Scott school district in Eldridge, Iowa, with its vast rural boundaries roughly the size of Chicago, had already been struggling to make ends meet when Superintendent Tim Dose says the unexpected happened.

DOSE: Our costs of fuel have gone up and up and up at a much higher rate, costing us much more money.

LOTHIAN: How much money, $66,000 extra to fill up their buses, but there was more. Natural gas prices also spiked, costing the district an extra $150,000.

DOSE: When we put in the increases in the fuel costs, it really caused us this year to have to go to more drastic moves.

LOTHIAN: Like layoffs. At the end of April, 10 pink slips went out across the district. These three high school friends were shocked.

KAMI SNOWDEN, STUDENT, N. SCOTT HIGH SCHOOL: I couldn't believe that they actually cut the teachers.

LESLIE BEERT, STUDENT, N. SCOTT HIGH SCHOOL: I think it was more upsetting at first to know that they would do that.

JULIE BADER, STUDENT, N. SCOTT HIGH SCHOOL: These teachers are very close with us. I've had classes with almost all of them.

LOTHIAN: So they decided to act by co-writing this letter to the editor of the local paper. It reads in part.

BADER: The impact it had made on the students here is tremendous.

SNOWDEN: It would be a huge loss for the students in the future not to have the opportunity

BEERT: ...to experience the teaching and coaching styles of these particular people.

LOTHIAN: The letter was published shortly after students staged a brief walk-out. But they couldn't undo the damage. The laid off teachers did not want to talk but their union president, who is also a teacher had plenty to say. Are they angry? What's the sense?

STEVE MOHR, PRESIDENT, TEACHERS UNION: I think betrayal is a good word.

LOTHIAN: That's because, while the teachers understand that keeping these buses moving and keeping these rooms heated has gotten more expensive, they had hoped for other options.

MOHR: They would have kept the people in the positions that they had. They would have found the money in some way, shape, or form to keep them.

LOTHIAN: Superintendent Dose says four of the pink slipped teachers have been reabsorbed after others quit or retired and one position was reinstated. But overall, the high cost of fuel will mean fewer teachers in the classroom for the district's 3,000 students. DOSE: All of our teachers are being forced to take on more teaching duties, probably larger classes but definitely more teaching duties.

LOTHIAN: It is quite unusual that a school district is this large. The reason it is this way is because city fathers set it up decades ago. School officials are hoping the lawmakers will take a look at this issue so that they could avoid any additional problems down the road. Dan Lothian, CNN, Eldridge, Iowa.

(END VIDEOTAPE)

WHITFIELD: And tracking Alberto, we'll show you where the tropical storm is headed and who it just might effect.

A city broken and broke. Citizens of Waveland, Mississippi, find themselves in a "Catch-22" situation after hurricane Katrina. Their story next.

And later, how this 25-year-old woman is making history one note at a time.

(COMMERCIAL BREAK)

WHITFIELD: Here's what's happening right now in the news. A different account of what happened in Haditha. Iraq. The marine sergeant in charge that day speaking through his attorney says there was no massacre of Iraqi civilians. And the Marines followed proper procedures as they searched houses for insurgents. The U.S. military is still investigating the incident.

A warning from al-Qaeda in Iraq on an Islamic Web site -- The group vows to carry out major attacks. The top U.S. general in Iraq says he's taking that threat seriously and expects security in Baghdad to be tightened.

The top commander in Iraq says it's possible some U.S. troops will be withdrawn from Iraq over the next few months, but only if Iraq security forces and its government make progress.

And "Cars" zooms into first place at the box office. Early estimates show the computer-animated comedy made more than $62 million in its debut weekend. That knocks "The Break-up" into second place followed by "X-Men the Last Stand," "The Omen" and "Over the Edge."

Now you're looking at Alberto, the first named tropical storm of the season. It's in the Gulf of Mexico dumping a lot of rain on Cuba and setting its sights on Florida. Meteorologist Jacqui Jeras is keeping a close watch. Already some rain in Florida, right?

JERAS: Yes, there has been -- not a whole heck of a lot. Pretty much everybody is under an inch with the rain over the last 24 hours. But Cuba, as you had mentioned, just pounded with steady rainfall, and the worst of the rain just to the west of the Havana area right now. There are some heavier showers offshore. You can see they're all kind of pulling up to the north and the east, heading towards Ft. Myers. Ft. Myers getting wet right now as well as Naples. And you can expect to see those heavier bands move on in. As they do so, they could be producing maybe around an inch plus per hour, so be aware.

And we do have flood watches in effect across much of the west coast of Florida through tomorrow, because of these heavy rains pulling on in. And this storm really not balanced out -- all the action on the east side of the storm. And that's why Florida could be seeing some very heavy rainfall.

But as to where this thing is going, now there still is some uncertainty. The consensus of it -- what we call all of our computer models -- do bring it into up towards the Big Bend area. Now, tropical storm watches have been posted from Steinhatchee heading down towards just to the north of Bonita Beach. That means that tropical storm conditions are possible within 36 hours. And we think that you're definitely going to be seeing some of those gusts anyway by that time.

Now the track is bringing it into more of a northerly turn -- the winds 45 miles per hour right now. So they have been holding steady pretty much all day long. But it had been moving, as you can see, on a northwesterly track. Now we're starting that pull up to the north a little bit. And we are expecting more of a northeasterly turn into the next 24 hours or so.

We expect it to stay as a tropical storm -- really not much of a chance for strengthening here. And the main reason why we've got some wind shear, as we call it, blowing in from the southwest and also the air very, very dry here into the Gulf of Mexico. So those two things working against the storm despite very, very ripe ocean temperatures. Fredricka.

WHITFIELD: All right. Thanks so much, Jacqui.

Well, there have been a lot of dashed hopes in the nine months since Hurricane Katrina hit the Gulf Coast. In this "Best of CNN" report, first seen on "ANDERSON COOPER 360," Sean Callebs looks at how one town can't rebuild, because it's tangled in red tape.

(BEGIN VIDEO TAPE)

SEAN CALLEBS, CNN CORRESPONDENT (voice-over): It's obvious Waveland, Mississippi, nine months after Katrina hit, is still a mess. The city is broke and broken.

UNIDENTIFIED MALE: It's real frustrating. Can you fix a leak here, and you fix a leak over here.

CALLEBS: There's more than $100 million in FEMA aid money just sitting there waiting for Waveland. But naturally there's a catch. And everyone here, like Roy and Mimi Lassis (ph) is caught.

ROY LASSIS (ph): I am ready to rebuild my house.

CALLEBS: But they can't, because Wavelands water, sewer and other utilities are in such pathetic shape. MIMI LASSIS (ph): You don't see any progress yet. I'd like to see something started.

CALLEBS: All government entities -- feds, states and county -- agree it will cost well over $100 million to fix Waveland. And federal funds are earmarked for the town. But get this -- Waveland can't get a penny until it raises 10 percent in matching funds, which would be well over $10 million. Mayor Tommy Longo says his town doesn't have the money.

TOMMY LONGO, MAYOR, WAVELAND, MISSISSIPPI: It's impossible. At this point, 95 percent of our commercial structures were substantially destroyed. So our economic base, our lifeline, financial life line is destroyed.

CALLEBS: So he stews, recounting the litany of assurances from government leaders who promised to make Waveland whole again. FEMA officials say they empathize with Waveland. But a spokesman says the agency works under strict guidelines and, by law, cannot dole out money to rebuild until Waveland has 10 percent of the needed funds. Ridiculous, says the mayor.

LONGO: One of the things that scare me dearly is that there's a lot of focus on the lessons that they've learned, and a lot of focus on the upcoming hurricane season, yet we're still sitting here 95 percent substantially destroyed trying to find a way to fix this puzzle.

DWIGHT HASKELL (ph): It's just non-stop.

CALLEBS: Right now, Dwight Haskell (ph) is one of only four people in the Public Works Department.

HASKELL (ph): Go out to 6079 Cutoff Road.

CALLEBS: He says the idea of hooking up new commercial properties to water and sewer lines is laughable. And why? Leaky water lines and broken down sewer systems.

(On camera): So basically your day is getting up, running around from thing to thing to thing, patching and trying to keep everything working.

HASKELL (ph): Basically.

CALLEBS: So the town limps along in limbo.

MIMI LASSIS (ph): We're trying our best to keep a positive attitude. That's all I can say. And it's hard sometimes.

CALLEBS: Residents and the town caught in a brutal catch-22 with no solution in sight, knowing only that they face a very uncertain future. Sean Callebs, CNN, Waveland, Mississippi.

(END VIDEO TAPE) WHITFIELD: And tonight at 6:00 p.m. Eastern, "CNN PRESENTS Sudden Fury" in Katrina's deadly wake. Brace yourselves for nature at its worst as we hear some amazing survival stories right here on CNN.

Time now to go global with headlines from around the world. Iranian officials say parts of a package aimed at getting Tehran to the negotiation table over its nuclear programs are acceptable. The package includes promises of U.S. and European nuclear help, if Iran suspends its uranium enrichment program. Officials say Iran will offer a counter-proposal.

Palestinian security sources tell CNN the Israeli Air Force launched two attacks against Palestinians in Gaza today. At least three people were killed. Meantime Palestinian militants bombed southern Israel with home-made rockets. The incidents are part of an escalating set of hostilities since a 16-month cease-fire by Hamas began to unravel.

In Bangladesh, more than 300 people were hurt in street clashes between police and opposition activists blockading the capital. A 14- party opposition alliance planned the siege at Dhaka. It's part of efforts to get the prime minister to meet their demands for reforms and the removal of several top election officials.

Scientists say there is less threat now of a full-blown eruption at Indonesia's Mount Merapi volcano. But the smoking mountain still could be deadly. A gas blast has collapsed a portion of the volcano's lava dome. That's eased some of the pressure that could prompt a massive eruption.

In China, rain is the last thing they need. But more is in tomorrow's forecast. Days of torrential downpours have caused flooding and landslides in several southern provinces. Emergency crews have had a lot of practice dealing with natural disasters there. Our Stan Grant reports from Beijing.

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STAN GRANT, CNN CORRESPONDENT (voice-over): It happens every year. Devastating floods wrecking entire provinces, destroying homes and taking lives. A heavy seasonal monsoon has flooded southern China. Nearly 400,000 people have been evacuated since late May. The worst summer flooding seeing the death toll rising. Many others missing. Fujian Province hardest hit, economic losses there nearing $300 million U.S. The banks of this swollen river collapsed; 11 villages flooded. In China, the human cost of natural disaster is counted in the millions -- earthquakes, typhoons, massive flooding. What are called freaks of nature elsewhere are facts of nature here.

YANG XUSHEN, CHINA RED CROSS: Every year we have about -- over or somewhere close to 200 million people affected by different calamities in China. So that occupies a great proportion of the Chinese population. And normally over 1,000 or 2,000 people killed.

GRANT: Just last month, a deadly typhoon battered China's southern cost. Workers struggled to clear roads of fallen trees -- embankments reinforced against huge waves. Thousands of Chinese soldiers deployed. Forty-one people dead. A massive 600,000 people evacuated. Such disasters have helped China fine tune its relief and rescue response. The Red Cross in China looking at other relief efforts around the world, like last year's Hurricane Katrina in the U.S., dismayed at what it sees.

XUSHEN: I was quite shocked to see the scenes as the consequence of the hurricanes. But I was also a little bit surprised by the reaction or responses of the U.S. government in terms of -- I think the initial response was pretty slow.

GRANT: In China, sadly it has had plenty of practice to get it right. Now it is calling on all that experience once again. Stan Grant, CNN, Beijing.

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WHITFIELD: Fighting the war on terror -- how an unresolved conflict is making U.S. officials rethink their foreign policy.

But first, a quick look at the most popular stories this hour on CNN.com. A New York City bouncer has been charged with the death of a 19-year-old patron. You're also clicking on to a story about an elephant at the Los Angeles Zoo. Gita was found dead this morning in her yard. Critics charge the 48-year-old animal was kept in unhealthy conditions.

And is your car a target? If it's a Cadillac Escalade, it is. The luxury SUV is tops with car thieves this year. Click on to CNN.com for more details.

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WHITFIELD: Somalia -- for many Americans it brings back memories of the infamous Blackhawk Down tragedy in the early 1990s. U.S. forces pulled out soon after. And the country has been in a state of anarchy ever since. This week, Islamic fighters took control of the capital of Mogadishu. How will that influence U.S. foreign policy towards Somalia and the war on terror? Here's ITN's Alex Thompson.

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ALEX THOMPSON, ITN CORRESPONDENT: You can hear the bird song again in Mogadishu. The technicals, truck-mounted guns of Somalia's civil war, have fallen quiet. The Islamic courts movement patrolling in victory around the streets of Mogadishu, claiming the capital is theirs after three months of heavy fighting and hundreds of people killed, mostly civilians.

Abdurrahman Mohammoud (ph) of the Islamic courts proclaims that they have controlled this place.

Allahu Akbar, they shout. The Islamic courts movement now says it will proceed out across the country and impose Sharia law on Somalia. And the militias allegedly back by the United States have been run out of town. And all this just months after a fledgling interim government had been agreed by most sides.

RICHARD DOWDEN, DIRECTOR, ROYAL AFRICAN SOCIETY: Once again, American policy in Somalia has completely backed the wrong horse. Instead of trying to unite the country behind this government which has been agreed after years of negotiations, they picked out one particular group and appeared to have supported it, or maybe armed it to fight this war against terror, which has undermined the one chance of actually getting some sort of government in Somalia, some sort of control, some sort of policing, which might actually have curbed the militant tendency.

THOMPSON: Surveying the outcome of that policy across the recent months of bloody street fighting, the U.S. State Department told Channel 4 news, this is not the outcome we wanted. We're disappointed.

Somalia has a habit of tearing up the best laid plans of America. In 1992, U.S. Marines helicoptered in from the ocean in the dawn light. Operation Restore Hope was underway. But military intervention was to end in slaughter a year later with the killing of hundreds of Somalies and the deaths of 18 American soldiers -- some of their bodies dragged through the streets of Mogadishu. Their Blackhawk helicopters downed.

The Clinton administration could not stomach this. And for 13 years, America has backed in effect a fight against Islamic militants by proxy, allegedly supplying warlords with cash and weapons to fight what it sees as the Islamic threat. U.S. officials claim those behind the embassy bombs in Kenya and Tanzania are being sheltered by the movement which controls the Somalia capital.

So are we really now looking at Somalia's version of the Taliban?

DOWDEN: It's very disparate. There are all sorts of flavors of Islam, if you like, in there. Some of them, sure, are probably -- tend towards to be an al-Qaeda view. But others are just trying to impose an Islamic peace over the city and over the country. And I'm not really interested in international Jihad or anything like that.

THOMPSON: For now, though, the outside world can do little more than wait and see if these Islamic militias can seize control of the whole country. And if they do, what kind of Islamic state will emerge?

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WHITFIELD: And talks this week in Kenya -- We'll be following that story about the demise of Somalia. Meantime Carol Lin is here to carry the baton into the evening.

CAROL LIN, CNN ANCHOR: Well coming up, Fred, tonight there is a terrific story at 7 o'clock about this 13-year-old girl. She is from Sierra Leone. She was sponsored here in the United States, going to school, middle school. All her friends wanted to find out why is she missing a hand? So she decides, in this documentary that you're seeing right now, to tell her story about how she was five years old when rebels came in and chopped off her hand as an example to her village to try to get their compliance for new leadership. And then when her mother asked the rebels if they could pick her up, they chopped off her mother's hand too. This 13-year-old has more courage than so many people on a day-to-day basis. So I want to get a reaction. What do her friends say about that story?

Then at 10 o'clock tonight, I'm talking with Captain James Yee. He was a chaplain at Guantanamo Bay. He had faced treason charges, sedition charges, all of that was dropped two years ago. But he counseled 95 percent of the detainees down there at Guantanamo. I want to find out more about his thoughts about the three suicides. What is being done to help some of the detainees? And what the legacy of Guantanamo he thinks is going to be.

WHITFIELD: All right. Look forward to all of that.

LIN: Seven and 10 o'clock tonight.

WHITFIELD: Thanks so much, Carol.

Well making history by sheer determination. Meet a woman who demands that she march to her own beat next.

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WHITFIELD: A Mexican conductor is tackling one of the most prestigious venues in the world, New York's Lincoln Center. It's an honor no other Mexican woman has ever received. And she is only 25. She is getting a little help from a band she even put together. Have a listen.

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ALONDRA DE LA PARRA, CONDUCTOR: This is the first concert of the Philharmonic Orchestra of the Americas. It is a unique group that will promote Latin American composers and performers. And it is the first time that something like this happens at Lincoln Center.

I'm feeling excited. I can't wait. Just as the word conductor describes it, is we are the conduit for the music -- the conductor. We conduct the energy that is driven through us from our knowledge of the score.

You're way too loud at 25, and before 25. Can you play shorter? A little sharper?

ELIZABETH YOUNG, VIOLINIST: She really believes in what she is doing. She has a special connection to the Latin American music, of course, because of her heritage. And that is also special, because her excitement and her energy for the music spreads to all of us.

MANELICK DE LA PARRA, FATHER: Besides the father, I'm Mexican, and proud of her. You know, I think she open up big space for many Latin American people. You know, half the musicians are from Latin America. More than half of the music is going to be from Latin America, which is a big statement.

ALONDRA DE LA PARRA: It's a social statement. Music is a celebration. And it's for enjoying together. So if that affects the social atmosphere and therefore the political atmosphere, wonderful. I feel just so honored to be able to work with all this amazing, incredible, talented young musicians.

YOUNG: Alondra's very passionate.

KLIMENT KRYLOVSKIY, CLARINETIST: The sort of passion that is, you know, almost hard to find nowadays.

ALONDRA DE LA PARRA: I never felt that I was extremely gifted.

KRYLOVSKIY: Ok, I don't believe that. I know she works hard. This I know for a fact. And you have to work hard. But she is talented.

ALONDRA DE LA PARRA: I don't think there's ever a day where I'm going to say I'm a good conductor. I think it's rather I'm growing. I'm better than yesterday.

YOUNG: It's great to see a female conductor who is gaining prominence, because there aren't so many in professional orchestras today.

ALONDRA DE LA PARRA: Well, to all of you, I just want to take one second to say thank you so much for doing such a wonderful job. We're going to have fun. And that's what it is all about.

This is an orchestra that will dedicate itself to promoting soloists, composers and performers from the American continent.

Let's have fun with it. Let's have fun at every entrance and every -- everything. Thank you so much.

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WHITFIELD: And brace yourself for what is next on CNN as "CNN PRESENTS" "Sudden Fury in Katrina's Wake." Then catch Carol Lin with all today's headlines at 7:00 Eastern. And at 8:00, al-Zarqawi may have been taken down, but Bin Laden and his top deputy remain at large. Watch "CNN PRESENTS The World's Most Wanted."

From CNN's global headquarters in Atlanta, I'm Fredricka Whitfield. The headlines after this quick break.

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