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Bush Team Warns of New Terror Attacks; Should Government Spy on Americans Inside U.S.?; Baseball Players, Owners Talk Strike

Aired May 25, 2002 - 10:00   ET



GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: For the United States, September the 11th, 2001, cut a deep dividing line in our history.


JONATHAN KARL, HOST: The Bush team beats the drum for the war on terrorism and warns of new attacks. We'll talk to Senator Richard Durbin, Democrat of Illinois, and Kay Bailey Hutchison, Republican of Texas, about the warnings, the intelligence investigation and the political fallout.

Plus, new debate over spying inside the U.S.A. Is that the best homeland defense? A Newsweek article says, the answer: a domestic CIA. We'll talk to the author and the ACLU.

And play ball. Millions have major league baseball on this holiday weekend schedule. But holy Crackerjacks, are owners and players already talking about a strike that would steal the end of the season from the fans? All just ahead on CNN's SATURDAY EDITION.

Good morning, California, the rest of the west and to all our viewers across North America, I'm Jonathan Karl in Washington. We want to hear from you over the hour -- our e-mail address is -- as we talk about the terror warnings, the calls for investigations into 9/11, and we want your questions about whether the government should spy on Americans inside the U.S. and about whether players and owners are right to even talk about a baseball strike.

Our two U.S. senators are straight ahead. But first, a news alert.


KARL: And terrorism warnings started this week, blunt warnings, but warnings without detail. And a political debate grinds on over whether the administration failed to gather the small threads of information before 9/11 and weave them into an effective picture of what might have happened. Joining us now are two key U.S. senators. From Dallas, Senator Kay Bailey Hutchison, Republican of Texas. And from Springfield, in the land of Lincoln, Senator Dick Durbin, Democrat of Illinois.

Welcome to both of you.


KARL: Want to get started right with today's New York Times, a very provocative piece by Frank Rich about these terrorism warnings. He said, quote, "Cheney, Rumsfeld, Ridge, Mueller, is there anyone who was not warned of Armageddon over the past week. You don't have to be a cynic to believe the point of the warnings is not to save lives so much as political hides."

Senator Hutchison, what do you make of that?

HUTCHISON: Oh, I think that's going way beyond the pale. I do think there were failures in our system. There's no doubt about that. I think we need to find those communications failures and also the failures in the ability to do the kind of investigations that we need to do when there is a reasonable cause to think that a crime is going to be committed or a terrorist act.

But I don't think that anyone should start pointing fingers in a personal way or suggest that people are trying to cover their political backsides. I just think that's ridiculous.

I think we need to go forward. We need to be positive. There are failures. We need to get to the root of it and try to make our country more secure.

KARL: Well, Senator Durbin, you're on the Intelligence Committee, so you're getting the classified briefings that we are not privy to. Should we be afraid? I mean, are these warnings on target?

SEN. RICHARD DURBIN (D), ILLINOIS: I don't know if we should be afraid. We should certainly be attentive to the fact that the threat of terrorism is still there. And I agree with Senator Hutchison, I think it's wrong to assign any motive to any of the gentlemen that you've mentioned that this is all about politics.

We live in a dangerous world. They perceive dangers that even Congress has not been alerted to, and they're trying to warn the American people. Let's accept that at face value.

But let's also take a look at what we've learned over the last several weeks: The very agencies that we're counting on to protect America didn't do their job before September 11. The FBI Phoenix memo, the Moussaoui arrest and investigation, all of those have now come to light. And we understand that, in Phoenix, the FBI office might as well have taken that memo, put it in a bottle and tossed it in the sea, because, frankly, no one paid any attention to it when they should have.

KARL: And you know, what's amazing about that Phoenix memo -- this is, of course, the one that warned of Middle Eastern men training at flight schools -- as we learn today in the New York Times, even Phoenix -- even that Phoenix FBI office didn't do any investigation into that. They didn't even check out the local flight schools.

DURBIN: Well, I think, if you look at it, it was a suggestion on what was labeled a routine memo that we had, perhaps a problem in Arizona, maybe a national problem. And Mr. Williams, who has now been identified, the agent that sent the memo, really said to the FBI, "Let me try to tell you what I found, foreign nationals, would-be terrorists, connected with Osama bin Laden at aviation training schools," and he named one...

KARL: All right, Senator Durbin, I hate to interrupt you, but we have to go to the president's radio address.

BUSH: Good morning.

As you hear this, I am in St. Petersburg, Russia, in the middle of a seven-day trip to Europe. I have come to Europe to reaffirm our close ties with important allies, to talk about the next stages of the war on terror, and to open a new chapter in our relationship with Russia.

In this last century, the conflicts of Europe led to war and suffering for America. Today, Europe is growing in unity and peace, and that benefits our country.

The nations of the European Union have made strong contributions to the war on terror, and the volume of our annual trade and investment relationship is nearly two trillion dollars, helping workers, consumers and families on both continents.

Germany, which I visited earlier this week, has emerged from a troubled history to become a force for good. German police and intelligence officials are helping in the war on terror.

In Afghanistan, German troops have served and died beside our own. Speaking in Berlin, I thanked the German people for their support and sacrifice and talked about the challenges that still lie ahead.

Here in Russia, President Putin and I are putting the old rivalries of our nation firmly behind us with a new treaty that reduces our nuclear arsenals to their lowest levels in decades.

After years of planning for war, Russia and the United States are building a friendship based on shared interest, fighting terrorism and expanding our trade relationship.

After centuries of isolation and suspicion, Russia is finding its place in the family of Europe, and that is truly historic. The partnership of America and Russia will continue to grow, based on the foundation of freedom and the values -- the democratic values -- we hold dear.

Free nations are more peaceful nations, and the spread of liberty strengthens America.

On the rest of my trip, I'll travel to Paris and then to Normandy, France, for Memorial Day, to honor the soldiers who, in 1944, gave their lives so that America, France and all of Europe could one day live in peace and freedom.

I will visit Rome for a summit that will forge new ties between the NATO alliance and Russia. I'll meet with the Holy Father, Pope John Paul II, whose message of peace and social justice is particularly urgent at this time.

In two world wars, the new world came to the rescue of the old, and America became a European power. Now, this continent is closer to being whole, free and at peace than any time in its history.

We must finish this job, inviting a new Russia to be our full partner. And together, we must face the challenges of the world beyond Europe and America: terrorism, poverty and evil regimes seeking terrible weapons.

Europe and America share common dangers and common values. We have the opportunity and the duty to build a world that is safer and better.

Thank you for listening.

KARL: Well, there we heard President Bush from Russia talking about that nuclear arms package just signed with Russian President Vladimir Putin.

Senator Hutchison, wanted to ask you about that. This treaty, the Treaty of Moscow, is only three pages long. And there doesn't seem to be any agreement over what to do with these weapons once they're taken out of a stockpile.

The U.S. wants to store them. Russia seems to want to destroy them. Where is the agreement?

HUTCHISON: Well, the agreement, of course, is that we are lowering the number of these nuclear weapons that we have the capability to be used. I think that is a good thing.

We have been working with Russia for years, though, trying to safely do away with the nuclear weapons that we know have been in the Soviet Union. And in fact, the Nunn-Lugar bill helped fund the safe dismantling of those weapons and, in some cases, perhaps a use for parts of those in a positive way for energy.

KARL: But Senator Durbin, is there less than meets the eye here with this three page treaty of Moscow?

DURBIN: Listen, I think it's progress. And I'm glad that President Bush and President Putin really do have a good solid relationship. That really makes America safer.

But former Senator Nunn came to see us just a week or so ago and pointed out the two areas of concern: first, the proliferation of nuclear weapons, the sale by Russia of nuclear technology to other countries around the world; and second, this nuclear stockpile in Russia, which is deteriorating in a country which has a very, very weak economy.

He really believes and I agree with him that we should be just as aggressive in trying to make certain that those nuclear stockpiles, as they exist, are as safe as possible.

KARL: OK, we do need to take a quick break. Senators Hutchison and Durbin will take your questions on the new terror alert and homeland defense when CNN's SATURDAY EDITION continues.


KARL: The Statue of Liberty on this Memorial Day.

The latest CNN-USA Today-Gallup poll shows that people think there was not enough information for the government to have prevented the 9/11 attacks. Only 25 percent say there was enough information. Sixty-three percent say no.

And more than half of Americans think that the Democrats' reaction to the 9/11 warnings is an effort to make the president look bad. Only 39 percent say the motive is really to find out what actually happened.

Senator Durbin, on that point, why is your leader, why is Senator Daschle so eager to have this big national commission to investigate what went wrong on 9/11 when you guys on the Intelligence Committee haven't even begun to hold your first hearings on this?

DURBIN: You know, there is a limitation to what the Intelligence Committee investigation can really give the American people. I am on that committee, and I will be part of it.

But so much of this is classified. So much of it is not going to become public knowledge. But I fear when it's all over, the people are going to look to us and say, "Well, what did you find?" And there is very little we can share with them.

I think what Senator Daschle and others are trying to do is to establish, as much as possible without compromising national security, answers to some important questions, like the Phoenix memo, like the situation with Moussaoui and other things which raise a question as to whether we did as much as we could have done to prevent September 11.

KARL: But isn't there a reason why you guys haven't -- I mean, isn't there a reason why you and the Intelligence Committee operate in secret. I mean, this stuff is classified for a reason. It's secret for a reason.

DURBIN: A good part of it is certainly classified and should remain as such. And the independent and public commission could not publicize that information. So the Intelligence Committee still has an important part of this investigation. But when it's all over, the American people, in this open, free and democratic government have the responsibility and the right to ask our agencies of government, "Did you do the job properly?" And I think that's want Senator Daschle is going after.

If we're going to overcome...

KARL: So, would you...

DURBIN: ... terrorism, we have to overcome bureaucracy.

HUTCHISON: Jonathan...

KARL: Yes, Senator Hutchison?

HUTCHISON: ... yes, could I jump in here? I've been on the Intelligence Committee as well. And I think the Intelligence Committee is the right approach perhaps bicameral with the House of Representatives because they have the capability. They have the secured personnel. They have the ability to really dig in to the FBI and the CIA and find out where the communications systems went wrong and how they can be improved.

I think the Intelligence Committee has the capability to do some public hearings. But I think it is the internal problems here that we must fix, and the Intelligence Committee members already are tuned in to the way these agencies operate, and I think it could be very positive to have the investigation done with the personnel already in place.

I worry that an outside commission would also take a long to gear up, a longtime to get staffed, a long time to make the appointments and make sure that everyone has a say in the appointments. I think we need to jump on this now, with the people who are already experienced.

KARL: Well, this week, Tom DeLay, of course the Republican number three man in the House is the weighed in on this, was talking about the Democrats. What he said was that the goal here should be to stop terrorism, not to help Osama bin Laden.

Listen to Tom DeLay this week.


REP. TOM DELAY (R), TEXAS: A public commission investigating American intelligence in a time of war is ill conceived and, frankly, irresponsible. We need to address America's challenges in intelligence gathering and terrorist prevention. But we don't need to hand the terrorists an after-action report...


KARL: Senator Feinstein, who serves with you, Senator Durbin, on the Intelligence Committee, who is also a Democrat, says that she would vote against the broader inquiry.

Other Democrats, like John Breaux, have said the same thing.

How are you going to vote?

DURBIN: I want to see how the commission is going to be formed. There is a bill before us. Senator McCain, Senator Lieberman, have a bill. Senator Torricelli has been very active in this debate as well.

KARL: How would you vote on that McCain-Lieberman bill, which Torricelli is now co-sponsoring?

DURBIN: Frankly, I think that bill, the commission itself, I don't like the composition of it, I don't like the way it's put together.

But I'm open to this idea. You know, I just don't think in this open society, that we can expect, at the end of the day, for the American people to be satisfied that somewhere in a closed door meeting in Washington, they came to a conclusion as to whether we did the job right before September 11. We can do this without compromising national security.

KARL: OK, back to the warnings. We've got a viewer e-mail I want to pose to both of you. This was comes from Kevin in Maryland. He says, "Who is to say the information provided by the detainees is really the truth and is not an attempt to confuse authorities?"

Obviously, a lot of these recent terror warnings have some from Al Qaeda prisoners, especially Zubaydah.

Senator Durbin, you are on the Intelligence Committee. I mean, should we be trusting this guy and putting out warnings based on his word?

DURBIN: Well, of course, that's what the analysts have to do. They take the information and then really try to establish whether it's credible, whether it's serious and then act on it if necessary.

Some people are credible because they've told us things that we've checked out to find out to be true. Other people are not to be trusted.

So it really is up to the folks on the ground working with them to come to the right conclusion.

KARL: Senator Hutchison, I don't know if you saw, there's a story today in the papers that the -- at the states, the people in charge or homeland defense made no significant changes this week, despite these dire warnings coming from the administration. I mean, what -- and we're still at, of course, the yellow level of alert. I mean, what are we supposed -- how are we supposed to react?

HUTCHISON: Well, I think there are warnings out there. I've seen the warnings to our transit systems, the warnings in apartment complexes. I do think that they are trying to specify as much as possible. Also, I want to say that they are gathering intelligence from many sources. These prisoners are being interrogated separately. They're trying to put the information they get together to see if there's a strain of truth.

They don't just automatically trust them. But I think that by gathering information, even from prisoners that are being held in other countries, matching the things that are said, they are trying to get the best information that we possibly can.

KARL: All right, well, Senator Durbin, where do you think we're headed from here? I mean, we're talking about. We've got this investigation that your chairman, Chairman Graham, says could go on right through the election and after.

DURBIN: Well, three weeks ago, I saw the Phoenix memo for the first time, and I realized when I saw it that this whole national debate is going to change, and then, this week, we received this letter from an FBI agent -- career agent -- in Minneapolis.

So it's hard to really predict how this is going to unfold. But keep in mind, what we are now discussing is the result of the first real inquiry into what happened before September 11.

We've asked Director Mueller, whom I have the greatest respect for, the new head of the FBI, if there are any more shoes to drop, and he says no. I hope he's right.

Frankly, a lot of these things are unsettling. We should've done a better job when it came to law enforcement and intelligence before September 11.

KARL: All right, well, Senator Durbin of Illinois, out there in Springfield, thank you so much.

DURBIN: Thank you.

KARL: And Senator Hutchison, always a pleasure. Thank you for joining us from Dallas.

HUTCHISON: Thank you, Jonathan.

KARL: And straight ahead, spying on the home front: a sensible approach to homeland defense or a recipe for political abuses?

Our next guests sort it out when CNN's SATURDAY EDITION continues.

And there you have, from Arlington National Cemetery, preparations underway for this Memorial Day weekend.



DONALD RUMSFELD, U.S. SECRETARY OF DEFENSE: The United States of America is one of the few countries on the face of the earth that does not have a domestic intelligence gathering agency.

We may very well be the only English speaking democracy in the world that doesn't have one.


KARL: Defense Secretary Donald Rumsfeld commenting on whether it's time to create a domestic version of the CIA. A column in this week's Newsweek magazine argues that a domestic intelligence agency is what's needed to prevent future terrorist attacks.

Joining us from New York is the author of that column, Newsweek international editor, Fareed Zakaria. Welcome.

And here in Washington, Laura Murphy. She is the director of the American Civil Liberties Union's D.C. national office.

Welcome to both of you.

And right to you, Fareed. This was your article that started the debate. You're talking about a domestic CIA. Do you really want to go back to the days when J. Edgar Hoover was spying on everybody from Martin Luther King to Bobby Kennedy?

FAREED ZAKARIA, NEWSWEEK: Jonathan, every major industrial country in the world has one. Every democracy that I know of has one. The point is not that, you know, we need something like the FBI under Edgar Hoover. Remember, the problem there was there were no checks, no balances, and it was all being done furtively.

My argument is let's admit we need domestic intelligence. We need the FBI to be functioning as an intelligence agency. And by admitting that, by bringing it out in front, we put civilian oversight, we put congressional oversight. We do it right so that we get security and liberty at the same time.

KARL: Well, let's look at a quote from this article that started this debate. You wrote in Newsweek, "We need a domestic intelligence capability. In an age of terrorism when the enemy will often be operating inside of America, we can't remain blindfolded."

Laura Murphy, that's a pretty powerful argument.

LAURA MURPHY, ACLU: Well, I think it's a ridiculous assertion to say that we don't have domestic intelligence capability in our own FBI. Right now, the FBI can monitor Internet communications through Carnivor (ph). And as the Rowley memo from the FBI agent in Minneapolis asserted, it wasn't a problem with getting a court order to engage in a wiretap or interrogation. The problem was the bungling in the bureaucracy of the FBI...

KARL: Well, of course, that court order was turned down. And the FBI...

MURPHY: No, no, it was a never court order. It went to the FBI headquarters and they... KARL: ... and they decided not even to ask for it because they thought it would turned down.

MURPHY: ... turned it -- not even to ask -- exactly.

And so it is internal to the FBI.

KARL: But the FBI was set up to solve crimes. The FBI was set up to do something after a crime is committed.

Don't we need something set up to prevent crimes?

MURPHY: No, no you're incorrect. Since 1978, there has been something called the Foreign Intelligence Surveillance Act. Under that act, any alien or any U.S. citizen can be investigated if there is a problem with airline piracy or aircraft or anything related to international terrorism.

They had more than adequate capabilities to investigate this guy, and that's why they tried to go around their own bureaucracy straight to the CIA, because they had the authority under the Foreign Intelligence Surveillance Act.

And if that wasn't enough, the USA Patriot Act that was signed into law in October, gave information sharing capabilities for domestic agencies. Now everything the FBI gathers in this regard must be turned over immediately to the CIA.

This proposal is absolutely unnecessary.

KARL: Fareed?

ZAKARIA: Well, I think what's amusing about this is the kind of reflexive opposition you're getting because, in point of fact, what I am proposing would provide greater oversight. I'm arguing for congressional oversight.

The FBI is actually very thinly overseen by lawyers. If you think of how the Defense Department oversees the uniformed services. There are hundreds of civilians. The FBI has almost no lawyers at Justice, the Department of Justice overseeing it.

So what I'm arguing is rather than giving a power here or a power there -- and Laura is technically right, they do have a few powers that have been accumulated over the last 10 or 15 years -- what I'm arguing is, it's a very Madisonian idea, that is bring this power out in the open. Make it clearly defined, delineated and give it the kind of checks and balances we give everywhere else in the system.

Look, it's very easy to talk about an isolated power here or there, but everybody knows that the easiest way to become invisible is to operate within the United States. If that weren't the case, Jonathan, why did these terrorists decide to come here and live here for one year, one-and-a-half years? Obviously, they thought it was a safe environment. They did it in two countries, in the United States and in Germany, the two countries that have very weak domestic intelligence. They did not operate very extensively in France or Britain or Spain because all of those countries have very strong domestic intelligence systems.

MURPHY: You know, I cannot believe what I'm hearing because you must have been out of the country when the USA Patriot Act was under consideration, and federal law enforcement came forward with the blessing of the attorney general to say "We need a broad new authorities."

Under the USA Patriot Act, there are...

KARL: Which you opposed, by the way.

MURPHY: We did oppose...

KARL: Vigorously opposed.

MURPHY: Well, we didn't...

ZAKARIA: And the point is...

MURPHY: Sir, may I finish? We did not oppose three-fourths of that act. The very thing that the gentleman is talking about, which is checks and balances, we're saying, if you're going to expand your wiretapping authority, give a judge meaningful oversight. Don't let the executive branch be the sole determination of whether something is warranted.

So there is adequate congressional oversight on our existing laws...

KARL: This debate will continue in just a minute. We've got to take a quick break.

Can a domestic spy agency co-exist with your constitutional freedoms? We will continue our conversation and take your questions in just a minute.

Plus editorial cartoons, baseball strikes and a CNN News Alert when SATURDAY EDITION returns.


KARL: An important source of information about the news of the day and terrorism investigation and transcripts of this show, CNN SATURDAY EDITION can be found online at or AOL keyword, CNN.

It's time for a quick check of the hour's stop stories.


KARL: President George W. Bush says a strong Russia is good for America. Mr. Bush joined Russian President Vladimir Putin at his alma mater, St. Petersburg University to answer questions from students.

The event comes one day after the two leaders signed a landmark arms reduction deal.

Kelly Wallace is traveling with Mr. Bush and joins us now from St. Petersburg.


KELLY WALLACE, CNN WHITE HOUSE CORRESPONDENT: Well, Jonathan, you will recall that when President Bush hosted President Putin at his Crawford, Texas, ranch, the two men took questions from high school students. And so they did the something today. Only, the difference, taking questions from college students as you noted, at Russian President's Putin's alma mater, St. Petersburg State University, the questions ranging from the fact that a lot of people here get educated and then head to the West, to Russia's chances of entering the World Trade Organization.

Earlier though, the leaders taking questions from the White House press corps. There, the subject that came up, tensions between India and Pakistan. Secretary of State Colin Powell saying the U.S. is disappointed that Pakistan went forward testing a missile on this day and Mr. Bush saying his administration is doing everything it can to pull the two sides back from the brink.


BUSH: We're deeply concerned about the rhetoric. It is very important for President Musharraf to stop, to do what he said he was going to do in a speech on terror and that is stop the incursions across the Line of Control. It's important that the Indians know that he's going to fulfill that promise.


WALLACE: Most of this day, though, devoted to the two men spending time together and visiting some of St. Petersburg's most treasured sites.

Mr. Bush laying a wreath at the cemetery, honoring the 600,000 people who died during the siege by Nazi forces of this city during World War II. The president saying during that visit or later, that during that time, there he was reminded to remember the ravages of war.

A little later, Jonathan, he told reporters that this whole visit to Russia is about peace, is about the United States and Russia ending their confrontational relationship, developing a new era of relations between the two countries.

The two men will be spending more time together this evening, enjoying the ballet and then taking a boat tour to enjoy the white nights of St. Petersburg.

Believe it or not, Jonathan, this city will be lit up -- it is in sunlight, practically, lit up until close to midnight.

Jonathan, back to you.

KARL: All right, it looks like a beautiful day in St. Petersburg. Last time I was there, it was in February. It looks much nicer now, Kelly.

Thanks a lot.

WALLACE: Yes. Better time to be here for sure.

KARL: Absolutely.

Well, now we return to our discussion on domestic terrorism, domestic spying as part of homeland defense with Fareed Zakaria of Newsweek International and Laura Murphy of the ACLU.

Back to this discussion, Laura Murphy, just to backtrack for one second, this whole discussion about the Phoenix memo and the warnings about Middle Eastern men training at U.S. flight schools.

If the FBI back then in July had gone forward with a plan to investigate Middle Eastern men training at flight schools, wouldn't the ACLU have screamed bloody murder?

MURPHY: No, not at all. They have the absolute authority to protect out nation. The ACLU wants to be safe and free just like any other American.

KARL: You wouldn't have said, "That's racial profiling?"

MURPHY: Absolutely not because they had reasons to investigate these people. Their behavior was odd. Their contacts abroad were suspicious. They had adequate basis for investigating them under the Foreign Intelligence Surveillance Act.

So the ACLU would not have challenged that. That's a red herring.

What is lacking here is sufficient oversight and checks and balances on the broad authority that the FBI now has. We don't need a new agency. We need to make sure that the FBI isn't bungling its analysis of the information it collects.

It had over 1,100 wiretaps in 2000. None of those wiretaps were turned down by a court order. It had foreign surveillance wiretaps. Only one wiretap has been turned down since 1978 -- thousands of foreign intelligence surveillance wire taps.

So there isn't an inadequate amount of resources. The question is: Can we do this in accordance with the Fourth Amendment, with our Bill of Rights and get to the goal which we all want, which is to live in a safe society free of terrorism?

KARL: In fact, Fareed, there is a lot of information coming in, and you could argue that what happened here was not not enough information coming in, but the bungling of the dealing with that information -- couldn't you?

ZAKARIA: Oh, Jonathan, that is what happened. The point is not, as I say, you can look at specific thing here or there and say the FBI, you know, had these tips.

The point is the FBI -- I think you made this point, Jonathan -- it's structured as a law enforcement organization that has a few intelligence functions. What that means very simply is, the FBI really goes into gear when a crime has been committed. And the FBI's culture is essentially to catch the Mafia. That's what you get promoted for at the FBI. That's who all the big guns of the FBI are.

Doing strange counter-terrorism stuff, investigating suspicious characters when it's not going to end up in a conviction or prosecution, that's not what they do for a living.

That's what the CIA has done. And all I'm saying is, what you need to do and what is going to happen inevitably is that the FBI gets more and more involved in intelligence.

You know, the odd thing, Jonathan, is I was having this debate with Alan Dershowitz a couple of days ago. And it turned out that Dershowitz and I agreed entirely.

I think that, if the ACLU -- I'm very sad to see this kind of reflexive opposition...

KARL: That must have concerned you, Fareed.

ZAKARIA: Well, it didn't concern me so much because I think Dershowitz understood very correctly that the point here is, you've got to get these powers out in the open.

KARL: I want to quickly get to something that Porter Goss, the chairman of the House Intelligence Committee, had to say this week on this.

Take a listen.


REP. PORTER GOSS (R), FLORIDA: It is intelligence that will prevent things from happening. The gates, guns and guards are great to have, but it's getting the good intelligence information, getting those plans and intentions, and we're talking about plain, old, classic espionage, and we've just got to get better at it.


KARL: OK, well, you can see that, Laura Murphy, that plain, old- fashioned espionage is the key to stopping this?

MURPHY: Yes, within the guidelines under the laws that protect due process, that allow for judicial oversight, but, you know, Fareed, you're just so factually incorrect here. Right now, there is over a $10 million antiterrorism unit within the FBI. After the Oklahoma City bombing...


FAREED: $10 million, Laura, think of that: out of a $30 billion budget, $10 million. I make my point.


MURPHY: But you're assertion that you have to have probable cause of a crime in order to investigate terrorism investigations is just factually incorrect.

KARL: Well, we're out of time. A lot more to discuss on this issue. We should probably have both of you back very soon as this investigation goes forward.

Fareed Zakaria, in New York, thank you so much for coming in.

Laura Murphy, always a pleasure. Thank you.

MURPHY: Good to see you again.

KARL: All right, up next, something much different: Baseball, it's in full swing now, but will fans miss out on a World Series? We'll get some perspective on the labor woes of America's national pastime when CNN's SATURDAY EDITION continues.


KARL: Editorial cartoonists are hearing the terrorism warnings this week. Kevin Siders of "The Charlotte Observer" has the FBI director saying, "another terrorism attack is inevitable, all things considered." And a plane labeled "warnings" is seen zipping in one ear and out the other.

Walt Handlesman (ph) of "Newsday" in New York shows FBI and CIA intelligence experts at their consoles. Says one, "the chatter is way up and our threat levels are high. We could be looking at a full-out attack." Says the suit behind him, "should we notify congressional leaders?" The answer, "he's talking about congressional leaders."

And Bob Rogers of the "Pittsburgh Post-Gazette" has the FBI in left field. "Who would have guessed there'd be fly balls out here?" says one agent as he's bumped on the head. His buddy replies, "actually, we got a memo on it last August."

From baseball images and political cartoons to baseball games this weekend, dozens of them drawing millions to the ballpark and the tube. But will the major leagues short-change fans by summer's end? Baseball owners are crying poor, while players are talking strike.

Joining us from New York to help sort out the state of baseball is sports commentator and CNN contributor Keith Olbermann. And here in Washington, sports commentator John Feinstein. Welcome to both of you. Keith, if you can help me out here, I've been reading this week -- first, I read about the possibility of a baseball strike on October 1, right before the play-offs. We've even heard talk about a baseball boycott of the all-star game, the players would actually boycott the all-star game. What is going on with baseball?

KEITH OLBERMANN, CNN CONTRIBUTOR: I think the boycott idea was there to scare the former owner, now commissioner, former owner of the Milwaukee Brewers and now commissioner of baseball, Bud Selig, just to throw a little scare at him. I don't think the players are planning to do that, because a lot of that money that they would lose by not playing that game would come out of their pension funds, to which much of the all-star money still goes.

The possibility of a strike on October 1 is very strong. It would allow all the players to get all their paychecks, and since the owners have pledged not to lock the players out, there is no motivation for the players to go out any earlier, necessarily. But the possibility of there being a strike is a strong one. The possibility would be very brief, because the owners do not have the wherewithal to withstand a long strike and would be called in, the banks would call in their loans on them, is the most likely outcome.

So you're looking at the probability of some sort of interruption, but nothing catastrophic, because in this weird case, baseball's poor economic health will actually work to save baseball.

KARL: But my God, attendance is already down this year, down pretty considerably. Can baseball survive another strike?

JOHN FEINSTEIN, SPORTS COMMENTATOR: Well, baseball always survives, Jonathan, because it's baseball. And it survived 1994 and '95, although attendance went down 19 percent after than lengthy work stop when there was no World Series in 1994.

The problem is, Keith's right about the economics of the game and the fact that it might lead to a relatively brief strike. But what if that strike wipes out post-season or damages post-season? That's terrible for baseball, because post-season is when kids fall in love with the game. We had a great post-season last year climaxing with that fabulous Arizona Yankees World Series. The owners don't want -- should not want this strike. But as Keith says, history says there will be a work stoppage, because all eight times these sides have had a negotiation, there's been a work stoppage.

KARL: All right, I'm confused. Keith, we had last year $3.5 billion in baseball revenue. That's almost twice where it was a decade ago. How is it that baseball is in a state of poverty?

OLBERMANN: In a lot of cases, especially as it regards the media, television companies have overpaid for the rights to televise baseball games. I think the write-off number for Fox for their game of the week broadcast, their post-season broadcast last year, was well over 300 million or 400 million -- it's not clear how much they wrote off as an entire company and how much pertained just to baseball. So they paid too much. A lot of local broadcasts are well over the actual profit level, and most of these broadcasters want to pay less and not more in the future. The owners still have after 30 years of shopping for free agents absolutely no idea what they're doing, as judged by the signing of Alex Rodriguez by the Texas Rangers for $252 million two winters ago, and the owner came out last week and said, "I'm tired of losing money, I'm not going to do this anymore." He's the man who put the price up there. So that's -- the economics of it are just fundamentally skewed.

KARL: Now, Bud Selig says you can have six to eight teams go under within the next year and a half?

FEINSTEIN: Well, see, one of the problems that the owners have is that Bud Selig and the owners keep running around screaming that the sky is falling. And at this point, nobody really believes them. The last time a major league baseball team folded was 1899. So now Selig is saying...

KARL: What was it?

FEINSTEIN: I think it was -- it might have been the Baltimore Orioles. Keith is the historian; he'll know that, the old Baltimore Orioles.

But now Selig says six to eight teams could go out of business. They're not going to go out of business. They might get bought. See, the problem is, an owner like Carl Pohlad of the Minnesota Twins is richer than George Steinbrenner, and yet his payroll last year was $1.1 million less for the entire team than Tom Hicks, the owner in Texas that Keith is referring to, paid for Alex Rodriguez. That's where the numbers are so skewed.

Baseball needs to have a balance economically. And one of the ways to do that, I think, is with a salary floor. Make every team pay a minimum amount of money, at least, on their payrolls.

KARL: And of course, obscured in all this is this has been a great start to the baseball season. We'll talk a little bit about that. We've got to take a quick break. Will baseball's owners and players strike out with the public? We'll continue our conversation with Keith Olbermann and John Feinstein when CNN's SATURDAY EDITION returns.


KARL: We're talking major league baseball with sports commentators Keith Olbermann and John Feinstein. So, Keith, it has been a pretty amazing year. I mean, this week we had Shawn Green hit four home-runs in a game -- that's only been done, what, about a dozen times in history, and yet it's been done twice already in May? What's going on?

OLBERMANN: More impressively, Jonathan, with Shawn Green, something nobody else really I think has picked up on, the 13 previous times that anybody hit four home-runs in one game, only once was the guy not shut out the next game. In other words, the home-run muse visits these guys for four homers one day, then they don't get any the next.

Green hit another homer last night. He's only the second man to do that. It has been a great start to the season, very competitive races in almost every division. A lot of the favorites in play. The two teams they were talking about contracting out of existence in play, Minnesota and Montreal both within sight if not within the pennant race. And it has been a great start.

But of course, that has nothing to do with it. The only new element to this entire labor dance that we've seen enacted, as John pointed out, several times since 1972 is that the fans seem to be acting preemptively. That attendance is down this year, even though there's no particular reason for it in terms of weather, by over 5 percent for the month of April, and that figure continued into May.

And they seem to be -- fans seem to be saying, hey, you know what, we're not going to be totally invested in this until we know you're going to still be here this year.

FEINSTEIN: Yeah, that's a really important point. Last night in Cincinnati, the Reds are a real surprise team in baseball. Ken Griffey Jr. is back in the line-up for the first time in seven weeks. They're in first place. They're playing the Atlanta Braves, one of the glamour teams, and they draw less than 30,000 on a Friday night in Cincinnati. That's not a good sign for baseball.

And I think Keith's right, that a lot of fans are going, I don't want to be all wrapped up emotionally in this pennant race and then have it shut down in August the way it did in '94, or get to the end of the season and say, congratulations, you've won the division, there's no post-season. People are really angry and nervous.

KARL: Well, here an e-mail that I think gets right to that point. From Dan in Massachusetts, he writes: "In the troubled times of today, the concerns of spoiled brat athletes are way down on the list. Are the people tired of hearing this?"

FEINSTEIN: You know, one of the things that's interesting about that e-mail is the fans always seem to side either against everybody or with the owners. Because it seems to be OK for owners, for older men, to have all this money, but these young guys, these hip guys with all this money, it bothers the fans, don't you think, Keith?

OLBERMANN: Absolutely, John. It is one of the great mysteries of mass psychology, as to why it is that people who work for a living support people who are running the other companies. It has almost always been like this, and on occasion, when the players seem to be getting that emotional hammer back, if you will -- like after the Alex Rodriguez signing, I think the reaction of baseball fans was, the owners are nuts, the players have been right all these years.

And then the players, several players have come out and just done egregiously stupid things, like talking about, oh, if I don't play every day, it will be operation shut-down, or self-centered things that get extraordinary amounts of publicity and gotten in trouble in various ways. And they always seem to give that emotional edge back, which is the one thing they don't do right.

KARL: What amazes me is that the owners seem to be -- these rich guys, have all this money, act like socialists.


KARL: ... problems with revenue sharing, you know, (UNINTELLIGIBLE) tax.

FEINSTEIN: Well, because they see that that's been successful in other sports. The reason the National Football League is the dominant sport today is because in the early 1960s, Pete Rozelle, then the commissioner, convinced the owners that socialism was best for the sport, and that's why everybody's competitive.

KARL: We have 15 seconds. Keith, last word?

OLBERMANN: If the owners want any kind of revenue sharing, which is the only safe future for the game, they ought to share revenues amongst the big markets and small markets, and possibly, as the former Commissioner Fay Winston (ph) suggested, bring the players in, either as a union or individually as part owners, put them on the same side of this equation, we won't have this stuff anymore.


FEINSTEIN: Salary floor with the revenue sharing. That's the way you make everybody viable.

KARL: OK. You heard it here. Thank you, John Feinstein, Keith Olbermann. Thank you both, have a great weekend.

When we come back, my turn. What we didn't know one year ago about a senator's plan to change parties and how the White House let him slip away.


KARL: The only reason the Democrats control the U.S. Senate today is because a once-obscure Vermont senator named Jim Jeffords decided to leave the Republican Party one year ago. The story of Jeffords' secret negotiation with Democrats broke right here on CNN. What I didn't know back then was the impact of that initial report, and more importantly what the report could have had, the kind of an impact it could have had on the decision that changed the balance of power in Washington.

Here's a flashback to the days leading up to that big decision.


KARL (voice-over): Little did Republicans know that as they talked tough about Jeffords, Democrats were talking sweet. SEN. TOM DASCHLE (D), SOUTH DAKOTA: I don't know that we ever used the words "whatever you need." We thought that his concerns, his interests, were reasonable.

KARL: Tuesday, May 15, in a clandestine meeting, Jeffords talks with the Senate's two top Democrats about switching parties.

(on camera): How did you keep that a secret? I mean, that's high drama. The stakes couldn't be any higher. You're sitting there meeting with the two top Democrats in the Senate about possibly switching parties.

SEN. JAMES JEFFORDS (I), VERMONT: Well, my hide-away is in the bowels of the Capitol. So you don't run into anybody except the police.

DASCHLE: We felt it was that important that we not share it with others, because if it got out, we were concerned that it could all unravel very quickly.

JEFFORDS: They asked me what I wanted, and I told them really all I want is, number one, to make sure my staff gets taken care of, and two, take care of my cows.

KARL (voice-over): By his cows he means Vermont's dairy cows and the milk money they produce for Vermont's farmers. Republicans had signaled the so-called Northeast Dairy Compact, which guaranteed higher prices for milk, would be killed as punishment for Jeffords' vote on the tax cut. The Democrats promised to take care of his cows, but they also offered something else: The chairman of the powerful Environment and Public Works committee. But the secret negotiations would not be secret for long, thanks to CNN.

Friday, May 18.

(on camera): When Democrats are reaching out very aggressively to Jeffords trying to get him to switch parties, one thing under consideration in these talks between Jeffords and the Democrats would be potentially for Jeffords to become an independent, but to vote for Tom Daschle for Democratic leadership.

What was your reaction when you saw we went on CNN that Friday before and reported these discussions were going on?

DASCHLE: Well, you were the one who did it, and it was one of the rare times when I would have rather not seen you on television. Because I was worried that the White House would pick up on it and spend the weekend wooing Jim back, that they would use whatever device, bringing him up to Camp David if necessary, do whatever it took to bring him back.

KARL (voice-over): But there was no weekend at Camp David.


KARL: Not only was there no weekend at Camp David, the White House didn't contact Jeffords until four days after that report on CNN. Could it have made a difference if they had? Well, the White House will never know.

Thanks again for watching CNN SATURDAY EDITION. I'm Jonathan Karl in Washington. "PEOPLE IN THE NEWS" profiles Hollywood legend actress Elizabeth Taylor right after a news alert. And there are pictures of Arlington Cemetery, again, on this Memorial Day weekend. Have a great weekend.