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CNN Wolf Blitzer Reports

Is Daniel Pearl Still Alive?; Big Brother Watches Nation's Capital; Barry White Sings Serenades to Sharks

Aired February 14, 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, is Daniel Pearl dead or alive? His wife makes a heartfelt plea. Is the main suspect playing a heartless game?

(BEGIN VIDEO CLIP)

AZIZ KHAN, PAKISTAN FOREIGN MINISTRY: We cannot give any credence to any of the statements that he gives

(END VIDEO CLIP)

BLITZER: U.S. troops face a new danger in Afghanistan, while a shadowy figure linked to the September attacks may be organizing new strikes here in the United States. Is the CIA up to the task?

And Big Brother is watching, closely. Is that now a good thing?

Hello, I'm Wolf Blitzer in Washington. Roller coaster news about kidnapped "Wall Street Journal" reporter, Daniel Pearl. Two days ago we were told he was perhaps on the verge of being freed. But that has not happened, and that tops our news alert.

Another emotional appeal from the wife of American journalist, Daniel Pearl, who was kidnapped three weeks ago. Today in court, a captured Muslim militant admitted to the kidnapping. But he also seemed to change his story, now saying he believes Pearl is dead. We'll go to Karachi for a detailed report in a moment.

Outside the U.S. base at the Kandahar airport in Afghanistan, flames lit up the night sky. The fire was sparked by flares launched by U.S. forces. The flames spread quickly, threatening the airfield, but are now out.

From neighboring Iran, word that 150 suspected Taliban or al Qaeda members may have been arrested. The Iranian news agency reports the group includes women and children, some with European passports. The arrests come just weeks after President Bush named Iran part of a -- quote -- "axis of evil" that supports terrorism.

First, she warned her superiors at Enron about accounting irregularities. Now she's telling Congress what she told them. Sherron Watkins, a vice president in the now-bankrupt company, says she feared for her job when she started speaking out. More on her testimony a bit later in this program.

A new twist to the ever-growing skating controversy at the Winter Games. Today, a stunning revelation that France's judge in Sunday's pair competition may have been coerced into voting for the Russian duo, over the Canadians. The International Olympic Committee wants the skating union to resolve the matter quickly.

The skating controversy is the subject of our Web question of the day: can the fix be in on figure skating? Vote at cnn.com/wolf. We'll look at the results later this hour and report them to you.

Now back to our top story: contradicting statements from the chief suspect in the kidnapping of journalist Daniel Pearl. The latest made today in court, as the search for Pearl continues. CNN's Ben Wedeman has more from Pakistan.

(BEGIN VIDEOTAPE)

BEN WEDEMAN, CNN CORRESPONDENT (voice-over): The prime suspect in the kidnapping of "Wall Street Journal" reporter Daniel Pearl was brought before a magistrate in an antiterrorism court in southern Karachi Thursday. There, British-born and educated Islamic militant, Sheikh Omar Saeed, told the court, as far as I know, Pearl is dead.

This directly contradicts statements that police said Saeed made shortly after he was detained Tuesday in Lahore, when he told the police that Pearl is alive and in Karachi. Pakistani police say at this point, they don't have much faith in Saeed's pronouncements, and will carry on with the search.

AZIZ KHAN, PAKISTAN FOREIGN MINISTRY: He has been changing them from day-to-day and we cannot give any credence to any of the statements that he gives. As far as the agencies are concerned, the government of Pakistan is utilizing all means possible to resolve this case as quickly as possible. And we hope that it will be resolved soon.

WEDEMAN (on camera): Later Thursday, the inspector general said at a press conference that they will not believe anything Saeed has to say unless they see evidence to the contrary. He says that there's no evidence that Pearl is dead, so we still believe he is alive. He said he was satisfied with the pace of the investigation.

(voice-over): He said Saeed is a sharp, clever, capable, and obviously to this point, somewhat successful at misleading and misguiding the investigation. A spokesman for "The Wall Street Journal," responding to Saeed's statements, said, "We continue to be hopeful. We remain confident that Danny is still alive."

Speaking in fluent English in the court, Sheikh Omar Saeed admitted to involvement in the kidnapping, and went on to say that, right or wrong, "I had my reasons." I think our country should not be catering to America's needs. Saeed has been remanded into police custody and will reappear before the antiterrorism court on the 25th of February. (on camera): With Saeed providing little more than misleading information and contradictory statements, the police now say their key suspect is not a very reliable source on the condition and whereabouts of Daniel Pearl. Ben Wedeman, CNN, Karachi.

(END VIDEOTAPE)

BLITZER: His family and friends, meantime, hold onto hope that Pearl is still alive. Today his wife, Marianne, appealed again to his kidnappers, reminding them she is six-months pregnant, and worried about what the stress is doing to their unborn child. She writes this: "From the bottom of my heart, I appeal to you please release Danny and enable us to continue carrying out the path we have chosen to pursue... I have faith you will trust the sincerity of my message to you, as a wife and an expectant mother, and that you will let him go free to join me."

Joining me here at CNN is our terrorism analyst, Peter Bergen. Peter, Ahmed Omar Saeed Sheikh, is he the real kidnapper, do you believe, of Danny Pearl?

PETER BERGEN, CNN TERRORISM ANALYST: I would guess he's very important for the following reason. This guy was previously unknown until December 1999. Then a plane was hijacked by Kashmiri separatists. One of the principle demands was the release of Sheikh. And I think that fact -- that demonstrated that he was a very important member of the Kashmiri militant groups that are operating the country.

This is also a group, by the way, that has kidnapped western tourists in the past. Sheik himself also tried to kidnap westerners. So it's part of a pattern, of him personally, and the organizations that he belongs to, to kidnap westerners. So it would make sense that he's a primary suspect.

BLITZER: And first he says that Danny Pearl is still alive. Now he says in court he believes he's dead. What are we to make of this?

BERGEN: I think it's extremely unlikely that he's dead, for following reason: if you have one hostage, you don't kill the only hostage you have. I mean, there's nothing to negotiate after that. Also, there's a great deal of pressure, unlike in some of these western tourists who were kidnapped in Pakistan in the mid '90s -- there was pressure, but nothing equivalent to the kind of pressure that's coming on the Pakistani government, to resolve this issue. I think it's extremely unlikely that he's dead.

BLITZER: All right, stand by, Peter, because I want to move on and I'll bring you right back in. But right now I want to shift focus to the al Qaeda, and the man who has emerged as al Qaeda's, perhaps, new chief of operations. Abu Zubaydah is a 30-year-old Palestinian, and has been one of bin Laden's key lieutenants since the late 1990s.

Known for using fake passports and identities, Zubaydah has been directly linked to the September terrorist attacks on the United States. And now investigators are convinced he is trying to activate sleeper cells to launch new attacks. Joining Peter and I here once again with more insight, is CNN national security correspondent, David Ensor.

Thanks for joining us as well. You've been doing some reporting on this. What are you hearing about Abu Zubaydah?

DAVID ENSOR, CNN CORRESPONDENT: Well, the key new insight is that I have knowledgeable sources that tell me, that I believe, that tell me they think they have evidence that Abu Zubaydah is in Pakistan. It had been previously suggested he might be in Iran, various other locations were suggested.

Pakistan, of course, is where he spent much of his time during the last 10 years or so. He was the key man to whom recruits to al Qaeda would go. He would screen them. He would decide which ones to send to training camps in Afghanistan. He speaks English, he is adept with disguises. He is an extremely elusive man, very seldom photographed. Little is known about him. But he is now one of the key people in al Qaeda. As I said, they think he's in Pakistan.

BLITZER: Interesting. Peter, you wrote the book "Holy War" and you spent some time with Osama bin Laden. We want to put up on our screen sort of a hierarchy, of course, the leader, Osama bin Laden. But if you take a look at his principle deputies, Ayman al-Zawahiri, the Egyptian, Abu Zubaydah, the Palestinian. Muhammad Atef, U.S. officials have suggested he was killed in one of those airstrikes.

What do you make of this new hierarchy that appears to be emerging, the leadership taking over, if Osama bin Laden is out of the picture -- a little bit, at least?

BERGEN: David correctly pointed out, Abu Zubaydah, he's been on the radar screen for about a year or two now. He's a younger man, he's younger than the older generation of the Ayman al-Zawahiris, Mohammed Atef, who's now dead, or bin Laden himself. However, we know from court testimony that he, as David said, was the key person.

If you were going to go to the camps, you want to Abu Zubaydah to A, process into the camps and B, when you left, you he would sort of debrief you on what the future course of action might be. So he does appear to be somebody who is stepping up, a new generation of leadership.

BLITZER: What about the suggestion that the Iranian news agency is reporting, that 150 al Qaeda fighters have been arrested? What are you hearing about that from your sources, David?

ENSOR: U.S. officials say they think that number, 150, is exaggerated, Wolf. However, they do say that some al Qaeda and Taliban people have gone into Iran, in fact, raised that matter with the Iranian government. They do not believe, however, that any senior al Qaeda personnel are in Iran.

BLITZER: And what are they saying to you about Osama bin Laden himself?

ENSOR: The best guess remains that he is still in Afghanistan, and probably still alive.

BLITZER: Is that what you're hearing as well, Peter?

BERGEN: Unless evidence is shown to the contrary, I think we'd better presume he's alive. And there's no reason for him to leave Afghanistan. Once you leave Afghanistan, you really -- you think about the neighborhood that you're in. Pakistan is enthusiastically looking for him.

Obviously, Iran is making some efforts to go after al Qaeda. They never liked bin Laden or the Taliban in the first place. And then you've got the former Soviet republics to the north. So I think it's extremely unlikely that he'd leave a place that, after all, he knows very well.

BLITZER: One other point while I have you, David. Federal authorities today formally charged a retired U.S. Air Force master sergeant with attempting to spy for Iraq, Libya and China. Brian Regan, formally accused today of this effort. You reported on this sometime back, when he was first arrested. What do we know about this?

ENSOR: Well, he's an extraordinarily ambitious man, obviously, to try and spy for all three of those countries. The good news is, say U.S. officials, he was caught before he did any of the above. But he offered, in a letter, according to the court documents that have just been released today, he offered to spy for Iraq. He wrote to Saddam Hussein, saying for $13 million he would give them everything he could get.

BLITZER: And the interesting point is he wasn't just a regular master sergeant. He worked for the NRO, the National Reconnaissance Office -- one of the most sensitive agencies in the U.S. government.

ENSOR: He had worked for that agency. He had those kinds of clearances. At the time he was arrested, he was working for a consulting company. But he still had those clearances, Wolf, that's right.

BLITZER: David Ensor, thank you very much. Peter Bergen, thanks to you as well.

And meanwhile, the House and Senate intelligence committees are launching a wide-ranging investigation into U.S. intelligence operations. They specifically want to know why the CIA and other agencies failed to learn of and prevent the September 11th terrorist attacks. Senator Richard Shelby of Alabama is the vice chairman of the Senate panel. He joins us now live from Capitol Hill.

Senator Shelby, I want to get to that unprecedented joint House- Senate investigation you're about to begin in a moment. But what's your take on this latest suggestion that there are sleeper cells about to be activated, that Abu Zubaydah, a top lieutenant to Osama bin Laden, may be in charge right now?

SEN. RICHARD SHELBY (R), ALABAMA: That could be credible, but we'll have to see. We've known all along that there were a lot of people that could be activated, sleeper cells or other ones, and that's why we've had a number of alerts by the FBI here in the States, and others. It's something we're going to have to live with until we eradicate.

BLITZER: I want to play for you, Senator Shelby, a quick clip from what the president said in his State of the Union address, one of the more alarming statements that he made. I want your perspective on what he said then, in light of what we know now. Listen to this.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Most of the 19 men who hijacked planes on September the 11th were trained in Afghanistan's camps. And so were tens of thousands of others. Thousands of dangerous killers, schooled in the methods of murder, often supported by outlaw regimes, are now spread throughout the world, like ticking time bombs set to go off without warning.

(END VIDEO CLIP)

BLITZER: Tens of thousands of potential terrorists, sleeper cells out there. In light of this new indication that Abu Zubaydah is alive and well, and perhaps orchestrating additional terrorist threats, how worried should the American people be?

SHELBY: Well, I don't think we should panic. We have said this all along, even on your program. The president laid it out quite well when he made his remarks to the American people. We know this. That's why the FBI is going through, under its new director, a change of structure, in a sense, to emphasize what we can do to prepare ourselves domestically. That's why we have Governor Ridge. And I'll tell you, we're doing a lot better, but we're still not out of the danger zone.

BLITZER: And this is the time you believe now, the members of the House intelligence committee, the Senate intelligence committee, to launch a bicameral, House-Senate joint investigation, into what went wrong if there was an intelligence failure leading up to September 11th. Some are suggesting this may not be the best time, because it could drain resources from the war on terrorism. How do you and your colleagues respond to that?

SHELBY: Well, basically, during the second world war, from 1941 to 1946, there were nine investigations regarding the debacle at Pearl Harbor, and the lack of intelligence and so forth, that brought it about. We're going to initiate this hearing, a number of hearings, with the House and the Senate. The administration and the agencies say they're going to cooperate with us. I believe we're on solid ground. It will take months to get into this, and months to conclude it.

BLITZER: And you have no doubts, Senator, as you've suggested in the past, that there was a major intelligence blunder in failing to anticipate September 11? SHELBY: Absolutely, it was an intelligence failure. But this was not the first one. We can go back many years. Let's start in '93, over the World Trade Tower, the bombings in Africa, Khobar Towers, the USS Cole. There are a number of huge intelligence failures. We can do better, Wolf.

BLITZER: Are you going to investigate all of those failures with a hope of learning from the mistakes of the past?

SHELBY: Absolutely. We're going to leave no stone unturned. We have to. We owe it to the American people. We owe it to the people who have been victimized by terrorism.

BLITZER: And will these hearings be open to the American public, or will they be behind closed doors?

SHELBY: A lot of them will be open to the American public. We need to make as many of them open as we possibly can. Anything to let the American people know what we're doing, what we're up against.

BLITZER: OK, Senator Shelby, always good to have you on the program.

SHELBY: Thank you.

BLITZER: Thanks for that.

Let's move now to a still-developing story regarding the terror alert issued just two days ago here in the United States. FBI sources tell CNN five of the 13 suspects that were announced on that day -- they're now telling us to be on the lookout for them. Five of those 13, we have just learned, have been arrested. CNN's Deborah Feyerick is here. She has details -- Deborah.

DEBORAH FEYERICK, CNN CORRESPONDENT: Well, there are actually 17 on that list. They had 13 pictures, and of those 13 pictures, five are now off the FBI Web site. The men that they were looking for are in custody. The FBI saying that they were tracked down overseas. And exactly where were they? Well, they were in jail in Yemen, according to law enforcement sources. Sources will not say why they were already locked up.

The men are believed to be acquaintances of Fawaz al-Rabeei. The FBI saying that al-Rabeei may be planning an attack inside the United States, or against U.S. interests in Yemen. And that was the warning that came to us on Monday. FBI officials were fearing that the attack could take place then or soon thereafter, and that's why they issued the warning.

Now, the information about al-Rabeei and his acquaintances came from information by detainees being held in Guantanamo Bay, Cuba, and Afghanistan. The five men are Issam al-Makhlafi, Ahmad Albidani, Bashir al-Sharari and Abdu Aziz Binotash and Shubra al-Sabri (ph). Now, all are Yemeni nationals between the ages of 24 and 26. Three of the men were born in Saudi Arabia. Sources say they were put on the list Monday, just in case. Officials thinking that some of the 17 guys may have already been locked up, but they just didn't want to take any chances -- Wolf.

BLITZER: Perhaps you said this, but did you say where they were picked up and arrested?

FEYERICK: They were found in jail in Yemen, and they were already there. So they put the names on the list because they didn't want to take any chances, especially because the threat and the date was so specific, that they figured they might as well put everybody on the alert for all of these people. They still don't have pictures for four of the guys that they are looking for, and those guys haven't turned up, either.

BLITZER: So, 12 more still on the loose.

FEYERICK: Yes.

BLITZER: Deborah Feyerick, thanks for that report.

While the situation in Afghanistan is less dangerous for American troops than it was a short time ago, many dangers remain. A fire just beyond the U.S. base at Kandahar airport was started by illumination flares launched by U.S. troops because a vehicle with three passengers and two people on foot were spotted near the perimeter. It came nearly 24 hours after a firefight that left two U.S. soldiers slightly wounded, and the remainder on alert for more attacks. CNN's Martin Savidge is in Kandahar.

(BEGIN VIDEOTAPE)

MARTIN SAVIDGE, CNN CORRESPONDENT (voice-over): From our vantage point at the Kandahar airport terminal, the firefight nearly a mile off seemed almost harmless. There was no way to know the members of Charlie company were in the fight of their lives.

UNIDENTIFIED MALE: Once I started getting about here, I had a lot of fire on me. I mean, it was smacking across the (UNINTELLIGIBLE). I could hear it pinging past my head.

SAVIDGE: The soldiers say the shots were fired with control and accuracy, that whoever was firing knew exactly what they were doing, and exactly where the members of Charlie company were.

UNIDENTIFIED MALE: 240 position was taking rounds. I was taking very effective rounds, sandbags right next to me.

SAVIDGE: The attackers were shielded by a nearby depression, 6-8 feet deep, and shrouded by bushes and trees. They opened up from just 50 yards away.

(on camera): The gun firing at this particular bunker was so close and so intense that the soldiers could actually hear the bullets snapping over their heads. They were thumping and hitting into the sandbags here, ripping them apart and forcing some of them down on the ground.

(voice-over): Lt. Darren McDonough (ph) left his position to try to get a better fix on where the attack was coming from. It was a decision that nearly cost him his life.

UNIDENTIFIED MALE: I made it about halfway between these two berms, and at that point, I heard a big whack -- you know, like a subsonic round -- and I felt the burning on my neck, and it kind of spun me around, and I guess the 762 round just grazed through my neck.

SAVIDGE (on camera): Did you know you'd been hit?

UNIDENTIFIED MALE: Well, that was the quote of the day. When I got to this berm, I hit on the ground and I got on the radio and I said, "I think I've been hit."

SAVIDGE: McDonough was dazed and bleeding, with bullets landing all around him.

UNIDENTIFIED MALE: Next thing I know, I hear, "hey, I think I'm hit." And that's the last thing you want to hear.

SAVIDGE (voice-over): Corporal Anthony Mata (ph) was in a nearby fighting hole. He ran through the gunfire that was tearing apart the sandbags around him, across open ground to his lieutenant's side.

UNIDENTIFIED MALE: So, adrenaline kicking, 150 miles an hour, I said, "hey, I'm going to go find him." Thank God he was right here at this berm. I found him. Rounds hitting directly -- I mean, two feet above both our heads.

SAVIDGE (on camera): You didn't hesitate at all? Didn't think once before you moved?

UNIDENTIFIED MALE: No, that's training.

SAVIDGE (voice-over): In another fighting hole, specialist Tim Bates kept up his gunfire, unaware that a bullet had ripped off the top of a finger on his right hand.

UNIDENTIFIED MALE: We just took fire, and I didn't even notice that I was wounded until five minutes into it.

SAVIDGE: Corporal Mata and Lt. McDonough struggled to get under cover. Nineteen-year-old PFC Joe Gallagher provided cover fire with a grenade launcher.

(on camera): What was the feeling afterwards, when the shooting stops?

UNIDENTIFIED MALE: It was surprise, kind of a mixed emotion. When the reality set in, they maybe just came a few inches from death.

SAVIDGE (voice-over): It will be a long time before the emotions and images of their fight together fade. These men are now linked by a life-and-death struggle that only those in combat know, a modern day "band of brothers." Martin Savidge, CNN, Kandahar.

(END VIDEOTAPE)

BLITZER: You can join Marty live from Afghanistan tonight. He'll sport a new haircut, all in the line of duty, to give you a glimpse of what a typical day is like for U.S. soldiers in Kandahar. Look at that. He's getting a haircut like any U.S. soldier. That's at 8:00 Eastern, 5:00 Pacific. I'll be watching.

Next, an Enron executive is talking, indeed. Find out what Sherron Watkins told Congress she told Ken Lay and others at Enron, when we come back.

Also, Big Brother is watching you in the nation's capital. What price privacy in an atmosphere of anxiety?

And a Valentine's serenade from Barry White, to the great white -- the fish story, later this hour.

(COMMERCIAL BREAK)

BLITZER: Welcome back. Valentine's day was sweet on many fronts for Congressmen Christopher Shays of Connecticut and Marty Meehan of Massachusetts. They're the chief sponsors of a campaign finance reform bill that passed the House of Representatives very early today. If it becomes law, it would force the most sweeping changes in campaign finance laws since Watergate.

The bill was forced to the floor for consideration after the Enron collapse. Let's go to the White House. Our correspondent there, Major Garrett, is standing by. Major, what are you hearing will happen if this Shays-Meehan McCain-Feingold is passed by the Senate and the House, ultimately, in a final form. Will the president sign it into law?

MAJOR GARRETT, CNN WHITE HOUSE CORRESPONDENT: In a word, Wolf, yes. Three senior Republican sources tell CNN today the president will in fact sign the McCain-Feingold Shays-Meehan legislation if it comes to the White House as it was passed by the House early this morning. That is to say, if in Senate provides no changes, that legislation once delivered to the White House, will be signed by President Bush.

This is widely known throughout the Bush White House, though it is not publicly acknowledged. The reason for that is the White House wants to remain somewhat cagey on this front. But the three senior Republican sources CNN has contacted about this today are absolutely adamant that the president's strategy is to sign this bill.

For one reason, the president doesn't want to look as if he's opposed to the Republican reformer, John McCain, who he battled so aggressively during the Republican nomination fight, for the nomination to be president of the United States.

And the president does not want to appear in any way in the context of Enron, to be opposing anything perceived widely by the public as a means of cleaning up the political system. He wants to be on that side of the ledger. And for those reasons, primarily, the president will sign the legislation -- Wolf.

BLITZER: All right, Major Garrett, stand by. I want to bring you back later to talk about what else the president has been doing today.

Meanwhile, the Enron executive who warned the company was heading for trouble appeared today before a House committee today. Lawmakers called Sherron Watkins "a bright spot" and described her as "heroic." Unlike other Enron executives who refused to testify by invoking the Fifth Amendment, Watkins had plenty to say. Let's get some details from our Congressional correspondent, Jonathan Karl -- Jon.

JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT: And, Wolf, unlike those other Enron executives, Sherron Watkins actually still works at Enron, goes to work every day at their Houston headquarters. But here on Capitol Hill, she absolutely got a hero's welcome. And in her story, if she's the hero, she said she clearly sees as the villains in this mess, Andrew Fastow, the former chief financial officer, and Jeffrey Skilling, the former CEO.

(BEGIN VIDEO CLIP)

SHERRON WATKINS, VICE PRESIDENT, ENRON: There were swindlers in the emperor's new clothes, discussing the fine material that they were weaving. And I think Mr. Fastow and Mr. Skilling are highly intimidating, very smart individuals, and I think they intimidated a number of people into accepting some structures that were not truly acceptable.

(END VIDEO CLIP)

KARL: By contrast, Watkins was quite easy on Ken Lay, the founder of Enron, who she described as a man of integrity who was essentially duped by Jeffrey Skilling and Andrew Fastow. Now, Mr. Skilling's attorney was actually at that hearing, and had a much different impression of what was going on. She said that essentially, she was simply using Skilling as a scapegoat, and trying to do a PR strategy here to protect Ken Lay's legacy.

So much different view from Jeffrey Skilling's attorneys, but up here on Capitol Hill, Sherron Watkins is clearly the hero of the Enron story -- Wolf.

BLITZER: Jonathan Karl on Capitol Hill, thank you very much for that report.

President Bush today unveiled an alternative to the Kyoto Treaty on global warming. His plan calls for incentives for businesses to voluntarily reduce greenhouse gas emissions. For a look at how that would work, once again, we're joined by our White House correspondent, Major Garrett -- Major.

GARRETT: Well, Wolf, the White House contends this new Bush plan corrects two of the central flaws it saw in the Kyoto Treaty. That treaty committed 40 industrialized nations to mandatory reductions in the emissions of carbon dioxide, which is considered by scientists to be among the leading pollutants that contributes to global climate change -- raising of the temperature of the planet.

The White House says those mandatory requirements would have forced millions of Americans out of work, would have hurt the U.S. economy, and under Kyoto, would have allowed several developing nations to be exempted from that treaty. The White House said this new plan deals with both of those flaws by making compliance in the United States voluntary, and also urging other developed nations to join in the protocol the White House is going to put in place for U.S. businesses. That, the White House says, corrects the two central flaws of the Kyoto treaty. The president outlined his plans today at the National Oceanographic and Atmospheric Administration, getting a round a applause from the workers there.

And he said, Wolf, one thing that is central to his environmental policy, at least as it deals with global climate change, that a strong and vibrant U.S. economy is essential to any of the sacrifices that are required in the future to reduce carbon dioxide or other pollutant emissions. Here's what the president said.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: To clean the air and to address climate change, we need to recognize that economic growth and environmental protection go hand-in-hand. Affluent societies are the ones that demand and can therefore afford the most environmental protection.

(END VIDEO CLIP)

GARRETT: There are two components to the Bush environmental plan. One is called the Clean Skies Act. That would be a piece of legislation that would deal with emissions other than carbon dioxide, cutting power plant emissions of nitrogen oxide, sulfur dioxide and mercury. And it would improve air quality with a market-based approach of tax incentives.

Then there is the second issue of global climate change. The Bush plan seeks reductions in greenhouse gases, supports more federal research into waste to achieve that. And because they are tied to the growth of the U.S. economy, the White House says it shields worker from any layoffs that would result from Kyoto mandatory reductions in carbon dioxide emissions. And, also, as I said earlier, Wolf, it would include nations in the developing world exempted under the original Kyoto treaty -- Wolf.

BLITZER: Major Garrett, thanks for that report over at the White House.

And for an interactive look at global warming, consequences of the greenhouse effect, and much more, log on to the in-depth special at CNN.com. The AOL key word is CNN.

Security and surveillance: Big Brother really is watching. Police in Washington, D.C. have a new weapon in the war against terror. We'll tell you what it is just ahead. And later: They looked good as gold, but the prize was silver. Controversy swells over the results of the pairs figure skating competition. We will bring you the latest twists and turns.

(COMMERCIAL BREAK)

BLITZER: Welcome back.

Officials here in Washington, D.C. have activated a command center to monitor security cameras throughout the city. The new system links hundreds of cameras that already monitor mass-transit stations, monuments and schools. It is intended to detect suspicious activity, but it's drawing criticism from privacy advocates.

CNN's Jeanne Meserve reports.

(BEGIN VIDEOTAPE)

JEANNE MESERVE, CNN CORRESPONDENT (voice-over): Outside Washington's Union Station, suspicious activity is picked up by a surveillance camera monitored by law enforcement at the city's joint operations operation command center.

UNIDENTIFIED MALE: Well why don't we have one of the Capitol officers roll a car by there, all right?

MESERVE: When the car arrives, the man is gone. All appears to be fine. The District of Columbia has spent $7 million on this state- of-the-art facility, with the ability to monitor 88 cameras simultaneously.

TERRANCE GAINER, EXECUTIVE ASSISTANT CHIEF, D.C. METROPOLITAN POLICE: It really gives us the eyes that we need to see what's going on in the city.

MESERVE: The system was designed to monitor events like this, protests against the World Bank. The World Bank bristles with cameras, as do many other buildings in the city. They belong to federal law enforcement, private business, the transit and school systems.

And the new center can link up with several hundred of them. That makes civil libertarians fear that this country could become like Britain, where it's estimated that the average citizen is caught on surveillance cameras 300 times a day.

JEFFREY ROSEN, GEORGE WASHINGTON UNIVERSITY: It increases the danger of discriminatory and voyeuristic surveillance. In Britain they found that the cameras tend to focus on younger women and also on minorities. So far from being an alternative to racial profiling, the cameras can actually exacerbate that danger.

GAINER: I don't think we can go overboard and should go overboard. And I think it's fair for people to question us. MESERVE: Although Britain's system did capture the famous image of young Jamie Bulger being abducted, Rosen says it has not done what was intended.

ROSEN: In the city of London, where the cameras were implemented to catch terrorists after a bunch of attacks in 1993, they actually haven't caught a single terrorist on the basis of the cameras.

MESERVE: But despite concerns and questions, surveillance systems are already in place in cities like Tampa and Baltimore. The threat of terrorism seems to guarantee that in these places we are seeing the future. And you can almost bet it is seeing us.

Jeanne Meserve, CNN, Washington.

(END VIDEOTAPE)

BLITZER: For more on the status of homeland security and what Congress should be doing about it, we are joined now by Republican Congressman Saxby Chambliss of Georgia -- he serves as the chairman of the House Intelligence Subcommittee on Terrorism and Homeland Security -- as well as Democratic Congresswoman Jane Harmon of California. She is the ranking member of that House subcommittee.

Thanks for joining us.

Congressman Chambliss, so what do you make of these cameras all over the District of Columbia? You are a conservative. Are you worried that Big Brother might be watching too much?

REP. SAXBY CHAMBLISS (R), GEORGIA: Yes, I really do.

I'm not sure what the purpose of it possibly could be, other than looking over folks' shoulders. And the president said we need for American citizens to participate and help out in this war on terrorism. But I'm not sure that putting cameras all around every city in America is the answer to that.

BLITZER: It does have a certain voyeuristic element to it. As someone who supports privacy rights, are you concerned?

REP. JANE HARMON (D), CALIFORNIA: Sure I am. The police here say they will only use these cameras if there is a terrorist threat out there. But, as we all know, there seem to be terrorist threats on a nonstop basis. So it is worrisome. And if discretion is not used, I think our civil liberties are at risk.

BLITZER: You know, there is another story out there involving these teddy bears. I don't know if you're familiar with it, these teddy bears that someone bought. The FBI is looking for someone who bought these teddy bears. An anonymous tip said this individual also went to a Wal-Mart and bought BB gun pellets, canisters of propane, perhaps going to send out these teddy bears.

What do you make of that, Congressman? CHAMBLISS: Well, it's a little bit of a strange story. Actually, the purchase occurred almost a month ago, three or four weeks ago, anyway. And for the report just to be coming out now and asking for help in looking and identifying this person, it's a little bit strange. I don't know.

BLITZER: Connected to Valentine's Day, perhaps?

HARMON: I don't know, but it shows how disorganized we still are with hour homeland security effort. We really way to rank these threats. We need some sort of a threatcon system like the Defcon system for defense, where the threats are ranked from one to five and there are protocols that tell people what to do. People are just reading one headline after another. And it shows why Tom Ridge, in my view, needs more authority and some kind of strategy here for homeland security that he is lacking.

BLITZER: Her voice is not isolated, as you know, Congressman Chambliss. A lot of people think there needs to be some greater structure to the homeland security director, Tom Ridge's, office.

CHAMBLISS: Well, that issue is still up for debate. But I am still of the opinion that he has got the authority he needs. He's right down in the White House, right down the hall from the president. He has the president's ear 24 hours a day. He has got budget authority now. And he is still in the process of organizing this huge issue of homeland security that involves so many federal agencies and subagencies. And it's a big job, but he's moving in the right direction.

BLITZER: You are shaking your head.

HARMON: Well, I mean, I think the signs of failure are all over the place. He is a talented man. He has a very excellent, small staff, no real budget himself. He is involved in the budget process. But this $38 billion budget is not something he specifically controls or can move around in any real way.

And he proposed a new agency for border control. It was dead on arrival. All the other agencies are fighting it and taking shots at him. I just don't this is a concept that is his, the concept of his job, that has a real future.

BLITZER: Congressman Chambliss, give us your perspective on the latest FBI alert. As you know, five of those suspects were arrested today in Yemen -- they were in jail -- of the 17 that were announced earlier in this week, raising a lot of concerns here in the U.S. How worried do you believe the American public should be?

CHAMBLISS: Well, Jane and I see classified reports every day about these threats and the activity that is going on out there in the world of terrorism.

And every time we have had a threat that has been issued, in my opinion, it's been justified. There has been a lot of activity. And the threat is real. The threat yesterday said something may occur in Yemen. It may occur in the United States. That's the problem we have got with these folks. As the president has said several times, there are literally thousands of these terrorists, these al Qaeda operatives, who are in places around the world.

And we don't know where they are or where they may attack us. But when we have the kind of activity that we have been seeing up to yesterday, I think it's important that the American people know about, that they have their eyes open to look for anything strange, just like happened on the American Airlines plane a few week ago.

BLITZER: On the other hand, if you do this so many times, the American public will get numb and won't know what to do.

HARMON: It's call "The Boy Who Cried Wolf" syndrome.

BLITZER: Not Wolf Blitzer.

HARMON: I will say that next time.

But people will tune out. It's a problem. We need organization for the homeland security effort the way we have organization for the war. And, by the way, our subcommittee and this new bicameral subcommittee also will be looking at 9/11, what went right and what want wrong, and making recommendations. And, hopefully, that will help good people who are still investigating and trying to prevent the second wave of attacks do better.

BLITZER: Her proposal for these Defcon alerts, one, two, three, four five, as in the military, that sounds like it might be a reasonable suggestion. At least the public could say, "Well, it's Defcon 3, Defcon 2, which is not as serious as Defcon 5."

CHAMBLISS: And I think you are going to see something like that be forthcoming from Governor Ridge. I visited with him at length yesterday. It's still a working process. This is a war we have never seen in America before. It's an entirely new atmosphere that we are operating in.

And I think you are going to see a real strategy developed by Governor Ridge. I think you're going to see the American people be able take some comfort in the various levels of threats that will continue in the future.

BLITZER: Congressman Chambliss, Congresswoman Harmon, thanks for joining us.

HARMON: Thank you.

CHAMBLISS: Always a pleasure.

BLITZER: My pleasure.

And coming up, a legal counterattack: Former Yugoslav President Slobodan Milosevic launches his defense with some very spirited remarks.

(COMMERCIAL BREAK)

BLITZER: Welcome back.

Now to the war crimes trial of Slobodan Milosevic: The former Yugoslav leader spoke out in his own defense today against charges of crimes against humanity and genocide. Milosevic presented a documentary that attempted to explain his actions. It claimed that there were never civilian massacres in Kosovo or forced expulsions. He denies the bloodshed was a result of his regime and claims his country had mounted a heroic defense against what he called NATO aggression.

(BEGIN VIDEO CLIP)

SLOBODAN MILOSEVIC, FORMER YUGOSLAV LEADER (through translator): ... prisoner of war. And an unarmed person is held sacred. Whoever violated this sacred principle has to be held accountable. However, this was not done by military or by the police. I am not trying to say that this had not been committed by some individuals or some groups, but this was not done by the army or by the police. The army and the police defended their own country with honor and chivalry.

(END VIDEO CLIP)

BLITZER: Milosevic will continue his opening remarks tomorrow.

A firestorm on ice: The skating community is still spinning over the results of the pairs figure skating competition -- the latest live from Salt Lake City next.

And later: Do you have something special in mind for your valentine? How about a little Barry White? It seems to be working for these sharks.

(COMMERCIAL BREAK)

BLITZER: The International Olympic Committee, for one, is tired of it, yet the controversy over the pairs figure skating is taking more twists and turns. There is even talk of awarding another pair of gold medals. Is that possible?

CNN Sports Illustrated's John Giannone joins us now from the Winter Games in Utah -- John.

JOHN GIANNONE, CNN CORRESPONDENT: Wolf, it's interesting.

There's a lot of developments going on in this story. There's competition on day six of the Winter Olympic Games. Janica Kostelic became the first Croatian to win an Olympic medal. She won the gold in women's combined.

But, indeed, the story continues to be that slippery scandal. And developments are coming quickly. Earlier today, the head of the French skating delegation spoke out in defense of the French judge, the woman who has come under fire for her controversial decision to award the gold medal to the Russians over the Canadians. Now, what he said was -- quote -- "Some people close to the judge have acted badly and have put someone who was honest and upright but emotionally fragile under pressure. He also went on to say that that judge was -- quote -- "somewhat manipulated," but he didn't say how or by whom.

Now, a short time ago, the Canadian Broadcasting Company said that judge has left the Winter Games. Her phone was flooded with calls from members of the media in recent days, but the International Skating Union does not allow judges to speak to members of the media.

Now, caught in the middle of all this, of course, is the Canadian pair, Jamie Sale and David Pelletier. They have still been receiving very high marks for the high road they have been traveling throughout this three-day controversy. They have also been receiving fervent support from their countrymen.

(BEGIN VIDEO CLIP)

MICHAEL CHAMBERS, PRESIDENT, CANADIAN OLYMPIC ASSOC.: We are not here to pull somebody down. We are here to pull somebody up. It has happened before and I don't see any reason why it couldn't happen again. And that is that, if it should turn out to be the case and accepted by the council who we're appealing to that the judging that took place on Monday night was tarnished, that there was one or more -- or there were one or more of the judges who were judging inappropriately, then we see no reason why the council of the ISU should not consider awarding a second gold medal.

DAVID PELLETIER, OLYMPIC SILVER MEDALIST: If there is an ugly story behind it, then the truth has to be spoken. But, on the other hand, it just brings dirt on our sport. And I do love my sport. That's why I do it. But, at the same time, do I trust it? That's another story today.

(END VIDEO CLIP)

GIANNONE: Canadian Prime Minister Jean Chretien checked in on the issue from Moscow. He called Sale and Pelletier and said his heart goes out to them. IOC President Jacques Rogge also got in the act. He sent a memo to the International Skating Union. He told them to be expeditious, to be thorough, and to make sure that they get this investigation wrapped up quickly.

Now, there will be skating tonight, the men's free skate program. A gold medal will be awarded. Timothy Goebel of the United States is in third place. He's trying to become the first American male to win an Olympic medal in 10 years.

Reporting from Park City, Utah, I'm John Giannone.

BLITZER: Thank you very much, John.

And tonight, we'll have a chance to hear from the Russian gold medalists. They're Larry King's guest at 9:00 Eastern, 6:00 Pacific right here, only on CNN. The music of Barry White has been used to make waves for many years. And in some human relationships, it obviously works. So when it came to some celibate sharks in England, researchers thought the same method might work swimmingly. Now Barry White classics have been blasting out of loudspeakers surrounding the tank of some frustrated sharks. Research shows fish are affected by and sensitive to different types of music. Even Barry White himself agrees.

As for Valentine's Day, here's what he had to say.

(BEGIN VIDEO CLIP)

BARRY WHITE, SINGER: It's a nice day. It's a quiet day. It's a day for lovers. It's a day for celebration of love. It's a very, very special day.

(END VIDEO CLIP)

BLITZER: The frustrated English sharks did seem to be a bit more excited after the first blast of Barry White and were -- quote -- "chasing each other around." That's as far as they have gotten. Let's enjoy a little bit of Barry White.

I don't about you, but I'm getting romantic.

Let's go to New York now and get a preview of "LOU DOBBS MONEYLINE." That begins at the top of the hour.

How about you, Lou?

LOU DOBBS, HOST, "LOU DOBBS MONEYLINE": Well, I'm not sure that's the way it's supposed to work, Wolf, but, as they say, whatever does work, terrific.

Coming up tonight: Senator John McCain will be here to talk about campaign finance reform. It looks as though it will become law. FCC Chairman Michael Powell will join us to talk about the growth for high-speed advanced communications. We'll also be joined by the CEO of Qwest Communications, Joseph Nacchio. We have a special report on our nation's nuclear power plants, how new security measures may be too little, too late -- all of that and another gain for the Dow Jones industrials coming up at the top of the hour. Please join us.

Wolf, are you feeling any better?

BLITZER: I'm feeling much better. Thanks, Lou. We will talk about this later.

Coming up: results from the question of the day: "Can the fix be in on figure skating?" Plus some of your e-mail -- stay with us.

(COMMERCIAL BREAK)

BLITZER: Today's Web poll question: "Can the fix be in on figure skating?" Ninety-three percent of you said yes. We'll have a new poll question tomorrow: CNN.com/Wolf. I'm Wolf Blitzer in Washington. "LOU DOBBS MONEYLINE" begins right now.

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