Return to Transcripts main page

CNN Wolf Blitzer Reports

Alleged Bin Laden Tape Offers Conditional Truce To European Nations; 3 Japanese Hostages Released; 20,000 More Troops Sent To Iraq

Aired April 15, 2004 - 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.


(BEGIN VIDEOTAPE)
MILES O'BRIEN, CNN ANCHOR (voice-over): Terror truce: an offer from Osama bin Laden to some countries. Can al Qaeda spilt the allies?

Hostage horrors: one is murdered, others are freed. Reliving the nightmare.

ALEXANDRE JORDANOV, JOURNALIST, FMR. HOSTAGE: They were screaming "jihad," and they blindfolded me and threw me in the back of the car with a blade under my throat.

O'BRIEN: Have Iraq's insurgents formed their own alliance?

Help on the way. U.S. commanders in Iraq will get more troops.

GEN. RICHARD MYERS, CHAIRMAN, JOINT CHIEFS OF STAFF: I think what it shows is our resolve to see this situation through.

O'BRIEN: Like cats and dogs. Can the FBI and the CIA really get along?

ANNOUNCER: This is WOLF BLITZER REPORTS for Thursday, April 15, 2004.

(END VIDEOTAPE)

O'BRIEN: Hello, I'm Miles O'Brien in Atlanta. Wolf is off today.

We begin with an ominous and puzzling new audiotape from al Qaeda, this one apparently recorded by Osama bin Laden himself. The message promises nothing but trouble for the United States. But al Qaeda is making others an offer, an offer, it says, they can't refuse.

(BEGIN VIDEOTAPE)

O'BRIEN (voice-over): The latest message was part proof of life, part let's make a deal. Proof of life, the voice. The CIA thinks it is most likely bin Laden. It seems to be about three weeks old.

Proof of current life? A mention of the Madrid bombings on March 11 as well as the Israeli killing of Hamas leader Shaikh Yassin on March 22. OSAMA BIN LADEN (through translator): It is enough to witness the event that shocked the world, the killing of the elderly wheelchair-bound Shaikh Ahmed Yassin, God have mercy on him. And we pledge to God to take revenge on America, God willing.

O'BRIEN: The "Let's Make a Deal" part? If European countries will get out of Iraq, Afghanistan and the Muslim world, al Qaeda will declare a truce. These countries have three months to decide. The deal is an offer to the U.S.

BIN LADEN (through translator): I offer a truce to them with the commitment to stop operations against any stay which vows to stop attacking Muslims or interfere in their affairs.

O'BRIEN: Spanish voters gave the boot to their ruling party which had backed the U.S. war in Iraq as days after the Madrid bombing. And the speaker is trying to split the coalition with his latest message. But if the Europeans don't agree, prepare for more attacks like Madrid.

BIN LADEN (through translator): Whoever rejects this truce and wants war, we are war's sons. And whoever wants this truce here we bring it.

O'BRIEN: On the ground in Afghanistan where U.S. troops are hunting bin Laden, the new tape is a reminder that the world's most wanted man is still at large.

(END VIDEOTAPE)

O'BRIEN: The White House says the al Qaeda tape, quote, "a clear reminder we are still at war." And just a short while ago Secretary of State Colin Powell said he expects U.S. allies to stand firm.

(BEGIN VIDEO CLIP)

COLIN POWELL, SECRETARY OF STATE: And I think that the international community realizes that they can't give into these kind of threats. And I hope this will strengthen our determination to deal with terrorism and especially to do everything we can to bring Osama bin Laden to justice.

(END VIDEO CLIP)

O'BRIEN: Al Qaeda's truce proposal is aimed at European nations which have sided with the U.S. in the war against terror. So far there are no takers as CNN's Guy Raz reports from London.

(BEGIN VIDEOTAPE)

GUY RAZ, CNN CORRESPONDENT (voice-over): An offer to end scenes of carnage in European capitals like last month's Madrid train bombings. The speaker's terms, an end to al Qaeda terrorism in return for European troop withdrawal from Muslim lands, but in Europe, the message was greeted with universal rejection. JACK STRAW, BRITISH FOREIGN SECRETARY: One has to treat such claims, proposals by al Qaeda with the contempt which they deserve. This is a murderous organization which seeks impossible objective objectives by the most violent of means.

RAZ: Germany, France and Italy have also dismissed the offer.

FRANCO FRATTINI, ITALIAN FOREIGN MINISTER (through translator): It is unthinkable we would establish any kind of negotiation with bin Laden. Everyone understands this.

RAZ: The prime minister-elect of Spain who is threatening to withdraw troops from Iraq didn't directly address the tape, but members of his government have dismissed it as well.

In European capitals, the public is following suit.

UNIDENTIFIED MALE (through translator): I think they should not accept it because terrorists are unpredictable.

UNIDENTIFIED MALE: I think there should be no negotiation with somebody like that. It's horrendous to surrender if we were to negotiate with Osama bin Laden.

RAZ: Experts believe anti-war sentiment in Europe, and trans- Atlantic divisions over the war on terror has allowed bin Laden to exploit those differences.

SAIJAN GOHEL, TERROR EXPERT: It seems that they want to isolate the U.S. on the ground inside Iraq. They wish to go after the U.S. without having to worry about any of the coalition partners and that in turn would then bring the U.S. into pressure into leaving from Iraq.

RAZ (on camera): European analysts believe al Qaeda's strategy will backfire and actually strengthen Europe's commitment to the war on terror.

Guy Raz, CNN, London.

(END VIDEOTAPE)

O'BRIEN: Bin Laden's habit of making demands, nothing new. Since the mid-'90s he's issued a series of fatwas or religious decrees calling for U.S. troops to leave the Arabian peninsula. A month after the 9/11 attacks he reiterated that demand.

Bin Laden also demanded an end to U.S. sanction against Iraq and an end to U.S. support of Israel and the country's occupation of Jerusalem.

In January, bin Laden called for the overthrow of Arab and Muslim regimes that collaborated with the U.S. including Saudi Arabia and Pakistan.

What's al Qaeda up to, is a good question right now. Does it really think any nation will accept its truce offer? Yonah Alexander, a senior fellow at the Potomac Institute and director of its International Center for Terrorism Studies is joining us today from Chicago. Mr. Alexander, good to have you with us.

YONAH ALEXANDER, SENIOR FELLOW, POTOMAC INSTITUTE, DIR., INTERNATIONAL CENTER FOR TERRORISM STUDIES: Thank you.

O'BRIEN: Is it true that bin Laden truly believes he can negotiate with heads of state in Europe?

ALEXANDER: Even if this is not practical this is not the purpose. As you know, the purpose of terrorism is to terrorize. Either propaganda by the day you throw the bomb and you make the political statement. Or the day they buy propaganda which really means to resort to psychological warfare in order to weaken their resolve of the coalition to fight the al Qaeda.

O'BRIEN: There are many people who when they hear these messages presume there are hidden messages inside, perhaps instructions to al Qaeda followers. Can we presume that to be the case? And is does this prestage attacks in perhaps in Europe in the near future?

ALEXANDER: This is really part of the equation. I mean, you have to look at the audience. Who is the target audience? Obviously, first and foremost, the coalition members and nothing's really new because as you indicated before there were tapes last year, for example and this year. And they're going to do it again and again.

But the purpose is also to encourage their own people and the followers and the sympathizers to show that they're alive and well and kicking. And perhaps there are some messages there to indicate that the worst is yet to come to the attacks as we have seen in Madrid.

And incidentally, they found in Madrid also a tape from the Madrid sale (ph) -- and the Spanish sale of al Qaeda indicating that they're going to attack Spain again, simply if Spain is going to support the effort in Afghanistan.

So again, it's part of the strategic, I think, plan of the al Qaeda.

O'BRIEN: Is al Qaeda, is bin Laden trying to sew the seeds of discontent among the populous in Europe and perhaps insist that their leadership, if it does apply, pull out of Iraq?

ALEXANDER: Well, that's the whole question. That's why we had uninvited participants in the Spanish elections. In fact, al Qaeda dictated the outcome of the elections in Spain.

And terrorists in general, they can have an effect. We're seeing what have been a number of elections in Israel when the terrorists struck or raised the ante over there during the period of elections. And, for example, Sharon was elected or Bebe Netanyahu was elected. And peace those candidates failed.

So again, we have to face in the broader context of what the strategy of the terrorists are and it can really manipulate public opinion by threatening that they're going to use terror and try to weaken our resolve.

O'BRIEN: Mr. Alexander, final thought here. There's at least eight, perhaps nine tapes now that have come out attributed to Osama bin Laden since 9/11. What does that say about his ability to continue to operate with some degree of impunity? And does it indicate that he still has his hands in the reins of power of al Qaeda?

ALEXANDER: Sure. He's still a player. Even if bin Laden is arrested or killed, his vision and legacy will continue.

So the point is that we have to understand that bin Laden and the al Qaeda, they are student of Sun Tzu going back to the fourth century before Christ, meaning that you don't have to win 100 battles. In order to win you don't have to even engage in operations. It's enough to instill fear. And the purpose of terrorism, obviously is to terrorize and therefore is exploiting modern communications and he will continue to use it because this is warfare on the cheap.

O'BRIEN: Yonah Alexander, thank you very much for your time and your insights.

ALEXANDER: Thank you.

O'BRIEN: Here's your turn to weigh in on this important story. Our web question of the day is this. Did you think that Osama bin Laden would be captured or killed by now? You can vote right now, CNN.com/wolf is the place. We'll have results for you later. While you're there, we'd like to hear from you directly. Send us your commends any time, time permitting we might read some of them at the end of this program every day.

Who's going to have to stay in Iraq and how much longer? The Pentagon reveals details of extended deployment for thousands of American forces. Also ahead...

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: They would, like, take you outside and make you believe that you were going to, you know they were going to kill you.

(END VIDEO CLIP)

O'BRIEN: Kidnapped in Iraq, a former hostage recounts his terrifying ordeal. Plus, building better intelligence in an age of terror. Is it mission impossible for the FBI and CIA?

(COMMERCIAL BREAK)

O'BRIEN: Now the latest in the battle for Iraq. Standoffs in two major hotspots, a growing kidnapping crisis. CNN's Jonathan Mann has an update for us.

(BEGIN VIDEOTAPE)

JONATHAN MANN, CNN CORRESPONDENT (voice-over): Fallujah. A tense cease-fire barely holding between U.S. marines and as many as 1,500 insurgents.

GEN. RICHARD MYERS, JOINT CHIEFS CHAIRMAN: This is a situation where you have clearly some foreign fighters, former regime element members who, again, while the cease-fire is ongoing are attacking our marines. The marines are obeying the cease-fire, but they're being fired upon, though they can return fire in self-defense which they do, but they're trying their best to follow the rules of the cease-fire.

MANN: General Myers warns forces need to be prepared for more fighting even as Iraqi leaders try to negotiate an end to the standoff. Will Baghdad be next? Insurgents are distributing leaflets warning residents to stay indoors promising to move their battle to the capital next week.

Also in Baghdad, a high-profile assassination. A diplomat with the Iranian embassy gunned down in his car on a city street. Najaf, scene of another standoff, this one with a radical anti-American cleric and his militia. At the urging of the country's top Shiite leader, Muqtada al-Sadr has dropped his demand for U.S. forces to pull out of all Iraqi cities. 2,500 U.S. soldiers are massed outside Najaf. Commanders say they're hesitant to march into Shia Islam's holiest city, but firm on their intent.

LT. GEN. RICARDO SANCHEZ, U.S. ARMY: The mission that I assigned to my forces was in fact what you stated. It's to kill or capture and to eliminate the Sadr elements influence across the country.

MANN: Meanwhile, mixed developments in the wave of kidnappings, an increasingly popular tactic among anticoalition forces. Three Japanese hostages have been freed, but there are reports two others have been taken. Rome confirms the death of one of four Italian hostages. The execution videotaped and sent to Arab media. A French journalist and former hostage released this week says the kidnappers are disparate, but united.

ALEX JORDANOV, FMR. HOSTAGE: They're all interconnected. They all know each other. They don't share the same political views, but they have one common enemy and it's the American occupation.

MANN: Jonathan Mann, CNN.

(END VIDEOTAPE)

O'BRIEN: Meanwhile Defense Secretary Donald Rumsfeld has announced plans to keep about 20,000 U.S. forces in Iraq longer. CNN's senior Pentagon correspondent Jamie McIntyre joins us with details and all of that -- Jamie.

JAMIE MCINTYRE, CNN SENIOR PENTAGON CORRESPONDENT: As Defense Secretary Rumsfeld made that announcement about extending the combat tours of those troops he also did something unusual for him, he admitted that he might have been wrong about how the level of violence that we'd see in Iraq now more than a year after the war began.

(BEGIN VIDEOTAPE)

MCINTYRE (voice-over): With the U.S. taking casualties at a higher rate than when the war began and the Pentagon forced to cancel the return of 20,000 troops needed to deal with a growing insurgency, U.S. Defense Secretary Donald Rumsfeld made what for him is a rare admission. He was wrong about how stable Iraq would be after a year's occupation.

DONALD RUMSFELD, U.S. DEFENSE SECRETARY: If you had said to me a year ago, describe the situation you'll be in today one year later, I don't know many people who would have described it, I would not have described it the way it happens to be today.

MCINTYRE: April has been the deadliest month of the war with nearly 90 Americans killed and more than 540 wounded. More than half of the deaths coming in the past week.

RUMSFELD: I certainly would not have estimated that we would have had the number of individuals lost in -- that we have had lost in the last week.

MCINTYRE: The Pentagon estimates during the same time between 1,500 and 2,000 enemy fighters have been killed, but those figures are not released to avoid the mistake of Vietnam when body counts were cited as a measure of success. The decision to hold 20,000 troops in Iraq for three more months will affect some 40 army units including 11,000 soldiers from the first armored division, 3,200 from the second armored cavalry regimen and about 6,000 guard and reserve troops. Despite the strain on the forces the Pentagon continues to reject the argument the U.S. military is too small.

UNIDENTIFIED MALE: We have the capacity, with 2.4 million individuals available to us, active, guard and reserve to handle this ongoing war and anything they can think of if it's on the horizon.

(END VIDEOTAPE)

MCINTYRE: Rumsfeld said he regretted having to extend the tour of duty of troops who have already been in Iraq a year and while sort of a promise, he did say the current plan is to replace them with fresh troops by the summer if the higher troop levels in Iraq are still needed -- Miles.

O'BRIEN: Jamie, that might be easier said than done, where are those fresh troops going to come from and is it possible these troops might be held over yet again?

MCINTYRE: It is possible, it seems highly unlikely after breaking a promise once that they would do it again. They are right now identifying additional units that could be sent to Iraq if they need to maintain this 20,000 extra margin. We don't know exactly which units they are. Probably would involve accelerating the deployment of units already intended to go to Iraq, but sending them on an earlier schedule. O'BRIEN: CNN's Jamie McIntyre at Pentagon, thanks much.

More on the dangerous situation in Iraq. A former hostage recounts his ordeal detailing some of the horrifying tactics his abductors used on him.

And on the road with Bush and Kerry. What the candidates are saying about the economy on this tax day and a convicted molester who claims hundreds of victims. How a technicality set him free.

(COMMERCIAL BREAK)

O'BRIEN: President Bush marked April 15 by calling on Congress to make the tax cuts he pushed for permanent. The president made his remarks in Iowa, a state he narrowly lost to Democrat Al Gore in the 2000 election. CNN White House correspondent Suzanne Malveaux joins us with details. Hello, Suzanne.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Hello, Miles. President Bush is back from his day trip in Des Moines, Iowa. He really used it as a backdrop on tax day first of all to highlight his broad economic plan, but also specifically to urge Congress to pass and make permanent his tax cut plan. It was four years ago candidate Bush actually introduced that tax relief plan in Iowa. Today administration officials are encouraging people and essentially telling them the message here is that 109 million Americans now get an average tax break of more than $1,500. Administration officials say that, look, with inflation low, interest rates low and homeownership up and with the increase of some 308,000 jobs in March, despite the sluggish economy they say things are now picking up.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Now is not the time to be raising taxes on hard-working people. With this economy growing strong and getting stronger, we don't need to raise the tax burden.

(END VIDEO CLIP)

MALVEAUX: And the Bush campaign has been accusing Senator Kerry of doing just that. We're expected to hear more about that in a bit, but also as you know, Iowa is a critical state for the president. He is battling for that state with Kerry. He lost that state by less than 5,000 votes some four years ago -- Miles.

O'BRIEN: Suzanne, changing subjects here. Any reaction from the White House about that Osama bin Laden tape?

MALVEAUX: Yes, there is and it poses a dilemma for this deliberation if the American people look at this as some sort of measure of the success in the war on terror but Scott Mcclellan, earlier today, the White House spokesman giving his statements saying that our intelligence community has publicly confirmed that it is likely his voice on the tape. He says I think it's a clear reminder that we're still at war on terrorism. I think that it's a clear reminder that terrorists will use any excuse to carry out their evil acts on innocent human beings.

He goes on to talk about the coalition saying, I think that the coalition in Iraq has shown their commitment to following through on what we are working to help the Iraqi people realize, that is a free and peaceful future. I think the important question here, Miles, is what happens on that June 30 date. Are we going to see that U.N. security council resolution that will allow and at least give some international cover for some allies who are rather nervous about keeping their troops there. One of them being the Spanish Prime Minister Zapatero -- Miles.

O'BRIEN: CNN'S Suzanne Malveaux at the White House, thanks much.

Senator John Kerry today accused President Bush of misleading the public about taxes. The Democratic presidential candidate visited Howard University in the nation's capital. He says the president is distorting the record.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: George Bush has made a big deal out of trying to convince America that he's lowered taxes for all Americans and that I'm going to come along and somehow raise taxes on Americans. He's misleading Americans one more time. There's a big truth deficit in this administration and this president is busy trying to run away from his own record and create a phony one for someone else because he doesn't have a record to run on.

(END VIDEO CLIP)

O'BRIEN: As last-minute taxpayers scurried to complete their returns, a new study says the IRS is more likely to audit individuals than corporations. The study conducted by a research center affiliated with Syracuse University, it says the audit rate for business tax returns has declined sharply in recent years to 2.1 audits last year for every 1,000 returns. By contrast, the rates for individuals was three times higher, 6.5 audits per thousand.

A new threat of attack and an offer of truce to some from Osama bin Laden. New audiotape message allegedly from the al Qaeda leader is released and then there's this...

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: They were screaming jihad and they blindfolded me and threw me in the back of the car with a blade under my throat.

(END VIDEO CLIP)

O'BRIEN: Held hostage in Iraq. One lucky journalist is freed. Hear the tale of his capture.

And some say the legal wall between the CIA and the FBI is just too high to climb. Is a new intelligence agency the answer?

(COMMERCIAL BREAK)

O'BRIEN: Welcome back to CNN.

To his killers, he died a hostage. To his country, he died a hero. New details surrounding the execution of an Italian contractor.

But first, a quick check of the headlines for you.

The White House calls an audiotape said to be the voice of Osama bin Laden -- quote -- "a clear reminder we are still at war" -- end of quote. The CIA says it was probably made by the al Qaeda chief in the past few weeks. Aired on Arabic TV networks, it offers a truce to European countries which leave Arab countries alone.

The State Department expected to order all nonessential diplomatic personnel and their families out of Saudi Arabia in coming days. An official says the department is concerned about the threat level there and feels the U.S. must keep a lower profile. He expects the order to come by week's end.

Army Chaplain Captain James Yee's record is now clean. The Army has dismissed all remaining charges against the Muslim chaplain, including a reprimand issued for lesser sex-related violations. Yee was once jailed on an accusation of espionage while serving as a cleric for detainees at Guantanamo Bay, Cuba. The most serious charges of mishandling classified information were dropped a month ago.

Set free on a technicality. "The Los Angeles Times" reporting a convicted child molester released last week after a state appeals court ruled he never had the chance to confront his accuser. The 16- year-old boy committed suicide before Edward Stokes' trial. Stokes whereabouts, unknown.

Italy says its troops will remain in Iraq despite the execution of one Italian hostage and threats that three of the remaining hostages also will be killed.

As CNN Rome bureau chief Alessio Vinci report, news of the execution has left many Italians very angry.

(BEGIN VIDEOTAPE)

ALESSIO VINCI, CNN CORRESPONDENT (voice-over): The newspaper headlines were all for him, Fabrizio Quattrocchi, one of four Italians kidnapped in Iraq, executed by his captors with a gunshot to his head and one to his chest.

This boy, as assassins were pointing the gun at him, tried to take off his hood and shouted, now I'll show you how an Italian dies, Italy's foreign minister said, adding he died as a hero.

News of the execution was first released by the Arabic news network Al Jazeera which had previously broadcast images of the hostages. The network obtained a second videotape on Wednesday showing the execution, too graphic to broadcast. In a statement delivered with the videotape, the hostage-takers, calling themselves the Mujahedeen Brigade, vowed to kill the other three captives if their demands are not met. They asked for the Italian troops to pull out of Iraq and then an apology by Prime Minister Silvio Berlusconi.

But the Italian government has vowed to stand firm. Italy's president said: The barbarian killing strengthens Italy's determination to bar hatred's way and work for the real fulfillment for peaceful co-existence in Iraq.

While other government officials say, there is no talk whatsoever of withdrawing troops. In a statement, Prime Minister Berlusconi said: They have cut short a life, but they have not damaged our resolve and our commitments to peace.

(on camera): Berlusconi sent to Iraq a top diplomat, and government officials insist he is not there to negotiate or make concessions but to seek a dialogue with intermediaries in the region to help secure the release of the remaining hostages.

(voice-over): The victim was 36 years old, employed by a private security firm. Colleagues and friends back home were shocked.

We are in pain because we did not expect something like this to happen to one of ours, he says, to somebody close to us because when we work we all feel close to each other.

Friends say Quattrocchi accepted a job in Iraq last December because he wanted to save some money, buy a house, marry his girlfriend and start a family.

Alessio Vinci, CNN, Rome.

(END VIDEOTAPE)

O'BRIEN: A journalist who was held hostage in Iraq for four days says he was freed after he convinced his abductors he was French. He also has a frightening account of who may have been behind his capture.

CNN's Brian Todd with that.

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT (voice-over): A harrowing week for a journalist kidnapped in Iraq.

ALEXANDER JORDANOV, JOURNALIST: A car jumped out of nowhere and four men grabbed me and took me away.

TODD: And an ominous claim.

JORDANOV: They are interconnected.

TODD: Alexander Jordanov from a French TV network captured Sunday on his way to Karbala, released a few days later. The ordeal itself, a knife held at his throat, psychological torture, shuffled to about 10 different locations, was frightening enough.

Now, he says, different groups who have often fought against each other are working together in the recent kidnappings of foreign civilians. He tells CNN he picked this up as he was being driven around and passed from one group to another.

JORDANOV: Every time they would stop and say hello to their colleagues, if I may say so, and these colleagues would sometimes from the Saddam party, sometimes from the Muqtada al-Sadr party, but they all knew each other and they all had a common goal, is to, I guess, get a hostage and try to get something out of it.

TODD: And he says, a common purpose, opposition to the U.S.-led occupation.

(on camera): Jordanov's claim cannot be independently verified. He implies that he dealt with a translator while in captivity, indicating he may have a hard time understanding what the hostage- takers were communicating.

TODD (voice-over): And one intelligence community observer we spoke to said it would be astonishing to see Sunni extremists like Saddam loyalists working with Shiite militias tied to radicals like Muqtada al-Sadr, leader of the latest uprising in southern Iraq. But others say in this kind of climate, those arrangements aren't only feasible; they've been going on for years.

COL. PATRICK LANG, FORMER DEFENSE INTELLIGENCE ANALYST: I think the record shows pretty clearly over the last 10 or 15 years, in a whole variety of places from Lebanon to Iraq to other places, that in fact Shia and Sunni will cooperate with each other on a tactical basis against a common non-Islamic enemy.

TODD: Jordanov was released with a letter from a group calling itself the United Front of the Mujahedeen. Whether this represents one group or more, one intelligence experts says the abductions are a big problem for the coalition and there's one way to stop them, to never meet the kidnappers' demands.

Brian Todd, CNN, Washington.

(END VIDEOTAPE)

O'BRIEN: More on the hostage situation in Iraq just ahead, including how the U.S. and its allies might prevent more civilians from being captured. I'll speak with expert Robin Wright of "The Washington Post."

Two separate agencies, one similar goal. Is there a better way for the FBI and the CIA to combat terrorism?

And a town remembers its fallen soldier. A family remembers its sister, the memorial for Michelle Witmer. That's later.

But, first, a quick look at some other news making headlines around the world.

(BEGIN VIDEOTAPE)

O'BRIEN (voice-over): Palestinian Prime Minister Ahmed Qureia responds angrily to President Bush's revised Middle East policy endorsing some Jewish settlements in a final peace deal. Qureia says Palestinians will not accept such a deal.

Israeli soldiers and Palestinian gunmen clashed in Southern Gaza today. Palestinian sources say 20 Palestinians were wounded by a missile fired at a building where they were hiding.

Vice President Cheney presses China to take a more aggressive stand against North Korea's nuclear program. Speaking in Beijing, he warned that North Korea could provide nuclear technology to others including terror groups such as al Qaeda. Cheney's comments came before he left for South Korea for the last leg of a weeklong Asian tour.

South Korea's pro-government Uri Party claims victory in today's parliamentary elections, a result that could distance the South from U.S. policy on North Korea. Projections show the party of loyalists to Seoul's recently-impeached president has apparently clenched a majority over the main opposition party. Uri's leaders called for immediate withdrawal of the impeachment.

Spain's new socialist leader prepares to take the helm. In a speech today, incoming Prime Minister Jose Luis Rodriguez Zapatero referred to a pledge to withdraw troops from Iraq if the U.N. doesn't take charge by mid-year. Zapatero is expected to be sworn in Saturday.

And that is our look around the world.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

O'BRIEN: The United States got a chilling new warning today from Osama bin Laden, an al Qaeda audiotape vowing to punish Americans, this just a day after the CIA director said it will take five years to build the kind of intelligence service the country needs.

The 9/11 Commission warns that the CIA and FBI must work together to keep Americans safe, but is that mission impossible?

CNN homeland security correspondent Jeanne Meserve with an inside account of the challenges that lie ahead.

(BEGIN VIDEOTAPE)

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT (voice-over): Smith Brandon International, a security consulting firm, is a mixed professional marriage. For 10 years, Gene Smith was a CIA agent. Skip Brandon is a 23-year veteran of the FBI.

SKIP BRANDON, FORMER ASSISTANT FBI DIRECTOR OF COUNTERTERRORISM: There are times when it can be a bit like the War of the Roses.

UNIDENTIFIED FEMALE: There's absolutely a difference in culture.

MESERVE: A difference that dates back decades. From the get-go, the FBI saw the newly-formed CIA as a threat to its turf.

RON KESSLER, AUTHOR, "INSIDE THE CIA": When J. Edgar Hoover was FBI director, he actually ordered FBI agents to not talk to CIA officers.

MESERVE: The rivalry persisted. FBI spy Robert Hanssen was not detected before 2001, some say, because the FBI insisted the mole must be inside the CIA.

More recently, the CIA did not share results from the Cole bombing investigation in a timely fashion, impeding FBI tracking of two 9/11 hijackers.

(on camera): Until the Patriot Act, there was also a high legal wall between intelligence and law enforcement agents. In addition, the FBI and CIA had different domains, missions and tactics.

(voice-over): Gene Smith, a former CIA agent, sees herself an independent undercover person who looks at the big picture. Skip Brandon, a former FBI agent, is more of a public team player oriented toward a specific result, but for nine years they've collaborated successfully.

BRANDON: Sometimes on projects we go both ways and then at the end we push them together, and I think it works pretty well. Maybe the same thing can make her head the CIA and me the FBI.

MESERVE: Though that isn't in the cards the FBI and the CIA are sharing more with the new terrorism threat integration center, for instance. The 9/11 Commission has talked about building an entirely new domestic intelligence agency like Britain's MI5, a bad idea, say Smith and Brandon.

GENE SMITH, SMITH BRANDON INTERNATIONAL: It's putting a dog and an alley cat in a smaller box. They need the room to roam.

MESERVE: To roam, they say, and do their respective jobs.

Jeanne Meserve, CNN, Washington.

(END VIDEOTAPE)

O'BRIEN: An old terror tactic creating new fear and drama, how the hostage phenomenon in Iraq is affecting the coalition's efforts.

Also ahead:

(BEGIN VIDEO CLIP)

CHARITY WITMER, SISTER OF MICHELLE: Why? Why God did she have to be the only one who died that day? Why it was her? (END VIDEO CLIP)

O'BRIEN: A solemn tribute. A sister says goodbye to her identical twin and fellow soldier.

(COMMERCIAL BREAK)

O'BRIEN: The recent surge in kidnappings in Iraq is adding a new dimension to the instability there.

Robin Wright covers international and diplomatic affairs for "The Washington Post."

Ms. Wright, good to have you with us.

ROBIN WRIGHT, "THE WASHINGTON POST": Nice to be with you, Miles.

O'BRIEN: Let's talk about the tactic. Historically, it's a favored tactic among terrorists, but injecting it into Iraq is a relatively new wrinkle. Why is it happening now, do you think?

WRIGHT: Well, clearly, it's a time that the various groups are trying to intimidate the United States and introducing a tactic that in the past has been far more effective in some cases than bullets or bombs. It scares people.

It's one thing when people are killed and they're buried and people move on. But the drama, the trauma of holding foreigners hostage. We saw this in Iran in 1979, when 52 Americans were held for 444 days. And it introduced the yellow ribbon as a symbol of the drama we all lived through. This kind of thing has the tremendous impact psychologically. We saw it again in Lebanon over a seven-year period, when dozens of Americans and other foreigners were held hostage, some for seven years.

And it was the moment at which a lot of foreigners left Lebanon, not because of the vast number of suicide bombings and attacks and Westerners, but because Westerners were taken hostage. And there was an open-ended period of being held.

O'BRIEN: Well, I've heard it said that it is militarily, really, in the grand scheme of things insignificant. Where it plays to the terrorists' goals is as a propaganda tool aimed at the general public here and aimed at those who might consider perhaps investing and propping up Iraq and sending it on the road toward freedom.

WRIGHT: Well, sure.

You look at the number of security workers, the contract workers who are leaving, the aid workers, people whose governments are actually pulling them out, not because of the kind of violence we've seen over the past year, but because of the danger of hostage taking. Even the Russians are pulling out their workers in Iraq today.

So it does play both to public opinion and in turn then pressuring governments to act. O'BRIEN: Now, I know you're not there on the ground and, in a sense, this is a bit of an unfair question, but would you be surprised if Sunnis and Shiites were cooperating in any concerted way in this effort or do you think it's more desperate?

WRIGHT: Well, it's really hard to tell.

I'm a long way away. It wouldn't surprise me to hear that some Shia and Sunni groups or minority militants may be collaborating because they share a common goal and that's to get the United States and other foreign forces to leave Iraq. But does that mean we're back to see the crossing of a political threshold and the unity of these very disparate populations? I don't think we're there yet.

O'BRIEN: All right, let's take another turn in the Middle East. The State Department today out with the announcement that U.S. citizens are being encouraged to leave Saudi Arabia, a significant development and obviously reflective of some, as they say, actionable intelligence at the root of it. What are your sources telling you about what's going on there?

WRIGHT: Well, the decision was made actually before the bin Laden tape, but it is based on new intelligence indicating that Americans remain a threat.

Everyone but the ambassador and emergency personnel will be evacuated beginning immediately. This is not known to be related to bin Laden himself, but to groups that have been affiliated with bin Laden's thinking, acted in the same kind of vein, and have been active in Saudi Arabia before, particularly in the bombings last year.

O'BRIEN: Yes, put that in perspective. That is very significant. I can't recall an occasion quite like this when this occurred.

WRIGHT: It's been a long time. And there's been no forced evacuation since before the Gulf War, even though there has been a voluntary evacuation. But this means that the majority of U.S. diplomats and all of the dependents, in other words families of diplomats, will be flown out of Saudi Arabia.

O'BRIEN: All right. Thank you very much, Robin Wright with "The Washington Post." Appreciate your time and insights today.

WRIGHT: Thank you, Miles.

O'BRIEN: Hundred of friends and neighbors packed a church auditorium outside Milwaukee to attend services for Michelle Witmer. The 20-year-old woman was killed in Iraq where she was one of three sisters serving in the National Guard. Her identical twin sister, Charity, a medic in Iraq, called her sister a here row.

(BEGIN VIDEO CLIP)

WITMER: When we were about probably like 10 years old, me, Rachel and Michelle were all sitting around and talking about what we wanted to be when we grew up.

And Michelle, of course, was very hesitant to tell us what exactly she wanted to be. Keep in mind, we're like 10 years old. She just kind of looked around and she said, you know what, you guys? I really want to be a hero.

She had a way of dancing, singing and tripping into every room she came into, along with me and Rachel tripping right behind her. One of the last times I saw Michelle, she gave me a big hug and a kiss. And she said I love you. When they came and told me what had happened, I said why? Why? Why, God, did she have to be the only one who died that day? Why witness as her? She was ready and she was at peace. And she was a hero when she died.

(END VIDEO CLIP)

O'BRIEN: Charity Witmer and her surviving sister, Rachel, are on bereavement leave right now. National Guard officials say it will be up to them to decide whether they want to return to Iraq.

Our hot "Web Question of the Day" is this. Did you think that Osama bin Laden would be captured or killed by now? We invite you to vote right now. CNN.com/Wolf is the place to do it. The results for you when we come back.

Plus, it's time to make the doughnuts. These cops are blazing a trail, slam dunking colors, trying to powder the competition.

(COMMERCIAL BREAK)

O'BRIEN: Here's how you're weighing in on our "Web Question of the Day." It is, did you think that Osama bin Laden would be captured or killed by now? Sixty-five percent of you say yes; 35 percent of you say no. The poll is not scientific.

Now to your e-mail on the latest audiotape thought to be from Osama bin Laden. It contains a truce offer for European countries which stop fighting Muslims.

J.C. writes this: "Bin Laden is grasping at straws in the effort to drive our allies away. These are desperate means from a desperate person. We can only hope that he will eventually be the cause of his own destruction. I'm glad to see that Germany, Italy, and England are bending to the whims of this lunatic."

But we get this from Ed: "This guy is way ahead of Bush at every turn. OBL uses everything Bush says and does to exploit the rift the U.S. and Europe have and further isolate the U.S. At the same time, his terror network continues to grow in strength and carry out attacks."

Well, cops and doughnuts, they go together like cops and doughnuts. Check out our picture of the day; 40 of the world's finest from as far away as Australia gathered in suburban Chicago for the World Cop Doughnut-Eating Contest. A cop from Geneva, Wisconsin, won the three-minute race, packing away 9 1/2 Dunkin' Donuts in that time. His name on is O'Brien, by the way, Terry O'Brien, not related, as far as I know, but clearly worthy of the name. Attaboy, Terry.

A reminder, you can always catch WOLF BLITZER REPORTS weekdays at this time, 5:00 Eastern. Wolf will back tomorrow. Until then, thanks for joining us.

"LOU DOBBS TONIGHT" starts right now.

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


Aired April 15, 2004 - 17:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEOTAPE)
MILES O'BRIEN, CNN ANCHOR (voice-over): Terror truce: an offer from Osama bin Laden to some countries. Can al Qaeda spilt the allies?

Hostage horrors: one is murdered, others are freed. Reliving the nightmare.

ALEXANDRE JORDANOV, JOURNALIST, FMR. HOSTAGE: They were screaming "jihad," and they blindfolded me and threw me in the back of the car with a blade under my throat.

O'BRIEN: Have Iraq's insurgents formed their own alliance?

Help on the way. U.S. commanders in Iraq will get more troops.

GEN. RICHARD MYERS, CHAIRMAN, JOINT CHIEFS OF STAFF: I think what it shows is our resolve to see this situation through.

O'BRIEN: Like cats and dogs. Can the FBI and the CIA really get along?

ANNOUNCER: This is WOLF BLITZER REPORTS for Thursday, April 15, 2004.

(END VIDEOTAPE)

O'BRIEN: Hello, I'm Miles O'Brien in Atlanta. Wolf is off today.

We begin with an ominous and puzzling new audiotape from al Qaeda, this one apparently recorded by Osama bin Laden himself. The message promises nothing but trouble for the United States. But al Qaeda is making others an offer, an offer, it says, they can't refuse.

(BEGIN VIDEOTAPE)

O'BRIEN (voice-over): The latest message was part proof of life, part let's make a deal. Proof of life, the voice. The CIA thinks it is most likely bin Laden. It seems to be about three weeks old.

Proof of current life? A mention of the Madrid bombings on March 11 as well as the Israeli killing of Hamas leader Shaikh Yassin on March 22. OSAMA BIN LADEN (through translator): It is enough to witness the event that shocked the world, the killing of the elderly wheelchair-bound Shaikh Ahmed Yassin, God have mercy on him. And we pledge to God to take revenge on America, God willing.

O'BRIEN: The "Let's Make a Deal" part? If European countries will get out of Iraq, Afghanistan and the Muslim world, al Qaeda will declare a truce. These countries have three months to decide. The deal is an offer to the U.S.

BIN LADEN (through translator): I offer a truce to them with the commitment to stop operations against any stay which vows to stop attacking Muslims or interfere in their affairs.

O'BRIEN: Spanish voters gave the boot to their ruling party which had backed the U.S. war in Iraq as days after the Madrid bombing. And the speaker is trying to split the coalition with his latest message. But if the Europeans don't agree, prepare for more attacks like Madrid.

BIN LADEN (through translator): Whoever rejects this truce and wants war, we are war's sons. And whoever wants this truce here we bring it.

O'BRIEN: On the ground in Afghanistan where U.S. troops are hunting bin Laden, the new tape is a reminder that the world's most wanted man is still at large.

(END VIDEOTAPE)

O'BRIEN: The White House says the al Qaeda tape, quote, "a clear reminder we are still at war." And just a short while ago Secretary of State Colin Powell said he expects U.S. allies to stand firm.

(BEGIN VIDEO CLIP)

COLIN POWELL, SECRETARY OF STATE: And I think that the international community realizes that they can't give into these kind of threats. And I hope this will strengthen our determination to deal with terrorism and especially to do everything we can to bring Osama bin Laden to justice.

(END VIDEO CLIP)

O'BRIEN: Al Qaeda's truce proposal is aimed at European nations which have sided with the U.S. in the war against terror. So far there are no takers as CNN's Guy Raz reports from London.

(BEGIN VIDEOTAPE)

GUY RAZ, CNN CORRESPONDENT (voice-over): An offer to end scenes of carnage in European capitals like last month's Madrid train bombings. The speaker's terms, an end to al Qaeda terrorism in return for European troop withdrawal from Muslim lands, but in Europe, the message was greeted with universal rejection. JACK STRAW, BRITISH FOREIGN SECRETARY: One has to treat such claims, proposals by al Qaeda with the contempt which they deserve. This is a murderous organization which seeks impossible objective objectives by the most violent of means.

RAZ: Germany, France and Italy have also dismissed the offer.

FRANCO FRATTINI, ITALIAN FOREIGN MINISTER (through translator): It is unthinkable we would establish any kind of negotiation with bin Laden. Everyone understands this.

RAZ: The prime minister-elect of Spain who is threatening to withdraw troops from Iraq didn't directly address the tape, but members of his government have dismissed it as well.

In European capitals, the public is following suit.

UNIDENTIFIED MALE (through translator): I think they should not accept it because terrorists are unpredictable.

UNIDENTIFIED MALE: I think there should be no negotiation with somebody like that. It's horrendous to surrender if we were to negotiate with Osama bin Laden.

RAZ: Experts believe anti-war sentiment in Europe, and trans- Atlantic divisions over the war on terror has allowed bin Laden to exploit those differences.

SAIJAN GOHEL, TERROR EXPERT: It seems that they want to isolate the U.S. on the ground inside Iraq. They wish to go after the U.S. without having to worry about any of the coalition partners and that in turn would then bring the U.S. into pressure into leaving from Iraq.

RAZ (on camera): European analysts believe al Qaeda's strategy will backfire and actually strengthen Europe's commitment to the war on terror.

Guy Raz, CNN, London.

(END VIDEOTAPE)

O'BRIEN: Bin Laden's habit of making demands, nothing new. Since the mid-'90s he's issued a series of fatwas or religious decrees calling for U.S. troops to leave the Arabian peninsula. A month after the 9/11 attacks he reiterated that demand.

Bin Laden also demanded an end to U.S. sanction against Iraq and an end to U.S. support of Israel and the country's occupation of Jerusalem.

In January, bin Laden called for the overthrow of Arab and Muslim regimes that collaborated with the U.S. including Saudi Arabia and Pakistan.

What's al Qaeda up to, is a good question right now. Does it really think any nation will accept its truce offer? Yonah Alexander, a senior fellow at the Potomac Institute and director of its International Center for Terrorism Studies is joining us today from Chicago. Mr. Alexander, good to have you with us.

YONAH ALEXANDER, SENIOR FELLOW, POTOMAC INSTITUTE, DIR., INTERNATIONAL CENTER FOR TERRORISM STUDIES: Thank you.

O'BRIEN: Is it true that bin Laden truly believes he can negotiate with heads of state in Europe?

ALEXANDER: Even if this is not practical this is not the purpose. As you know, the purpose of terrorism is to terrorize. Either propaganda by the day you throw the bomb and you make the political statement. Or the day they buy propaganda which really means to resort to psychological warfare in order to weaken their resolve of the coalition to fight the al Qaeda.

O'BRIEN: There are many people who when they hear these messages presume there are hidden messages inside, perhaps instructions to al Qaeda followers. Can we presume that to be the case? And is does this prestage attacks in perhaps in Europe in the near future?

ALEXANDER: This is really part of the equation. I mean, you have to look at the audience. Who is the target audience? Obviously, first and foremost, the coalition members and nothing's really new because as you indicated before there were tapes last year, for example and this year. And they're going to do it again and again.

But the purpose is also to encourage their own people and the followers and the sympathizers to show that they're alive and well and kicking. And perhaps there are some messages there to indicate that the worst is yet to come to the attacks as we have seen in Madrid.

And incidentally, they found in Madrid also a tape from the Madrid sale (ph) -- and the Spanish sale of al Qaeda indicating that they're going to attack Spain again, simply if Spain is going to support the effort in Afghanistan.

So again, it's part of the strategic, I think, plan of the al Qaeda.

O'BRIEN: Is al Qaeda, is bin Laden trying to sew the seeds of discontent among the populous in Europe and perhaps insist that their leadership, if it does apply, pull out of Iraq?

ALEXANDER: Well, that's the whole question. That's why we had uninvited participants in the Spanish elections. In fact, al Qaeda dictated the outcome of the elections in Spain.

And terrorists in general, they can have an effect. We're seeing what have been a number of elections in Israel when the terrorists struck or raised the ante over there during the period of elections. And, for example, Sharon was elected or Bebe Netanyahu was elected. And peace those candidates failed.

So again, we have to face in the broader context of what the strategy of the terrorists are and it can really manipulate public opinion by threatening that they're going to use terror and try to weaken our resolve.

O'BRIEN: Mr. Alexander, final thought here. There's at least eight, perhaps nine tapes now that have come out attributed to Osama bin Laden since 9/11. What does that say about his ability to continue to operate with some degree of impunity? And does it indicate that he still has his hands in the reins of power of al Qaeda?

ALEXANDER: Sure. He's still a player. Even if bin Laden is arrested or killed, his vision and legacy will continue.

So the point is that we have to understand that bin Laden and the al Qaeda, they are student of Sun Tzu going back to the fourth century before Christ, meaning that you don't have to win 100 battles. In order to win you don't have to even engage in operations. It's enough to instill fear. And the purpose of terrorism, obviously is to terrorize and therefore is exploiting modern communications and he will continue to use it because this is warfare on the cheap.

O'BRIEN: Yonah Alexander, thank you very much for your time and your insights.

ALEXANDER: Thank you.

O'BRIEN: Here's your turn to weigh in on this important story. Our web question of the day is this. Did you think that Osama bin Laden would be captured or killed by now? You can vote right now, CNN.com/wolf is the place. We'll have results for you later. While you're there, we'd like to hear from you directly. Send us your commends any time, time permitting we might read some of them at the end of this program every day.

Who's going to have to stay in Iraq and how much longer? The Pentagon reveals details of extended deployment for thousands of American forces. Also ahead...

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: They would, like, take you outside and make you believe that you were going to, you know they were going to kill you.

(END VIDEO CLIP)

O'BRIEN: Kidnapped in Iraq, a former hostage recounts his terrifying ordeal. Plus, building better intelligence in an age of terror. Is it mission impossible for the FBI and CIA?

(COMMERCIAL BREAK)

O'BRIEN: Now the latest in the battle for Iraq. Standoffs in two major hotspots, a growing kidnapping crisis. CNN's Jonathan Mann has an update for us.

(BEGIN VIDEOTAPE)

JONATHAN MANN, CNN CORRESPONDENT (voice-over): Fallujah. A tense cease-fire barely holding between U.S. marines and as many as 1,500 insurgents.

GEN. RICHARD MYERS, JOINT CHIEFS CHAIRMAN: This is a situation where you have clearly some foreign fighters, former regime element members who, again, while the cease-fire is ongoing are attacking our marines. The marines are obeying the cease-fire, but they're being fired upon, though they can return fire in self-defense which they do, but they're trying their best to follow the rules of the cease-fire.

MANN: General Myers warns forces need to be prepared for more fighting even as Iraqi leaders try to negotiate an end to the standoff. Will Baghdad be next? Insurgents are distributing leaflets warning residents to stay indoors promising to move their battle to the capital next week.

Also in Baghdad, a high-profile assassination. A diplomat with the Iranian embassy gunned down in his car on a city street. Najaf, scene of another standoff, this one with a radical anti-American cleric and his militia. At the urging of the country's top Shiite leader, Muqtada al-Sadr has dropped his demand for U.S. forces to pull out of all Iraqi cities. 2,500 U.S. soldiers are massed outside Najaf. Commanders say they're hesitant to march into Shia Islam's holiest city, but firm on their intent.

LT. GEN. RICARDO SANCHEZ, U.S. ARMY: The mission that I assigned to my forces was in fact what you stated. It's to kill or capture and to eliminate the Sadr elements influence across the country.

MANN: Meanwhile, mixed developments in the wave of kidnappings, an increasingly popular tactic among anticoalition forces. Three Japanese hostages have been freed, but there are reports two others have been taken. Rome confirms the death of one of four Italian hostages. The execution videotaped and sent to Arab media. A French journalist and former hostage released this week says the kidnappers are disparate, but united.

ALEX JORDANOV, FMR. HOSTAGE: They're all interconnected. They all know each other. They don't share the same political views, but they have one common enemy and it's the American occupation.

MANN: Jonathan Mann, CNN.

(END VIDEOTAPE)

O'BRIEN: Meanwhile Defense Secretary Donald Rumsfeld has announced plans to keep about 20,000 U.S. forces in Iraq longer. CNN's senior Pentagon correspondent Jamie McIntyre joins us with details and all of that -- Jamie.

JAMIE MCINTYRE, CNN SENIOR PENTAGON CORRESPONDENT: As Defense Secretary Rumsfeld made that announcement about extending the combat tours of those troops he also did something unusual for him, he admitted that he might have been wrong about how the level of violence that we'd see in Iraq now more than a year after the war began.

(BEGIN VIDEOTAPE)

MCINTYRE (voice-over): With the U.S. taking casualties at a higher rate than when the war began and the Pentagon forced to cancel the return of 20,000 troops needed to deal with a growing insurgency, U.S. Defense Secretary Donald Rumsfeld made what for him is a rare admission. He was wrong about how stable Iraq would be after a year's occupation.

DONALD RUMSFELD, U.S. DEFENSE SECRETARY: If you had said to me a year ago, describe the situation you'll be in today one year later, I don't know many people who would have described it, I would not have described it the way it happens to be today.

MCINTYRE: April has been the deadliest month of the war with nearly 90 Americans killed and more than 540 wounded. More than half of the deaths coming in the past week.

RUMSFELD: I certainly would not have estimated that we would have had the number of individuals lost in -- that we have had lost in the last week.

MCINTYRE: The Pentagon estimates during the same time between 1,500 and 2,000 enemy fighters have been killed, but those figures are not released to avoid the mistake of Vietnam when body counts were cited as a measure of success. The decision to hold 20,000 troops in Iraq for three more months will affect some 40 army units including 11,000 soldiers from the first armored division, 3,200 from the second armored cavalry regimen and about 6,000 guard and reserve troops. Despite the strain on the forces the Pentagon continues to reject the argument the U.S. military is too small.

UNIDENTIFIED MALE: We have the capacity, with 2.4 million individuals available to us, active, guard and reserve to handle this ongoing war and anything they can think of if it's on the horizon.

(END VIDEOTAPE)

MCINTYRE: Rumsfeld said he regretted having to extend the tour of duty of troops who have already been in Iraq a year and while sort of a promise, he did say the current plan is to replace them with fresh troops by the summer if the higher troop levels in Iraq are still needed -- Miles.

O'BRIEN: Jamie, that might be easier said than done, where are those fresh troops going to come from and is it possible these troops might be held over yet again?

MCINTYRE: It is possible, it seems highly unlikely after breaking a promise once that they would do it again. They are right now identifying additional units that could be sent to Iraq if they need to maintain this 20,000 extra margin. We don't know exactly which units they are. Probably would involve accelerating the deployment of units already intended to go to Iraq, but sending them on an earlier schedule. O'BRIEN: CNN's Jamie McIntyre at Pentagon, thanks much.

More on the dangerous situation in Iraq. A former hostage recounts his ordeal detailing some of the horrifying tactics his abductors used on him.

And on the road with Bush and Kerry. What the candidates are saying about the economy on this tax day and a convicted molester who claims hundreds of victims. How a technicality set him free.

(COMMERCIAL BREAK)

O'BRIEN: President Bush marked April 15 by calling on Congress to make the tax cuts he pushed for permanent. The president made his remarks in Iowa, a state he narrowly lost to Democrat Al Gore in the 2000 election. CNN White House correspondent Suzanne Malveaux joins us with details. Hello, Suzanne.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Hello, Miles. President Bush is back from his day trip in Des Moines, Iowa. He really used it as a backdrop on tax day first of all to highlight his broad economic plan, but also specifically to urge Congress to pass and make permanent his tax cut plan. It was four years ago candidate Bush actually introduced that tax relief plan in Iowa. Today administration officials are encouraging people and essentially telling them the message here is that 109 million Americans now get an average tax break of more than $1,500. Administration officials say that, look, with inflation low, interest rates low and homeownership up and with the increase of some 308,000 jobs in March, despite the sluggish economy they say things are now picking up.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Now is not the time to be raising taxes on hard-working people. With this economy growing strong and getting stronger, we don't need to raise the tax burden.

(END VIDEO CLIP)

MALVEAUX: And the Bush campaign has been accusing Senator Kerry of doing just that. We're expected to hear more about that in a bit, but also as you know, Iowa is a critical state for the president. He is battling for that state with Kerry. He lost that state by less than 5,000 votes some four years ago -- Miles.

O'BRIEN: Suzanne, changing subjects here. Any reaction from the White House about that Osama bin Laden tape?

MALVEAUX: Yes, there is and it poses a dilemma for this deliberation if the American people look at this as some sort of measure of the success in the war on terror but Scott Mcclellan, earlier today, the White House spokesman giving his statements saying that our intelligence community has publicly confirmed that it is likely his voice on the tape. He says I think it's a clear reminder that we're still at war on terrorism. I think that it's a clear reminder that terrorists will use any excuse to carry out their evil acts on innocent human beings.

He goes on to talk about the coalition saying, I think that the coalition in Iraq has shown their commitment to following through on what we are working to help the Iraqi people realize, that is a free and peaceful future. I think the important question here, Miles, is what happens on that June 30 date. Are we going to see that U.N. security council resolution that will allow and at least give some international cover for some allies who are rather nervous about keeping their troops there. One of them being the Spanish Prime Minister Zapatero -- Miles.

O'BRIEN: CNN'S Suzanne Malveaux at the White House, thanks much.

Senator John Kerry today accused President Bush of misleading the public about taxes. The Democratic presidential candidate visited Howard University in the nation's capital. He says the president is distorting the record.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: George Bush has made a big deal out of trying to convince America that he's lowered taxes for all Americans and that I'm going to come along and somehow raise taxes on Americans. He's misleading Americans one more time. There's a big truth deficit in this administration and this president is busy trying to run away from his own record and create a phony one for someone else because he doesn't have a record to run on.

(END VIDEO CLIP)

O'BRIEN: As last-minute taxpayers scurried to complete their returns, a new study says the IRS is more likely to audit individuals than corporations. The study conducted by a research center affiliated with Syracuse University, it says the audit rate for business tax returns has declined sharply in recent years to 2.1 audits last year for every 1,000 returns. By contrast, the rates for individuals was three times higher, 6.5 audits per thousand.

A new threat of attack and an offer of truce to some from Osama bin Laden. New audiotape message allegedly from the al Qaeda leader is released and then there's this...

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: They were screaming jihad and they blindfolded me and threw me in the back of the car with a blade under my throat.

(END VIDEO CLIP)

O'BRIEN: Held hostage in Iraq. One lucky journalist is freed. Hear the tale of his capture.

And some say the legal wall between the CIA and the FBI is just too high to climb. Is a new intelligence agency the answer?

(COMMERCIAL BREAK)

O'BRIEN: Welcome back to CNN.

To his killers, he died a hostage. To his country, he died a hero. New details surrounding the execution of an Italian contractor.

But first, a quick check of the headlines for you.

The White House calls an audiotape said to be the voice of Osama bin Laden -- quote -- "a clear reminder we are still at war" -- end of quote. The CIA says it was probably made by the al Qaeda chief in the past few weeks. Aired on Arabic TV networks, it offers a truce to European countries which leave Arab countries alone.

The State Department expected to order all nonessential diplomatic personnel and their families out of Saudi Arabia in coming days. An official says the department is concerned about the threat level there and feels the U.S. must keep a lower profile. He expects the order to come by week's end.

Army Chaplain Captain James Yee's record is now clean. The Army has dismissed all remaining charges against the Muslim chaplain, including a reprimand issued for lesser sex-related violations. Yee was once jailed on an accusation of espionage while serving as a cleric for detainees at Guantanamo Bay, Cuba. The most serious charges of mishandling classified information were dropped a month ago.

Set free on a technicality. "The Los Angeles Times" reporting a convicted child molester released last week after a state appeals court ruled he never had the chance to confront his accuser. The 16- year-old boy committed suicide before Edward Stokes' trial. Stokes whereabouts, unknown.

Italy says its troops will remain in Iraq despite the execution of one Italian hostage and threats that three of the remaining hostages also will be killed.

As CNN Rome bureau chief Alessio Vinci report, news of the execution has left many Italians very angry.

(BEGIN VIDEOTAPE)

ALESSIO VINCI, CNN CORRESPONDENT (voice-over): The newspaper headlines were all for him, Fabrizio Quattrocchi, one of four Italians kidnapped in Iraq, executed by his captors with a gunshot to his head and one to his chest.

This boy, as assassins were pointing the gun at him, tried to take off his hood and shouted, now I'll show you how an Italian dies, Italy's foreign minister said, adding he died as a hero.

News of the execution was first released by the Arabic news network Al Jazeera which had previously broadcast images of the hostages. The network obtained a second videotape on Wednesday showing the execution, too graphic to broadcast. In a statement delivered with the videotape, the hostage-takers, calling themselves the Mujahedeen Brigade, vowed to kill the other three captives if their demands are not met. They asked for the Italian troops to pull out of Iraq and then an apology by Prime Minister Silvio Berlusconi.

But the Italian government has vowed to stand firm. Italy's president said: The barbarian killing strengthens Italy's determination to bar hatred's way and work for the real fulfillment for peaceful co-existence in Iraq.

While other government officials say, there is no talk whatsoever of withdrawing troops. In a statement, Prime Minister Berlusconi said: They have cut short a life, but they have not damaged our resolve and our commitments to peace.

(on camera): Berlusconi sent to Iraq a top diplomat, and government officials insist he is not there to negotiate or make concessions but to seek a dialogue with intermediaries in the region to help secure the release of the remaining hostages.

(voice-over): The victim was 36 years old, employed by a private security firm. Colleagues and friends back home were shocked.

We are in pain because we did not expect something like this to happen to one of ours, he says, to somebody close to us because when we work we all feel close to each other.

Friends say Quattrocchi accepted a job in Iraq last December because he wanted to save some money, buy a house, marry his girlfriend and start a family.

Alessio Vinci, CNN, Rome.

(END VIDEOTAPE)

O'BRIEN: A journalist who was held hostage in Iraq for four days says he was freed after he convinced his abductors he was French. He also has a frightening account of who may have been behind his capture.

CNN's Brian Todd with that.

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT (voice-over): A harrowing week for a journalist kidnapped in Iraq.

ALEXANDER JORDANOV, JOURNALIST: A car jumped out of nowhere and four men grabbed me and took me away.

TODD: And an ominous claim.

JORDANOV: They are interconnected.

TODD: Alexander Jordanov from a French TV network captured Sunday on his way to Karbala, released a few days later. The ordeal itself, a knife held at his throat, psychological torture, shuffled to about 10 different locations, was frightening enough.

Now, he says, different groups who have often fought against each other are working together in the recent kidnappings of foreign civilians. He tells CNN he picked this up as he was being driven around and passed from one group to another.

JORDANOV: Every time they would stop and say hello to their colleagues, if I may say so, and these colleagues would sometimes from the Saddam party, sometimes from the Muqtada al-Sadr party, but they all knew each other and they all had a common goal, is to, I guess, get a hostage and try to get something out of it.

TODD: And he says, a common purpose, opposition to the U.S.-led occupation.

(on camera): Jordanov's claim cannot be independently verified. He implies that he dealt with a translator while in captivity, indicating he may have a hard time understanding what the hostage- takers were communicating.

TODD (voice-over): And one intelligence community observer we spoke to said it would be astonishing to see Sunni extremists like Saddam loyalists working with Shiite militias tied to radicals like Muqtada al-Sadr, leader of the latest uprising in southern Iraq. But others say in this kind of climate, those arrangements aren't only feasible; they've been going on for years.

COL. PATRICK LANG, FORMER DEFENSE INTELLIGENCE ANALYST: I think the record shows pretty clearly over the last 10 or 15 years, in a whole variety of places from Lebanon to Iraq to other places, that in fact Shia and Sunni will cooperate with each other on a tactical basis against a common non-Islamic enemy.

TODD: Jordanov was released with a letter from a group calling itself the United Front of the Mujahedeen. Whether this represents one group or more, one intelligence experts says the abductions are a big problem for the coalition and there's one way to stop them, to never meet the kidnappers' demands.

Brian Todd, CNN, Washington.

(END VIDEOTAPE)

O'BRIEN: More on the hostage situation in Iraq just ahead, including how the U.S. and its allies might prevent more civilians from being captured. I'll speak with expert Robin Wright of "The Washington Post."

Two separate agencies, one similar goal. Is there a better way for the FBI and the CIA to combat terrorism?

And a town remembers its fallen soldier. A family remembers its sister, the memorial for Michelle Witmer. That's later.

But, first, a quick look at some other news making headlines around the world.

(BEGIN VIDEOTAPE)

O'BRIEN (voice-over): Palestinian Prime Minister Ahmed Qureia responds angrily to President Bush's revised Middle East policy endorsing some Jewish settlements in a final peace deal. Qureia says Palestinians will not accept such a deal.

Israeli soldiers and Palestinian gunmen clashed in Southern Gaza today. Palestinian sources say 20 Palestinians were wounded by a missile fired at a building where they were hiding.

Vice President Cheney presses China to take a more aggressive stand against North Korea's nuclear program. Speaking in Beijing, he warned that North Korea could provide nuclear technology to others including terror groups such as al Qaeda. Cheney's comments came before he left for South Korea for the last leg of a weeklong Asian tour.

South Korea's pro-government Uri Party claims victory in today's parliamentary elections, a result that could distance the South from U.S. policy on North Korea. Projections show the party of loyalists to Seoul's recently-impeached president has apparently clenched a majority over the main opposition party. Uri's leaders called for immediate withdrawal of the impeachment.

Spain's new socialist leader prepares to take the helm. In a speech today, incoming Prime Minister Jose Luis Rodriguez Zapatero referred to a pledge to withdraw troops from Iraq if the U.N. doesn't take charge by mid-year. Zapatero is expected to be sworn in Saturday.

And that is our look around the world.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

O'BRIEN: The United States got a chilling new warning today from Osama bin Laden, an al Qaeda audiotape vowing to punish Americans, this just a day after the CIA director said it will take five years to build the kind of intelligence service the country needs.

The 9/11 Commission warns that the CIA and FBI must work together to keep Americans safe, but is that mission impossible?

CNN homeland security correspondent Jeanne Meserve with an inside account of the challenges that lie ahead.

(BEGIN VIDEOTAPE)

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT (voice-over): Smith Brandon International, a security consulting firm, is a mixed professional marriage. For 10 years, Gene Smith was a CIA agent. Skip Brandon is a 23-year veteran of the FBI.

SKIP BRANDON, FORMER ASSISTANT FBI DIRECTOR OF COUNTERTERRORISM: There are times when it can be a bit like the War of the Roses.

UNIDENTIFIED FEMALE: There's absolutely a difference in culture.

MESERVE: A difference that dates back decades. From the get-go, the FBI saw the newly-formed CIA as a threat to its turf.

RON KESSLER, AUTHOR, "INSIDE THE CIA": When J. Edgar Hoover was FBI director, he actually ordered FBI agents to not talk to CIA officers.

MESERVE: The rivalry persisted. FBI spy Robert Hanssen was not detected before 2001, some say, because the FBI insisted the mole must be inside the CIA.

More recently, the CIA did not share results from the Cole bombing investigation in a timely fashion, impeding FBI tracking of two 9/11 hijackers.

(on camera): Until the Patriot Act, there was also a high legal wall between intelligence and law enforcement agents. In addition, the FBI and CIA had different domains, missions and tactics.

(voice-over): Gene Smith, a former CIA agent, sees herself an independent undercover person who looks at the big picture. Skip Brandon, a former FBI agent, is more of a public team player oriented toward a specific result, but for nine years they've collaborated successfully.

BRANDON: Sometimes on projects we go both ways and then at the end we push them together, and I think it works pretty well. Maybe the same thing can make her head the CIA and me the FBI.

MESERVE: Though that isn't in the cards the FBI and the CIA are sharing more with the new terrorism threat integration center, for instance. The 9/11 Commission has talked about building an entirely new domestic intelligence agency like Britain's MI5, a bad idea, say Smith and Brandon.

GENE SMITH, SMITH BRANDON INTERNATIONAL: It's putting a dog and an alley cat in a smaller box. They need the room to roam.

MESERVE: To roam, they say, and do their respective jobs.

Jeanne Meserve, CNN, Washington.

(END VIDEOTAPE)

O'BRIEN: An old terror tactic creating new fear and drama, how the hostage phenomenon in Iraq is affecting the coalition's efforts.

Also ahead:

(BEGIN VIDEO CLIP)

CHARITY WITMER, SISTER OF MICHELLE: Why? Why God did she have to be the only one who died that day? Why it was her? (END VIDEO CLIP)

O'BRIEN: A solemn tribute. A sister says goodbye to her identical twin and fellow soldier.

(COMMERCIAL BREAK)

O'BRIEN: The recent surge in kidnappings in Iraq is adding a new dimension to the instability there.

Robin Wright covers international and diplomatic affairs for "The Washington Post."

Ms. Wright, good to have you with us.

ROBIN WRIGHT, "THE WASHINGTON POST": Nice to be with you, Miles.

O'BRIEN: Let's talk about the tactic. Historically, it's a favored tactic among terrorists, but injecting it into Iraq is a relatively new wrinkle. Why is it happening now, do you think?

WRIGHT: Well, clearly, it's a time that the various groups are trying to intimidate the United States and introducing a tactic that in the past has been far more effective in some cases than bullets or bombs. It scares people.

It's one thing when people are killed and they're buried and people move on. But the drama, the trauma of holding foreigners hostage. We saw this in Iran in 1979, when 52 Americans were held for 444 days. And it introduced the yellow ribbon as a symbol of the drama we all lived through. This kind of thing has the tremendous impact psychologically. We saw it again in Lebanon over a seven-year period, when dozens of Americans and other foreigners were held hostage, some for seven years.

And it was the moment at which a lot of foreigners left Lebanon, not because of the vast number of suicide bombings and attacks and Westerners, but because Westerners were taken hostage. And there was an open-ended period of being held.

O'BRIEN: Well, I've heard it said that it is militarily, really, in the grand scheme of things insignificant. Where it plays to the terrorists' goals is as a propaganda tool aimed at the general public here and aimed at those who might consider perhaps investing and propping up Iraq and sending it on the road toward freedom.

WRIGHT: Well, sure.

You look at the number of security workers, the contract workers who are leaving, the aid workers, people whose governments are actually pulling them out, not because of the kind of violence we've seen over the past year, but because of the danger of hostage taking. Even the Russians are pulling out their workers in Iraq today.

So it does play both to public opinion and in turn then pressuring governments to act. O'BRIEN: Now, I know you're not there on the ground and, in a sense, this is a bit of an unfair question, but would you be surprised if Sunnis and Shiites were cooperating in any concerted way in this effort or do you think it's more desperate?

WRIGHT: Well, it's really hard to tell.

I'm a long way away. It wouldn't surprise me to hear that some Shia and Sunni groups or minority militants may be collaborating because they share a common goal and that's to get the United States and other foreign forces to leave Iraq. But does that mean we're back to see the crossing of a political threshold and the unity of these very disparate populations? I don't think we're there yet.

O'BRIEN: All right, let's take another turn in the Middle East. The State Department today out with the announcement that U.S. citizens are being encouraged to leave Saudi Arabia, a significant development and obviously reflective of some, as they say, actionable intelligence at the root of it. What are your sources telling you about what's going on there?

WRIGHT: Well, the decision was made actually before the bin Laden tape, but it is based on new intelligence indicating that Americans remain a threat.

Everyone but the ambassador and emergency personnel will be evacuated beginning immediately. This is not known to be related to bin Laden himself, but to groups that have been affiliated with bin Laden's thinking, acted in the same kind of vein, and have been active in Saudi Arabia before, particularly in the bombings last year.

O'BRIEN: Yes, put that in perspective. That is very significant. I can't recall an occasion quite like this when this occurred.

WRIGHT: It's been a long time. And there's been no forced evacuation since before the Gulf War, even though there has been a voluntary evacuation. But this means that the majority of U.S. diplomats and all of the dependents, in other words families of diplomats, will be flown out of Saudi Arabia.

O'BRIEN: All right. Thank you very much, Robin Wright with "The Washington Post." Appreciate your time and insights today.

WRIGHT: Thank you, Miles.

O'BRIEN: Hundred of friends and neighbors packed a church auditorium outside Milwaukee to attend services for Michelle Witmer. The 20-year-old woman was killed in Iraq where she was one of three sisters serving in the National Guard. Her identical twin sister, Charity, a medic in Iraq, called her sister a here row.

(BEGIN VIDEO CLIP)

WITMER: When we were about probably like 10 years old, me, Rachel and Michelle were all sitting around and talking about what we wanted to be when we grew up.

And Michelle, of course, was very hesitant to tell us what exactly she wanted to be. Keep in mind, we're like 10 years old. She just kind of looked around and she said, you know what, you guys? I really want to be a hero.

She had a way of dancing, singing and tripping into every room she came into, along with me and Rachel tripping right behind her. One of the last times I saw Michelle, she gave me a big hug and a kiss. And she said I love you. When they came and told me what had happened, I said why? Why? Why, God, did she have to be the only one who died that day? Why witness as her? She was ready and she was at peace. And she was a hero when she died.

(END VIDEO CLIP)

O'BRIEN: Charity Witmer and her surviving sister, Rachel, are on bereavement leave right now. National Guard officials say it will be up to them to decide whether they want to return to Iraq.

Our hot "Web Question of the Day" is this. Did you think that Osama bin Laden would be captured or killed by now? We invite you to vote right now. CNN.com/Wolf is the place to do it. The results for you when we come back.

Plus, it's time to make the doughnuts. These cops are blazing a trail, slam dunking colors, trying to powder the competition.

(COMMERCIAL BREAK)

O'BRIEN: Here's how you're weighing in on our "Web Question of the Day." It is, did you think that Osama bin Laden would be captured or killed by now? Sixty-five percent of you say yes; 35 percent of you say no. The poll is not scientific.

Now to your e-mail on the latest audiotape thought to be from Osama bin Laden. It contains a truce offer for European countries which stop fighting Muslims.

J.C. writes this: "Bin Laden is grasping at straws in the effort to drive our allies away. These are desperate means from a desperate person. We can only hope that he will eventually be the cause of his own destruction. I'm glad to see that Germany, Italy, and England are bending to the whims of this lunatic."

But we get this from Ed: "This guy is way ahead of Bush at every turn. OBL uses everything Bush says and does to exploit the rift the U.S. and Europe have and further isolate the U.S. At the same time, his terror network continues to grow in strength and carry out attacks."

Well, cops and doughnuts, they go together like cops and doughnuts. Check out our picture of the day; 40 of the world's finest from as far away as Australia gathered in suburban Chicago for the World Cop Doughnut-Eating Contest. A cop from Geneva, Wisconsin, won the three-minute race, packing away 9 1/2 Dunkin' Donuts in that time. His name on is O'Brien, by the way, Terry O'Brien, not related, as far as I know, but clearly worthy of the name. Attaboy, Terry.

A reminder, you can always catch WOLF BLITZER REPORTS weekdays at this time, 5:00 Eastern. Wolf will back tomorrow. Until then, thanks for joining us.

"LOU DOBBS TONIGHT" starts right now.

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