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Presidential Candidates Rev Up Engines; A Look at the California Recall Election; What Will Bombing in Najaf Mean for Iraq's Future?

Aired August 30, 2003 - 10:00   ET

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


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


CANDY CROWLEY, CNN SR. POLITICAL CORRESPONDENT: Welcome to CNN's ON THE STORY, where our journalists have the inside word on the stories we covered this week. I'm Candy Crowley, on the story of presidential candidates revving up their engines at the traditional Labor Day starting line.
KELLY WALLACE, CNN NATIONAL CORRESPONDENT: And I'm Kelly Wallace, on the story of how the California recall, Gray, Arnold, the whole gang, may really be the big political event.

RYM BRAHIMI, CNN CORRESPONDENT: I'm Rym Brahimi, in Baghdad, on the story of what this latest attack at Shiite Islam's holiest site means for the future of Iraq.

KARA HENDERSON, CNN CORRESPONDENT: I'm Kara Henderson in Atlanta. Pete Sampras, the tennis player, some say was the best ever, chose retirement this week. We'll talk about what a difference that makes and what difference it makes if the Williams sisters decide to sit this one out.

ELAINE QUIJANO, CNN CORRESPONDENT: And I'm Elaine Quijano, on the story of how a scathing report on the Columbia disaster points out NASA needs to make major changes in its culture before Americans return to space.

We'll be talking about all these stories. We'll discuss the latest on the Laci Peterson case. We'll talk about how television dramas keep returning to Washington for ideas, suspense and political thrills. And we'll hear the president's weekly radio address at the end of the hour.

E-mail us at on onthestory@cnn.com. First up, Candy and campaign 2004.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I came to the office of president of the United States to solve problems instead of passing them on to future presidents and future generations.

(END VIDEO CLIP)

CROWLEY: President Bush this week at a political fund-raiser in St. Paul, Minnesota, comparing himself, favorably of course, to other politicians. And hang on. It's the Labor Day weekend. That's the traditional start of presidential campaigning.

Well, I've been paying attention now for a year and a half. I'm not sure -- usually this is -- not everybody else is. What's interesting to me is right now we are sort of at the point where we're wondering, well, what's going to happen to the bottom tier candidates? You know, when are they going to -- you know, are they here until January and the first caucus, or are they going to get out sooner?

And, at the same time, we're thinking, well, what about General Wesley Clark? Is he going to get in? What about Hillary Clinton? Is she going to get in? So we're sort of betwixt and between while everybody gets their kids back to school and brushes off the sand from vacation and begins to pay attention.

BRAHIMI: Well, what I was wondering, from Baghdad here, of course, is how much the situation in Iraq, this violence and what the security situation that the U.S. troops are facing, how much of that will affect the presidential campaign debate in Washington?

CROWLEY: It's clearly going to affect the debate. Whether or not it affects the vote is an entirely different thing because there's sort of a split thing on Iraq at this point. One is that well over 60 percent of the people in our latest poll thought that the Iraq war was worth fighting. On the other hand, a majority thinks that President Bush doesn't really have a plan. So -- on postwar Iraq.

So we're kind of there again. He has a potential for it being a good point, and another potential for it being a minus.

WALLACE: Candy, I wanted to ask you -- you're going to go ahead and cover John Kerry's announcement this coming week, but so much attention this summer has been on Howard Dean, the Howard Dean phenomenon. You've been covering him and others. Is this just a blip on the radar screen or is he really the one to beat right now?

CROWLEY: Yes, the $64,000 question. I mean, we don't really know. I mean, the fact is, people are surprised that he has staying power this long. The question now is did he peak too early? You know, if it we're a year out, have we seen what we're going to see?

The fact of the matter is that, right now, as opposed to a year ago, we were talking about Howard Dean as the front-runner. A year ago, we talked about John Kerry as the front-runner and we were talking about how this brand new face, John Edwards, the senator from North Carolina, was really going to be this big deal and the fresh face the Democrats were looking for.

Well, Edwards is nowhere in the polls; it's early. And Kerry has declined and fallen behind Dean in polls in Iowa and New Hampshire. So it's a whole different thing and it will be a whole different thing a year from now.

QUIJANO: What about General Wesley Clark? What's the buzz?

CROWLEY: Well, in fact, I talked to him on the phone the other day, Thursday, and said, "So, what's the deal?" And I thought, despite all these reports that he's going to get in there, I thought he sounded sort of negative.

He said, you know -- he said, "I'm still thinking about it," but he talked about here we are Labor Day, he's got to get all this money, he's got to get a staff together. He says he's got two people. He's got the person that answers his phone and then a guy who's not a politico. And he said, "You know, if I announce today, two weeks from now you guys will eat my lunch and say, 'What's going on, what's going on?'"

So it shows both the lateness of the time. I think he would like to, but it's a huge deal to get in a year out.

HENDERSON: Candy, this is Kara Henderson, having the question, do you think that the war in Iraq, now turning into a situation in Iraq, has turned from a strength to a liability in terms of President Bush's numbers?

CROWLEY: I think it's turned from a strength to a questionable strength. The problem is that, again, people still see Iraq, first of all, as having been a fight on terrorism. The majority think it was about terrorism. And second of all, they see it as worth fighting for, despite all the constant sort of daily reports of U.S. soldiers dying. What they see here is this is worth fighting for, some 60 percent.

On the other hand, can we take a year of things blowing up every couple of days? I mean, that's the question. What's going to happen between now and then? Can they get it together? Can they get some stability?

QUIJANO: Yes. And you know some of the stories trickling out now to the newspapers, the local newspaper now, and the little town that these soldiers come from, you know, those are the kinds of images that can wear over time on people. Are you starting to see perhaps the Bush administration being very aware of the fact that these images are now starting to permeate to those smaller towns?

It's not just some intangible kind of effect that's happening. I mean, really, they are seeing the loss that these families are feeling and feeling these losses very deeply.

CROWLEY: Sure. What's interesting to me is I've talked to a couple World War II veterans lately who went away for two and three years in World War II. Almost immediately after the war was prosecuted, the bulk of the war was prosecuted, we began to talk about when are these guys coming home?

So it's very clear that some of them have been gone for a long time. Some veterans look at it as, hey, that's nothing. Nonetheless, you have the wives, the children, you know? And those are a thousand words in all that. Those are pretty powerful picture. So certainly the pressure is on Bush to make this work in the post major war period.

WALLACE: And Candy, you know when we talk campaign 2004, one name that keeps popping up, Hillary Clinton. Her name keeps being put out there as a possible person who could jump into the race. Is that true, what she's saying? What are your sources telling you?

CROWLEY: I take her at her word, which is, "I'm absolutely not running."

WALLACE: Right.

CROWLEY: But you know the fact of the matter is this is really hard for an '04 -- what it means is nobody's jelled around a single candidate, because that's when they talk about somebody else, the magic bullet. Oh, won't Hillary Clinton get in? Why won't Al Gore get in?

You know when Democrats begin to settle around somebody, I think this kind of talk goes away. In the meantime, I think Hillary Clinton has some great PR people who keeps her name out there, she's still a national player.

WALLACE: She can say no, no, no.

CROWLEY: That's right, no, no, no, but look good.

WALLACE: That's right.

CROWLEY: And people always look good before they get in, that's the problem. So I think that's why you hear her name. It's just we haven't sort of settled around anybody.

By this time last year, people pretty much settled on George Bush, at least moneywise. A lot of other people were still in the race. And John McCain had yet to become the phenomenon he was in New Hampshire. But this race is so unclear that they keep looking around for the person who is going to come save the party.

BRAHIMI: Well, this latest attack in Najaf has sent shockwaves right into Baghdad, where people are now -- it's triggered a lot of anger now among people who are wondering why the U.S. is finding it so difficult to stabilize postwar Iraq. I'll be back in a moment on the story with what's happening right now in Iraq.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

BUSH: In Afghanistan and Iraq, we gave ultimatums to terror regimes. Those regimes chose defiance and those regimes are no more.

(END VIDEO CLIP)

BRAHIMI: Those regimes may be no more, as President Bush said, but meanwhile, there's an increasingly confusing void in place of what Saddam Hussein and his cronies had in here in Iraq. And basically, it all amounts to three main questions.

One of them, how is it that a coalition that won the war in Iraq is not capable of maintaining the peace or managing the peace in postwar Iraq? There's another question with regard to, has the U.S. actually created a haven for terrorists in a country where there wasn't that trend before? And finally, how can a force -- a U.S. force that is being targeted on a regular basis and preoccupied with its own protection, actually protect the country it is occupying?

And that's one of the questions that the Governing Council is asking. It's had an emergency session. At a news conference just a couple of hours ago, it told reporters that it was very preoccupied with the security situation and is calling on the U.S. to hand over security to the hands of the Iraqis.

HENDERSON: Rym, this is Kara Henderson. In terms of the bombing in Najaf, I think we all well understand the human toll that was tack there. But can you kind of explain the significance in terms of the Iraqi people in this bombing?

BRAHIMI: It's really very big. It's very, very big. Basically, imagine the Vatican, St. Peter's Basilica on a Sunday right after mass and a bomb goes off there. That is the equivalent of what happened in Najaf at what is the most holy site for Shiite Muslims.

It all comes down to an area where the Imam Ali is buried. Now he was the cousin of the prophet and he was killed precisely because there were people who believed that he shouldn't be the leader of all Muslims and that the leader of all Muslims shouldn't be a direct descendent of the prophet.

The Shias emerged then because they believed Ali should be their leader. So symbolically, it's very big, and it does have the risk of being viewed by Shias here in Iraq who have always struggled under Saddam and suffered because, although they were the majority, they didn't have the power, basically. It really runs the risk of having them wonder if this isn't an attack against them, against Shia Islam as a whole.

WALLACE: Rym, the key question, of course, is who could be behind this attack, and of course the deadly attack outside the U.N. headquarters not too long ago? And is it part of some very sophisticated, well organized, even influenced by foreign forces to go ahead and destabilize the country?

BRAHIMI: Well that's exactly what a lot of Iraqis are asking right now. And a lot of people pointing fingers, precisely at remnants of the Ba'ath Party regime. A lot of people think it's not inconceivable that remnants of the Ba'ath Party regime could either be behind this or could have forged an alliance with what we call -- what are called foreign terrorists who would have infiltrated the country after the fall of the regime.

Now this is just speculation. There's not been any result of any investigation in any of the three major bombings, because there was also the Jordanian Embassy bombing earlier this month and the then U.N. compound and this one. They seem to become bigger and bigger in scale.

There's also a lot of finger pointing. Of course, there's the usual complicity theory, the plot theory. Some people here say the United States is behind it because they want to divide Muslims and Shias. But mainly people paint a finger to the U.S. because they believe that postwar Iraq was not properly planned. And a lot of people think the U.S. is all-powerful, can do what it wants. If it wanted to, it could actually prevent these attacks.

You also have some groups now emerging. Different Shia groups who are now calling on the U.S. to do what it takes to protect at least the holy sites in Iraq.

CROWLEY: Rym, let me ask you about the security situation. I think the U.S. would probably like nothing so much as to hand it over to Iraqis. And I suspect that they will say there's just not enough there or they don't trust who would take over. And what is the state of Iraqi security, the possibilities?

BRAHIMI: Well, there's definitely a bit of both. For one, it does cost a lot of money. They're trying to organize training for Iraqi police. And they say there's not the capacity just now to organize that training as much as they -- as quickly as they would want to, which is why they are considering taking it to Hungary so they can train some 16,000 policemen and some -- you know, in courses of eight weeks, one after the other, in a period of a year.

There are now some 37,000 policemen around that are trained and up and running, but their goal is 70,000 to 75,000. But then their being reproached -- what the coalition authority is being reproached with is having disbanded the army so quickly and leaving space for weeks, when the army was -- the people that they had disbanded were not receiving a salary, were not being restated in any other sort of security call or defense call. And that's where people have a problem with what's happened here.

The Governing Council were also saying it was a big mistake right after the toppling of the regime not to reinstate a government immediately afterwards. And this is why we're having these security problems because there is a void. And what authority there is comes from the U.S., which, as an occupying power, of course, is resented and not necessarily met with that much support, although some people do want the U.S. to stay because they think on the whole the situation could be worse if the U.S. troops pulled out.

QUIJANO: Rym, what about the United Nations? About a week now after the bombing, the deadly bombing at their headquarters in Baghdad, announcing that they're pulling people out? What kind of message does that send? How is that decision playing out?

BRAHIMI: Well that's definitely a very serious decision. The U.N. now announcing that it is pulling out a lot of its people. It's going to reduce its staff to some 40 to 50 people basically in Baghdad, and that's very significant.

Also significant, the fact that the Red Cross has pulled a lot of its people out. Other organizations, international organization, nongovernmental organizations, and this is extremely significant as to the rebuilding of the country, which is what this whole toppling of the regime was about, to create a new Iraq, a prosperous Iraq. And of course this -- it seems to be all falling apart.

Now, groups like the United Nations say they realize they will always be vulnerable targets and are prepared to continue their work, despite that. But the fact is, there is a reality of a very fragile security situation, and a lot of -- and it will impact on the reconstruction efforts that the U.S. and other groups are trying to bring about here.

HENDERSON: Rym Brahimi, thank you so much. What's on the story for you in the coming days?

BRAHIMI: Well, definitely, the big focus now will be on the consequences in Iraq of what happened in Najaf. A lot of people concerned that this could leave to civil war and what the impact will be. But of course, we're also monitoring other aspects of the story, how this police force is being increased, what the other security aspects are, and the sabotage.

There's been apparently another oil fire in the northern pipeline. There's always a lot of stories here. And that's -- if you don't mention the regular stories, like covering what's happening to women in postwar Iraq, again, a lot of questions there. Are they better off now or not? So we'll be very busy in the weeks to come.

HENDERSON: Thank you very much.

Well, from war and peace to a much smaller battleground in sports this week, center court at the U.S. Open. Back ON THE STORY in two minutes.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

PETE SAMPRAS, TENNIS PLAYER: This is something that I love to do and I've been doing since I was seven. And saying good-bye is not easy, so -- but I know it's time in my heart.

(END VIDEO CLIP)

HENDERSON: Pete Sampras getting a little choked up. Now he knows in his heart it's time to say good-bye this week.

Welcome back. We're ON THE STORY.

And it's really a close to an era in men's tennis at the U.S. Open. Pete Sampras calling it quits at age 32, after a record 14 Grand Slam titles. Now it's interesting. He actually won his first Grand Slam at the U.S. Open at age 19 back in 1990. He did that against Andre Agassi.

Then he won his last Grand Slam last year against Agassi. And now he is left Agassi kind of out there as (UNINTELLIGIBLE) from his generation, 33 years old. And Agassi said it's a little strange for him not to be leaving kind of with the one he came with. But Agassi is the top seed and he is playing great tennis. So it's going to be interesting to see if we see a changing in the guard in men's tennis this week at the U.S. Open, or if we see Agassi staying on top.

QUIJANO: Kara, going back to Pete Sampras for a minute, what is this that you were mentioning about perhaps the role -- or at least there being some discussion about maybe the role that his wife had to play in him retiring. What is that about? Blame it on the woman?

HENDERSON: Of course. Well, isn't that always the case? Now, Bridget Wilson, his wife, went -- about the time that they got together is when Sampras really started refocusing his career. So a lot of people are saying that it was her fault that he really went on the decline, which he said in his press conference, his farewell press conference, was b.s.

And I tell you, he filled in the blanks there, which we don't usually see from Sampras, him kind of exhibiting that kind of enthusiasm, or for lack of a better word. But it's funny when you look at it. In terms of Andre Agassi, here's a guy whose wife has actually probably helped his cause.

Steffi Graf, ever since he met her, they have -- his career has really taken off. So if people want to look at women in that way, they also have to take the other side of it and see that Steffi Graf has really helped Andre Agassi stay on top.

WALLACE: Kara, you know we are all gong to miss, of course, Pete Sampras. But also, Venus and Serena Williams will not be, we know, in the U.S. Open this year. So why are they out, and how worried are tennis officials about having Sampras and the two Williams sisters not being part of the tennis game at the Open?

HENDERSON: Well, there are really two sides of this. Some people say that the Williams sisters' domination of women's tennis is actually bad for game, which I think is a little bit ridiculous. I think they brought the game to a whole new level.

But I think, in a way, it's actually been kind of good that they've been out this week for them and for women's tennis. It gives some other people the chance to maybe win their first U.S. Open, like a Jennifer Capriati, who, it's kind of funny -- she actually was wearing those cornrow braids the other night, maybe channeling a little bit of those Williams sisters.

But it's also been good for the Williams sisters, because it's given them a chance to be in New York without having to worry about tennis, and it's given them the chance to kind of show the human side. And they actually explained the real reasons on David Letterman of why they sat this one out. Take a listen.

(BEGIN VIDEO CLIP)

SERENA WILLIAMS, TENNIS PLAYER: We're spending our time in the lab developing a third, even more powerful Williams sister.

VENUS WILLIAMS, TENNIS PLAYER: What? The U.S. Open is this week?

DAVID LETTERMAN, TALK SHOW HOST: Yes.

S. WILLIAMS: Can't concentrate on game with Mars so close to Earth.

V. WILLIAMS: For once we thought we'd give the other players a chance.

S. WILLIAMS: Surprise. We're running for governor of California.

(END VIDEO CLIP)

HENDERSON: I thought you guys would get a kick...

WALLACE: I like it.

HENDERSON: ... out of that last one. But it will be interesting to see who steps up into their place this week. Now Jennifer Capriati's a good one. She hasn't won the U.S. Open before. This will a great chance for her.

Lindsay Davenport, who is having a lot of foot problems, she usually has problem with her feet that her usually reserved for women who wear too many high heels. And that's not her problem. She's 6'2".

But she's trying to battle through that. So this would be a great time for her to step up. She's actually the last woman other than a Williams sister to have win the U.S. Open. And it's interesting; Serena Williams actually said that she was pulling for Lindsay Davenport because she was the only one that sent Serena flowers when she had her knee surgery last month.

CROWLEY: Let me ask you about the Williams sisters, because it seems to me that one of them at least, Kara, is taking acting lessons and has said "I want to be in acting." Is there a possibility that they're -- you know we saw them at the awards ceremony, they're on Letterman. They were presenters.

They clearly loved, you know -- I mean, they were decked out and looked great. I am wondering if maybe there is any scuttlebutt that they're going to leave and go on off to other things?

HENDERSON: Well, they actually held another press conference this week talking about that very thing. And they both said that they plan on playing tennis until the age that Andre Agassi is now, which is 33 years old, which I'm sure the other women on the tour weren't too pleased to hear.

But I think they have tried to diversify themselves a little bit because they've been playing tennis since they were, you know, this high. And they're trying to do other things. Venus is very involved in fashion design. She helps design many of the outfits that she wears, which are always a hot topic at any tournament.

And Serena is trying to get a little bit into acting. So it's kind of nice to see these young women diversifying themselves a little bit. But I tell you, they're still concentrating on their tennis. And the other women know that as well.

QUIJANO: Talking about glamour, where is Anna Kournikova in all of this? Is she playing tennis? Where is she?

HENDERSON: Well, she's going to have to learn to make a place for herself because she had to sit out pretty much all of this year with back problems. And it really pained her to have to do that.

Of course she's never won a singles tournament since she's turned pro. But she has actually been a sideline reporter during the U.S. Open, doing such hard-hitting topics as who's the hottest guy on the men's tour, which was interesting.

WALLACE: How's she doing, Kara?

HENDERSON: Well, I think I'll reserve comment on that. But there are plenty of other women that are going to kind of out Kournikova in coming years, because there are plenty of glamorous women who can also play tennis who are kind of moving their way up on the tour.

WALLACE: And Kara, tell us about the Tampa Bay Buccaneers. You know we love Washington. There seems to be a merging of Washington and...

HENDERSON: It's interesting to see what people actually think about this. If it's just kind of tongue in cheek or people kind of get up in arms, so to speak about it.

On the Tampa Bay Buccaneers Web site they have a little cartoon that runs when you log on. And it's actually Condoleezza Rice, Colin Powell, President Bush in cartoon form finding the dossier on where the weapons of mass destruction have actually been. And it turns out it's the starting lineup for the Tampa Bay Buccaneers. But as a way to know, you should probably take this tongue in cheek, they didn't spell Condoleezza's name right. You needed to add that second "Z," which seems to hurt (ph) people up.

WALLACE: I don't know how the White House is going to feel about that.

CROWLEY: It is very funny, however.

WALLACE: It is funny, exactly.

OK. Well, from the fun and the wild world of tennis to the wild, wild and crazy world of the California recall, I'll have more on that. I'm on the story of that topic when ON THE STORY continues right after this.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GOV. GRAY DAVIS (D), CALIFORNIA: I'll become the first governor of this state to be elected three times to serve two terms.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

ARNOLD SCHWARZENEGGER (R), CALIFORNIA GUBERNATORIAL CANDIDATE: I don't have no memory of any of the articles I did 20 or 30 years ago.

(END VIDEO CLIP)

WALLACE: Gray Davis says he'll win and Arnold Schwarzenegger says he can't remember the drug use and group sex.

Welcome back. We are ON THE STORY.

Well, California is sure getting interesting. I am heading back there Monday. But we are referring to an issue that made a lot of news this week. Arnold Schwarzenegger doing an interview back in 1977, when he's an up and coming body builder. And he was asked questions and talked about issues such as group sex and drug use and a variety of other things.

What's been interesting this week is watching how this new candidate, actor turned candidate, handled it. On a radio show the night before he talked about it and said, you know, look, I actually didn't sort of live my life or talk in a way back in 1977 as if I would ever consider politics. I mean, look, it was 1977. I was a lot younger.

The next day -- and that's what our viewers just heard -- he said, I don't remember 20 or 30 years ago. The key issue is, will this matter?

CROWLEY: Well, you know, since I can't remember what happened yesterday, I'll give him a pass, but this seems like the stuff you might remember. You know, having read that whole interview, you also wonder what he was living his life for.

However, it's California. I saw a couple of the candidates say I'm much more interested in his secret politics than in his secret sex life. Have you any sense of how this is going to play at all?

WALLACE: At this point -- and it's almost interesting, too, because Arnold Schwarzenegger seemed to almost sort of launch a preemptive strike. He announced his candidacy on The Tonight Show" with Jay Leno, and he said, look, I know they're going to come after me with dirt. I know they're going to call me a womanizer, because there have been allegations, but I know that the people of California are more concerned about who is going to be tough enough, who is going to focus on dealing with the budget and other problems.

So right now it's unclear. It does appear that voters are pretty savvy, that they're interested in the issues, it appears. And it really does depend, again, on where he stands and if voters are going to vote that way or... CROWLEY: Plus, he wasn't married at the time. I mean we'll say that.

QUIJANO: The public side of things, what about the private side of things? I mean, one can only imagine the conversations that took place. Maria Shriver and him having the discussion. How do you explain something like that to the children?

And certainly, I would think for some female voters out there, that has got to weigh heavily. I mean, it was certainly very graphic language that was used in this interview. And as understanding as some people might be, at the same time, I think certainly some people are going to be very offended by that, whether or not that was Arnold then and he didn't necessarily think he was going to be running for governor.

I'm not sure people are going to be as forgiving, some people anyway. People with families are going to look at this and cringe. This was the "Kindergarten Cop;" this was the "Terminator" saying these things, a man whose built his reputation in Hollywood as sort of, you know, being a person that kids could look up to, in a sense.

WALLACE: But you know, on the flip side of that, really, what's been interesting in some stories we've been all following, how Schwarzenegger is attracting people who never went to the polls before. People are saying, vote for the "Terminator." "I'm going to go vote for Arnold Schwarzenegger."

His star power, his celebrity status, the way he talks. So he is bringing kind a whole new sector to the polls. Again it all depends -- and we keep reminding the voter there are two issues here. Number one, Californians have to decide, should we recall Governor Gray Davis? If 51 percent say no, Davis should stay in office, Schwarzenegger, Lieutenant Governor Cruz Bustamante, it doesn't matter.

But if a majority of Californians decide he should go, then they have to vote for who should replace him. And what's been having interesting, at least in the most recent poll, the "Los Angeles Times," Schwarzenegger's trailing the major Democrat, Lieutenant Governor Cruz Bustamante. So it will be interesting to see, again, how it plays out.

And that's why you see Schwarzenegger now talking a little about Governor Davis and Lieutenant Governor Cruz Bustamante, trying to link them together and saying, vote for me, I'm the answer to these guys, who, he says, caused all the problems.

HENDERSON: Kelly, let's talk about the process for a minute. How concerned are people that this is going to turn into another Florida? You were just mentioning a lot of new voters are going to be coming to the polls. It seems lie it's going to be a very confusing process.

Each county kind of having their own way of going about things, 135 candidates. And the fact that you can vote for the recall and still vote for a candidate. Are they trying to get that message out?

WALLACE: It is very confusing, Kara. And that is again part of it. You know Californians have to be very sophisticated when they go to the polls to know they have two parts to this ballot. And Democrats have a very confusing argument to make to say, no, don't recall Davis, but if you're going to go ahead and vote for anybody else, make sure you vote for the Democrat, Cruz Bustamante.

We should mention there are still some lawsuits pending. The American Civil Liberties Union has a pending appeal with the higher court, basically saying this recall should not happen now, that the polling places are not going to be up to speed. Some may have to use those butterfly ballots, hanging chads. Candy knows all too well.

We'll have to see how it unfolds right now. The election slated for October 7th.

QUIJANO: Well, from the craziness in California to the very serious scathing report this week on what happened to the space Shuttle Columbia and why, I'm back ON THE STORY in a moment.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SCOTT HUBBARD: We concluded that the falling foam impacting the leading edge of the wing was the cause of the breach that ultimately led to the destruction of the orbiter and the loss of the crew.

(END VIDEO CLIP)

QUIJANO: Scott Hubbard, a member of the board that investigated the space Shuttle Columbia disaster. Welcome back. We are ON THE STORY.

And you know what I thought was so interesting, is when we heard the NASA administrator, Sean O'Keefe, come out point blank and say, you know what, we missed it. We just missed it.

Here you have the group that people look to in terms of the best and brightest in the aerospace area, and the fact that he says, very freely, this was something that we should have taken a harder look at, I think for a lot of people it's just hard to understand. It's inconceivable that a group of rocket scientists, after having seen this problem before, would not know this is a possibility -- that this was a possibility. But, in fact, this is what happened.

They said, you know, it happened before. It happened many, many times before, where these pieces of foam, these chunks of foam broke off, but it was sort of a maintenance issue. It was more of just, well, this is something we can fix but it's not something that's going to cause any kind of catastrophic damage. So certainly it was very interesting to hear them come out and just say we missed it.

WALLACE: And Elaine it was, as you said, a very scathing report. And a lot of the focus on the culture really of NASA. So our viewers are going to ask, what's going to change to prevent this from ever happening again?

QUIJANO: Yes. Well, absolutely. First of all, I should say I talked to some of my sources at NASA and what they said was that not a lot of this was a surprise to them.

They were prepared for this. They were told this is going to be a very harsh critique of the way they did things at NASA. So a lot of it was not unexpected.

What was unexpected was this idea that some of the lower level engineers simply felt this immense deadline pressure. They felt stressed out. Some of the unsolicited comments that came to the board were from some of these engineers who said, we felt very pressured by these time constraints. We felt very much under the gun to meet these deadlines.

And that came as a surprise to some of the top managers who said, well, those were just guidelines. And we have done a bad job then of communicating that down to our lower level engineers. And that's something that, according to my NASA sources, they say they are working very hard on. Some of the managers now going to those engineers and saying, you know what, this is how we want the communication to work from now on.

CROWLEY: You know, a disconnect between management and workers is not unheard of in some business. But it seems to me that before this report came out there was talk that some of these lower level engineers really thought there was a problem in this specific case. And still, even while they were up in the air, didn't go back.

Now we're talking life and death disconnect. Were they -- was there any discussion in this report about why didn't these guys shout it? Why didn't they go in front of a TV camera?

QUIJANO: Well, exactly. You know and there actually were a lot of e-mails that were sent back and forth among these engineers, saying we need better pictures. Because the thinking was, something has happened here. We're not sure exactly what.

Let's go ahead and request from the DOD, from the Department of Defense that we get a better look at this. We want some pictures from the high-powered telescopes, we want some pictures from the spy satellites so we can at least check it out for ourselves.

So these were some of the discussions that were going on. However, those discussion, for whatever reason, partly the miscommunication, the communication glitches, partly also there was a sense of intimidation, a sense that perhaps they'd be singled out and ridiculed, in fact, if they did bring up a certain safety concern. So that obviously is something that...

CROWLEY: See, that's scary.

QUIJANO: It is.

CROWLEY: Because they thought it might have been a life -- it was a life and death issue. That's what's scary to me.

QUIJANO: Right, absolutely. And that is something, as I talked to my sources, that they are very much aware of. They are trying so hard to get that message out there that, if it's not safe, say so. That's their motto. Right?

And the thing is, there actually were some mechanisms in place but people were reticent to use them. For instance, there was a program that allowed people to anonymously say if they didn't feel comfortable going right to the top and telling people -- or going through the proper channels and telling people, look, I have a concern about this, there were ways that they could have said so anonymously, but they chose not to.

They were just hesitant to do so. And that is part of this cultural change that the board says is so very needed before they actually send up more shuttles into space.

HENDERSON: Elaine, how much pressure is there now to get the shuttle back off the ground, especially -- I have to imagine there's quite a bit of depression going on in this agency now that they have all these problems to fix.

QUIJANO: Well, one would think, certainly, when you hear some of the criticism and you see some of the details laid out -- I mean, this was a 248 page report. I mean, they combed over all of the data, all of the records, the debris itself, they interviewed people. Certainly, you would think that morale would be low.

But in talking to some of the people at NASA, what they say is that these are also people who are very much committed to fixing things. These are engineers. These are the kind of people who grew up taking apart toasters and wanting very much to solve problems.

And here they have a very clear directive. They've been given 29 recommendations, 15 of which are return to flight, they call them, recommendations that should be implemented before the next shuttle goes back up. And so they're very interested in making sure they follow these recommendations to the best of their ability. In fact, I was told people are work over the weekend as we speak because they want to try to get their so-called implementation plan to Congress in the next couple of weeks so they can start to make some of those fixes.

CROWLEY: Disasters, investigation hearings, reports are just part of a familiar pattern here in official Washington. Now another Washington TV show is hoping to mix fact and fiction about the nation's capital. We're back on that story in a moment.

(COMMERCIAL BREAK)

CROWLEY: The ON THE STORY question this week: can television overdose on Washington drama? HBO, a corporate sister of CNN, is set to launch a new half-hour series called K Street" about the Washington lobbying industry. This cracks me up. We wish our corporate sister well, we hope they send the stock up, all that stuff. But the fact of the matter is it cracks me up because, if I tried to go and sell a story on corporate lobbying on K Street, they'd go, oh, boring, white guys. Oh, get us something else.

Let's get outside Washington. So where is Hollywood coming for it's drama?

WALLACE: Right into the Beltway.

CROWLEY: Washington, K Street. It cracks me up.

QUIJANO: Yes. I just don't know if the people out there are really going to care that much. I mean you have "The West Wing." OK, lots of people are interested in that, that's very clearly issues of power, prestige and all the things that are sort of wrapped up in people's ideas of the White House. They get to sort of see the inside view.

But I'm not sure that they want to see the inner workings of lobbyists. And do they necessarily want to see that process?

CROWLEY: And further, as journalists, there's that troubling mesh of fiction and fact. Because there will be real lobbyists, real players in Washington in this sort of fictional thing. As a journalist, you got to be a little worried about that.

WALLACE: And I think I was hearing that they're going to try to follow real issues going on, stories of the week, to keep it as present as possible. So you'll have this series focusing on some real issues people are talking about.

And then you have people like Mary Matalin and James Carville, both -- a legendary Washington power couple who I believe are going to play themselves on this show. They haven't asked you to play, have they?

QUIJANO: But it's only a matter of time though, Candy.

CROWLEY: George Clooney's in it, so how bad could it be?

WALLACE: I know. I know. I think that's...

QUIJANO: Well, another story that is looming this week is the preliminary hearing in the Laci Peterson murder case. Now the cover of "PEOPLE" magazine shouts out "New Evidence Revealed, Secret Laci Files."

And I have to tell you, I was out there in Modesto for a couple of weeks a couple of months ago. And it is just extraordinary to me the amount of coverage that happens every time there's a hearing, anytime there's any trickle of information. I mean, essentially what happens is they shut down the street in front of the courthouse in order to accommodate the hordes of media that come out because of all the intense interest that has been generated by this case. But what will really be interesting to see is the effect this "PEOPLE" magazine article has because the judge in this case, Judge Al Girolami, had made it very clear. He put a gag order on the parties involved. He wants a clamp down of information. And so as this article comes out, it will be interesting to see how that is received, because there are supposedly new details in there that were not revealed before.

HENDERSON: Oh, and having read the article, it has a lot of details about the state of the bodies. What effect do you think that might have on, say, the prosecution's efforts?

QUIJANO: Well, certainly that's got to be a difficult blow for them. I can tell you, just from my time out there, part of the article talks about this, actually, about this idea that perhaps a piece of tape was found around the neck of the fetus. And a lot was made out of that when I was there because some of these details were being leaked about the coroner's report.

And so it will be interesting to see how that plays out, because that certainly calls into question the idea that perhaps there was something that happened after the body perhaps was placed there. And it just raises a whole host of questions that will have to be answered.

WALLACE: Well, Elaine, we have to leave it there. And we'll all certainly be watching that story.

Thanks to my fabulous colleagues and thanks to you all for watch watching ON THE STORY. We will be back next week.

Still ahead, "PEOPLE IN THE NEWS" focusing this week on the British royal family, Prince William and Prince Harry. At 12:00 noon Eastern, 9:00 Pacific, CNN "LIVE SATURDAY". And at 1:00 p.m. Eastern, 10:00 Pacific, CNN's "IN THE MONEY" looks at why some people are predicting a boom in new jobs.

Coming up at the top of the hour a news alert. But first, the president's weekly radio address.

(BEGIN AUDIOTAPE)

BUSH: Good morning. On this Labor Day weekend, Americans pay tribute to the spirit of hard work and enterprise that has always made this nation strong. Every day, our worker go to factories and offices and farms and produce the world's finest goods and services. Their creativity and energy are the greatest advantage of the American economy.

Worker productivity accelerated last year at the fastest rate in more than a half century. This higher productivity means our workers receive higher wages. Our nation's exports get a competitive boost in world markets and our economic recovery gains momentum at a crucial time.

The Jobs and Growth Act I signed in May ensures that workers enjoy more of the benefits of their work through more take-home pay. Tax relief was based on the conviction that workers are entitled to keep more of their hard-earned wages. That belief, after all, is why America celebrates Labor Day and not tax day.

For America's families, tax relief has come at just the right time. For a family of four with a household income of $40,000, tax relief passed over the last two-and-a-half years means they get to keep nearly $2,000 more of their own money. Millions of families this past month received checks for up to $400 per child because we increased the child tax credit.

This tax relief, more than $13 billion worth, means that America's workers can save, invest, and make purchases they have been putting off. Many moms and dads are using their extra income to take care of back to school expenses. As consumer spending rises, manufacturers are seeing more new orders for their goods. Low interest rates mean businesses have better balance sheets and families have saved billions of dollars by refinancing their homes.

These are the signs of a reviving economy. Now we must build on this progress and make sure that the economy creates enough new jobs for American workers.

Next week, I will travel to Ohio, Missouri and Indiana to talk about my agenda for job creation across America. As part of this agenda, our nation needs a comprehensive energy plan so that our businesses and homes can rely on a steady and affordable supply of energy. The recent blackout in the Northeast shows how important reliable energy is to the American economy and demonstrates the need to take action on good energy policy.

So when members of Congress return from the summer recess, I will again ask them to pass a sound energy bill as soon as possible. America needs legal reform because junk lawsuits can destroy a business, and they're making health care coverage less affordable for employers and workers. And Congress must restrain government spending so that we can bring the deficit down by half within the next five years.

We must negotiate trade agreements with other nations. My administration will be vigilant in making sure our agreements are followed by all our trading partners. With free trade and a level playing field, American workers can successfully compete with any workers in the world.

This long weekend is a well deserved reward for the millions of men and women who make this economy go. I wish all Americans a happy and restful Labor Day.

Thank you for listening.

(END AUDIOTAPE)

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com




California Recall Election; What Will Bombing in Najaf Mean for Iraq's Future?>


Aired August 30, 2003 - 10:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CANDY CROWLEY, CNN SR. POLITICAL CORRESPONDENT: Welcome to CNN's ON THE STORY, where our journalists have the inside word on the stories we covered this week. I'm Candy Crowley, on the story of presidential candidates revving up their engines at the traditional Labor Day starting line.
KELLY WALLACE, CNN NATIONAL CORRESPONDENT: And I'm Kelly Wallace, on the story of how the California recall, Gray, Arnold, the whole gang, may really be the big political event.

RYM BRAHIMI, CNN CORRESPONDENT: I'm Rym Brahimi, in Baghdad, on the story of what this latest attack at Shiite Islam's holiest site means for the future of Iraq.

KARA HENDERSON, CNN CORRESPONDENT: I'm Kara Henderson in Atlanta. Pete Sampras, the tennis player, some say was the best ever, chose retirement this week. We'll talk about what a difference that makes and what difference it makes if the Williams sisters decide to sit this one out.

ELAINE QUIJANO, CNN CORRESPONDENT: And I'm Elaine Quijano, on the story of how a scathing report on the Columbia disaster points out NASA needs to make major changes in its culture before Americans return to space.

We'll be talking about all these stories. We'll discuss the latest on the Laci Peterson case. We'll talk about how television dramas keep returning to Washington for ideas, suspense and political thrills. And we'll hear the president's weekly radio address at the end of the hour.

E-mail us at on onthestory@cnn.com. First up, Candy and campaign 2004.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I came to the office of president of the United States to solve problems instead of passing them on to future presidents and future generations.

(END VIDEO CLIP)

CROWLEY: President Bush this week at a political fund-raiser in St. Paul, Minnesota, comparing himself, favorably of course, to other politicians. And hang on. It's the Labor Day weekend. That's the traditional start of presidential campaigning.

Well, I've been paying attention now for a year and a half. I'm not sure -- usually this is -- not everybody else is. What's interesting to me is right now we are sort of at the point where we're wondering, well, what's going to happen to the bottom tier candidates? You know, when are they going to -- you know, are they here until January and the first caucus, or are they going to get out sooner?

And, at the same time, we're thinking, well, what about General Wesley Clark? Is he going to get in? What about Hillary Clinton? Is she going to get in? So we're sort of betwixt and between while everybody gets their kids back to school and brushes off the sand from vacation and begins to pay attention.

BRAHIMI: Well, what I was wondering, from Baghdad here, of course, is how much the situation in Iraq, this violence and what the security situation that the U.S. troops are facing, how much of that will affect the presidential campaign debate in Washington?

CROWLEY: It's clearly going to affect the debate. Whether or not it affects the vote is an entirely different thing because there's sort of a split thing on Iraq at this point. One is that well over 60 percent of the people in our latest poll thought that the Iraq war was worth fighting. On the other hand, a majority thinks that President Bush doesn't really have a plan. So -- on postwar Iraq.

So we're kind of there again. He has a potential for it being a good point, and another potential for it being a minus.

WALLACE: Candy, I wanted to ask you -- you're going to go ahead and cover John Kerry's announcement this coming week, but so much attention this summer has been on Howard Dean, the Howard Dean phenomenon. You've been covering him and others. Is this just a blip on the radar screen or is he really the one to beat right now?

CROWLEY: Yes, the $64,000 question. I mean, we don't really know. I mean, the fact is, people are surprised that he has staying power this long. The question now is did he peak too early? You know, if it we're a year out, have we seen what we're going to see?

The fact of the matter is that, right now, as opposed to a year ago, we were talking about Howard Dean as the front-runner. A year ago, we talked about John Kerry as the front-runner and we were talking about how this brand new face, John Edwards, the senator from North Carolina, was really going to be this big deal and the fresh face the Democrats were looking for.

Well, Edwards is nowhere in the polls; it's early. And Kerry has declined and fallen behind Dean in polls in Iowa and New Hampshire. So it's a whole different thing and it will be a whole different thing a year from now.

QUIJANO: What about General Wesley Clark? What's the buzz?

CROWLEY: Well, in fact, I talked to him on the phone the other day, Thursday, and said, "So, what's the deal?" And I thought, despite all these reports that he's going to get in there, I thought he sounded sort of negative.

He said, you know -- he said, "I'm still thinking about it," but he talked about here we are Labor Day, he's got to get all this money, he's got to get a staff together. He says he's got two people. He's got the person that answers his phone and then a guy who's not a politico. And he said, "You know, if I announce today, two weeks from now you guys will eat my lunch and say, 'What's going on, what's going on?'"

So it shows both the lateness of the time. I think he would like to, but it's a huge deal to get in a year out.

HENDERSON: Candy, this is Kara Henderson, having the question, do you think that the war in Iraq, now turning into a situation in Iraq, has turned from a strength to a liability in terms of President Bush's numbers?

CROWLEY: I think it's turned from a strength to a questionable strength. The problem is that, again, people still see Iraq, first of all, as having been a fight on terrorism. The majority think it was about terrorism. And second of all, they see it as worth fighting for, despite all the constant sort of daily reports of U.S. soldiers dying. What they see here is this is worth fighting for, some 60 percent.

On the other hand, can we take a year of things blowing up every couple of days? I mean, that's the question. What's going to happen between now and then? Can they get it together? Can they get some stability?

QUIJANO: Yes. And you know some of the stories trickling out now to the newspapers, the local newspaper now, and the little town that these soldiers come from, you know, those are the kinds of images that can wear over time on people. Are you starting to see perhaps the Bush administration being very aware of the fact that these images are now starting to permeate to those smaller towns?

It's not just some intangible kind of effect that's happening. I mean, really, they are seeing the loss that these families are feeling and feeling these losses very deeply.

CROWLEY: Sure. What's interesting to me is I've talked to a couple World War II veterans lately who went away for two and three years in World War II. Almost immediately after the war was prosecuted, the bulk of the war was prosecuted, we began to talk about when are these guys coming home?

So it's very clear that some of them have been gone for a long time. Some veterans look at it as, hey, that's nothing. Nonetheless, you have the wives, the children, you know? And those are a thousand words in all that. Those are pretty powerful picture. So certainly the pressure is on Bush to make this work in the post major war period.

WALLACE: And Candy, you know when we talk campaign 2004, one name that keeps popping up, Hillary Clinton. Her name keeps being put out there as a possible person who could jump into the race. Is that true, what she's saying? What are your sources telling you?

CROWLEY: I take her at her word, which is, "I'm absolutely not running."

WALLACE: Right.

CROWLEY: But you know the fact of the matter is this is really hard for an '04 -- what it means is nobody's jelled around a single candidate, because that's when they talk about somebody else, the magic bullet. Oh, won't Hillary Clinton get in? Why won't Al Gore get in?

You know when Democrats begin to settle around somebody, I think this kind of talk goes away. In the meantime, I think Hillary Clinton has some great PR people who keeps her name out there, she's still a national player.

WALLACE: She can say no, no, no.

CROWLEY: That's right, no, no, no, but look good.

WALLACE: That's right.

CROWLEY: And people always look good before they get in, that's the problem. So I think that's why you hear her name. It's just we haven't sort of settled around anybody.

By this time last year, people pretty much settled on George Bush, at least moneywise. A lot of other people were still in the race. And John McCain had yet to become the phenomenon he was in New Hampshire. But this race is so unclear that they keep looking around for the person who is going to come save the party.

BRAHIMI: Well, this latest attack in Najaf has sent shockwaves right into Baghdad, where people are now -- it's triggered a lot of anger now among people who are wondering why the U.S. is finding it so difficult to stabilize postwar Iraq. I'll be back in a moment on the story with what's happening right now in Iraq.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

BUSH: In Afghanistan and Iraq, we gave ultimatums to terror regimes. Those regimes chose defiance and those regimes are no more.

(END VIDEO CLIP)

BRAHIMI: Those regimes may be no more, as President Bush said, but meanwhile, there's an increasingly confusing void in place of what Saddam Hussein and his cronies had in here in Iraq. And basically, it all amounts to three main questions.

One of them, how is it that a coalition that won the war in Iraq is not capable of maintaining the peace or managing the peace in postwar Iraq? There's another question with regard to, has the U.S. actually created a haven for terrorists in a country where there wasn't that trend before? And finally, how can a force -- a U.S. force that is being targeted on a regular basis and preoccupied with its own protection, actually protect the country it is occupying?

And that's one of the questions that the Governing Council is asking. It's had an emergency session. At a news conference just a couple of hours ago, it told reporters that it was very preoccupied with the security situation and is calling on the U.S. to hand over security to the hands of the Iraqis.

HENDERSON: Rym, this is Kara Henderson. In terms of the bombing in Najaf, I think we all well understand the human toll that was tack there. But can you kind of explain the significance in terms of the Iraqi people in this bombing?

BRAHIMI: It's really very big. It's very, very big. Basically, imagine the Vatican, St. Peter's Basilica on a Sunday right after mass and a bomb goes off there. That is the equivalent of what happened in Najaf at what is the most holy site for Shiite Muslims.

It all comes down to an area where the Imam Ali is buried. Now he was the cousin of the prophet and he was killed precisely because there were people who believed that he shouldn't be the leader of all Muslims and that the leader of all Muslims shouldn't be a direct descendent of the prophet.

The Shias emerged then because they believed Ali should be their leader. So symbolically, it's very big, and it does have the risk of being viewed by Shias here in Iraq who have always struggled under Saddam and suffered because, although they were the majority, they didn't have the power, basically. It really runs the risk of having them wonder if this isn't an attack against them, against Shia Islam as a whole.

WALLACE: Rym, the key question, of course, is who could be behind this attack, and of course the deadly attack outside the U.N. headquarters not too long ago? And is it part of some very sophisticated, well organized, even influenced by foreign forces to go ahead and destabilize the country?

BRAHIMI: Well that's exactly what a lot of Iraqis are asking right now. And a lot of people pointing fingers, precisely at remnants of the Ba'ath Party regime. A lot of people think it's not inconceivable that remnants of the Ba'ath Party regime could either be behind this or could have forged an alliance with what we call -- what are called foreign terrorists who would have infiltrated the country after the fall of the regime.

Now this is just speculation. There's not been any result of any investigation in any of the three major bombings, because there was also the Jordanian Embassy bombing earlier this month and the then U.N. compound and this one. They seem to become bigger and bigger in scale.

There's also a lot of finger pointing. Of course, there's the usual complicity theory, the plot theory. Some people here say the United States is behind it because they want to divide Muslims and Shias. But mainly people paint a finger to the U.S. because they believe that postwar Iraq was not properly planned. And a lot of people think the U.S. is all-powerful, can do what it wants. If it wanted to, it could actually prevent these attacks.

You also have some groups now emerging. Different Shia groups who are now calling on the U.S. to do what it takes to protect at least the holy sites in Iraq.

CROWLEY: Rym, let me ask you about the security situation. I think the U.S. would probably like nothing so much as to hand it over to Iraqis. And I suspect that they will say there's just not enough there or they don't trust who would take over. And what is the state of Iraqi security, the possibilities?

BRAHIMI: Well, there's definitely a bit of both. For one, it does cost a lot of money. They're trying to organize training for Iraqi police. And they say there's not the capacity just now to organize that training as much as they -- as quickly as they would want to, which is why they are considering taking it to Hungary so they can train some 16,000 policemen and some -- you know, in courses of eight weeks, one after the other, in a period of a year.

There are now some 37,000 policemen around that are trained and up and running, but their goal is 70,000 to 75,000. But then their being reproached -- what the coalition authority is being reproached with is having disbanded the army so quickly and leaving space for weeks, when the army was -- the people that they had disbanded were not receiving a salary, were not being restated in any other sort of security call or defense call. And that's where people have a problem with what's happened here.

The Governing Council were also saying it was a big mistake right after the toppling of the regime not to reinstate a government immediately afterwards. And this is why we're having these security problems because there is a void. And what authority there is comes from the U.S., which, as an occupying power, of course, is resented and not necessarily met with that much support, although some people do want the U.S. to stay because they think on the whole the situation could be worse if the U.S. troops pulled out.

QUIJANO: Rym, what about the United Nations? About a week now after the bombing, the deadly bombing at their headquarters in Baghdad, announcing that they're pulling people out? What kind of message does that send? How is that decision playing out?

BRAHIMI: Well that's definitely a very serious decision. The U.N. now announcing that it is pulling out a lot of its people. It's going to reduce its staff to some 40 to 50 people basically in Baghdad, and that's very significant.

Also significant, the fact that the Red Cross has pulled a lot of its people out. Other organizations, international organization, nongovernmental organizations, and this is extremely significant as to the rebuilding of the country, which is what this whole toppling of the regime was about, to create a new Iraq, a prosperous Iraq. And of course this -- it seems to be all falling apart.

Now, groups like the United Nations say they realize they will always be vulnerable targets and are prepared to continue their work, despite that. But the fact is, there is a reality of a very fragile security situation, and a lot of -- and it will impact on the reconstruction efforts that the U.S. and other groups are trying to bring about here.

HENDERSON: Rym Brahimi, thank you so much. What's on the story for you in the coming days?

BRAHIMI: Well, definitely, the big focus now will be on the consequences in Iraq of what happened in Najaf. A lot of people concerned that this could leave to civil war and what the impact will be. But of course, we're also monitoring other aspects of the story, how this police force is being increased, what the other security aspects are, and the sabotage.

There's been apparently another oil fire in the northern pipeline. There's always a lot of stories here. And that's -- if you don't mention the regular stories, like covering what's happening to women in postwar Iraq, again, a lot of questions there. Are they better off now or not? So we'll be very busy in the weeks to come.

HENDERSON: Thank you very much.

Well, from war and peace to a much smaller battleground in sports this week, center court at the U.S. Open. Back ON THE STORY in two minutes.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

PETE SAMPRAS, TENNIS PLAYER: This is something that I love to do and I've been doing since I was seven. And saying good-bye is not easy, so -- but I know it's time in my heart.

(END VIDEO CLIP)

HENDERSON: Pete Sampras getting a little choked up. Now he knows in his heart it's time to say good-bye this week.

Welcome back. We're ON THE STORY.

And it's really a close to an era in men's tennis at the U.S. Open. Pete Sampras calling it quits at age 32, after a record 14 Grand Slam titles. Now it's interesting. He actually won his first Grand Slam at the U.S. Open at age 19 back in 1990. He did that against Andre Agassi.

Then he won his last Grand Slam last year against Agassi. And now he is left Agassi kind of out there as (UNINTELLIGIBLE) from his generation, 33 years old. And Agassi said it's a little strange for him not to be leaving kind of with the one he came with. But Agassi is the top seed and he is playing great tennis. So it's going to be interesting to see if we see a changing in the guard in men's tennis this week at the U.S. Open, or if we see Agassi staying on top.

QUIJANO: Kara, going back to Pete Sampras for a minute, what is this that you were mentioning about perhaps the role -- or at least there being some discussion about maybe the role that his wife had to play in him retiring. What is that about? Blame it on the woman?

HENDERSON: Of course. Well, isn't that always the case? Now, Bridget Wilson, his wife, went -- about the time that they got together is when Sampras really started refocusing his career. So a lot of people are saying that it was her fault that he really went on the decline, which he said in his press conference, his farewell press conference, was b.s.

And I tell you, he filled in the blanks there, which we don't usually see from Sampras, him kind of exhibiting that kind of enthusiasm, or for lack of a better word. But it's funny when you look at it. In terms of Andre Agassi, here's a guy whose wife has actually probably helped his cause.

Steffi Graf, ever since he met her, they have -- his career has really taken off. So if people want to look at women in that way, they also have to take the other side of it and see that Steffi Graf has really helped Andre Agassi stay on top.

WALLACE: Kara, you know we are all gong to miss, of course, Pete Sampras. But also, Venus and Serena Williams will not be, we know, in the U.S. Open this year. So why are they out, and how worried are tennis officials about having Sampras and the two Williams sisters not being part of the tennis game at the Open?

HENDERSON: Well, there are really two sides of this. Some people say that the Williams sisters' domination of women's tennis is actually bad for game, which I think is a little bit ridiculous. I think they brought the game to a whole new level.

But I think, in a way, it's actually been kind of good that they've been out this week for them and for women's tennis. It gives some other people the chance to maybe win their first U.S. Open, like a Jennifer Capriati, who, it's kind of funny -- she actually was wearing those cornrow braids the other night, maybe channeling a little bit of those Williams sisters.

But it's also been good for the Williams sisters, because it's given them a chance to be in New York without having to worry about tennis, and it's given them the chance to kind of show the human side. And they actually explained the real reasons on David Letterman of why they sat this one out. Take a listen.

(BEGIN VIDEO CLIP)

SERENA WILLIAMS, TENNIS PLAYER: We're spending our time in the lab developing a third, even more powerful Williams sister.

VENUS WILLIAMS, TENNIS PLAYER: What? The U.S. Open is this week?

DAVID LETTERMAN, TALK SHOW HOST: Yes.

S. WILLIAMS: Can't concentrate on game with Mars so close to Earth.

V. WILLIAMS: For once we thought we'd give the other players a chance.

S. WILLIAMS: Surprise. We're running for governor of California.

(END VIDEO CLIP)

HENDERSON: I thought you guys would get a kick...

WALLACE: I like it.

HENDERSON: ... out of that last one. But it will be interesting to see who steps up into their place this week. Now Jennifer Capriati's a good one. She hasn't won the U.S. Open before. This will a great chance for her.

Lindsay Davenport, who is having a lot of foot problems, she usually has problem with her feet that her usually reserved for women who wear too many high heels. And that's not her problem. She's 6'2".

But she's trying to battle through that. So this would be a great time for her to step up. She's actually the last woman other than a Williams sister to have win the U.S. Open. And it's interesting; Serena Williams actually said that she was pulling for Lindsay Davenport because she was the only one that sent Serena flowers when she had her knee surgery last month.

CROWLEY: Let me ask you about the Williams sisters, because it seems to me that one of them at least, Kara, is taking acting lessons and has said "I want to be in acting." Is there a possibility that they're -- you know we saw them at the awards ceremony, they're on Letterman. They were presenters.

They clearly loved, you know -- I mean, they were decked out and looked great. I am wondering if maybe there is any scuttlebutt that they're going to leave and go on off to other things?

HENDERSON: Well, they actually held another press conference this week talking about that very thing. And they both said that they plan on playing tennis until the age that Andre Agassi is now, which is 33 years old, which I'm sure the other women on the tour weren't too pleased to hear.

But I think they have tried to diversify themselves a little bit because they've been playing tennis since they were, you know, this high. And they're trying to do other things. Venus is very involved in fashion design. She helps design many of the outfits that she wears, which are always a hot topic at any tournament.

And Serena is trying to get a little bit into acting. So it's kind of nice to see these young women diversifying themselves a little bit. But I tell you, they're still concentrating on their tennis. And the other women know that as well.

QUIJANO: Talking about glamour, where is Anna Kournikova in all of this? Is she playing tennis? Where is she?

HENDERSON: Well, she's going to have to learn to make a place for herself because she had to sit out pretty much all of this year with back problems. And it really pained her to have to do that.

Of course she's never won a singles tournament since she's turned pro. But she has actually been a sideline reporter during the U.S. Open, doing such hard-hitting topics as who's the hottest guy on the men's tour, which was interesting.

WALLACE: How's she doing, Kara?

HENDERSON: Well, I think I'll reserve comment on that. But there are plenty of other women that are going to kind of out Kournikova in coming years, because there are plenty of glamorous women who can also play tennis who are kind of moving their way up on the tour.

WALLACE: And Kara, tell us about the Tampa Bay Buccaneers. You know we love Washington. There seems to be a merging of Washington and...

HENDERSON: It's interesting to see what people actually think about this. If it's just kind of tongue in cheek or people kind of get up in arms, so to speak about it.

On the Tampa Bay Buccaneers Web site they have a little cartoon that runs when you log on. And it's actually Condoleezza Rice, Colin Powell, President Bush in cartoon form finding the dossier on where the weapons of mass destruction have actually been. And it turns out it's the starting lineup for the Tampa Bay Buccaneers. But as a way to know, you should probably take this tongue in cheek, they didn't spell Condoleezza's name right. You needed to add that second "Z," which seems to hurt (ph) people up.

WALLACE: I don't know how the White House is going to feel about that.

CROWLEY: It is very funny, however.

WALLACE: It is funny, exactly.

OK. Well, from the fun and the wild world of tennis to the wild, wild and crazy world of the California recall, I'll have more on that. I'm on the story of that topic when ON THE STORY continues right after this.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GOV. GRAY DAVIS (D), CALIFORNIA: I'll become the first governor of this state to be elected three times to serve two terms.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

ARNOLD SCHWARZENEGGER (R), CALIFORNIA GUBERNATORIAL CANDIDATE: I don't have no memory of any of the articles I did 20 or 30 years ago.

(END VIDEO CLIP)

WALLACE: Gray Davis says he'll win and Arnold Schwarzenegger says he can't remember the drug use and group sex.

Welcome back. We are ON THE STORY.

Well, California is sure getting interesting. I am heading back there Monday. But we are referring to an issue that made a lot of news this week. Arnold Schwarzenegger doing an interview back in 1977, when he's an up and coming body builder. And he was asked questions and talked about issues such as group sex and drug use and a variety of other things.

What's been interesting this week is watching how this new candidate, actor turned candidate, handled it. On a radio show the night before he talked about it and said, you know, look, I actually didn't sort of live my life or talk in a way back in 1977 as if I would ever consider politics. I mean, look, it was 1977. I was a lot younger.

The next day -- and that's what our viewers just heard -- he said, I don't remember 20 or 30 years ago. The key issue is, will this matter?

CROWLEY: Well, you know, since I can't remember what happened yesterday, I'll give him a pass, but this seems like the stuff you might remember. You know, having read that whole interview, you also wonder what he was living his life for.

However, it's California. I saw a couple of the candidates say I'm much more interested in his secret politics than in his secret sex life. Have you any sense of how this is going to play at all?

WALLACE: At this point -- and it's almost interesting, too, because Arnold Schwarzenegger seemed to almost sort of launch a preemptive strike. He announced his candidacy on The Tonight Show" with Jay Leno, and he said, look, I know they're going to come after me with dirt. I know they're going to call me a womanizer, because there have been allegations, but I know that the people of California are more concerned about who is going to be tough enough, who is going to focus on dealing with the budget and other problems.

So right now it's unclear. It does appear that voters are pretty savvy, that they're interested in the issues, it appears. And it really does depend, again, on where he stands and if voters are going to vote that way or... CROWLEY: Plus, he wasn't married at the time. I mean we'll say that.

QUIJANO: The public side of things, what about the private side of things? I mean, one can only imagine the conversations that took place. Maria Shriver and him having the discussion. How do you explain something like that to the children?

And certainly, I would think for some female voters out there, that has got to weigh heavily. I mean, it was certainly very graphic language that was used in this interview. And as understanding as some people might be, at the same time, I think certainly some people are going to be very offended by that, whether or not that was Arnold then and he didn't necessarily think he was going to be running for governor.

I'm not sure people are going to be as forgiving, some people anyway. People with families are going to look at this and cringe. This was the "Kindergarten Cop;" this was the "Terminator" saying these things, a man whose built his reputation in Hollywood as sort of, you know, being a person that kids could look up to, in a sense.

WALLACE: But you know, on the flip side of that, really, what's been interesting in some stories we've been all following, how Schwarzenegger is attracting people who never went to the polls before. People are saying, vote for the "Terminator." "I'm going to go vote for Arnold Schwarzenegger."

His star power, his celebrity status, the way he talks. So he is bringing kind a whole new sector to the polls. Again it all depends -- and we keep reminding the voter there are two issues here. Number one, Californians have to decide, should we recall Governor Gray Davis? If 51 percent say no, Davis should stay in office, Schwarzenegger, Lieutenant Governor Cruz Bustamante, it doesn't matter.

But if a majority of Californians decide he should go, then they have to vote for who should replace him. And what's been having interesting, at least in the most recent poll, the "Los Angeles Times," Schwarzenegger's trailing the major Democrat, Lieutenant Governor Cruz Bustamante. So it will be interesting to see, again, how it plays out.

And that's why you see Schwarzenegger now talking a little about Governor Davis and Lieutenant Governor Cruz Bustamante, trying to link them together and saying, vote for me, I'm the answer to these guys, who, he says, caused all the problems.

HENDERSON: Kelly, let's talk about the process for a minute. How concerned are people that this is going to turn into another Florida? You were just mentioning a lot of new voters are going to be coming to the polls. It seems lie it's going to be a very confusing process.

Each county kind of having their own way of going about things, 135 candidates. And the fact that you can vote for the recall and still vote for a candidate. Are they trying to get that message out?

WALLACE: It is very confusing, Kara. And that is again part of it. You know Californians have to be very sophisticated when they go to the polls to know they have two parts to this ballot. And Democrats have a very confusing argument to make to say, no, don't recall Davis, but if you're going to go ahead and vote for anybody else, make sure you vote for the Democrat, Cruz Bustamante.

We should mention there are still some lawsuits pending. The American Civil Liberties Union has a pending appeal with the higher court, basically saying this recall should not happen now, that the polling places are not going to be up to speed. Some may have to use those butterfly ballots, hanging chads. Candy knows all too well.

We'll have to see how it unfolds right now. The election slated for October 7th.

QUIJANO: Well, from the craziness in California to the very serious scathing report this week on what happened to the space Shuttle Columbia and why, I'm back ON THE STORY in a moment.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SCOTT HUBBARD: We concluded that the falling foam impacting the leading edge of the wing was the cause of the breach that ultimately led to the destruction of the orbiter and the loss of the crew.

(END VIDEO CLIP)

QUIJANO: Scott Hubbard, a member of the board that investigated the space Shuttle Columbia disaster. Welcome back. We are ON THE STORY.

And you know what I thought was so interesting, is when we heard the NASA administrator, Sean O'Keefe, come out point blank and say, you know what, we missed it. We just missed it.

Here you have the group that people look to in terms of the best and brightest in the aerospace area, and the fact that he says, very freely, this was something that we should have taken a harder look at, I think for a lot of people it's just hard to understand. It's inconceivable that a group of rocket scientists, after having seen this problem before, would not know this is a possibility -- that this was a possibility. But, in fact, this is what happened.

They said, you know, it happened before. It happened many, many times before, where these pieces of foam, these chunks of foam broke off, but it was sort of a maintenance issue. It was more of just, well, this is something we can fix but it's not something that's going to cause any kind of catastrophic damage. So certainly it was very interesting to hear them come out and just say we missed it.

WALLACE: And Elaine it was, as you said, a very scathing report. And a lot of the focus on the culture really of NASA. So our viewers are going to ask, what's going to change to prevent this from ever happening again?

QUIJANO: Yes. Well, absolutely. First of all, I should say I talked to some of my sources at NASA and what they said was that not a lot of this was a surprise to them.

They were prepared for this. They were told this is going to be a very harsh critique of the way they did things at NASA. So a lot of it was not unexpected.

What was unexpected was this idea that some of the lower level engineers simply felt this immense deadline pressure. They felt stressed out. Some of the unsolicited comments that came to the board were from some of these engineers who said, we felt very pressured by these time constraints. We felt very much under the gun to meet these deadlines.

And that came as a surprise to some of the top managers who said, well, those were just guidelines. And we have done a bad job then of communicating that down to our lower level engineers. And that's something that, according to my NASA sources, they say they are working very hard on. Some of the managers now going to those engineers and saying, you know what, this is how we want the communication to work from now on.

CROWLEY: You know, a disconnect between management and workers is not unheard of in some business. But it seems to me that before this report came out there was talk that some of these lower level engineers really thought there was a problem in this specific case. And still, even while they were up in the air, didn't go back.

Now we're talking life and death disconnect. Were they -- was there any discussion in this report about why didn't these guys shout it? Why didn't they go in front of a TV camera?

QUIJANO: Well, exactly. You know and there actually were a lot of e-mails that were sent back and forth among these engineers, saying we need better pictures. Because the thinking was, something has happened here. We're not sure exactly what.

Let's go ahead and request from the DOD, from the Department of Defense that we get a better look at this. We want some pictures from the high-powered telescopes, we want some pictures from the spy satellites so we can at least check it out for ourselves.

So these were some of the discussions that were going on. However, those discussion, for whatever reason, partly the miscommunication, the communication glitches, partly also there was a sense of intimidation, a sense that perhaps they'd be singled out and ridiculed, in fact, if they did bring up a certain safety concern. So that obviously is something that...

CROWLEY: See, that's scary.

QUIJANO: It is.

CROWLEY: Because they thought it might have been a life -- it was a life and death issue. That's what's scary to me.

QUIJANO: Right, absolutely. And that is something, as I talked to my sources, that they are very much aware of. They are trying so hard to get that message out there that, if it's not safe, say so. That's their motto. Right?

And the thing is, there actually were some mechanisms in place but people were reticent to use them. For instance, there was a program that allowed people to anonymously say if they didn't feel comfortable going right to the top and telling people -- or going through the proper channels and telling people, look, I have a concern about this, there were ways that they could have said so anonymously, but they chose not to.

They were just hesitant to do so. And that is part of this cultural change that the board says is so very needed before they actually send up more shuttles into space.

HENDERSON: Elaine, how much pressure is there now to get the shuttle back off the ground, especially -- I have to imagine there's quite a bit of depression going on in this agency now that they have all these problems to fix.

QUIJANO: Well, one would think, certainly, when you hear some of the criticism and you see some of the details laid out -- I mean, this was a 248 page report. I mean, they combed over all of the data, all of the records, the debris itself, they interviewed people. Certainly, you would think that morale would be low.

But in talking to some of the people at NASA, what they say is that these are also people who are very much committed to fixing things. These are engineers. These are the kind of people who grew up taking apart toasters and wanting very much to solve problems.

And here they have a very clear directive. They've been given 29 recommendations, 15 of which are return to flight, they call them, recommendations that should be implemented before the next shuttle goes back up. And so they're very interested in making sure they follow these recommendations to the best of their ability. In fact, I was told people are work over the weekend as we speak because they want to try to get their so-called implementation plan to Congress in the next couple of weeks so they can start to make some of those fixes.

CROWLEY: Disasters, investigation hearings, reports are just part of a familiar pattern here in official Washington. Now another Washington TV show is hoping to mix fact and fiction about the nation's capital. We're back on that story in a moment.

(COMMERCIAL BREAK)

CROWLEY: The ON THE STORY question this week: can television overdose on Washington drama? HBO, a corporate sister of CNN, is set to launch a new half-hour series called K Street" about the Washington lobbying industry. This cracks me up. We wish our corporate sister well, we hope they send the stock up, all that stuff. But the fact of the matter is it cracks me up because, if I tried to go and sell a story on corporate lobbying on K Street, they'd go, oh, boring, white guys. Oh, get us something else.

Let's get outside Washington. So where is Hollywood coming for it's drama?

WALLACE: Right into the Beltway.

CROWLEY: Washington, K Street. It cracks me up.

QUIJANO: Yes. I just don't know if the people out there are really going to care that much. I mean you have "The West Wing." OK, lots of people are interested in that, that's very clearly issues of power, prestige and all the things that are sort of wrapped up in people's ideas of the White House. They get to sort of see the inside view.

But I'm not sure that they want to see the inner workings of lobbyists. And do they necessarily want to see that process?

CROWLEY: And further, as journalists, there's that troubling mesh of fiction and fact. Because there will be real lobbyists, real players in Washington in this sort of fictional thing. As a journalist, you got to be a little worried about that.

WALLACE: And I think I was hearing that they're going to try to follow real issues going on, stories of the week, to keep it as present as possible. So you'll have this series focusing on some real issues people are talking about.

And then you have people like Mary Matalin and James Carville, both -- a legendary Washington power couple who I believe are going to play themselves on this show. They haven't asked you to play, have they?

QUIJANO: But it's only a matter of time though, Candy.

CROWLEY: George Clooney's in it, so how bad could it be?

WALLACE: I know. I know. I think that's...

QUIJANO: Well, another story that is looming this week is the preliminary hearing in the Laci Peterson murder case. Now the cover of "PEOPLE" magazine shouts out "New Evidence Revealed, Secret Laci Files."

And I have to tell you, I was out there in Modesto for a couple of weeks a couple of months ago. And it is just extraordinary to me the amount of coverage that happens every time there's a hearing, anytime there's any trickle of information. I mean, essentially what happens is they shut down the street in front of the courthouse in order to accommodate the hordes of media that come out because of all the intense interest that has been generated by this case. But what will really be interesting to see is the effect this "PEOPLE" magazine article has because the judge in this case, Judge Al Girolami, had made it very clear. He put a gag order on the parties involved. He wants a clamp down of information. And so as this article comes out, it will be interesting to see how that is received, because there are supposedly new details in there that were not revealed before.

HENDERSON: Oh, and having read the article, it has a lot of details about the state of the bodies. What effect do you think that might have on, say, the prosecution's efforts?

QUIJANO: Well, certainly that's got to be a difficult blow for them. I can tell you, just from my time out there, part of the article talks about this, actually, about this idea that perhaps a piece of tape was found around the neck of the fetus. And a lot was made out of that when I was there because some of these details were being leaked about the coroner's report.

And so it will be interesting to see how that plays out, because that certainly calls into question the idea that perhaps there was something that happened after the body perhaps was placed there. And it just raises a whole host of questions that will have to be answered.

WALLACE: Well, Elaine, we have to leave it there. And we'll all certainly be watching that story.

Thanks to my fabulous colleagues and thanks to you all for watch watching ON THE STORY. We will be back next week.

Still ahead, "PEOPLE IN THE NEWS" focusing this week on the British royal family, Prince William and Prince Harry. At 12:00 noon Eastern, 9:00 Pacific, CNN "LIVE SATURDAY". And at 1:00 p.m. Eastern, 10:00 Pacific, CNN's "IN THE MONEY" looks at why some people are predicting a boom in new jobs.

Coming up at the top of the hour a news alert. But first, the president's weekly radio address.

(BEGIN AUDIOTAPE)

BUSH: Good morning. On this Labor Day weekend, Americans pay tribute to the spirit of hard work and enterprise that has always made this nation strong. Every day, our worker go to factories and offices and farms and produce the world's finest goods and services. Their creativity and energy are the greatest advantage of the American economy.

Worker productivity accelerated last year at the fastest rate in more than a half century. This higher productivity means our workers receive higher wages. Our nation's exports get a competitive boost in world markets and our economic recovery gains momentum at a crucial time.

The Jobs and Growth Act I signed in May ensures that workers enjoy more of the benefits of their work through more take-home pay. Tax relief was based on the conviction that workers are entitled to keep more of their hard-earned wages. That belief, after all, is why America celebrates Labor Day and not tax day.

For America's families, tax relief has come at just the right time. For a family of four with a household income of $40,000, tax relief passed over the last two-and-a-half years means they get to keep nearly $2,000 more of their own money. Millions of families this past month received checks for up to $400 per child because we increased the child tax credit.

This tax relief, more than $13 billion worth, means that America's workers can save, invest, and make purchases they have been putting off. Many moms and dads are using their extra income to take care of back to school expenses. As consumer spending rises, manufacturers are seeing more new orders for their goods. Low interest rates mean businesses have better balance sheets and families have saved billions of dollars by refinancing their homes.

These are the signs of a reviving economy. Now we must build on this progress and make sure that the economy creates enough new jobs for American workers.

Next week, I will travel to Ohio, Missouri and Indiana to talk about my agenda for job creation across America. As part of this agenda, our nation needs a comprehensive energy plan so that our businesses and homes can rely on a steady and affordable supply of energy. The recent blackout in the Northeast shows how important reliable energy is to the American economy and demonstrates the need to take action on good energy policy.

So when members of Congress return from the summer recess, I will again ask them to pass a sound energy bill as soon as possible. America needs legal reform because junk lawsuits can destroy a business, and they're making health care coverage less affordable for employers and workers. And Congress must restrain government spending so that we can bring the deficit down by half within the next five years.

We must negotiate trade agreements with other nations. My administration will be vigilant in making sure our agreements are followed by all our trading partners. With free trade and a level playing field, American workers can successfully compete with any workers in the world.

This long weekend is a well deserved reward for the millions of men and women who make this economy go. I wish all Americans a happy and restful Labor Day.

Thank you for listening.

(END AUDIOTAPE)

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California Recall Election; What Will Bombing in Najaf Mean for Iraq's Future?>