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CNN Wolf Blitzer Reports

Secret State Department Memo: Who Saw It?; London Again Targeted; Vetrans Affiars Department Turns 75; Roberts Visits Senators; U.S.-Canada Tunnel Uncovered; Rice's Staff Roughed Up

Aired July 21, 2005 - 17:00   ET

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

WOLF BLITZER, CNN ANCHOR: Happening now, there are new developments in the case of the unauthorized naming of a clandestine CIA officer. At issue, a secret State Department memo and who saw it.
And we're live in London with late developments in today's second terror attack in two weeks in that city.

Stand by for hard news on WOLF BLITZER REPORTS.

(BEGIN VIDEO CLIP)

BLITZER (voice-over): London attacks. Just like last time, the targets are three trains and a bus. This time, the city gets away with a scare.

UNIDENTIFIED MALE: And then suddenly people were started screaming and shouting and running to get to the second carriage.

TONY BLAIR, PRIME MINISTER OF BRITAIN: But it doesn't change us. It's not going to change what we do.

BLITZER: Transit terror. Can Americans learn from others how to stay safe? Subway workers take security into their own hands.

Troubling tunnel. It's not south of the border, but between the U.S. and Canada. Could the next one be used to smuggle terrorists?

ANNOUNCER: This is WOLF BLITZER REPORTS for Thursday, July 21, 2005.

(END VIDEO CLIP)

BLITZER: Thanks very much for joining us. I'm reporting from New York today.

Once again, there is terror in London. This time, four attempted bombings in the city's transit system. Today, there were no deaths.

London's police commissioner says the assailants failed in their mission, but he said they clearly intended to kill. The attacks came exactly two weeks after the blasts on three underground trains and a double-decker bus killed 52 commuters and four bombers.

Just like before, the targets were three subway trains and another double-decker bus. Panicked passengers ran out of the underground stations as police rushed in.

We have a map that shows both sets of underground attacks. Authorities say it's too soon to say who's responsible today or whether the eerily similar attacks are even related. But the police commissioner notes that evidence found at the scenes could provide a breakthrough.

For a complete picture of all the day's events in London, we begin with this report from Bill Neely of ITV News.

(BEGIN VIDEOTAPE)

BILL NEELY, REPORTER, ITV NEWS (voice-over): Suddenly, and for the second time in two weeks, chaos on and below London streets.

UNIDENTIFIED MALE: Can you please move?

NEELY: Tens of thousands evacuated. Reports of explosions, smoke, rucksacks. News first of one bomb, then two, then more. And scattered around London streets, so many who thought they were about to die.

UNIDENTIFIED MALE: People were panicking. And there was a very bad smell come from the train. But I never seen any (INAUDIBLE) explosion, except but I still thought everyone was going to die on it. People was told not to panic, but everyone was panicking.

NEELY: Just before 1:00, west London, near Shepherd's Bush station, something has just exploded on a train.

UNIDENTIFIED FEMALE: There's been an explosion in there. And in fact, that has happened somewhere between Ladbroke Grove and Hammersmith on the Hammersmith and City Line.

NEELY: Minutes later in south London, police respond to calls about a bomb on a train and about much more than that. Passengers are chasing a man who dumped a rucksack in a carriage, screaming, "Stop him!"

UNIDENTIFIED MALE: And suddenly, I saw a guy running from the stairs and then people chasing him, really. And I was carrying two bags, so I couldn't really do anything. The time that I put it back on down (ph) he passed by me already. He run.

NEELY: And police, too, gave chase. But the suspect, described as a young, dark-skinned British man with a beard, escaped. London's northern Tube line, almost exactly the same time, and underground passengers smell that something is very wrong.

UNIDENTIFIED FEMALE: Basically, I was on the train. And it was pulling into Warren Street and then we just saw lots of people running to our carriage. And then we started to smell smoke, and then we just got off the train. And there was, like, lots of panic and confusion.

UNIDENTIFIED MALE: All I saw is people running for their lives. And there was no room for me to get away to the next carriage. There was no way I could get away from it. All I did is say a prayer and wait for it.

NEELY: So far, only one man is injured, but it's not over. After west, south, and north London comes an attack in the east, and a carbon copy of a fortnight ago, a device exploding on the upper deck a bus.

UNIDENTIFIED FEMALE: I was on a bus behind. I saw number 26 pulled over at the bus stop, people being evacuated. The police arrived very quickly on the spot.

NEELY: Windows on the bus are broken but, again, no one is injured. Two hours after the first incident, and the police confirm four bombs.

COMMISSIONER IAN BLAIR, METROPOLITAN POLICE: We know that we have four explosions, or attempts at explosions. And it's still pretty unclear as to what's happened.

At the moment, the casualty numbers appear to be very low in the explosions. The bombs appear to be smaller than on the last occasion. But we don't know the implications of all this yet, and we're going to have to examine the scene very carefully.

NEELY: But London is still jittery. Armed police are sent to deal with an incident at a hospital where many of the dead and injured from a fortnight ago were taken.

The police announced that four detonators but not explosives went off in the four locations which are now being checked for traces of chemical weapons.

Then, opposite Downing Street, armed police arrest a man they became suspicious of. They make him open his shirt to check for weapons or bombs. But there is nothing to connect him to the explosions. Just 100 yards away, the prime minister makes his first comment.

TONY BLAIR, PRIME MINISTER OF BRITAIN: We can't minimize incidents such as this, because they obviously have been serious in the four different places, as we know.

And I think all I'd like to say is this, that we know by these things, they're done to scare people, and to frighten them, to make them anxious and worried.

And fortunately, in this instance, there appear to have been no casualties. And the police have done their very best, and the security services, too, in the situation. And I think we've just got to react calmly and continue with our business, as much as possible as normal.

NEELY: But outside, across London, it's anything but normal.

(on-screen): This scene at Warren Street is just a few hundred yards away from Tavistock Square, where the bus exploded just two weeks ago. But what the police want to know is, is there an even closer connection than that? Did the same people plan this or another group of terrorists? Who were the men who got away? And were their bombs sophisticated devices designed for mass murder or something cruder?

Now in all of this, the police have a huge lead. The devices, the bombs, are still largely intact. And one of them is just over there.

(voice-over): The police have confirmed there is no question the detonators were meant to set off explosions.

COMMISSIONER IAN BLAIR, METROPOLITAN POLICE: Clearly, the intention must have been to kill. I mean, you don't do this with any other intention. And I think the important point is that the intention of the terrorists has not been fulfilled.

NEELY: As for who the terrorists are, that's still unclear.

BLAIR: There's a resonance here, isn't there? I mean, there are four attacks. There were four attacks before.

Whether or not this is directly connected, in the sense of carried out by the same group of people, however loosely knit that is, I think that's going to take just a little bit longer before we can qualify that.

NEELY: Police have now recovered forensic material from the sites. Another four crime scenes for them to pore over, thousands more statements to take, and thousands of hours of CCTV footage to examine.

The four bombers may still be free tonight to strike again. But luckily, and for some unknown reason, their bombs failed and dozens of people, at least, are alive tonight who might be dead. But that doesn't give them or us very much comfort, now or for the future.

Bill Neely, ITV News.

(END VIDEOTAPE)

BLITZER: The United States responded quickly to the latest violence in London. A U.S. Embassy official in London says the London embassy was closed as a precautionary measure so officials could take stock of security.

Back home, security was stepped up over at the Pentagon, where the heavily armed anti-terrorism police could be seen patrolling the grounds.

U.S. transit systems are already on heightened alert. And in New York City, officials announced that police will begin random searches of bags on the city's subway.

In Washington, President Bush said this country won't give in to terrorists.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: They have the desire to use their terrorist techniques to frighten us.

In other words, they understand when they kill in cold blood, it ends up on our TV screens. And they're trying to shake our will. And they're trying to create vacuums into which their ideology can move.

They don't understand our country, though. They don't understand that, when it comes to the defense of universal freedoms, this country won't be frightened.

(END VIDEO CLIP)

BLITZER: Let's turn now to CNN national security adviser John McLaughlin, a former acting CIA director. He's joining us live from Washington.

John, there are so many unanswered questions. But as you look at this, in the immediate hours after what happened, what goes through your mind?

JOHN MCLAUGHLIN, CNN NATIONAL SECURITY ADVISER: Well, the first thing that occurs to me is that, with all the bad news here, the good news is that the police are going to have a ton of forensic data to go through.

If these bombs have survived, if they're in backpacks, there will be other material in there, perhaps. They'll have video, as I mentioned at the early stages of the last bombing, that will enable them to possibly identify and help them apprehend the perpetrators.

So there's a lot here that they're going to learn, and possibly about the previous attacks, as well.

BLITZER: Does it look like this is related to the terrorist attack of two weeks ago?

MCLAUGHLIN: I think it's impossible to tell for sure, but there are some similar characteristics. The bombs were intended to go off in sequence at about the same time.

The police commissioner just said they were intended to kill. So I take that as his judgment that they were intended to create the same kind of explosion and destruction. And in that sense, there's a superficial resemblance. But we'll need more...

BLITZER: The question though is this: Are these copycat killers potentially, or are they part of the same cell?

MCLAUGHLIN: We won't know that. But my point is the forensic data may lead us there more certainly than in the last case.

The other thing I think we have to think about here, what struck me, as you asked at the outset, is that they got through when the British were on high alert. People have asked all day, why is that so? I think that tells us that these people, and certainly, in my experience, my observation tells me that they're operating with a higher degree of stealth than we normally see in these operations. If you think back to the July 7 bombing, the families, the mothers, the fathers, the friends, the associates, the employers, the schools, no one had any idea that these people were preparing -- they gave no signals. So it's reasonable to assume there's a larger pool of people out there who are doing this. That's extraordinarily hard to detect.

And the message, I think, is that, despite the fact that we have to look downstream with intelligence to detect these things in advance, the powerful message here is that you have to play defense, too. You have to harden the vulnerabilities of our systems against attackers like this who, in some small numbers, at least, will always be able to slip through.

So there are a lot of messages that are coming out of these two weeks, Wolf.

BLITZER: And perhaps the biggest question still unanswered: Why did four bombs fail, fail to go off? We don't know the answer to that question, but investigators are certainly looking at that.

MCLAUGHLIN: That's part of the puzzle here. And of course, that's on the side of the ledger that says "Not al Qaeda." That weighs heavily, because typically their bombs go off.

But then there are things on the other side of the ledger that would keep us from ruling this out as an al Qaeda operation so far. I think it's prudent to assume at this point that it's part of that same pattern we saw two weeks ago.

BLITZER: John McLaughlin, the former acting CIA director, thanks very much for your assessment and analysis.

When we come back, reporters roughed up. Journalists traveling with the secretary of State, Condoleezza Rice, in Africa get into a scuffle with security guards. Our Andrea Koppel was there. She will join us live and tell us exactly what happened.

Vulnerable borders? A secret smuggling route into the United States is uncovered. We have new pictures.

And there's also new video of Saddam Hussein that was released today. See how the former Iraqi dictator is faring.

Stay with us.

(COMMERCIAL BREAK)

BLITZER: Welcome back.

Investigators are still trying to find out how the name of undercover CIA officer Valerie Plame got into the news media. So far, the probe has landed "New York Times" reporter Judith Miller jail and led to demands for the ouster of the presidential adviser, Karl Rove.

Now investigators are looking into a State Department memo stamped "Secret."

Our White House correspondent, Dana Bash, is joining us now with details -- Dana?

DANA BASH, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, there has been talk for some time about this memo around Washington, but now we know more about why this memo is apparently so important to investigators in this case.

(BEGIN VIDEOTAPE)

BASH (voice-over): A covert CIA agent known as Valerie Plame was named in a paragraph marked with an "S" for secret in a classified State Department memo federal investigators hope leads them to who leaked her identity.

Two government sources who have seen the June 10, 2003, memo confirmed to CNN Plame was referred to by her married name, Valerie Wilson, without indication she was undercover or her identity was protected. Nevertheless, a former national security staffer not privy to this memo says the rules are clear.

RICHARD FALKENRATH, CNN SECURITY ANALYST: And revealing it to someone without proper security clearance or without the need to know is not authorized and is a violation.

BASH: The memo, which discussed allegations Iraq tried to buy uranium from Africa, notes Valerie Plame Wilson was in a meeting about sending her husband, Ambassador Joe Wilson, to look into the claims, according to the officials.

Other sources familiar with the leak investigation say federal prosecutors asked several senior administration officials testifying before the grand jury if they had seen this memo.

A senior U.S. official believes Secretary of State Colin Powell took it with him aboard Air Force One July 7, 2003, when he accompanied the president to Africa. Investigators want to know if any senior Bush officials had access to the memo then and, as CNN previously reported, subpoenaed the manifest of Air Force One.

(END VIDEOTAPE)

BASH: What prosecutors really want to know is if this classified memo naming Valerie Wilson was the source of the leak of a covert identity and, if so, under what circumstances.

Now, a source familiar with and sympathetic to Karl Rove's testimony said that he has no indication that he saw the memo.

Wolf?

BLITZER: Dana Bash at the White House. Thanks, Dana, very much.

Staying in Washington, President Bush's Supreme Court nominee, John Roberts, was back on Capitol Hill today seeking support for his confirmation.

Our congressional correspondent, Ed Henry, is standing by. Ed, how did it go?

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: Wolf, the praise for Judge Roberts is so effusive that some key senators today decided to remind everyone this is a confirmation, not a coronation.

(BEGIN VIDEOTAPE)

HENRY (voice-over): A family picture in the morning. John Roberts embraces his wife as he gets ready for day two of outreach to key senators. The reception on Capitol Hill is affectionate, too.

SEN. ORRIN HATCH (R), UTAH: He's going to make a great justice. No question about it.

JUDGE JOHN ROBERTS, SUPREME COURT NOMINEE: Thank you.

HATCH: I think my colleagues are all coming to that realization.

HENRY: But the Senate Democratic leader urged Republicans to slow down and remember the confirmation hearings haven't even started.

SEN. HARRY REID (D-NV), SENATE MINORITY LEADER: People need to just relax and let the process go forward.

HENRY: Reid also had blunt advice for liberal groups who think the initial Democratic response to the nomination has been muted.

REID: Same thing I just said: Cool your jets. Let the process go forward.

HENRY: Similar talk from the Gang of 14 moderates, who huddled about the nominee for the first time.

SEN. JOSEPH LIEBERMAN (D), CONNECTICUT: There was united agreement that it's too early to reach a judgment, that we have to hopefully defer to the members of the Judiciary Committee...

HENRY: Still, many members of the group that averted a nuclear showdown over lower court judges repeated they do not believe Roberts will face a filibuster.

UNIDENTIFIED MALE: You know, my sense is so far, so good.

HENRY: Not surprisingly, the praise for Roberts continued in the afternoon outside his parents' home in Maryland.

PEGGY BURKE, ROBERTS' SISTER: This is a very proud moment for our family. John treasures his service to the country, and we feel the country will be well-served with John on the Supreme Court.

(END VIDEOTAPE)

HENRY: So the outlook for Judge Roberts is very good, with Senate Judiciary Chairman Arlen Specter telling CNN that the private chatter among senators is that this is unlikely to be filibustered -- Wolf?

BLITZER: Ed Henry on Capitol Hill, thank you very much.

They put their lives on the line, but are America's troops getting all they deserve from Uncle Sam when they return home? I'll ask Veterans Affairs Secretary Jim Nicholson if the government is doing enough.

A secret smuggling route unearthed. What are the implications for national security?

No access. Reporters traveling with the secretary of State, Condoleezza Rice, clash with security forces in Sudan. CNN's Andrea Koppel was there, and she's standing by to tell us exactly what happened.

(COMMERCIAL BREAK)

BLITZER: Welcome back.

The Department of Veterans Affairs marking its 75th anniversary today, but some veterans see little to celebrate.

CNN's Brian Todd is joining us now live from Washington with the story -- Brian?

BRIAN TODD, CNN CORRESPONDENT: Wolf, right now, the department is dealing with a budget crunch and a strain on its system, with hundreds of thousands of new vets back from Iraq and Afghanistan. It's caused serious concern among veterans across the country, as the V.A. marks that milestone.

(BEGIN VIDEOTAPE)

TODD (voice-over): A celebration of service. Veterans from at least six conflicts, from World War I to Iraq, honored for their sacrifice, part of the 75th anniversary of the Department of Veterans Affairs.

UNIDENTIFIED MALE (SINGING): God, family, and country...

TODD: Abbie Pickett isn't celebrating. The 23 year old with post- traumatic stress disorder is just trying to get by.

ABBIE PICKETT, IRAQ WAR VETERAN: I just can't see how things (INAUDIBLE)

TODD: Pickett was part of a Wisconsin National Guard unit in Iraq, a truck driver in a combat support group near Tikrit. She vividly remembers one attack on her base.

PICKETT: The mortars started -- what would you say -- flying, coming down like rain.

TODD: Pickett, who now works for a veterans advocate group, escaped physical injury that day, but the experience left her emotionally scarred. And she says she needed serious psychological help when she got back home in April of last year.

PICKETT: I got home in April. And I didn't actually get in to see a psychiatrist until July of 2004. And now, I mean, there's a huge gap in between the last time I saw a psychiatrist and right now.

TODD: She says that last visit was in December or January. We're hearing other stories like Abbie Pickett's these days, as the Department of Veterans Affairs deals with a budget shortfall of more than $1 billion for this fiscal year. Emergency funding has been temporarily stalled in the House of Representatives, and Democrats place the blame squarely on their rivals.

REP. CHET EDWARDS (D), TEXAS: While Republicans in Washington are fiddling, veterans all across America are hurting.

TODD: But the Republican who heads the House Veterans Affairs Committee says his group did pass nearly a billion dollars in funding for veterans' care, but had to readjust at the last minute when the V.A. said it needed more money.

REP. STEVE BUYER (R), CHAIRMAN, VETERANS AFFAIRS COMMITTEE: This is in-the-weeds math. The reality is, we're going to take care of the veterans. The funding is being done prior to the August break.

TODD: But in the meantime, members of Congress, veterans groups, and V.A. officials themselves say there are tens of thousands of vets waiting more than a month for appointments. Veterans' advocates say some facilities are understaffed and mismanaged.

Veterans Affairs Secretary Jim Nicholson admits the V.A. underestimated the number of service members returning from Iraq and Afghanistan who would need care.

JIM NICHOLSON, U.S. SECRETARY VETERANS AFFAIRS: It was based upon '02 data, because that's the budget cycle for the U.S. government. We didn't have a war in Iraq in '02.

(END VIDEOTAPE)

TODD: V.A. officials say the number of vets on waiting lists has gone way down in recent years. They say veterans' hospitals and clinics provide world-class care and that they're always trying to streamline operations. But veterans' groups are warning, as military units keep returning from Iraq and Afghanistan, huge numbers at a time, there will be new strains on the system in the near future -- Wolf?

BLITZER: Brian Todd reporting from Washington. Brian, thank you very much.

And the secretary of veterans affairs, Jim Nicholson, is joining us now live from Washington with more.

Mr. Secretary, congratulations on this 75th anniversary. But let's get to that $1 billion shortfall. A fellow Republican of yours, Larry Craig, senator of the Veterans Affairs Committee in the Senate, said this on June 28. He said, "I'm confused as to how such a problem of this magnitude can catch everyone, even a cabinet secretary, off guard."

What's the brief answer?

NICHOLSON: Well, it's a dynamic situation. There have been now, I think, about 300,000 people who have rotated back from the combat theater from the reserve components. And they have been made eligible for V.A. health care services. And they are coming in, in records that were never anticipated.

Now we've seen up to 103,000 of them. And they're a priority. All of the people coming back from the combat theater are a priority of the V.A. And that number was just much larger, and it's still unfolding.

It's a dynamic situation. In many ways, Wolf, it's a positive situation, because it's a real compliment to the kind of health care that we are providing to our veterans.

BLITZER: How much more will you need? A lot more than a billion, I take it, beyond what was budgeted for.

NICHOLSON: Well, we're dealing with two different fiscal years. We're in the tail-end of fiscal '05. We have a couple more months after this one to go.

And we need a billion-plus to get through the end of this year. Then we're talking about fiscal '06. The president has sent up a request to amend his budget for '06 to increase that more than $2 billion.

And I might point out that this president, this administration, has increased funding for V.A. by an amount twice as much as the previous administration, about 47 percent on the health care side and over 50 percent on the benefits side.

So the president and his team -- I wasn't here, you know, beyond a few months ago -- but they have been focused on this. And there have been just more done (ph) increases in V.A. spending. But...

BLITZER: But you know...

NICHOLSON: But we're going to need more.

BLITZER: And you know you're getting slammed by a lot of Democrats, even some Republicans. Barack Obama, the senator -- the junior senator from Illinois -- said this, he said, we recently passed a budget where we had no problem finding billions and billions of dollars to give away in tax cuts, but when it comes to the priorities of providing health care to veterans, we've got to dip into a rainy- day fund -- and it's not even clear how solid that rainy-day fund is.

What do you say in response to Senator Obama?

NICHOLSON: Well, what's really solid is the position that veterans are placed by this administration and by this society. No other country in the world treats veterans the way we do and I have a reference point for that, having been a diplomat on my way to this job and talking to hundreds, really, other ambassadors.

But we are at war and we have an aging veteran population and they are using the V.A. facilities more and more than ever before. They have other choices. They could go on Medicare. They could go to TriCare or third-party providers (ph), but they're coming into our V.A. hospitals because they are doing such a world-class job medically. And that's not just me, the secretary, bragging. If you take a look at this week's issue of "U.S. News and World Report," you'll see how they compliment the V.A. health system.

BLITZER: Jim Nicholson is the former U.S. ambassador to the Holy See of the Vatican; former chairman of the Republican Party. Now arguably having one of the most -- the toughest jobs in Washington, but certainly one of the most important, dealing with the veterans. Appreciate it, Mr. Secretary, very much. Congratulations, once again, on this 75th anniversary.

NICHOLSON: Thank you. It was a great day for us, Wolf. Thank you.

BLITZER: And when we come back, we'll return to our top story, the London terror strikes. Why police believe they've already made what they're calling a significant breakthrough. We'll update you on the latest on the investigation.

Plus, subway security. The terror alert level has already been raised for public transportation in all U.S. cities. Why one city's subway workers say it's not enough and are taking matters into their own hands.

And later, an illegal tunnel under the U.S.-Canadian border. We'll tell you who's accused of digging it and why.

(COMMERCIAL BREAK)

BLITZER: Welcome back. I'm Wolf Blitzer reporting from New York today. Back now to our top story, today's attempted terror bombings in London. While only one injury is reported, today's events are a disturbing reminder of the deadly London transit bombings of only two weeks ago.

CNN's Becky Anderson is joining us now live from London with more -- Becky?

BECKY ANDERSON, CNN CORRESPONDENT: That's right, Wolf. Thank you for that. About 10 hours ago, four near-simultaneous attempts were made to explode devices at four separate transit situations here in London. One, to the west. One to the east. One to the south. And one here at Warren Street tube station, which is just about 100 meters down the road from where I stand at present.

Now, the police very quickly cordoned off the areas around those scenes and this cordon, I'm told, will stay in place for the foreseeable future. Those who were in their houses here at Warren Street, were told to stay inside. Those who were outside of this cordon were made to stay outside and that is where they stay at present.

It is fairly calm at present, now in London. The traffic to my right on the main arterial road out of London to the west is moving. Fairly calm here. It would be on a Thursday night.

The sense of fear and confusion very much subsided in London now. But it really was fairly chaotic at about 12:30 London time today when the first of those attempted explosions was reported.

Now, Tony Blair has urged calm to those in London and around Britain. And he is defending himself from suggestions that these attacks and those of a fortnight ago are associated with his support of the U.S. in the war with Iraq.

(BEGIN VIDEO CLIP)

BLAIR: The terrorist attacks go back over 10 years. And the way of defeating it, is to defeat it, of course, by security measures, but also by going after the ideas of these people, the ideology of these people, their arguments, as well as their methods -- taking them on and defeating them.

MAYOR KEN LIVINGSTONE, LONDON: It is not surprising that we have had another attempt to take life in London so rapidly after the first. Those people whose memories stretch back to the terrorist campaigns in the '70s and '80s and early '90s will remember there were very often horrifying bombings in London, often only weeks apart.

(END VIDEO CLIP)

ANDERSON: And that's the mayor of London there talking after Tony Blair. Authorities here have said today that the intention was obviously to kill, but they say they cannot, at present, confirm that these attacks are associated with those of two weeks ago. Fairly calm in London tonight, but a very chaotic and confusing scene just some hours ago -- Wolf?

BLITZER: All right. Thanks very much. Becky Anderson reporting live from London. We'll go back there if we get new developments.

In our CNN "Security Watch," as we noted, New York City today announced it will boost transit security with random searches on the subways. This comes as the Transit Union complains that not enough is being done. It has hired an Israeli security expert.

Let's go live to CNN's Mary Snow. She has more here in New York -- Mary?

MARY SNOW, CNN CORRESPONDENT: Well, Wolf, those random searches will begin here in New York tomorrow, but union workers plan to start their own training this weekend.

(BEGIN VIDEOTAPE) SNOW (voice-over): Since London's train bombings two weeks ago, the estimated four-million-plus riders a day on New York's trains and buses have been warned by officials to be alert, and extra police have been riding the trains. But now, New York is stepping up security another notch while emphasizing there are no threats to the city.

COMMISSIONER RAY KELLY, NEW YORK POLICE: We will be instituting random searches of packages and backpacks as people enter the transit system.

SNOW: The union representing the thousands of workers who operate the trains and buses say they don't feel safe. They say training provided by the Transit Authority is inadequate and they've hired their own Israeli security expert.

ROGER TOUSSAINT, TRANSPORT WORKERS UNION: London is a wake-up call and we're trying to get the attention on this to urge the authority and the governor to stop just scratching the surface and to provide the most advanced training that's available.

SNOW: Raphael Ron, the man hired, used to be in charge of security at Israel's Ben Gurion Airport. He admits airport security is different from protecting an open transit system used by millions, but says they still have ample guidance to offer.

RAPHAEL RON, NEW AGE SECURITY SOLUTIONS: We will provide more information to the employees about the kinds of weapon the terrorist are using and the way they -- the presence of this weapon is projected in appearance.

SNOW: Lawrence Reuter believes the New York's transit workers are getting the proper training. He runs the city's Transit Authority, and says the 47,000 workers on trains and buses go through a two-hour course called eyes and ears. He believes it works.

LAWRENCE REUTER, PRES. NYC TRANSIT: We have dozens and dozens of suspicious packages reported almost daily to us from our employees, that are all inspected by NYPD and our personnel. So, I think the system actually works very well when you take a look at it.

SNOW: He says the workers keeping watch over the subway trains and tunnels are told to look for anything unusual, from people wearing bulky clothing to spotting loose wires from a bag or a piece of clothing.

Rocco Cortese trains workers.

ROCCO CORTESE, NYC TRANSIT: Obviously packages and bags, that's obvious. But we also wanted to know people standing, maybe taking a picture, or just standing at a fare collection agency, we want to be known about that.

SNOW: The head of the Transit Authority says while he's constantly looking for ways to improve security, is he counting on help from riders.

REUTER: 4.7 million eyes are better than 47,000 eyes. And we want every eye and ear we can looking for things on the system.

(END VIDEOTAPE)

SNOW: And in addition, Wolf, the New York Police Department has issued a memo to its officers on talking points on what to look out for if its a suicide bomber. Some of these points include clenched fists, perhaps to signal that someone may have a detonator in their hand, or another talking point, excessive perfume, perhaps used to throw off a bomb-sniffing dog -- Wolf.

BLITZER: All right. Mary Snow, very informative. Thanks very much for that report.

And to our viewers, please stay tuned to CNN day and night for the most reliable news about your security.

Coming up at the top of the hour, LOU DOBBS TONIGHT. Lou is standing by here in New York with a preview -- Lou.

LOU DOBBS, CNN ANCHOR: Thank you, Wolf. Coming up at the top of the hour, major American cities stepping up security after a new wave of radical Islamist bombings in London. My guest tonight, one of the country's top former counter-terrorism officials and Homeland Security Committee member, Senator Susan Collins.

Also, the Pentagon acknowledging nearly all the Iraq army's and police battalions cannot fight insurgents without the help of American troops. We'll have that special report.

And the Bush administration wins one -- perhaps a small one -- in the economic relationship with China. Is it too little, or is it the beginning of something big? I'll be talking with Treasury Secretary John Snow.

And I'll be talking with attorney David Boies about the nomination of Judge Roberts to the Supreme Court.

All of that, a great deal more coming up at the top of the hour. Please join us.

Now back to Wolf Blitzer -- Wolf.

BLITZER: All right. Thanks very much, Lou Dobbs has another excellent show tonight at the top of the hour.

When we come back, officials are calling it a sophisticated project. A tunnel is discovered along the United States-Canadian border.

And later, scuffle in Sudan. Some of Secretary of State Condoleezza Rice's staff and members of the press corps are roughed up. We'll tell you why.

(COMMERCIAL BREAK)

BLITZER: It's a first along the United States-Canadian border, a tunnel that law enforcement officials say was used for smuggling drugs from British Columbia right into Washington State. Today, we got a look inside.

(BEGIN VIDEOTAPE)

BLITZER (voice-over): Officials call it a sophisticated project. A tunnel about 360 feet long, running between three and 10 feet underground from a hut near Aldergrove, British Columbia, to the living room of this home in Lyndon, Washington.

Canadian and American authorities became aware of the construction in February, and started surveillance.

KEVIN SCOVILLE, CANADA BORDER SERVICES AGENCY: From the activities we observed on the premises, such as lumber going in and soil coming out, combined with the location of the building and its proximity to the Canada-U.S. border, it wasn't too difficult to come to the conclusion that there was likely a tunnel was being constructed.

BLITZER: The builders went to great lengths, even reinforcing it with wood supports and iron. Similar tunnels have been found along the U.S.-Mexican border, but never here.

Earlier this month, under a search warrant, federal agents planted hidden cameras and microphones in the Washington State house. And they say they observed three Canadian men smuggling bags of marijuana. They were arrested Wednesday night, and face prosecution here in the U.S.

Two hunred pounds of marijuana were seized during the operation. And although this was strictly a drug operation, officials say the threat of terrorism looms in the background.

LEIGH WINCHELL, IMMIGRATION, CUSTOMS ENFORCEMENT: The security implication for both Canada and the United States are immense. That tunnel could be used to smuggle aliens into the U.S. It could be used to smuggle equipment into the U.S. for those who could do harm to the United States.

(END VIDEOTAPE)

BLITZER: Officials say the owner of the Washington State house has not been arrested. They add that investigators have -- quote -- "a great deal of interest in that individual" and that the investigation is ongoing. We'll continue to watch this story.

Reporters roughed up. We'll show what you prompted Secretary of State Condoleezza Rice to demand an apology.

(COMMERCIAL BREAK)

BLITZER: Now, we want to go back to London. There's new information coming into CNN. CNN's Nic Robertson standing by on the scene for us. What have you learned, Nic? NIC ROBERTSON, CNN SR. INTERNATIONAL CORRESPONDENT: Well, Wolf, earlier this afternoon, the police commissioner said that there have been two arrests through the day, one closer to the Warren Street tube station where one of the explosions happened; the other arrest coming very close to where the British prime minister lives, at 10 Downing Street.

Earlier this afternoon, the police commissioner had said these were not linked to today's attack. The language from the police has now changed on that. The police now say it is not clear if these two arrests earlier today are linked to today's attacks, softening their language, leaving the way open there perhaps, perhaps the police saying, unclear if these arrests were linked to today's attacks -- Wolf.

BLITZER: All right. We'll continue to watch this story with our viewers and you, Nic Robertson. Thanks very much for that.

A tense moment today as the secretary of State, Condoleezza Rice, met with Sudan's president. Coming up, we'll tell you what happened when a reporter tried to ask the Sudanese leader about the humanitarian crisis in Darfur.

(BEGIN VIDEOTAPE)

ANNOUNCER: This week in history on July 23, 1967, a riot with racial overtones broke out on Detroit's 12th Street. It took federal troops and the National Guard five days to quell the disturbance. Five people died.

NEIL ARMSTRONG, ASTRONAUT: That's one small step for man, one giant leap for mankind.

ANNOUNCER: In 1969, Neil Armstrong, who commanded the Apollo 11 mission, became the first person to walk on the moon.

And in Milwaukee, Wisconsin, police arrested serial killer Jeffrey Dahmer on July 22, 1991. He was later sentenced to 15 consecutive life terms.

That is this week in history.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

BLITZER: There are new pictures of the former Iraqi president, Saddam Hussein. Al Arabiya TV, which first aired the video, says it was made in a hearing earlier today. On the tape, Saddam Hussein remains defiant. He calls his detention "a game," and he claims the Iraqi government was appointed by Americans. He also says he's been given poor access to legal aid.

Secretary of State Condoleezza Rice is now in Jerusalem after a stop in Sudan, where concern over the refugee situation led in part to a confrontation. Our State Department correspondent Andrea Koppel is traveling with the secretary. Andrea is joining us now live from Jerusalem -- Andrea.

ANDREA KOPPEL, CNN STATE DEPARTMENT CORRESPONDENT: Wolf, journalists who live and work in Africa say this kind of behavior happens all the time. But it still took Secretary of State Rice by surprise.

(BEGIN VIDEOTAPE)

KOPPEL (voice-over): Tense moments in Sudan's capital as American reporters and members of Secretary of State Rice's own entourage clash with Sudan's secret police. They wanted to keep us out of a meeting between Rice and Sudan's president. We wanted to get in.

Finally, after trying to ask president Omar al-Bashir a question about ongoing violence in Darfur, an American journalist was manhandled off camera by what one senior U.S. official called thugs.

In an unusual move, Rice vented, telling us she was furious.

CONDOLEEZZA RICE, SECRETARY OF STATE: It was outrageous to have first our staff, then our press treated in that way.

KOPPEL: And demanded, and eventually got an apology from Sudan's foreign minister.

This incident a distraction from the humanitarian nightmare and ethnic violence which continues to terrorize African villagers in western Sudan.

(on camera): In this one camp alone, there are an estimated 55,000 refugees. Many of them, as you can see, are just children. But what most concerned Secretary Rice during this visit is the continued victimization of women. One woman I just spoke with off camera told me a few minutes ago that she knows of at least 70 cases of women who have been raped by government forces when they left the camp to gather firewood.

(voice-over): Rice, too, met privately with 15 women in the Abu Shouk camp who told her they had been victimized.

RICE: The stories are unbelievable. But they're true. And so, I said to them that we would try to make it better.

KOPPEL: During her brief stop in Darfur, Rice welcomed another 40 African Union peacekeepers just flown in by the U.S. Air Force, convinced that presence of about 3,000 AU monitors has reduced the violence.

But at the same time, Rice put Sudan's government on notice, to follow through on its promises of the last two years to end the violence so that these African villagers can feel safe enough to go home.

(END VIDEOTAPE)

KOPPEL: And in the next several months, the African Union monitoring forces expected to more than double, from about 3,000 to 7,600 peacekeepers. And Wolf, Secretary Rice says she won assurances today from Sudanese leaders to allow that force to increase to whatever level they deem is necessary -- Wolf.

BLITZER: Andrea, is the secretary of State sticking to the formula that her predecessor, Colin Powell, had, that the Sudanese government was engaged in genocide in Darfur?

KOPPEL: Absolutely, Wolf. In fact, we asked Secretary Rice that question when she was in another African country, in Senegal, just a couple of days ago, and she used those exact words. She said, "this was and is genocide" -- Wolf.

BLITZER: Andrea Koppel, reporting for us from Jerusalem. Andrea, thank you very much.

Remember, we're on week days, 5:00 p.m. Eastern. Don't forget, we launch our new program, THE SITUATION ROOM, August 8. Until tomorrow, thanks very much for joining us. I'm Wolf Blitzer in New York.

LOU DOBBS TONIGHT starting right now. Lou standing by -- Lou.

END

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