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CNN Wolf Blitzer Reports
John Walker Sees Parents; Did Al Qaeda Have Secret Nuclear Program?; How did Enron Chief Invest Money?
Aired January 24, 2002 - 17:00 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.
WOLF BLITZER, CNN ANCHOR: Now on WOLF BLITZER REPORTS, John Walker Lindh sees his parents.
(BEGIN VIDEO CLIP)
FRANK LINDH, JOHN WALKER LINDH'S FATHER: John loves America.
(END VIDEO CLIP)
BLITZER: And hears the charges against him.
(BEGIN VIDEO CLIP)
JOHN ASHCROFT, ATTORNEY GENERAL: John Walker chose to join terrorists who wanted to kill Americans.
(END VIDEO CLIP)
BLITZER: Did al Qaeda have a secret nuclear program? We'll have an exclusive report on documents recovered from the rubble.
Dangerous cargo: could a weapon of mass destruction reach a U.S. port in a shipping container? We're on the waterfront.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Enron robbed the bank. Arthur Andersen provided the getaway car, and they say you were at the wheel.
(END VIDEO CLIP)
BLITZER: A fired auditor won't talk to Congress, but find out how the Enron chief invested his money.
Hello. I'm Wolf Blitzer in Washington. We are monitoring a developing story happening in suburban Washington, D.C. Right now, 13 children are waiting to be picked up after their school bus went more than 100 miles off its route and crossed state lines. Inside the bus: a loaded rifle and a disturbed driver.
Police are trying to piece together the facts at this hour. We'll have live reports coming up shortly. We're also standing by for a news conference from the FBI, who's on the scene. They're monitoring the development as well. When that news conference happens, we'll take it live. First, this hour's latest developments.
The American who joined Taliban fighters in Afghanistan made his first court appearance today. Asked if he understood charges that he conspired to kill his fellow Americans, John Walker Lindh replied, "Yes, I do." If convicted, Walker Lindh faces life in prison. We'll have much more on this in a moment.
In Afghanistan, U.S. Army special forces attacked two Taliban compounds today, killing about 12 fighters and taking 27 prisoners. The Pentagon says an American soldier was wounded, but his injury is not life-threatening. The fighting happened some 35 miles north of Kandahar.
President Bush is proposing to roughly double spending on homeland security, to almost $38 billion in the next fiscal year. Speaking to the nation's mayors, Mr. Bush also promised much more help to local fire, police and rescue departments.
A fired Arthur Andersen auditor refused to testify today at the opening of a Congressional hearing on the Enron scandal. David Duncan invoked his fifth amendment rights against self-incrimination when asked about the destruction of Enron documents. Other Andersen officials say Duncan ordered the shredding campaign on his own. Duncan has said he acted on the advice of Andersen lawyers.
More now on the American who fought with the Taliban in Afghanistan. John Walker Lindh, who just returned to the United States from Afghanistan last night, faced a federal judge for the first time today. CNN national correspondent, Susan Candiotti, is covering the story. She joins us now live from outside the federal courthouse in Alexandria, Virginia -- Susan.
SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT: Hello, Wolf. Far away from the war zone in Afghanistan, John Walker Lindh found himself in a courtroom in Alexandria, Virginia, wearing a dark jumpsuit with the word "prisoner" written on the back.
(BEGIN VIDEOTAPE)
(voice-over): Driven before dawn about two blocks from jail to courthouse, John Walker Lindh, sandwiched between federal agents. Looking far different than he did after his capture, the American Taliban's beard and long hair, gone. His head, close-shaven.
He looked around briefly when he walked into court, without glancing at his parents seated in the second row. The charges were read, including conspiring to kill U.S. nationals overseas. The possible penalties including life behind bars, laid out.
Magistrate Curtis Sewell: "Do you understand the charges?"
Walker Lindh: "Yes, I understand."
"Do you have any questions?"
"No, I don't have any questions." Walker Lindh's attorneys, hired by his parents and approved by their son, charge that after his capture, he was denied early medical treatment and access to a lawyer before talking with the FBI.
JAMES BROSNAHAN, DEFENSE ATTORNEY: He began requesting a lawyer almost immediately, which would have been December 2nd or 3rd. For 54 days, he was held incommunicado.
JOHN ASHCROFT, ATTORNEY GENERAL: He chose to waive his right to an attorney, both orally and in writing, before his statement to the FBI. Mr. Walker will be held responsible in the courtroom for his choices.
CANDIOTTI: Legal experts call Walker's statement to the FBI crucial to the government's case. In it, he allegedly admits training in al Qaeda camps and being told about planned suicide attacks in the U.S.
Also part of the government's case: a CNN interview with Walker Lindh shot shortly after his capture. Both pieces of evidence expected to be challenged by his lawyers. Walker Lindh met his parents for about 20 minutes before the hearing, separated by a mesh screen in a small room, with an FBI agent present.
MARILYN WALKER, JOHN WALKER'S MOTHER: It's been two years since I last saw my son. It was wonderful to see him this morning. My love for him is unconditional and absolute.
FRANK LINDH, JOHN WALKER'S FATHER: John did not take up arms against America. He never meant to harm any American, and he never did harm any American. John is innocent of these charges.
CANDIOTTI: For now, Walker Lindh is being held in this city jail, confined to a 7.5 x 7.5 cell, equipped with a bed, sink and toilet, joined to a common area with a TV.
(END VIDEOTAPE)
Walker Lindh is allowed scheduled visits with his parents and meetings with his lawyers. And, Wolf, he can have all kinds of meetings with his lawyers, as many as he wants. Back to you.
BLITZER: Susan, in the next few days, what is immediately scheduled? What happens with Walker Lindh next?
CANDIOTTI: Within a couple of weeks, on February 6th specifically, he is next scheduled to appear in court for what is called a bond hearing, to determine whether he can continue to be held without bond, and a preliminary hearing. However, sources say it is possible he could be indicted by a grand jury before then.
BLITZER: Susan Candiotti, thanks for that report.
And joining us now with a closer look at the legal issues involved in the John Walker Lindh case, former Justice Department official -- she was a federal prosecutor, Victoria Toensing, and criminal defense attorney, Jeralyn Merritt. She joins us from Denver.
Thanks to both of you for joining us. Jeralyn, let me begin with you. The argument that the defense attorney makes for John Walker Lindh, that they didn't allow an attorney present. That he wanted an attorney, and didn't waive his rights. How does the judge deal with that specific issue, which seems to be at the heart of an immediate dispute between the prosecution and the criminal defense attorney?
JERALYN MERRITT, CRIMINAL DEFENSE ATTORNEY: That is probably going to be the most critical issue in the case. And what the judge will have to decide is whether he knowingly and intelligently waived his right to counsel. And the court will use a totality of the circumstance test, including looking at all of the circumstances of his confinement and his physical condition, and his mental condition.
And if the court finds that his waiver of a right to a lawyer was not made with a full understanding of the nature of the right that he was giving up and the consequences of that decision, the court may well decide the statements were not voluntary and therefore, inadmissible.
BLITZER: Victoria, what about that? What if he was on painkillers? He was, as you can see in the CNN interview that he had, he was obviously hurt. Was he of mind to make that kind of decision, to waive his right to an attorney?
VICTORIA TOENSING, FORMER FEDERAL PROSECUTOR: Well, of course, all those facts will come out at a hearing, Wolf. There's no indication that was a problem so far. And the FBI, we hope, is professional enough to know that he should not have been on something that was going to be a detriment to his waiver. We're pretty experienced here in the United States, about making sure that you're not on any drugs when you write out such a waiver.
The CNN interview, though, is very crucial, because here is John Walker. Maybe he was in pain, but I mean, fully wanting to talk about his situation and giving all kinds of information to the CNN reporter. And I think that will be a factor that the judge will look at. He wasn't hesitant at all, to speak about this previous waiver to the FBI.
BLITZER: But nowhere in the CNN interview. Victoria, does he say he wants to kill Americans, or that's his goal.
TOENSING: Well, of course, that's not going to be the evidence that's being used to show that he's going to kill Americans. A conspiracy is an agreement. And by the very fact that he was out marching with people who were out to kill Americans is sufficient, legally, to show a conspiracy to do so.
BLITZER: What about that, Jeralyn Merritt? Is this a slam-dunk case, this first charge of conspiring to kill Americans?
MERRITT: No, I don't think it's slam dunk at all. And I think the complaint against him itself states that at the training camps he was given a choice between fighting against American and Israeli interests, and fighting in Afghanistan against the Northern Alliance. And he clearly chose to fight against the Northern Alliance. So I don't know that there's any evidence that he conspired to kill Americans.
TOENSING: But he said very well that he knew -- and this is in his statement to the FBI -- that he was aware that the Taliban was against not only Americans, but the Saudi Arabian government. That he was aware of the September 11th attack, and he was aware that al Qaeda had sent suicide bombers to the United States -- pretty damning words. No case is a slam dunk, Wolf, I can tell you that, never, ever, ever. But it's pretty strong evidence if these statements come in.
BLITZER: Go ahead, Jeralyn.
MERRITT: I was just going to say, Victoria, he also did not want to fight against Americans. He was fighting against the Northern Alliance. And the fact that he knew about the September 11 attacks after they happened doesn't make him a participant in those acts. And the fact that he knew that bin Laden was going to send suicide bombers to the U.S. doesn't mean that he knew the nature, or that they were going to attack the World Trade Center. In fact, bin Laden himself said that many of the suicide bombers didn't even though they were on a suicide mission until afterwards.
TOENSING: He could look up and see airplanes that are from his own country, and know. If he had left, Jeralyn, before he had left the army and quit fighting prior to September 11th, or even prior to October 7th, when our forces started over there and it was clear they were fighting the Americans, then there would not be a case. But, having stayed after that, he was captured the end of November -- I think it was November 25th -- there is certain, strong evidence that he knew he was fighting his own country.
BLITZER: Let me ask both of you, because you have a lot of experience in plea agreements -- who has a greater desire in this particular case? Try to spoke objectively, I'll begin with you, Jeralyn. Who has a better desire to see a plea agreement reached that would avoid a full-scale trial, a plea agreement in which he would cooperate fully with the government?
MERRITT: I think both sides have an incentive to do that. First of all, if he were to plead guilty to anything, the federal sentencing guidelines would apply. And he has cooperated, and so that would justify a departure from the guidelines and a lesser sentence for him.
I also think the government might benefit from a plea agreement and from avoiding a protracted trial, and to let him plead guilty to something that would hold him accountable for any misconduct he engaged in. But not also be to the extent that we're seeking revenge instead of justice for him.
BLITZER: What about that, Victoria?
TOENSING: We should never seek revenge. I don't think that's what our criminal justice system is all about. What Jeralyn and I do agree on is that both sides are better off if there's an agreement, a plea agreement. So let's hope that that's what occurs. But if he doesn't, Jeralyn, then he's going to have to get credit for the cooperation, say that his statements to the FBI were being helpful, and not done under duress.
BLITZER: On that note, I want to thank both of you for your analysis. Victoria Toensing and Jeralyn Merritt, appreciate it very much.
And our on-line quick vote asks, "Can John Walker Lindh get a fair trial?" So far, as you can see, the vast majority says "yes." Cast your vote at cnn.com. The AOL keyword is CNN. And remember, this poll is not scientific.
Back in Afghanistan, an extraordinary find: a host of documents that appear to be training manuals for al Qaeda members, with notes on everything from high explosives to nuclear bomb making. And for the past two months, CNN national correspondent, Mike Boettcher, has been busy deciphering them, with the help of experts. Mike joins us now from Atlanta with details. What have you learned from all of these documents, Mike?
MIKE BOETTCHER, CNN CORRESPONDENT: Well, Wolf, we've gone through hundreds, if not thousands of pages of documents, with some top nuclear and weapons experts, and a top Arabic translator. And we were going through documents like this, Wolf. And this says in this blue magic marker written on a notepad, it says "superbomb." And inside were all sorts of different plans for conventional and nuclear weapons.
The bottom line is, in these documents, it appears, and according to our experts analyzing them, they were surprised at the depth of knowledge that al Qaeda had, that they were definitely on track on a program to try to build a bomb, although they weren't there yet. But they also had capabilities to build what was known as a dirty bomb, which is a conventional explosion that spreads radioactive material over a broad area. It's not a nuclear explosion, but it does contaminate an area.
As well, there were other pages dealing with conventional weapons. All sorts of pages. You're looking right there, Wolf. Let me give you the translation of that diagram there. It says "enriching uranium by using laser beams." So, they had achieved a level of knowledge. Now, you have to take that further. They would have to come up with things like plutonium and machinery in order to mill certain parts of the weapon, which they didn't have -- that is the belief. So, we have to bank on that belief, Wolf.
BLITZER: And, Mike, I've heard top Bush administration officials, experts, intelligence officials, say they believe that al Qaeda operatives were attempting to develop some sort of crude nuclear device. They don't know how close they might have gotten. They don't believe they got very close. Does the information that you've gathered suggest they were closer than perhaps previously thought?
BOETTCHER: They were further along in their knowledge curve than previously thought. Now, the gap is, were they able to obtain nuclear materials like plutonium. It's not believed that they were able to obtain that yet. And some of their plans, Wolf, frankly didn't work. Like -- here's a little plan right here. Now, you can't see it, but at the top is a little diagram. It's not workable. They were nonworkable designs.
But they were looking for shortcuts, and had found some shortcuts to get around problems they couldn't solve by acquiring material conventionally around the world. So they were being pretty clever in their research. But again, U.S. authorities and other coalition authorities believe they have not built any bomb.
BLITZER: And I know that you have information about other conventional weapons that the al Qaeda were looking for. Any bomb shells, if you'll forgive the pun, that you found there?
BOETTCHER: Oh, yes. They were making their own brand of C-4. They were taking conventional explosives, high explosives, and trying to make them better. For example, they had diagrams on where to put an explosive in an airplane in order to blow it up. There were other graphics showing how to place explosives -- presumably, plastic explosives -- in a tower to blow it up. Also, here is a diagram of how they believe they could blow up a bridge.
So they were far along in how to deploy these weapons. And also, they were very far along on making sophisticated weapons, explosives, out of material that could be bought out in the open market.
BLITZER: And, Mike, briefly tell our viewers how CNN obtained these documents.
BOETTCHER: Well, in those confusing days in mid November, when the Taliban and al Qaeda were leaving Kabul, CNN producer Ingrid Arneson (ph) took the initiative and went out into the neighborhoods with the help of Afghan authorities who remained behind, and people familiar with the houses, and said we want to show you the houses where the Arabs lived. They escorted her to those houses, and several of them, she found these documents lying around, some in the garbage. These are documents left behind, which makes you wonder what they took with them.
BLITZER: OK, Mike Boettcher, thanks for that report. Fascinating material. And to our viewers, this note. You can watch Mike Boettcher's complete report tonight, as Martin Savidge anchors our "LIVE FROM AFGHANISTAN." That's at 8:00 Eastern, 5:00 Pacific. A lot more details coming up in Mike Boettcher's report on that program.
And for more perspective on these documents linked to al Qaeda, we turn now to Gary Milhollin. He's the director of the Wisconsin Project on Nuclear Arms Control. Gary, as usual, thanks for joining us. What did we learn from this series of documents? I know you've had a chance to review some of the material that Mike Boettcher and his team collected. It does suggest that they may have been more advanced than we previously thought.
GARY MILHOLLIN, WIS. PROJECT NUCLEAR ARMS CONTROL: What it shows is that they certainly have an appetite. They want to get a nuclear weapon, they have been looking around for the ingredients. They've been thinking about designs. And they've obviously been giving it some thought. So, even though we don't have any evidence that they have the machinery or the materials or the people, or the time necessary to make a nuclear weapon, the fact that they're interested and working at it is disturbing.
BLITZER: And the fact that they had a sophisticated knowledge of what it would require would be very disturbing as well?
MILHOLLIN: Yes. There are people in the world that could help you. And one of the big question marks is, how many of these people have they been talking to? There's a lot of information open in the public domain, which you can get from the Internet. But you can't get the techniques and you can't overcome the problems without expert help.
BLITZER: The fact that they were looking for uranium deposits in Afghanistan, what does that suggest to you?
MILHOLLIN: Well, it suggests to me that they wanted to become independent. They wanted to have their own source of uranium. They wanted to have their own source of brain power. And it wouldn't be long before they started figuring out how to have their own source of manufacturing capabilities.
BLITZER: And, walk our viewers through the process, the step between the brain power, assuming they had some smart nuclear physicists on board supporting them. There have been reports, as you know, Pakistanis who worked on Pakistan's nuclear program, had moved over to Afghanistan to work with al Qaeda and the Taliban. How much of a leap forward does it take from the knowledge, the expertise, to actually developing a crude device?
MILHOLLIN: It takes a tremendous leap. The biggest problem is to produce or acquire the nuclear material, either the plutonium or high-enriched uranium. And that stuff is not easy to make. I think it would be impossible, virtually impossible, for a terrorist group to actually produce that material.
If they managed to steal it or buy it on the world market, then that brings them a giant step closer. But this material is carefully protected, and I think it is unlikely that they would be able to get their hands on the material they would need.
BLITZER: All right. That was then. Since then, since these documents, of course, have been found, al Qaeda's on the run, Osama bin Laden is still on the run. The network has been dispersed, presumably, the Taliban regime has been destroyed. Do you sense that there's still a lingering capability that they might have to develop some sort of crude nuclear device?
MILHOLLIN: What they would need would be a sanctuary. They need a place where they can put material, people and equipment together, and keep them there for a period of time, probably undetected. If we prevent them from having that, they're going to have a very difficult time. BLITZER: But the other point that Mike Boettcher made, which you and our viewers heard, that in the conventional area, they did have some pretty impressive capabilities.
MILHOLLIN: That's the immediate threat, it seems to me. They know how to use high explosives, they have dedicated people and have trained thousands of them. And we have to assume they're still out there and they're still looking for targets.
BLITZER: OK, Gary Milhollin, thanks again for joining us.
MILHOLLIN: Thank you.
BLITZER: No one knows more about this stuff than you do. Appreciate it.
And, what information has been gathered to prevent fresh terrorist attacks on U.S. interests? The Senate intelligence committee chairman, Bob Graham, joins me later tonight in the CNN "WAR ROOM." That's at 7:00 Eastern, 4:00 Pacific. And you can participate. Just go to my Web site, cnn.com/wolf. Click on "send questions." I'll get as many of them answered by my guests as possible.
Enron's accountants are taken to task on Capitol Hill, while Enron's CEO quits, but not before making some big stock deals. Find out what he bought and sold before Enron went down. That's at the half-hour.
But up next, the school bus that missed more than just one stop. The kids from Pennsylvania who wound up near Washington, D.C. Stay with us.
(COMMERCIAL BREAK)
BLITZER: Welcome back. A school bus carrying 13 children in Pennsylvania went missing for several hours today, prompting a frantic search by parents, police and FBI agents. It was finally found more than 100 miles from its destination, with everyone on board safe and uninjured. The driver was arrested.
We have two correspondents covering the bizarre journey. CNN's Deborah Feyerick is in Oley Township, Pennsylvania, where the children were picked up this morning. But we begin with CNN's Kathleen Koch in Landover, Maryland. That's just outside Washington, D.C., where the children are being reunited with their parents. Kathleen, give us the latest.
KATHLEEN KOCH, CNN CORRESPONDENT: Wolf, right now we're waiting for the arrival of the parents here at Prince George's County police headquarters in Landover, Maryland. And we just got an update from the FBI, though, on how this situation wrapped up.
It was about 2:00 this afternoon that this bus driver, 63-year- old Otto Nuss, pulled into the parking lot of a Family Dollar store in Landover Hills. He saw a police cruiser sitting outside. He told the children to stay in the bus and then he got off the bus and went inside, and then basically turned himself in to a Prince George's County police officer, who was in his uniform and working part-time at the Family Dollar store.
Then he went outside with the officer, and told the officer that he had a weapon on board the bus. I'll let the special agent Pete Gulotta pick up the story from there.
(BEGIN VIDEO CLIP)
PETE GULOTTA, FBI PUBLIC AFFAIRS, BALTIMORE: The weapon was, as my understanding, an M-1 Springfield rifle. And it was loaded.
QUESTION: No children were harmed?
GULOTTA: No, sir. No children were harmed.
QUESTION: Were they scared?
GULOTTA: Well, you know, they seemed to be in good spirits. But as I mentioned before, they're in the process of being interviewed, and I'm sure there must be some children that would be traumatized by being taken from their homes and showing up in Washington, D.C. This certainly wasn't a scheduled trip to school.
(END VIDEO CLIP)
KOCH: Now, 63-year-old Otto Nuss will be charged with kidnapping. He is now in federal custody and he will be putting in an appearance tomorrow morning in federal court in Greenbelt, Maryland -- Wolf.
BLITZER: Kathleen Koch in Landover, outside of Washington. Thanks very much.
Let's bring in Deborah Feyerick now. She's in Oley Township, Pennsylvania, where this bizarre journey began earlier today. How are they dealing with this over there, Deborah?
DEBORAH FEYERICK, CNN CORRESPONDENT: Well, they're dealing with it as best they can. One state trooper made a joke saying the biggest thing that ever happens around here is that a cow may fall down. So this is a pretty big deal, indeed. There is going to be a prayer service at about 6:30 today. The whole community gathering to give thanks that these 13 children are safe. The moms and dads are on their way. They are anxious to be reunited with their children.
This vanishing act began at about 7:30 this morning. The bus driver was a no-show at the Berks Christian Academy. And when attendance was taken, somebody realized that 13 kids were missing. So there was an all-out search. About 100 state troopers swarming all over the highways. They even sent out a helicopter, but it was very rainy and very foggy. So the big fear was that maybe that bus slid off into a ditch or into some sort of a quarry. That was not the case, they found, when they retraced the entire route.
The ride ended about five hours after it began. The driver pulled to the side of the road and he surrendered.
(BEGIN VIDEO CLIP)
RAYMOND ALBERT, PENNSYLVANIA STATE POLICE: He actually spotted a Prince George's County police car and flagged the police car over. And kind of simultaneously, the children were waving their arms out the windows. And he walked up to the police car and said, "I know you're looking for me, I want to give up." And they arrested him. They found a shotgun in the bus. And the good news is all the children are safe.
(END VIDEO CLIP)
FEYERICK: The driver, Otto Nuss, began this route just in September. He had worked for a pie company prior to that. He had been living in a big farm house in this neighborhood, but moved out into a smaller house after his mother died, about four or five years ago. Neighbors describe him as a very neat and orderly man. There are counselors at local hospitals here in case any of the children need them -- Wolf.
BLITZER: So, Deborah, as of this point, nothing really all that suspicious in the bus driver's background that would point to this kind of event today?
FEYERICK: No, and that's what's so curious about this whole thing. We're hoping to hear more from either the state troopers or the FBI, as to what sparked this crazy journey, really, because he seemed like a pretty straightforward person.
BLITZER: Deborah Feyerick in Pennsylvania and Kathleen Koch in Maryland. Two ends of a very, very strange journey. Thank God everything, so far, has turned out OK. Appreciate your reports.
And now checking some other stories on today's news wire. Encouraging words from the Fed today. The chairman, Alan Greenspan, says the U.S. economy may be on the brink of recovery. Just two weeks ago, Greenspan was warning of risks to economic expansion. For more, tune in to "LOU DOBBS MONEYLINE." That's right after this program, of course, at the top of the hour.
A solemn, final salute today to the former Secretary of state Cyrus Vance. He was buried at Arlington National Cemetery, almost two weeks after his death. Vance, who was 84, had endured a long battle with Alzheimer's disease. His public service spanned three decades, culminating with a cabinet position in the Jimmy Carter administration.
Think your portfolio looks bad? Check out the losses of Ken Lay. Enron's CEO's surprising statements are coming up. Also, the Enron hearings. Who refused to talk in front of Congress?
And later, a twin story with a twist.
(COMMERCIAL BREAK)
BLITZER: Dramatic developments today in the Enron collapse, as Congress begins hearings. We'll get to that in just a moment.
But now a check at this hour's latest developments: The American accused of joining al Qaeda fighters in Afghanistan made his first court appearance today. John Walker Lindh is charged with four criminal counts, including conspiracy to kill Americans. Walker Lindh told a magistrate judge he understood the charges and that he could be sentenced to life in prison if convicted. Attorney General John Ashcroft says the United States could seek additional charges that carry the death penalty.
In Afghanistan, U.S. Army special forces attacked two Taliban compounds today, killing about 12 fighters and taking 27 prisoners. The Pentagon says an American soldier was wounded, but his injury is not life-threatening. The fighting happened some 35 miles north of Kandahar.
And here in Washington, supporters of campaign finance reform say they have collected 218 signatures, enough to force a vote on the issue on the House floor. No date has been set for debate and vote on the bill, which would virtually ban what's called soft money. Those are the unlimited sums that go to politicians. Campaign finance reform passed the Senate last year, but stalled in the House of Representatives.
Widespread campaign donations by Enron helped fuel the move toward finance campaign reform in the House. And today, Capitol Hill began focusing on Enron's dramatic collapse. How did it happen and who knew what and when? Today, both the House and Senate opened hearings into the matter.
From Capitol Hill, our congressional Kate Snow, she joins us now with more on who is talking and who is not talking -- Kate.
KATE SNOW, CNN CONGRESSIONAL CORRESPONDENT: Wolf, the House hearing was quite heated, a lot of sharp exchanges here today. And it wasn't just from one side of the aisle. It was Democrats and Republicans joining in the questioning. One Democrat would ask a question. A Republican would follow up and vice versa.
There was some frustration afterwards from lawmakers that they didn't get to learn more from Arthur Andersen.
(BEGIN VIDEOTAPE)
(voice-over): The panel's first witness, the man who seemed likely to have the most information: David Duncan was Andersen's top partner on the Enron account in Houston.
REP. JIM GREENWOOD (R), PENNSYLVANIA: Did you give an order to destroy documents in an attempt to subvert governmental investigations into Enron's financial collapse?
DAVID DUNCAN, FORMER ANDERSEN AUDITOR: On the advice of my counsel, I respectfully decline to answer the question based on the protection afforded me under the Constitution of the United States. SNOW: Duncan refused to testify, leaving current Andersen officials to do all the talking. They said Duncan called a meeting last October and told others to use the shredder.
C.E. ANDREWS, ANDERSEN PARTNER: I agree that the action that took place an October 23 and the subsequent elimination of e-mails and destruction of documents is an action that is totally inappropriate.
SNOW: Lawmakers wondered about the finger-pointing.
UNIDENTIFIED MALE: Is Mr. Duncan being made a scapegoat here?
SNOW: But he wasn't the only one under fire. Attorney Nancy Temple wrote an October 12 e-mail about the company's policy on retaining documents. Duncan has told investigators he was following her advice. Temple was grilled on why she wrote that memo. Did she know Enron was being investigated? Did she know a whistle-blower had raised questions about the company's practices?
NANCY TEMPLE, ANDERSEN ATTORNEY: Not to my recollection. I don't...
UNIDENTIFIED MALE: Just yes or no.
TEMPLE: I don't recall seeing a letter by Ms. Watkins.
UNIDENTIFIED MALE: So you are saying, no, you did not know about Sherron Watkins' letter? On October 23, you knew nothing about it. Is that your answer, that no?
TEMPLE: I was aware that she had made allegations.
(END VIDEOTAPE)
SNOW: Now, after the hearing today, investigators released two new documents, two memos that they say prove that many layers of management at Andersen knew about or were part of the document shredding. The ranking Democrat on the committee says that up to 80 people may have been involved at Andersen in shredding documents -- Wolf.
BLITZER: This is just the first of a lot of hearings. Perhaps a dozen committees, subcommittees are going to be holding hearings. Is there any anticipation that they will get some more cooperative witnesses in the days and weeks ahead?
SNOW: Well, they are hoping that. I was speaking to Chairman Tauzin about what they do next. He said their next step is to try to look into Enron now. In fact, next week -- and they have taken sort of the lead on all this -- next week, their investigators, I'm told, will go out and interview a woman who this week blew the whistle on Enron and said that Enron was also destroying documents.
BLITZER: Kate Snow, thanks for that report.
And, a few months ago, Ken Lay was assuring Enron employees that all was OK and he encouraged them to keep buying Enron stock. Last month, about 4,000 Enron workers lost their jobs. And last night, Ken Lay resigned as company chairman.
CNN's Ed Lavandera is at the Enron headquarters in Houston.
(BEGIN VIDEOTAPE)
ED LAVANDERA CNN CORRESPONDENT: Most Enron employees we have had a chance to speak with today say they are not surprised by Ken Lay's resignation. In an e-mail to his employees, Mr. Lay says that he truly believes Enron will survive. He also goes on to say that: "Unfortunately, with multiple inquiries and investigations that require my immediate attention at that time, I am unable to fully concentrate on what is most important to Enron's stakeholders."
Now, a lot of people we have spoke with say they are exhausted by all of the news that has come out about their company over the last 2 1/2 months and they can't wait to get all of this behind him.
UNIDENTIFIED FEMALE: For him, it's probably good. He can probably concentrate better on what he needs to. And, hopefully, the company can turn around for the better.
UNIDENTIFIED FEMALE: I got an e-mail late last night. So I found out that way. But it's interesting news, everything that we are finding out, you know. It's just something one after another. And it's been interesting working here.
LAVANDERA: Ken Lay is still on the board of directors at Enron, but that board is now looking for an interim chief executive that will lead the company through the reorganization process. And that is something that a lot of employees are not necessarily looking forward to.
I'm Ed Lavandera in Houston for CNN.
(END VIDEOTAPE)
BLITZER: With the sudden collapse of Enron came the collapse of many people's portfolios. In some cases, investors and employees lost it all. On the other hand, some Enron executives made money selling their stock before it bottomed out, but not Ken Lay.
CNN's senior correspondent Brooks Jackson has that report.
(BEGIN VIDEOTAPE)
BROOKS JACKSON, CNN CORRESPONDENT (voice-over): Meet one of the biggest losers of all in the Enron fiasco. Ken Lay. CNN has learned that Lay has lost more than $100 million since the end of August, including more than 60 percent of the shares of Enron stock he once owned. What a change. In the past, Lay loaded up on Enron stock. Even as he was cashing in on lucrative stock options, Lay was buying more than he was selling.
In late 1998, Lay reported owning fewer than a million shares. But, toward the end of 1999, that had increased to nearly 2 million. Even as the stock price soared from $25 a share to more than $40. And he would add nearly a million more after that, as the price spiked to $80 and $90. He was still buying as late as last August. And stayed bullish.
August 20th and 21st, Lay bought a total of 93,620 shares for his portfolio, as he reported on this form to the Securities and Exchange Commission. At the very same time, August 21st, Lay predicted, "a significantly higher stock price," in an e-mail to a group of employees.
In September, he told employees, he'd been buying and they should do the same. In an e-mail chat, he called Enron stock, "an incredible bargain," at the current price of around $30 a share. A "great opportunity, incredibly cheap."
(on camera): Lay reported his Enron holdings back then at 2.9 million shares of Enron stock. But, then disaster. Lay's attorney, Earl Silbert, told CNN that by late November, as Enron was slipping into bankruptcy, Lay owned only 1.1 million shares of Enron stock. That's a drop of 1.8 million shares. That's 62 percent of Lay's holdings.
(voice-over): Silbert told CNN, and others, that Lay lost the shares because he's use them as collateral for money he'd borrowed from Enron. And when Enron's stock price sagged, Lay turned the shares over to the company rather than pay back the cash.
How much has Lay lost? The value of the stock Lay said he owned in august was $101 million, at the time, when it was selling for $35 a share. The current value of what's left, at a recently quoted price of 67 cents a share, is well under a million. Lay's loss on Enron stock alone? $100 million.
Lay is hardly a poor man. But, in November, he put two houses in Aspen, Colorado, up for sale, asking around $15 million.
(on camera): And this much is clear from the record, so far. Lay bought more shares than he sold on the way up and lost a ton when the price collapsed.
Brooks Jackson, CNN, Washington.
(END VIDEOTAPE)
BLITZER: And if you have questions about your 401(k), click the "Extra Info" box at CNN.com. Among the features is an online investment calculator, suggesting where you should be putting your money. The AOL keyword, of course, is CNN.
They bring goods from overseas, but could they one day bring terror? Coming up: the concern over these containers. And later: keeping the faith at Camp X-Ray. Learn about the visitor who is leading the detainees in prayer.
(COMMERCIAL BREAK) BLITZER: Welcome back.
President Bush, saying the United States is still under attack, is pledging to almost double the $20 billion being spent on homeland security. Speaking to the nation's mayors at the White House earlier today, the president said Americans face a two-front war, overseas and at home. He says his overriding goal is to make the nation safe from terrorists.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: But in order to make sure that our homeland is secure for a long time, we as a nation must be patient enough and resolved enough to hunt down the killers and the terrorists wherever they try to hide and bring them to justice. And that is exactly what this country is going to do.
(APPLAUSE)
(END VIDEO CLIP)
BLITZER: The president says he will lay out his priorities for homeland security in his State of the Union address before Congress next Tuesday.
Our CNN senior White House correspondent, John King, now with what we can expect.
(BEGIN VIDEOTAPE)
JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT (voice-over): It is a sign of the times: security a new benchmark when discussing the state of Union: more alert, without question, and, in the president's view, more secure -- but more to be done.
BUSH: You know, the intentions of the enemy are to hit us again. And I make a vow every morning that I will do everything in my power and encourage those of us in positions of responsibility not to let that happen.
KING: Homeland security will be a central theme of the president's State of the Union address. Mr. Bush will propose doubling the $20 billion being spent this year on the domestic front of the war on terrorism; new training, equipment and communications systems for police, fire and emergency medical squads; more spending on border and port security; and new money to fight bioterrorism, including more research and more drug stockpiles -- also in the works: a new standard for alerts about possible terrorist strikes.
Local officials complain prior warns from Washington were too vague.
THOMAS MENINO, MAYOR OF BOSTON: I think they should be more specific about, it because it just freezes your city.
KING: The changes are just beginning, but already dramatic: National Guard troops at airports; fighter jets patrolling domestic airspace; outside the White House, decoy helicopters to protect the president; and inside, a new agency and a new urgency.
(on camera): The President created the Homeland Security Office in the wake of the September 11 attacks to lead the war on terrorism here at home. He tapped a close friend to lead it, the former Pennsylvania governor, Tom Ridge. And the president the views mission as so critical he not only gave the post Cabinet rank, but prime office space in the West Wing, just a few steps from his own.
(voice-over): It is a learning process -- most of the lessons unwelcome.
KAREN HUGHES, COUNSELOR TO THE PRESIDENT: I think all of America feels like I do, that we wish we didn't have to know anything about anthrax. But, unfortunately, we now do.
KING: The new emphasis on improving security doesn't come cheap. The four-month tab for combat air patrols by the Air National Guard is $500 million, not to mention the strain on planes and personnel.
LT. GEN. RUSSELL DAVIS, NATIONAL GUARD: We normally in a unit will fly about 270 hours a month. Some units are flying in the 600- 700-800-hours-a-month range. So it's two to three times the norm.
KING: New perimeters at ports and power plants are draining budgets already strained by recession. The National Governors Association says the state's tab for homeland security is at least $5 billion and rising fast. And the U.S. Conference of Mayors estimates the cost to cities will be at least $2.6 billion by the end of this year.
MENINO: Our educational process, from our after-school programing and also health care, we are taking from other places to pay these costs. And that's unfortunate.
KING: The administration promises more federal money is coming. Harder to measure is the cost of a changing lifestyle, what the vice president calls the new normalcy, a national crisis that touches even the national pastime.
GOV. BILL OWENS (R), COLORADO: It's discouraging. We are used to being in such an open society, where you can go anywhere without having to go through police checkpoints. Because of what the terrorists did to us on September 11, I'm afraid that has changed, perhaps forever.
KING: John King, CNN, the White House.
(END VIDEOTAPE)
BLITZER: Of all the potential terrorist targets in the United States, one of the most obvious is also one of the hardest to defend.
CNN's Jeanne Meserve looks at the nation's ports and what is being done to protect them. (BEGIN VIDEOTAPE)
JEANNE MESERVE, CNN CORRESPONDENT (voice-over): Six million shipping containers come into U.S. ports every year. Already used by drug smugglers, they could also be used by terrorists.
JOSEPH ANGELO, U.S. COAST GUARD: Probably the worst-case scenario: a weapon of mass destruction, some sort of nuclear device. Put it in a container. As the ship enters the port, detonate it and you have the destruction of that entire city.
MESERVE (on camera): Only about 2 percent of containers are manually inspected, like this. But the U.S. Custom service argues that it is managing the risk of terrorism by using technology.
(voice-over): Before a ship arrives in port, computers sift through databases, filtering information on the vessel, its crew, its cargo and where it's been.
MICHAEL HEGLER, U.S. CUSTOMS SERVICE: This happens to be out of Jeddah, Dammam, which is Saudi Arabia; Port Rashid, which is Pakistan.
MESERVE: If containers need further security, they are examined with a gamma ray device, which gives inspectors a picture of what's inside. If they don't see enough or don't like what they see, the container is unloaded and the cargo put through a portable X-ray device and radiation detector. Fiberoptics can give them a peak inside an item like a roll of paper.
UNIDENTIFIED MALE: You're seeing a cut right there in the paper. That's abnormal.
MESERVE: Raymond Pardo is the customs inspection they called MacGyver because of the gadgets he uses, like this electronic stethoscope, which can ferret out secret compartments, something they also look for in the containers themselves with density detectors. This is not a perfect system. At this facility in Newark, for instance, there are no detectors for biological or chemical weapons. But this could be a perfect target.
KATHLEEN HAAGE, U.S. CUSTOMS SERVICE: We not only have the seaport right here. If you look across the road, we have the oil pipelines. We have the airport. And we are a major transportation hub. That is a -- we are a symbol.
MESERVE: A federal panel is now devising a plan to make containers more secure. After all, they are loaded on to trains and trucks and hauled all over the country, posing a risk not only here, but virtually everywhere.
Jeanne Meserve, CNN, Newark, New Jersey.
(END VIDEOTAPE)
BLITZER: And an expecting mother makes some unexpected news. Coming up, learn why her pregnancy is so rare. And later: The flight from Kabul, this one put one airline back on the map.
(COMMERCIAL BREAK)
BLITZER: Now checking other stories on today's "Newswire": A U.S. Navy Muslim chaplain is now leading prayers for al Qaeda and Taliban detainees at the U.S. Naval base in Guantanamo Bay, Cuba. The cleric was sent to advise senior commanders on Islamic issues and will be available to meet with detainees. He said his first visit was a success.
(BEGIN VIDEO CLIP)
LT. SAIF-UL-ISLAM, MUSLIM CHAPLAIN: ... that I have seen there were very happy to see me this morning. I prayed with them. And they indicated that they are very appreciative for the effort we are making.
(END VIDEO CLIP)
BLITZER: Baseball Hall of Famer Ted Williams is back in the hospital. The 83-year-old former Boston Red Sox outfielder had a pacemaker implanted in the year 2000. He is the last baseball player to hit .400 for a season.
More unwelcome rain is falling in parts of Tennessee already covered by floodwaters. A flash-flood warning has been issued for half-a-dozen counties. It's a dangerous situation. At least two people were killed in flash-flooding this week. And there have been several water rescues.
And a Wichita, Kansas woman is preparing for some newsmaking new arrivals. She is pregnant with two -- two -- sets of identical twin boys. While twins run in her family, she and her husband did not use fertility drugs.
Let's go to New York now and get a preview of "LOU DOBBS MONEYLINE." That begins at the top of the hour. Jan Hopkins is sitting in tonight for Lou -- Jan.
JAN HOPKINS, "LOU DOBBS MONEYLINE": Hi, Wolf.
Coming up tonight on "MONEYLINE," we will have latest on the unfolding Enron scandal, including the boost that it has given to campaign finance reform. We will hear from Senator Carl Levin. We will also have the latest on John Walker, the American Taliban who appeared in court today. And we'll tell you why Alan Greenspan is feeling better about the economy and why Wall Street likes that -- all that and more at the top of the hour -- Wolf.
BLITZER: Thank you very much, Jan.
And Afghans are returning to the air. When we return: the flight that made the news media take some notice.
(COMMERCIAL BREAK)
BLITZER: Welcome back.
It's not quite competition for Delta or United, but Afghanistan's one-plane-strong national carrier is now back in the air and crossing borders. Ariana Airlines made its first international flight since 1999 earlier today. The Boeing 727 flew from Kabul to New Delhi with 12 crew members and 13 passengers on board. The airline's international flights stopped more than two years ago when the United Nations imposed sanctions on the Taliban regime. They were lifted 11 days ago. Good luck to Ariana Airlines.
I'll be back in one hour here in the CNN "War Room." Among my guests: Senate Intelligence Committee Chairman Bob Graham.
Until then, thanks very much for watching. I'm Wolf Blitzer in Washington. CNN's coverage of America's new war continues with "LOU DOBBS MONEYLINE." That begins right now.
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