clearing out. the first evacuations are ordered as hurricane earl barrels towards the east coast. "operation new dawn." president obama declares an end to the u.s. operation in iraq. >> we have met our responsibilities. now it's time to turn the page. and survival story. a new york man falls 39 stories, lands on a car and lives. this is the "cbs morning news" for wednesday, september 1, 2010. good morning, everybody. and thanks so much for joining us. i'm betty nguyen. this morning hurricane earl remains on a path to sideswipe the east coast. the first evacuations have already been ordered.

earl is expected to move northeast of the bahamas today packing 135-mile-an-hour winds. it's a large category 4 storm with hurricane-force winds extending outward 90 miles. earl is moving towards the northwest and is expected to glance much of the east coast. north carolina has ordered tourists to evacuate ocracoke island this morning. a hurricane watch is in effect from north of surf city, north carolina, to the virginia border. but it is still too close to tell just how close earl might come to land. don teague reports. >> reporter: whipping angry winds, seen from a window in st. maarten as hurricane earl sideswiped the virgin islands dumping up to 8 inches of rain. >> i've never scene waves like this. >> reporter: in st. croix heavy surf crashed on shore. the waves tore boats from their docks. in st. kitts, heavy surf ran this coast guard boat aground.

high winds damaged roofs and knocked down trees and power lines, blocking roads. the next population in the hurricane's path, the 36,000 residents of the turks and caicos islands. >> we're getting choppy water. on the west side of the island is where the open ocean is and it's extremely rough right now. >> reporter: computer models predict earl will remain a powerful hurricane, tracking to brush the north carolina coast as early as thursday night. already the phone is ringing off the hook at the outer banks motel in hatteras. >> we don't charge you, of course, if you don't come during a hurricane. >> reporter: people here are also starting to worry about beach erosion. the outer banks are shrinking. some beaches losing 15 feet of sand a year. 81-year-old carol dillon, who has owned this motel since 1955, worries there's not enough beach left in front of her motel to protect it. >> when we had 500 feet of beach we did not have water on the outer banks motel property.

>> reporter: the water here on the outer banks is already off limits to swimmers because of dangerous rip currents. those currents will only get stronger as the hurricane approaches. as for most of the people here, very few have left so far but many say they'll make that decision if the hurricane continues on its current track. don teague, cbs news, north carolina. in other news this morning, american forces have a new mission in iraq. the president formally ended u.s. combat operations in iraq in an oval office speech last night, saying this country paid a huge price. mr. obama praised america's armed forces and noted the toll the war in iraq took on the problems here at home. tara mergener is in washington with more on this. good morning, tara. >> reporter: good morning, betty. last night the president said that the u.s. has met its responsibilities in iraq. as of today, our role has changed. >> it's time to turn the page. >> reporter: u.s. combat operations may have come to an end but the war in iraq isn't

over. >> i can't tell my soldiers you're not a combat armed soldier anymore. that's offensive. you know what i'm saying? we're still doing what we did before. >> reporter: today roughly 50,000 american forces begin "operation new dawn." their mission, advising and supporting iraqi security forces over the next year. >> they have to be successful really early on. the next 90 days will tell whether or not the iraqi security forces have been successful and trained well. >> reporter: this morning defense secretary robert gates arrived in iraq joining vice president biden who has been in the country all week. pushing political leaders to end a stalemate and form a new government. president obama also urged iraqi leaders to come to an agreement during his prime time address from the oval office last night. >> i encourage iraq's leaders to move forward with a sense of urgency, to form an inclusive government that is just representative and accountable to the iraqi people. >> reporter: even when an iraqi government finally takes shape, president obama promised the u.s. wouldn't just walk away.

>> our combat mission is ending, but our commitment to iraq's future is not. >> reporter: that commitment has come with a heavy price. nearly $1 trillion spent and more than 4,400 lives lost. and with combat operations over, the president says he can focus now on the country's most urgent task, fixing the economy. betty? >> tara, some republicans say president obama is taking credit for a war he opposed all along. did he address that last night? >> reporter: no, betty. he did not. instead he made it clear he opposed the war right from the start. now, during the speech he acknowledged president bush for a number of things, including his love of country, his support of troops and his commitment to security, but he did not address that directly. betty? >> cbs's tara mergener in washington this morning for us live. thank you, tara. in alaska senator lisa murkowski has thrown in the towel. it is a stunning defeat for murkowski who trailed attorney

joe miller following the august 24th primary. miller, a conservative, was backed by the tea party and strongly endorsed by sarah palin. murkowski is the seventh member of congress and the third senator to be ousted amid anti-incumbent sentiment. the obama administration begins its latest attempt as brokers peace in the middle east today. formal talks brokered by secretary of state hillary clinton begin in washington tomorrow. but today the president meets separately with palestinian president mahmoud abbas and israeli prime minister benjamin netanyahu. he'll host them for dinner tonight. on the eve of the talks, four israeli settlers were shot dead on the west bank. hamas says it is responsible. and this morning israeli settlers on the west bank said they will break a government freeze on construction and protest of the shootings. in other news, homeland security officials say it doesn't appear two men arrested in the netherlands were conducting a dry run for a

terrorist attack. the men were taken into custody monday following a flight from chicago. in one man's luggage suspicious material was found, including cell phones and watches taped together. a law enforcement official says the men did not know each other. on the "cbs moneywatch" stocks in asia rebounded this morning. ashley morrison is here with the latest on that. good morning. >> good morning to you, betty. asian markets sprang back from heavy losses tuesday after news china's manufacturing got a boost. japan's nikkei gained a percent while hong kong's hang seng was mostly higher. today wall et get the latest on jobs and auto sales. the dow gained almost 5 points while the nasdaq fell nearly 6. traders are happy to finally close the books on august. the worst in nine years with the dow losing more than 4% and the nasdaq more than 6%. but september could be just as scary. historically it is one of the worst months for the market.

retail sales continue to be sluggish. shoppers spent only a bit more this august than they did last year. retailers will be disappointed by this year's back-to-school season which is supposed to be their second busiest time of the year. one bright spot -- online sales, which rose for the 13th month in a row. apple may have big surprises in store. the tech giant is holding a news conference later today but once again is not giving any details about what it's about. industry analysts are expecting some upgrades to the company's line of ipods. they may also unveil new features to apple tv, a device that connects to your television set that lets you stream movies and music. amazon wants in the tv game as well. according to "the wall street journal," the online retailer is talking with several big media companies about offering older tv shows and movies online. betty, i guess it's all about trying to stay in the game and be relevant when it comes to the fast-moving tech industry. >> no doubt.

people are so busy that they want to be able to watch those shows whenever they have time available. that might just work. ashley, joining us live here in new york, thank you so much for that. and just ahead on the morning news -- homeowners get a lift from rising home prices. actor michael douglas stays upbeat about his chances for surviving throat cancer. you're watching the "cbs morning news." surviving throat cancer. you're watching the "cbs morning news." [ female announcer ] stay once... stay twice... earn a free night! two separate stays at comfort inn or any of these choice hotels can earn you a free night -- only when you book at choicehotels.com. until the combination of three good probiotics in phillips' colon health defended against the bad gas, diarrhea and constipation.

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at the white house, we got a look at the redecorated oval office before president obama's speech last night. the room has new couches, latches lamps and striped wallpaper. and a new rug bearing the presidential seal with a border bearing quotes from former presidents. one thing that has not changed -- the historic desk, a gift from queen victoria in 1880. looks pretty nice. a little more modern, though,

i'd say. now to the housing industry where the number of homes being sold may be falling but the prices are on the rise. a new report says home prices in the second quarter of this year were up nearly 4.5% but they are still 27% lower than four years ago. anthony mason has more. >> reporter: across the country, the arrow went up for home prices in june. chicago, minneapolis and detroit led the rebound, according to the case-shiller index. among 20 major metropolitan areas, only las vegas fell. nationally, house prices are up nearly 7% from the lows in 2009 with some cities showing double digit gains. >> notably, san francisco, our best-performing city since 2009, it's up 21%. that's -- that's booming. >> reporter: but ominous signs still loom for housing. sales of existing homes plummeted 27% last month. and some economists believe

house prices are about to drop again, too. >> we're not quite through with the housing crash. we've got another 5% or so to go on house prices. >> reporter: because the first time home buyers tax credit which fueled much of the growth has expired and foreclosures continue to mount. hundreds showed up for a workshop for distressed homeowners in west palm beach, florida, this past weekend. >> we've been here all night. >> reporter: like raquel and robert turner who have fallen three months behind on their mortgage payments. >> basically, i was out of a job for six months. >> reporter: unemployment continues to feed the foreclosure crisis. >> i think that we should be focused not on boosting the housing market, but focused on creating jobs. and if we create jobs, i think that the mood of the country will change. >> reporter: meanwhile, even with mortgage rates at historic lows, the housing market remains on shaky ground. anthony mason, cbs news, new york. actor michael douglas is speaking out about his throat cancer.

on the "late show with david letterman," he said he's optimistic he'll make a full recovery. >> i finished my first week of radiation and chemo. and it's about an eight-week struggle -- >> so you've already begun the regimen. >> i've started the regimen already. >> you've never looked better to me and this proves that you're a tough guy, for god's sake. >> thank you. >> yeah. >> thank you very much. i'm -- let's just say i'm pretty lit up. i'm pretty lit up right now. >> letterman and douglas hugged as david wished him good luck with the treatment and his new movie, a sequel to "wall street." a young man fell 39 stories from a high rise building here in new york yesterday and lived. thomas mcgill crashed through the back windshield of a dodge

charger. he broke both legs and is now hospitalized in critical condition. police are still investigating what may have been a suicide attempt. straight ahead, your wednesday morning weather. in sports, look out. a scary collision at home plate. ion at home plate. if you fight to sleep in the middle of the night, why go one more round ? you don't need a rematch, but a rethink. with lunesta. lunesta is thought to interact with gaba receptors associated with sleep. lunesta helps you get the restful sleep you need. lunesta has some risk of dependency. when taking lunesta, don't drive or operate machinery until you feel fully awake. walking, eating, driving or engaging in other activities while asleep without remembering it the next day have been reported. abnormal behaviors may include aggressiveness, agitation, hallucinations, or confusion. in depressed patients, worsening of depression, including risk of suicide, may occur. alcohol may increase these risks. allergic reactions such as tongue or throat swelling occur rarely and may be fatal.

side effects may include unpleasant taste, headache, dizziness, and morning drowsiness. stop fighting with your sleep. ask your doctor if lunesta is right for you. get lunesta for a co-pay as low as zero dollars at lunesta.com discover a restful lunesta night. here's a look at the weather in some cities around the country. new york, sunny, 94. miami, partly cloudy, 90.

chicago, thunderstorms, 79. denver, sunny, 87. it's a sunny 77 -- or 74, that is, in los angeles. time now for a check on the national forecast. the latest satellite picture shows cloudy skies across the midwest while much of the east is looking at clear skies. later today, scattered thunderstorms and showers will be developing across the midwest and mississippi valley. the southwest remains mainly dry and hot. and a few scattered showers are likely across the northwest. in sports, the top seeds advance at the u.s. open. number one, rafael nadal took almost three hours but won in straight sets. nadal won the french open in june and wimbledon in july. women's number one seed caroline wozniacki easily beat ncaa champion chelsey gullickson. the match took only one hour and one minute. in baseball the yankees are alone at the top. in new york, mark teixeira hit a

three-run homer for the yankees who beat up on oakland again. the 9-3 win moved the yankees ahead of tampa bay and back into sole possession of first place in the american league eastern division. and if the tenth inning, florida's chad tracy singled to left and hanley ramirez slid under the tag at home plate. the 1-0 victory was the ninth walkoff win for the marlins this season. and when we return, another look at this morning's top stories. plus, new mission, same dangers. u.s. soldiers carry on in iraq seven years after the invasion. carry on in iraq seven years after the invasion. amazing right from the faucet, r but you think home filters can be a pain in the tucus. well check this out... boo-yah! shazam! h2...o! hydrolicious! look what i can do! magic bananas! adios contaminos! introducing the first faucet filter that installs with just one click and removes 99% of lead and microbial cysts. check it out at purwater.com. ♪

stay twice... earn a free night! two separate stays at comfort inn or any of these choice hotels can earn you a free night -- only when you book at choicehotels.com. high speed chase with police. good morning. i'm john kessler. and i'm sydnie kohara. a woman in the car with the suspect is also dead. the suspect's connection to two missing women in vallejo. still no budget... but state lawmakers say "no" to banning some plastics in california. and evacuations begin overnight on the east coast ahead of hurricane earl. join us for cbs 5 eyewitness news early edition ... beginning

at five. a murder suspect... killed at a mall after a high speed chase with on the "cbs morning news," here's a look at today's weather. scattered showers and thunderstorms will be developing across much of the midwest and t mississippi valley. the northeast remains steamy and dry. a few scattered showers are likely around the northwest. here's another look at this morning's top stories. powerful hurricane earl

continues on a path to sideswipe the eastern seaboard. the first evacuations have been ordered on north carolina's ocracoke island. president obama says it's time to turn the page. the president officially marked the end of u.s. combat operations in iraq during an oval office speech last night. the remaining u.s. troops in iraq are not due to leave until the end of next year at the earliest and they still face day-to-day risks. terry mccarthy spoke with american soldiers at a checkpoint in northwest iraq. >> reporter: captain keith benoit leads a joint patrol of u.s. and iraqi troops through zumar. two weeks ago an ied went off here. american intelligence is warning of an attack in the coming days. benoit's primary job is training the iraqis, something that is finally starting to pay off. >> we live, we work with them, we patrol with them. there's nothing we don't do together. >> reporter: it wasn't always that way. sergeant clint davis recalls on

his first tour here in anbar province, the local police actually launched an attack on his men. they shot at you? >> yes, sir. >> reporter: when you were meant to be their partners? >> yes, sir. >> reporter: now you come back and you are working with them. >> yes, sir. day and night. a completely different attitude. >> reporter: u.s. combat operations may be ending here and the overall level of violence may be down. but the war is not over. for the 50,000 troops that are staying here, the risks are very real. after 15 years in the military and three tours in iraq, sergeant first class robert reich knows you can never be too careful. >> after 300 meters, wire, 360 degrees. >> reporter: sylvester has done three tours in iraq and the memories of fellow soldiers who have died weighs heavily on him. >> i'm happy iraq doing better. but as far -- there's not anything that is going to make it better for the friend i've lost here.

>> reporter: seven years on, the iraq war is still a story of blood, sweat and tears. terry mccarthy, cbs news. i'm betty nguyen. this is the "cbs morning news." news. i'm betty nguyen. this is the "cbs morning news." but it's just the beginning of our work. i'm iris cross. bp has taken full responsibility for the clean up in the gulf and that includes keeping you informed. my job is to listen to the shrimpers and fishermen, hotel and restaurant workers and find ways to help. that means working with communities. we have 19 centers in 4 states. we've made over 120,000 claims payments, more than $375 million. we've committed $20 billion to an independent claims fund to cover lost income until people impacted can get back to work. we'll keep looking for oil, cleaning it up if we find it and restoring the gulf coast. i was born in new orleans. my family still lives here. bp is gonna be here until the oil is gone

and the people and businesses are back to normal... until we make this right.

the midterm elections are less than nine weeks away. a new poll indicates voters may be turning away from the democrats. a new gallup poll shows voters prefer republicans 51% by 41%. heading into the midterm elections. the ten-point advantage for republicans is the largest gallup has found since 1942. even more bad news for democrats is a 25-point enthusiasm gap. 50% of republicans said they were very enthusiastic about the elections compared to just 25% of democrats. jeff glor looks at a congressional race in ohio that could help determine which party will control the house. >> we bash all our metal, we paint all our metal. >> reporter: congress man is

touring a manufacturing plant in north canton, ohio, where the number one issue this year is jobs. the unemployment rate in this district has almost doubled since the recession began. >> current runs through -- >> reporter: a freshman democrat, he is campaigning for re-election in a district whose republican roots go back to president william mckinley and what president obama lost to john mccain in 2008. >> at the end of the day my constituents vote for me to be the congressman. they don't vote for the u.s. president. u.s. manufacturing, this is what i like to hear. >> reporter: he hears a lot about the challenges facing small businesses, especially their rising health insurance premiums. >> another 15%. that's 46% in three years. that's outrageous. >> reporter: he says he supported the president's health reform bill because he said it should increase access to care and cut costs. >> seems like the insurance industry is beginning to run like credit cards. >> reporter: republican

challenger jim renassi krs health reform a mistake. >> 15% was coverage. all this bill did was take care of the coverage issues. >> reporter: a one-time mayor of a small ohio city touts his 27 years as owner of nursing homes and a car dealership. >> i've employed over 3,000 people. i understand what it means to create a job. >> reporter: this plastics factory has laid off 50 workers. he calls for lower taxing while attacking boccieri and the democrats for the ballooning deficit. >> we can't have policies that basically kill jobs and at the same time spend the amount of money we're spending and put the amount of debt we're putting on our country. >> reporter: for his part boccieri has sponsored legislation to reward businesses with tax credits for hiring the long-term unemployed. built his voting record is under attack. >> being the one who voted against nationalized health care. voted for the stimulus bill. >> boccieri is representing nancy pelosi and that's a

problem. >> reporter: he argues his voting record is moderate, saying he sided with house republicans in nearly 850 of his nearly 1500 house votes. >> i don't want to be a seat warmer in washington. i came to to office not just to win election but to get things done. >> the democrats currently hold a 37-seat majority in the house jeff glor, cbs news, new york. and that is the "cbs morning news" for this wednesday. thanks for watching. hope you'll join us a little later for "the early show." i'm betty nguyen. have a great day. have a great day. ,,,,

your realtime captioner is linda marie macdonald. caption colorado, l.l.c. comments@captioncolorado.com a murder suspect killed at a mall after a high-speed chase with police. the suspect's connection