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America's New War; Stock Markets Reopen; Politicians React; Baseball Returns

Aired September 17, 2001 - 17:00   ET


JOIE CHEN, CNN ANCHOR: Fighting words from the president of the United States.


GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I want them to know I want justice. There's an old poster out west, as I recall, that said, "wanted, dead or alive."


CHEN: The bell that brought business back to the floor.


UNIDENTIFIED MALE: They took an attack right at the financial capitol of the world, and we are back.


CHEN: Back, but did the investors come along?

Undivided loyalty, and unrelenting suspicions. Arab-Americans say, "Take a closer look at who we are."


CAIR SPOKESMAN: We are Americans, and we should not be judged on our looks, on our last names, on the way we dress, on the way we talk.


BILL HEMMER, CNN ANCHOR: It is just past 5:00 here in New York City. Workers on Wall Street and traders making their way home after the worst single-day point drop ever for the Dow Jones Industrial Average.

Also, the work continues for rescuers down at ground zero, looking for air pockets possibly underneath the rubble, which may hold survivors. It's now well over six and a half days into this terrible tragedy in New York City, but again, the hope fades with every passing day. Good evening, or late afternoon, from Manhattan, I'm Bill Hemmer. CHEN: I'm Joie Chen at CNN Center in Atlanta. We begin this hour with the latest developments in America's war on terrorism.

The big headline today: the stock markets plunged at the opening bell and never recovered. On the first day of trading in nearly a week, the Dow Jones Industrial Average lost about 684 points, and that is its largest one-day point loss ever. Nasdaq lost more than 110. This morning, the Fed lowered interest rates by another half point.

More bad news from the airline industry. U.S. Airways announcing more than 10,000 layoffs. We'll have more on that, plus more on the status of a federal bailout of the country's airlines, the possibility of that.

President Bush denouncing attacks on Muslim-Americans. The message delivered at a mosque in Washington, amid reports of beatings, bombings, and possible killings of Muslims and Arab-Americans.

Also today from Mr. Bush, more harsh words for Osama bin Laden. In Afghanistan, meantime, the Taliban government is to convene an Islamic council to determine what, if anything, to do with Osama bin Laden. That council is to meet tomorrow. Today the Taliban received a delegation from Pakistan, which delivered a message from Washington.

It has been another rough day in New York. People returned to work, produced gridlock, and then spot police inspections of trucks and other vehicles only made things worse.

At the crash scene, no new survivors today. Mayor Giuliani says the search will continue until all hope is lost.

Ahead in this hour: assessing the hit taken by the U.S. economy. We'll talk to's Mark Zandi about that. Diplomatic efforts by the United States to line up support from around the world and get up to date on the intelligence on Afghanistan with a former CIA bureau chief.

And it is back at it at the nation's ball parks. We'll be live in Philadelphia shortly where baseball is back at bat. Bill?

HEMMER: Joie, you mentioned harsh words, tough words from the president today. This upon a visit by the commander in chief to the Pentagon earlier today. CNN's John King at the White House watching developments there. Hello.

JOHN KING, CNN CORRESPONDENT: Hello, Bill. Very tough words from the president today, and some worrying if he's perhaps raising the rhetoric too high. President using the word, calling old western frontier justice, if you will, saying when the name Osama Bin Laden was mentioned, "wanted dead or alive."

Political advisers outside the White House say they understand what the president is doing. He has to prepare the nation for a sustained military, diplomatic, financial campaign against the Bin Laden organization. At the same time, though, remember the president trying to rally the support of moderate Arab nations. Many of them have radical Islamic fundamentalist whose worship Mr. Bin Laden in their populations. I spoke to one ambassador from such a country a short time ago, who said he understood he understood the challenge before President Bush, but that that would not be helpful back in his country -- Bill.

HEMMER: John, with that visit to the Pentagon today, the words the president used, wanted dead or alive, his reference to an old western poster that he was talking about today. Why the visit to the Pentagon? Why not just pick up a telephone and call over there?

KING: Very symbolic reasons you would want to go across to the Pentagon. Obviously the building is still devastated by that aircraft that struck into it by going across the Potomac River. The president trying to send the signal that the nerve center of the United States military is still up and running. Shaking hands here, trying to boost the morale of the troops there, and obviously he could get a firsthand account from the Defense Secretary Donald Rumsfeld. This meeting at the Pentagon dealt mostly, we are told, with the plans to activate some 35,000 members of the reserve and the National Guard.

So some business to conduct, briefings on call up to come, but mainly for symbolic reason. You're right, the president could have picked up the phone or Secretary Rumsfeld could have come to the White House. The president trying to boost morale at the Pentagon and show the terrorists who attacked the Pentagon that the building may be damaged, but folks are still working quite hard.

HEMMER: John, by now everybody knows what happened on Wall Street today. Talk today from the economics team about a possible economic stimulus package. What is the White House proposing on this? What would that package look like? Do we have a good idea yet or not?

KING: We don't know the numbers just yet, but we do have a pretty good idea of the outline. The president met with his senior economic team here at the White House this afternoon, was briefed to day on Wall Street. Two big things before the president right now. He's already in negotiations with the leadership and Congress.

One, an economic stimulus package; an emergency package that would include some boost in government spending to try to prime the economy. Also, another tax cut, most likely a cut in the capital gains taxes. That's designed to spur investment, to boost the markets after that drop today.

Item number two, a planned bailout of the struggling airline industry. There's a proposal in Congress for $2.5 billion in direct aid, another $12.5 billion or so in loan guarantees to the airline industry. The president yet to endorse that specific plan, but he did meet with his advisers today. Item number one on the economic agenda, a briefing from the transportation secretary and others as to just what the administration can do to help that industry as well.

HEMMER: All right, John. John King at the White House, live with us.

More on the economy today and those massive numbers we saw today on Wall Street. To Atlanta and Joie with more on that. Joie.

CHEN: Absolutely. Bill, as you noted, and John just mentioned it, there's a certain anxiety about giving a little push to the markets and the economy as a whole.

There was a massive sell-off on Wall Street today as the markets resumed trading for the first time since the terror attacks. The Dow Jones Industrial Average fell nearly 685 points in its worst single- day point drop ever. The volume was described as "record-breaking," with airlines, hotels and leisure-related stocks taking big hits. On the broader markets, the Nasdaq tumbled almost 116 points, or close to seven percent, for its lowest close since October of 1998. CNN's Brooks Jackson now looks at Wall Street's day, and what the results might mean for the whole economy.


BROOKS JACKSON, CNN CORRESPONDENT (voice-over): The attacks hit the U.S. economy too. Airlines could lose billions and lay off tens of thousands. With long security delays discouraging travel, many airlines already are cutting operations 20 percent. Orders for new airliners could suffer. Boeing stock plunged as the market reopened with a big loss. Hotels braced for a reduction in travel business. Trucking was hit. There were 12-hour delays at the Canadian and Mexican borders last week. Many factories shut down, unable to get shipments. As America mourned, stores emptied. Example: book seller Barnes & Noble says sales at its 569 super stores were down 55 percent on the day of the attack. The economy was barely growing before. Now, many economists expect it will shrink.

JERRY JASINOWSKI, NATIONAL ASSOCIATION OF MANUFACTURERS: Business stopped last week, and it's going to be slow going this week. So the month of September is going to be a very weak month, and that probably is going to pull the third quarter into negative territory.

JACKSON: More economists now fear a full-blown spiral into recession. It will take weeks or even months before the full economic effects are known, and they could be dire. Nobody really knows or can know. But as Americans went back to work this week, there were some encouraging signs.

Of course, economic cheerleading. Treasury Secretary Paul O'Neill issued a rosy forecast at the opening of the Stock Exchange Monday and in interviews during the day.

PAUL O'NEILL, TREASURY SECRETARY: Crops are still growing in the fields, people are still showing up factories. Shopkeepers are out there. There even here in Midtown New York you can begin to feel a quickening pace again.

JACKSON: Labor and business staged a show of patriotic unity in the persons of AFL/CIO President John Sweeney and U.S. Chamber of Commerce President Tom Donahue, an economic odd couple.

UNIDENTIFIED MALE: We're going to put all our resources to put down those maniacs and quite frankly, to go out and kick some economic butt.

JACKSON: More importantly, consumers were back in the malls. For many Americans, shopping was therapy.

UNIDENTIFIED MALE: We have been watching all week and we need a break. So we're coming out to shop.

JACKSON: But consumers were buying lots more than candles. Barnes & Noble reported sales on Saturday and Sunday were 4.5 percent above the comparable days last year. In Washington, the president of the retail industry's trade association spent the morning gathering reports from CEOs of retail chains.

TRACY MULLIN, NATIONAL RETAIL FEDERATION: The retailers are saying that their sales over the last the several days have been reasonably good, given the magnitude of the disaster that we have all faced and that we're all part of.

JACKSON: The Federal Reserve announced another half-point cut in its key interest rate and signaled more cuts would come if needed. In Congress, leaders were drafting proposals for business tax cuts to add further economic stimulus, leading some to predict the nation would still avoid a recession and begin a strong recovery next year.

JASINOWSKI: ...that we would get maybe stronger growth as we move forward in 2002 than we might have gotten if this had not occurred.

Brooks Jackson, CNN, Washington.


HEMMER: Brooks raises the point how to make anything out of what we saw today. Mark Zandi will help us try at He's with us live tonight from Philadelphia. Mark, hello to you.

MARK ZANDI, ECONOMY.COM: Good afternoon.

HEMMER: We were expecting a dip. This was more than a dip today. What do you make of what we saw today on Wall Street?

ZANDI: It was a bad day. It was disappointing. I was surprised at the extent and the broad-based nature of the sell-off, particularly after the Federal Reserve board moved so aggressively and symbolically to cut interest rates. So it was a disappointing day.

HEMMER: Mark, what do you tell average Americans, millions across the country, who come home from work and see this Dow number that is absolutely staggering? How do you make sense of it? What do you do at this point going forward?

ZANDI: Certainly don't panic. We have seen these kind of days on and off again over the past decade. It happens. But one thing that always does happen after the down days is you have up days. And I am sure that a year from now this stock market, this economy will be in a much better place. So it's going to be a bumpy ride, it's a difficult time. It's hard to ignore what's going on. But if you're the average individual investor, you should do exactly that. You should ignore this.

HEMMER: Mark, quickly here on the airlines. They have taken a crushing blow for the past week here. What are we looking at in terms of additional layoffs as a possibility? And also, how the airlines might possibly be able to find some firmer footing?

ZANDI: This is very serious for the airlines. If there's any significant economic loser in all of this, it's the airlines. We may see layoffs that total as many as 100,000. This is very significant. I do think the airlines do need some financial help from the federal government, and I think that will be forthcoming. And hopefully that will staunch the worst of it for those airlines. You know, we'll get back in the air, we'll start traveling, commerce will pick up again and hopefully the airlines will pick up with it.

HEMMER: What are you doing tomorrow, Mark? Are you buying?

ZANDI: You know, I think there are some bargains out there. I think the market is appropriately valued -- now probably undervalued, given today's sell-off. So I think looking down the road a bit, I think you should be optimistic in the country and the economy and stock prices.

HEMMER: Mark Zandi, Live from Philly. Mark, thanks for sharing your thoughts today. Again, the Dow Jones Industrial Average down almost 700 points today on Wall Street. A lot more coming up on the markets after we close out here. Next hour on CNN, Lou Dobbs and "MONEYLINE" comes your way at 6:00 eastern time. Much more on what happened today on Wall Street coming up then.

In the meantime, there was a lot of talk today about getting Manhattan back to normal. But how to define normal certainly has been a major issue here, and a bit of a difficult prospect at this time as well. But nonetheless, commuters did start streaming back into the southern end of Manhattan island. CNN's Martin Savidge was there to see a lot of commuters get off that boat from Staten Island, along the ferry. Marty, hello to you.

MARTIN SAVIDGE, CNN CORRESPONDENT: Hello, Bill. Try as they might, it was still not a normal day for many commuters, but that had nothing do with transportation. It had to do with the mind set of facing once again Lower Manhattan.

The Staten Island ferry began operating again at 6:00 this morning, following what had been a six-day disruption. That is the longest disruption that the ferry service has had ever had in its nearly 100 years of operation. On any given day there are probably about 65,000 commuters that make the commute, the 5-mile journey that takes about 25 minutes from here over to Lower Manhattan. Today they say that there were about 20 percent fewer people that went on that journey. Not that surprising, probably. One thing you do find, the passengers stood on the rail and they would just stare in the distance at that New York City sky line. They could not believe that the two buildings were gone. Here is some of what they had to say. (BEGIN VIDEO CLIP)

NEW YORK COMMUTER: It gives me just a very bad feeling of like somebody has really invaded us, and it's just like if someone came into your home and stole something from you, I guess.

NEW YORK COMMUTER: The last time I was on the ferry, the buildings were there. So my heart just aches. That's the only way I can describe it. It just aches.

NEW YORK COMMUTER: It's like a nightmare, it really is. There's nothing there no more. There's nothing, it's all gone.


SAVIDGE: One thing that the officials of the Staten Island ferry point out is that the ferry did continue to opt operate last week. It didn't take passenger. It did take emergency personnel and equipment. Now they say they're back to normal, a 24-7 schedule. One thing has changed, though. Prior to the disaster, they used to take vehicles on board the Staten Island ferry. They say they won't be taking vehicles now for the foreseeable future. One more change in what has been a lot of changes here in New York and across the nation. Bill?

HEMMER: They cannot stop staring and neither can we. Marty Savidge, south end of Manhattan. Thank you, Marty. We're going to take you now to the area known as "the zone." Or some people are calling it "the pile," others "ground zero." CNN's Gary Tuchman about two blocks in away from the World Trade Center, where some of the more brutal work is being done here in New York City. Gary, hello to you.

GARY TUCHMAN, CNN CORRESPONDENT: Bill, hello to you. The search continues for survivors, but all they are finding is the dead. The smoke continues to rise behind me. The air still has a stench -- one of the reasons we cough occasionally. They're still looking for missing people, the number 4,957.

A short time ago, I was on top of a 40-story building here, just a block away from where I'm standing right now. I looked to the north, and I saw the gleaming structure of the Empire State Building under the peaceful blue sky. I looked to the south and reflexively expected to see the World Trade Center. Instead, just saw this smoky cauldron which you've now seen for six days -- which is still frankly very hard to believe.

Regarding the search for victims -- the search for possible survivors. There are six levels underneath the World Trade Center building. It's about 120 feet from the ground level to the bottom. According to police officials we've talked with, they have searched much of it. They have not found one survivor, but there are certain parts underneath the rubble they cannot get to because it is simply too dangerous.

If there was a reasonable expectation that searchers would not get hurt, they would do it. However, they feel there's a reasonable expectation that searchers would get hurt or possibly get killed, so they can't get to those areas. They tried to get to them from underground, but the subway tunnels, where they were going in through, were flooded. That's the scenario.

One of the searchers is a gentleman by the name of Sergeant Antonio Scannella. Sergeant Scannella is in a Port Authority police squadron of nine people. Six of his people are missing. There are three of them left. He is still continuing in the search, and we talked to him about it.


SERGEANT ANTONIO SCANNELLA, PORT AUTHORITY POLICE: My whole working squad was working that day and many of my good friends are in there.

TUCHMAN: How do you cope?

SCANNELLA: I don't know. I just try to be strong.


TUCHMAN: It certainly isn't easy to keep strong. This is what many of these people here are going through. Many people -- perhaps most of the searchers inside -- know someone who is missing. They have also been told by their bosses here, most of the people participating in the search, that they must take a day off as soon as possible. They're not being told they should take a day off, they're being told they must. Not only for their well-being, but they think it will also help the search. There are a lot more people here than they need. There are people to replace them. And they want people to be as fresh as they possibly can be. Bill, back to you.

HEMMER: Gary, quickly here. The mayor today mentioned something, he's mentioned it a few days ago, too. But he mentioned the possibility that some bodies will never be located and never found inside that rubble behind you. Are many people down there that you have conversations with prepared for that possibility?

TUCHMAN: I think that's what officials are trying to do, is prepare people for that possibility. Because of the fact that nearly 5,000 people are missing, it's not only very likely, it's completely probable that many of the victims will never be found. That's very bad news. But we must emphasize that they really do still believe it's possible for survivors to be there. They are hoping for a lucky break where they could find a survivor. One thing I want to mention to you, one story we heard from a police officer. They got deep underground, they saw a car under there, they saw a body inside the car, and it was someone who had passed away. They were hoping it would have been a survivor.

HEMMER: Another story. Gary Tuchman from what is known as ground zero with us today. I can attest, Gary, that the choking sensation you get there after being on Wall Street throughout the day today, that smoke drifts in and sometimes it can be pungent, gets in your eyes. And once it gets into your lungs too, you can end up choking quite a bit for quite a long time. Indeed the masks that people have been using throughout this entire operation are needed in many, many cases. Back to Atlanta. More coming up shortly in New York. Here's Joie.

CHEN: The diplomatic efforts to build support for attacks against terrorists: What Pakistan has done to try to assist the United States. And later, a Russian expert on fighting a war inside Afghanistan talks about the dangers -- potential dangers -- to U.S. troops.



BUSH: Osama Bin Laden is a prime suspect. And the people who house him, encourage him, provide food, comfort or money are on notice.


CHEN: Today, Washington's message was formally put to the Taliban by a delegation from Pakistan. CNN's Mike Chinoy is in the Pakistani capitol, Islamabad.


MIKE CHINOY, CNN CORRESPONDENT (voice-over): Amid heightened security and growing tension at home, Pakistan's government waited for news of its last-ditch effort to avoid war. In the southern Afghan city of Kandahar, a team from Pakistan's military intelligence service delivered a blunt message to the Taliban. Hand over Osama Bin Laden and his associates, or face the consequences.

ABDUL SATTAR, FOREIGN MINISTER OF PAKISTAN: We hope that the government of Afghanistan will act with responsibility in the terribly grave situation raised by these horrendous terrorist attacks.

CHINOY: If anyone can influence the Taliban, it's the ISI -- Pakistani military intelligence -- which played a key role during Afghanistan's civil war in helping the Taliban seize and hold power. Now as President Pervez Musharraf moves to ally his government with Washington, officials here are unclear whether the Taliban will listen to them.

SATTAR: The assumption that Pakistan is in a position to exercise complete influence is flawed, in our opinion. We have constantly pointed out to our friends that we have diplomatic relations, but that doesn't necessarily translate into great influence.

CHINOY: Meanwhile, the government has already responded to one U.S. request, closing its borders with Afghanistan, keeping growing numbers of refugees at bay and halting shipments of everything but food. The government's stance has stirred sharp opposition in some quarters here, especially from Islamic fundamentalists -- many of whom have close links with the Taliban. Demonstrations against President Musharraf have broken out in several cities. There are fears things could get worse.

NAJAM SETHI, NEWSPAPER EDITOR: It could be pretty destabilizing. It will begin in the northern areas, the border areas (UNINTELLIGIBLE) and the frontier. And if the conflict is long, drawn-out, it will spill over into the streets of Lahore and Karachi and the urban areas. And at that time Musharraf and his government will be hard pressed.

CHINOY: The government knows this, and has reportedly asked the U.S. for large-scale economic aid and political support in return. But that may not be enough to prevent turmoil in the streets or possible reprisal attacks by Taliban or Bin Laden supporters as Pakistan chooses sides in this new war against terrorism.

Mike Chinoy, CNN, Islamabad, Pakistan.


CHEN: On the other hand, the United States will not get military support from another country which neighbors Afghanistan. Iran's foreign minister told CNN today the United States should not punish a country while trying to punish a terrorist. In Washington today, Secretary of State Colin Powell said it will not be enough to get at Osama Bin Laden.


COLIN POWELL, SECRETARY OF STATE: Osama Bin Laden is the chairman of a holding company. Within that holding company are terrorist cells and organizations in dozens of countries around the world, any one of them capable of committing a terrorist act. So it is not enough to get one individual, although we will start with that one individual. It will not be over until we have gotten into the inside of this organization, inside its decision cycle, inside its planning cycle, inside its execution capability -- and until we have neutralized and destroyed it.


CHEN: Joining us now with the latest from the State Department is CNN's Andrea Koppel. Andrea, follow up on this a little bit. How clear is Pakistan's support for the United States? How clear is it that Pakistan is on board?

ANDREA KOPPEL, CNN CORRESPONDENT: Well, Joie, publicly and privately, it's very clear, U.S. officials tell us, that President Pervez Musharraf has said explicitly that he has agreed to everything on a list of specific demands that the U.S. put forward last week. And they're taking him at his word. But really, we'll have to see whether or not they follow through on those specific requests when a U.S. delegation travels to Pakistan in coming days to give them more details.

CHEN: We have talked about other elements to all of this. Talk to us about the next diplomatic steps. What other nations need to be on board? What else is the State Department working toward here? KOPPEL: Well, there are a number of pieces to this diplomatic puzzle. One of the biggest pieces is within the Arab world and countries like Morocco, Egypt, Saudi Arabia. Why are they important? Well, you heard secretary Powell talk about those holding companies, those terrorist cells. Many of them operate on the soil of these countries. In the Arab world, the U.S. needs them to shut them down, to cut off all financial support, that go from the cells to the Taliban -- excuse me, to Bin Laden's network in Afghanistan.

There's a second portion to that. Many of those countries are Islamic. The U.S. needs it to be made very clear this is not the U.S. against Bin Laden because he is Islamic. This is a law enforcement issue, this is an act of terrorism. Countries like Saudi Arabia, which are known as the Mecca for many of the holiest sites in the Islamic world, need to come out publicly and say that this is not east against west. This is the international community against acts of terrorism. It's a message that should be reinforced later this week when the Saudi foreign minister comes here to Washington.

Another big area is Central Asia. They border northern Afghanistan. They need to shut down their borders. They also have terrorist cells operating there. Finally, Joie, there is Russia, which of course its own history -- the Soviet Union had a lot of experience in Afghanistan and now today with terrorism. So those are three big diplomatic pieces to that puzzle.

CHEN: CNN's Andrea Koppel at the State Department for us.

When we talk about Afghanistan, we're talking about a country that's largely unfamiliar to most of us. To try to add to our knowledge, we have invited on board with us Frank Anderson, former chief of the CIA's Afghan task force. We understand that that was your role in the 1990s, when Bin Laden's influence was growing within Afghanistan. I wonder if you can tell us -- give us some insight. We've heard a great deal about his strengths there. What are his weaknesses?

FRANK ANDERSON, FORMER CHIEF, CIA AFGHAN TASK FORCE: Well, first, a minor correction. I did the Afghan task force in the 1980s. 1987 to '89.

CHEN: Forgive me for that. What can you tell us about any weaknesses that he has?

ANDERSON: Well, let's talk about his weaknesses, in the sense that Afghanistan is truly a country that no one has been able to conquer, no one has been able to rule throughout its history. The Taliban are Osama Bin Laden's only protectors -- or his hosts, to the extent that he has protectors in Afghanistan.

And while they do control some 95 percent of the territory of Afghanistan, they're a long way from having real secure control over the country, and they're a long way from being truly united. So we're confronted with a situation where we have to deal with the Afghans' unwillingness, to some extent -- and their inability, to some extent, to work with us. But neither of those things is absolute. CHEN: I think you're going away from where I started with you, which think is, all right. You have outlined to us some of the fragile nature of the host country -- or what we believe to be the host country for Osama Bin Laden. But for him himself, does he have particular frailties?

ANDERSON: I'm sorry. In the sense of personal frailties, or in the sense of his security?

CHEN: In the sense of his security, or in the sense of trying to build some sort of operation against him. What holes would you look for in his operation?

ANDERSON: Well, let me point to recent history. And that is that Miramal Kansi, who murdered CIA employees outside the headquarters some years ago was captured inside Afghanistan. And that capture was affected because Afghans assisted.

They're, however, monstrous the Taliban may have been portrayed in the past and however negative our feelings might be about those that are supporting Bin Laden at this time, inside Afghanistan, as well as in Pakistan and elsewhere, there have to be people who are horrified by this. There have to be cracks in the total loyalty of his supporters.

And I'm confident that over time, if it hasn't already happened, there will be substantial intelligence and they'll be substantial cooperation from those people close to him with the United States or indirectly with Pakistan. And his security over time has got to erode. I would say that he was at his safest on the morning of the 11th of September. And every day after that, his personal security position has got to erode.

CHEN: You have been quoted a couple years back as saying that you believed his money was running out. His vast wealth has been reported so greatly in the western press. Is that a miscalculation or was money a necessary element of this operation?

ANDERSON: Well, his money was running out in a sense, but he still unquestionably has multiple millions of dollars. The unfortunate thing about this monstrous action in the murders of so many people in New York, is that it would not necessarily be expensive.

The one comment that's been made is that, in fact, you could you mount this operation for the cost of an upper middle class home in any major metropolitan area in the United States.

CHEN: I hate to interrupt you, because we are going to run out of time, Mr. Anderson. And I want to get back to this point that we started with. And if I can get you to narrow on this. You had noted that you felt that he was less safe now than he might have been a week ago, before September 11. Why is Osama Bin Laden less safe today than he was a week ago?

ANDERSON: Let me reiterate that what we're dealing with are countries and organizations and people whom we have to measure on their willingness and their ability to help us in getting at him. And however much some of his close and most fanatical supporters may have been encouraged by what happened and strengthened in their resolve to protect and assist him, there are others who have to have been horrified by the monstrosity of what he'd done or what has been done in his name or at least with his cooperation.

And moreover, now that the resolve of the United States has become so clear and the long-term prospects for any nation or any organization for that matter, any individual who picks the other side in this war on terrorism are becoming increasingly clear. And I'm confident that the number of penetrations of his organization, the number of penetrations of the Taliban and others who are supporting him are going to grow.

CHEN: I'm sorry, we're going to have to leave it there, Mr. Anderson. Frank Anderson is the former CIA chief of the Afghan task force. We appreciate your insight today.

ANDERSON: Thank you.

CHEN: And now back to Bill in New York -- Bill.

HEMMER: Joie, thank you.

Coming up here, the very latest on the investigation, the latest on the hunt for those responsible and the latest on those already under arrest. Also coming up, the airlines. What's next? Are new layoffs headed next? And is Congress ready for a bail-out? That and more when we continue here.


HEMMER: Once again, welcome back to New York City. I'm Bill Hemmer. More coming up from here, but first to Joie Chen in Atlanta and the latest developments thus far today -- Joie.

CHEN: Bill, first up, after a drop of nearly 700 points, the stock market closed below 9,000 for the first time since 1998. And at the closing bell, there was this bad news. U.S. Airways expected to cut 11,000 jobs, just the latest announcement of airline layoffs since the hijackings on Tuesday.

Airline executives are to meet with members of Congress tomorrow about a possibility of a multi billion dollar federal bailout. The FBI is now investigating 40 apparent attacks aimed at Muslim-Americans as possible hate crimes.

One of the attacks occurred overnight in Ohio, when a man allegedly plowed his car into a mosque. However, he injured no one but himself. President Bush says the country will not stand for intimidation of Muslim-Americans.

Also today from President Bush, more harsh words for Osama Bin Laden. Mr. Bush says Bin Laden remains the government's number one suspect for the terror attacks last Tuesday that claimed thousands of lives. The President said America will win the war on terrorism, but warned there will be costs.

We touched on the problem of the airlines. From the U.S. Attorney General today, a message about airline security.


JOHN ASHCROFT, ATTORNEY GENERAL: Each day as flights increase, we will be adding additional enforcement officials from the Department of Justice as air marshals on planes in addition to the already heightened security on the ground in airports. These...


HEMMER: Apologize for the interruption there. Going to take you to Phoenix, Arizona now. Senator John McCain speaking with reporters. We shall listen to the senator now.


SEN. JOHN MCCAIN (R), ARIZONA: Tomorrow I'll be on a conference call with airline executives. And I think that it's important that the government act to assist the airlines and keep them from going out of business. It's a serious situation, obviously that has been made dramatically worse by the acts of terror.

So I would anticipate by the end of this week, when I go back to Washington, that we should be putting together some package of assistance to the airlines.

QUESTION: What will that entail?

MCCAIN: It's a variety of proposals. And we haven't gotten to the point yet of exactly what that package would be. We owe the taxpayers the benefit here as well. One of the areas that I am very confident that we can act on is government guaranteed loans to some of these airlines.

The additional measures, there's been as many as 20, 30 proposals. So we've got to work with the White House, with the airline industry and the Congress all working together. And we just have to think it through. And that's why I say probably be the end of this week, early next week before we could solidify that proposal.

QUESTION: Specifically America West, I mean, they took some of the biggest stock hits today.


QUESTION: They're not one of the weakest airlines, but they are not one of the most financially sound. I mean...

MCCAIN: America West is in significant difficulty. American, Delta, Continental.

QUESTION: Is it likely that we're going to lose airlines in this? MCCAIN: Pardon me?

QUESTION: Is it -- I mean, we already lost Midway. Will we lose more?

MCCAIN: I don't know. I know they're experiencing extreme difficulty. And that's why I think we have to act on behalf of all the airlines that are experiencing problems. It is a national interest issue if we're in danger of losing the services of our major airlines.

QUESTION: Does this package -- in the billions? I know there's a number of proposals.

MCCAIN: I don't know.

QUESTION: Let's kind of swing into the economy. I mean, obviously you're paying attention today. I mean, are we going to take a quick hit? Is this going to be a long hit? What's going to happen in your crystal ball?

MCCAIN: I have great difficulty in predicting what's going to happen to the economy, except to say the following. One, the underpinnings of our economy are very strong. So whatever happens is not, is going to be temporary. Second, we're going to be pumping a lot of money into the economy, in the form of reconstructing New York City, the Pentagon. As we've already, we already have sent $40 billion into the economy, we'll be sending a lot more.

And hopefully this will act as a stimulus in the short-term. Second point and final point is, the quicker we get back to normal, the more likely the economy is to recover. As soon as Americans start traveling again, start buying again, start investing again, then that will be, will dictate how quickly our economy gets back on its feet.

QUESTION: Is it going to take a larger tax cut out of people's wallet, though, to finance a lot of things that need to be done, whether it's federalizing security at airport or anything else?

MCCAIN: I think that a talk cut is going to be under consideration as well.

QUESTION: A tax cut?

MCCAIN: A tax cut.

QUESTION: How can you pay for new things with a tax cut?

MCCAIN: You're going to have to dig in to the surplus as we are now. I think to increase taxes at this time would be a terrible mistake. So we may have to look at that. I think that literally every option in order to stimulate the economy is on the table.

QUESTION: Senator, what have you gleaned from your visit around the valley? What is the mood of residents? I know you met with firefighters. MCCAIN: The mood is one of sorrow, outrage and commitment to this country and its future. The opportunity with meeting with firefighters, including some that are going to go to New York City on Wednesday. They're eager to go. They're eager to go into harm's way on behalf of their fellow citizens. And I think that's what the citizens of Arizona are all about.

QUESTION: There was a murder over the weekend, apparently appears to have been related to American fervor, as the case may be.

MCCAIN: What happened in, over the weekend, in the murder of a innocent person is a outrage and disgrace and frankly, an embarrassment to all of us who live in the valley. And it should never, ever happen again and should never have happened before. It's a disgrace.

QUESTION: How do you stop it? What do you do?

CHEN: Senator McCain out in Arizona, giving his support to government-backed loans for the airline industry. We told that you the airline industry is already indicating some very tough times ahead.

Since Tuesday's attacks, American and other major carriers have lost at least a billion dollars. Already a source at American Airlines tells CNN the company expects, as early as midweek, to announce job cuts. U.S. Airways just announced plans to slash 11,000 jobs. Northwest plans to announce an unspecified number of layoffs as early as this Thursday and over the weekend. Continental announced 12,000 layoffs. Among the factors affecting the industry, a fear of flying since last Tuesday's attacks.


UNIDENTIFIED MALE: We're into unchartered waters here. I don't think any of us can really predict exactly when it would come back, but certainly from the standpoint of the industry, we are expecting a lengthy amount of time before we get back to the levels that would have prevailed otherwise.


CHEN: Some analysts say this year's losses by U.S. airlines will top $5 billion. And what to do for the airline industry?

Joining us now, CNN congressional correspondent Kate Snow on Capitol Hill.

Kate, there's already a difference of opinion from the two sides.

KATE SNOW, CNN CORRESPONDENT: Well, there is, Joie. I mean, the consensus is that something probably needs to be done for the airlines, but I can tell you that there's a bit of a difference when it comes to the price tag.

What we're learning today is that the senior most Democrat on the House Transportation Committee, Mr. Oberstar, is talking now about twice as much money for the airlines than what was being talked about just two days ago. Mr. Oberstar now talking about providing $5 billion in direct cash payments to the airlines. And then on top of that, other additional loan guaranties. And they're even now looking at things like repealing the jet fuel tax that airlines have to pay.

All of this coming because these members are being lobbied very heavily by the airlines right now. Mr. Oberstar saying if they don't do something soon, the entire industry could go under.


REP. JAMES OBERSTAR (D), MINNESOTA: If the U.S. airlines go down, there are no other airlines. No one else will step in to provide that service. If it's gone, we lose it, maybe forever. That is the dimension of the problem.


SNOW: Now details on the dollar figures are still being worked out, still being discussed. I spoke with aides to the chairman of the same committee, the Republican, Mr. Don Young. And they say they too want to help the airline industry. They're not exactly sure how much money we're talking about. But on all sides, Joie, the hope is that the House might be able to get something done by the end of this week -- Joie.

CHEN: Kate, you know, I've been listening earlier in the day. We heard here on CNN Leo Mullen of Delta Airline, talking about his concerns and trying to balancing it out. I suspect that the airline industry needs to follow a very fine line. Mr. Mullen was talking about hey, part of the issue here is that airlines have such large fixed costs. An that is one of their immediate concerns about the money.

SNOW: Well, yes. And they were in bad shape, Joie, before anything happened last us Tuesday. We've been told by industry associations that they were already in the red to the tune of some $6 billion. So now asking for $5 billion seems to make sense, because not only were they already in the red, but now obviously things have gotten much worse for these airlines.

I should tell you though, there is some note of caution coming, Joie, from both -- some members of the House. I just spoke with Lloyd Doggett, who's a member of the House, a Democrat from Texas, who tells me he was one of the people the other night who expressed some caution about this. He says he's getting a lot of phone calls now from the airline industry.

His concern, though, and some others concern on the Senate side as well, is that we shouldn't rush into this. that Congress needs to make sure that they're not giving airline industry, give the airline industry help at the expense of other industries. There are going to be a lot of needs out there, lot of members are saying. And they want to make sure that this is the right way to do it and not rush into things -- Joie. CHEN: On Capitol Hill, CNN's Kate Snow -- Bill.

HEMMER: Joie, thank you.

Back to the investigation now. There are four people said to be material witnesses under arrest right now, that according to the FBI and other law enforcement officials.

To Washington and CNN'S Eileen O'Connor, where there is more news about at least one of these four. Eileen, good evening to you.


Well, sources say that there are also a lot more of those material witness arrest warrants out there. And more and more FBI, ATF, INS and Customs Agents are working this case in conjunction with local law enforcement. They are finding links between these hijackings and past attacks against the United States, its embassies or military installations, linked to Osama Bin Laden.

In custody is Zacarias Moussaoui, Habib Zacarias Moussaoui, who came into the United States in February on a student visa for flight school. He was picked up by the INS on August 17 on a visa violation. He was still in custody in Minneapolis when the attacks on the Pentagon and the World Trade Center happened. And he's now been transferred to New York for questioning, where sources say he is not cooperating.

He was studying, according to sources, at a flight school in Oklahoma. Another person linked to Osama Bin Laden studied at that same school. Now, we saw in New York in earlier trials, testimony by government protected witnesses that were in the trial of Bin Laden for those bombings at the U.S. embassies in Tanzania and Kenya.

That testimony indicated that Ehab Ali had trained as a pilot at the request of Bin Laden. Ali currently in federal custody, held on charges relating to that case, took flying lessons in Norman, Oklahoma as well. So there's a critical link.

Sources say that they are looking at that link very closely. They've been searching buildings where others associated, but never brought to trial for those embassy attacks live. Now, the strategy of training pilots to execute terrorist acts was uncovered during that embassy bombing trial. And that strategy appears to have been repeated in preparation for the attack on the Pentagon and the World Trade Center.


(voice-over): Hani Hanjour, one of the dead Pentagon hijackers studied here in May at Freeway Airport in Bowie, Maryland, 25 miles from Washington, D.C., and the White House.

UNIDENTIFIED MALE: Take a look inside just to get the general look and feel of this type of trainer. O'CONNOR: Hanjour wanted to rent a Cessna 172, says owner Marcel Bernard. But he needed to prove he was good enough and went up three times with two instructors.

MARCEL BERNARD, INSTRUCTOR: On the last flight, I made it clear to him that they felt that his overall proficiency was so poor that they were going to insist that he do a little more flying us with, and get some additional training before they would allow him to rent our aircraft.

O'CONNOR: Hanjour didn't come back. And while landing a Cessna is far different from landing a 757, Bernard says keeping it in the air isn't.

BERNARD: We believe that even though he didn't necessarily have experience in jets, that once the airplane was airborne, that he could have easily pointed it in any direction he wanted to and crashed it into a building or whatever would be a real feasibility, real possibility.


O'CONNOR: A real possibility that turned in to a tragic reality -- Bill.

HEMMER: Eileen O'Connor, fascinating information. Eileen, thank you.

Back here in New York City, many people thought this could be a day that returned to a sense of normalcy, however your definition of normal may be.

CNN's Richard Roth talking with a lot of people, flooding back into Manhattan for work today. Richard's near the Brooklyn Bridge with us now.

Richard, hello.

RICHARD ROTH, CNN CORRESPONDENT: Well, not exactly the bridge, but in the canyons of Wall Street, the venerable canyons, a place where business can tend to be a little ruthless. There are a lot of emotions here.

From where I'm standing, you really can't see what would have been the World Trade Center anyway due to these tall buildings, but they were not forgotten by many of the Wall Street pros here.

Fear is always a big emotion here on Wall Street, but there was an extra component today. Everyone was very jittery, but there was more than just regarding money. They were concerned about what had happened. And many thought the stock exchange and other buildings could be a possible target.

There was nervousness. People were uncomfortable. There was a lot of anxiety. There were scenes on the streets of Wall Street never really witnessed before by veterans here, soldiers and police on every street. Streets empty of trucks and cars. And everybody wearing a mask to ward off the effects of the smoke from the tower's rubble.

A few blocks away with American flags flying everywhere here, Wall Streeters did the best they could to cope with the trauma the first day of trading.


UNIDENTIFIED MALE: As soon as got into my building, made sure I checked the fire escapes and the fire exits to make sure I knew the way out.

UNIDENTIFIED MALE: First day back, I think it's pretty nerve- racking. A lot of people I see walking around having faces, like me, covered. I think they're a little anxious though.

UNIDENTIFIED MALE: Coming in and watching National Guard troops on the street feels like watching something out of a news reel from another country.


ROTH: One man said he was not going to look up through the side streets at where the towers would have been. Another said he didn't really want to be here, but felt there would be unity in showing up. And another, after the close of trading with the Dow Jones down over more than 600 points, bitterly said: "I'm not disappointed. What's to be disappointed about? There are a lot of other important things to worry about" -- Bill.

HEMMER: Richard, thank you. A lot of tears and a lot of emotion this morning and throughout the day on Wall Street. Richard Roth on Wall Street with us tonight.

We talked about the word "normal." Let's bring in CNN's Jeff Greenfield for a closer look at what we mean when we talk about this word.

Jeff, good evening to you here. New Yorkers thought this was the day to get back to business. Get back to work, that seemed to be the theme taking root over the weekend and into the morning. What do you think of when we try and define this word "normal" in a case like this?

JEFF GREENFIELD, CNN SENIOR ANALYST: I think that for the next couple of days, we're going to get back to normal. And it will be absolutely not normal in the way we thought about it up until last Tuesday and never will be again.

We're starting baseball again tonight. That's fine, but people are going to be waiting on line, I think, for long periods of time to be searched. And to be blunt, I think a lot of people who are in the stadiums, thousands of people, are going to wonder, "Could this be a target?"

The television shows are getting back to normal. But who thinks that we're ever going to have the kind of mocking political commentary and kind of mocking of our leaders that we've had over the last 20 years? How do you do that kind of humor in this context?

People went back to Wall Street today, but not only was it different in terms of what happened in the market, but as we just heard, the whole mood is different. Whoever thought that a stock broker or trader was going to have go down and pass a series of checkpoints? Normal as...

HEMMER: With the National Guard there on the streets.

GREENFIELD: With the National Guard in the street and sky marshals on airplanes. They're flying today, but is anybody in a airplane with the same emotional state they would have been in six days ago when their biggest concern was how much am I going to be delayed?

The world's changed so much that you have to kind of go back and start looking at how people managed to have something of a normal life in other times. You know, in World War II, people laughed, people listened to radio, people went to the movies. And that was at a time when what they were worried about were their sons and fathers and brothers overseas, not about their own personal safety.

HEMMER: You know, in the four days I've been here in New York, it strikes me so many times throughout the course of our day as we run around to different parts of Manhattan, I wonder truly across the country if it's really settled in just yet, if people really understand the magnitude of what we see here on the streets.

And I made the comment that television can only show so much. But you can't see it truly unless you come to this city and walk through the World Trade Center area and talk to the people and feel their emotion that they're taking on.

GREENFIELD: I'm sure that's true, but I do believe, having talked to people all over the country, that the sense of unsettledness, the sense of worry, the sense of, are we going to be next? We're going to be talking about that tonight about 11:00 with former Senator Gary Hart, who co-chaired a National Security commission. And he talks about the fact that you know, cities like he mentioned Seattle, he mentioned Denver, why assume that if you're not living in New York, you're safe?

And that's the great unsettledness that our leaders and the people as a whole have to come to grips with. We have to find a way to go about our lives, to love, to work, to play. And the same time, we're understand a shadow that we never thought we'd be under.

HEMMER: You mentioned baseball. It will be a welcome distraction I think for a lot of people tonight. See how the evening goes.

GREENFIELD: I think so, you know.

HEMMER: Jeff, thanks, we'll talk later, OK?

GREENFIELD: You bet. HEMMER: Back to Joie now in Atlanta -- Joie.

CHEN: Speaking of baseball, take a look back here, batting practice underway after a week off. Major league baseball is back and you see it there. Veterans Stadium, Philadelphia, the Braves are playing the Phillies this evening.

Josie Karp is standing by in Philadelphia now.

Josie, what are you seeing?

JOSIE KARP, CNN CORRESPONDENT: Joie, in total six games will be played for major league tonight. One is here at Veterans Stadium. About 20 to 30,000 fans are expected here. And those fans, of course, are going to be subjected to much tighter security than normal.

And one of the most obvious signs of that increased security has to be the increase in uniformed police officers, both inside and also outside the stadium. Outside the stadium, the number of uniformed police officers is expected to be triple what it normally is. Also, fans aren't allowed to bring in large coolers and bags. The bags they are allowed to bring in are subjected to search.

In addition, parking has been restricted within 100 feet of all stadiums. These are all of the restrictions that are put in place, Joie. And it's against this backdrop that the Phillies and the Braves are doing what so many Americans did today, that's pretty much go back to work. Back to you.

CHEN: All right, Josie Karp at Veterans Stadium. The American spirit back in play.

And that's it from here at CNN Center in Atlanta. I'm Joie Chen.

HEMMER: And I'm Bill Hemmer live from New York City. The Dow Jones Industrial average plummeted today, almost 700 points. Much more on the markets and the mood on Wall Street coming up next on Lou Dobbs "MONEYLINE." Stay tuned for that. It follows us now.



4:30pm ET, 4/16

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