captioning sponsored by macneil/lehrer productions >> woodruff: as new details emerge in the murder of james foley, we take a deeper look at the islamic state militants-- their brutal campaign of forced conversion, kidnapping and execution and its recruitment of american and european fighters. good evening. i'm judy woodruff. gwen ifill is away. also ahead this thursday, bank of america agrees to pay a record $17-billion for selling risky mortgage-backed securities before the financial crisis of 2008. plus, after surviving ebola, americans treated at emory hospital are able to leave and return home.

>> today is a miraculous day. i am thrilled to be alive, to be well and to be reunited with my family. >> woodruff: those are just some of the stories we're covering on tonight's pbs newshour. >> major funding for the pbs newshour has been provided by: >> i've been around long enough to recognize the people who are out there owning it. the ones getting involved, staying engaged. they are not afraid to question the path they're on. because the one question they never want to ask is, "how did i end up here?" i started schwab with those people. people who want to take ownership of their investments, like they do in every other aspect of their lives.

>> supported by the john d. and catherine t. macarthur foundation. committed to building a more just, verdant and peaceful world. more information at macfound.org >> and with the ongoing support of these institutions and... >> this program was made possible by the corporation for public broadcasting. and by contributions to your pbs station from viewers like you. thank you. >> woodruff: the governor of missouri ordered the national guard today to begin withdrawing from the st. louis suburb of ferguson. they were deployed monday, amid the unrest over the police shooting of michael brown. meanwhile, u.s. attorney general eric holder urged americans everywhere to address tensions between minorities and police. he spoke a day after visiting ferguson to talk with local residents and investigators.

>> the national outcry we have seen speaks to a sense of mistrust and mutual suspicion that can take hold in the relationship between law enforcement and certain communities. i wanted the people of ferguson to know that i personally understood that mistrust. i wanted them to know that while so much else may be uncertain, this attorney general and the department of justice stands with the people of ferguson. >> woodruff: the streets of ferguson were relatively calm overnight in a further sign that tensions are easing some. small crowds demonstrated peacefully and only six people were arrested. police also announced that of the 163 people arrested to date, only seven live in ferguson. meanwhile, a police officer-- seen in this amateur video-- was suspended for pointing a semi- automatic rifle at a crowd of protesters tuesday night, and threatening to kill one of them. a friend of the accused boston

marathon bomber pleaded guilty today to obstruction of justice charges. dias kadyrbayev allegedly removed evidence from a college room, including a backpack holding emptied firework casings. under a plea agreement, he will serve no more than seven years. the 2013 bombing killed three people and wounded more than 260. in ukraine, there was no break in the heavy fighting around the eastern cities of donetsk and luhansk. at least 50 people were killed yesterday, as government forces pressed their offensive against pro-russian rebels. meanwhile the first of more than 200 trucks in a russian relief convoy began clearing customs. they're being inspected by ukrainian border guards. the red cross has agreed to oversee distribution of the humanitarian aid. the "ice bucket challenge" sweeping social media now faces challenges of its own. the campaign features people being doused with freezing water

to raise money for research into a.l.s, or "lou gehrig's disease". today, the roman catholic archdiocese of cincinnati ordered its schools not to take part because the research involves embryonic stem cells. and, the state department ruled ambassadors may not raise money for any private cause-- however worthy. and on wall street: the dow jones industrial average gained 60 points to close at 17,039. the nasdaq rose five points to close at 4,532. and the s&p 500 added more than five points to finish at 1,992-- a new record. still to come on the newshour: a look at the members, the mission and the tactics of the islamic state group, bank of america makes a record settlement with the justice department, former virginia governor bob mcdonnell takes the stand in his public corruption trial, israeli strikes kill several hamas leaders in gaza, plus, americans treated for

ebola reunite with their families and can return home. >> woodruff: the u.s. state government announced today that it is going after the man who beheaded american journalist james foley. this word came after news that american special forces tried and failed to rescue the reporter and others from his islamic state captors. >> we all regret that the mission did not succeed, but i'm very proud of the u.s. forces that participated in it. >> woodruff: news of the failed hostage rescue brought defense secretary chuck hagel and army general martin dempsey-- chair of the joint chiefs of staff-- to the pentagon briefing room this afternoon. >> this operation, by the way, was a flawless operation, but, the hostages were not there.

so, we'll do everything that we need to do, that the american people would expect from their leaders, to continue to do everything we can to get our hostages back. >> woodruff: the raid targeted an islamic state site in northern syria earlier this summer, but found no sign of james foley or any other hostages. the fact is, as you all know, intelligence doesn't come wrapped in a package with a bow. >> woodruff: in a statement last night, the national security council said it never intended to disclose the operation. rather, it said, we only went public when it was clear a number of media outlets were preparing to report on the operation. the news leaked after the islamic state group posted a video titled "a message to america", showing foley being

beheaded. today, attorney general eric holder announced the justice department is going after the killers. >> we have an open criminal investigation and those who would perpetrate such acts need to understand something: this justice department, the department of defense, this nation, we have long memories and our reach is very wide. we will not forget what happened and people will be held accountable one way or the other. >> woodruff: "the new york times" reported today the united states rejected an islamic state demand to pay a multi-million dollar ransom for james foley's release. other western countries have funneled millions to the militants in exchange for the release of their citizens. meanwhile, the british accent of the militant in the beheading video raised new questions about the islamic state's reach. >> we have brothers from bangladesh, from iraq, from

cambodia, australia, u.k. >> woodruff: this video-- released by the group in june-- shows militants identifying themselves as british, urging westerners to join them, and saying "the cure for depression is jihad". the video was removed from you tube shortly after its release. for more on the attempted rescue of james foley we turn to karen deyoung of "the washington post". karen, welcome back to the "newshour". first of all, what more is known about this rescue attempt? >> well, i don't think we got a lot more details today. i think, as we reported this morning, there were at least two blackhawk helicopters on the ground. they discovered very quickly that the hostages weren't there. there was a firefighting in which some of the islamic state fighters were killed. one u.s. soldier was wounded, not seriously, before they took off. they were not on the ground very

long. >> woodruff: and we just heard defense secretary hagel say it was not a failure of intelligence that explains the fact that this didn't work out. why do they believe it didn't work? >> well, i think that their departure, the militant departure with the hostages from this place took place not very long before the raid happened. there's every reason to believe that, in fact, they were there, that the intelligence was correct, but that they had left. it's not clear if it was several days to two weeks before the raid took place. >> woodruff: so it was not known whether they knew this was coming? >> correct, i haven't heard that suggested, but they certainly had been there. >> woodruff: what level of confidence, karen, does the administration need typically in order to carry out something like this? >> well, you know, secretary hagel said today that along with

gen. dempsey said they had undergone a lot of planning for this raid, they had practiced it a number of times. i think it does require a lot of planning, whether weeks or months, i don't know, but i don't think it's something that they undertake as we were told yesterday without a great deal of planning and without intelligence from many different sources. they had signals intelligence, they had human intelligence, so they did have good reason to believe that this is where the hostages were being held. >> reporter: people are familiar with the successful raid to go after osama bin laden. i think some people may get the impression that something like this is usually successful. do we know whether there are many other attempts made like this by special forces that we just never hear about? >> i couldn't say. i think, in this case, for these hostages, we're pretty certain there haven't been.

but remember, the successful raid against osama bin laden, i think the confidence that he was actually there was far less than it was with this raid. >> woodruff: huh. and in this case, more confidence, but it still didn't work. i was struck today, karen, in one of the stories i read, that some pentagon officials were quoted saying they were angry that the administration made the decision to confirm this, that this happened. what do you know about that? >> well, i think as the administration itself said last night and earlier today, there were several news organizations including "the washington post" that were prepared to run stories about it. we certainly were prepared to run a story about it. we had the information that we thought we needed, when the administration decided that they would brief their few organizations that had come to them and said, look, we have this information, i don't think we got a great deal more detail

from them and, of course, then they publicly announced it very shortly thereafter. again, i think that it was something that was going to come out, regardless of whether the administration decided to publicly acknowledge it or not. >> woodruff: karen, one other thing -- we have been told the administration of the united stateshouse a policy -- of the united states has a policy of never paying ransom in a situation like. this do you get any sense if your extensive reporting that that's something being discussed, rethought or what? >> i don't. the the administration strongly today came out and said, we don't pay ransom, we don't think it's a good idea to pay ransom, that that puts more americans at risk. it actually is against the law for americans to pay ransom to the islamic state and many other

organizations designated as terrorist organizations, and i think the request did not come and was not turned down by the united states, it came to the family of james foley and the globalpost, his employer, and the request was for about $132 million, and i think that neither they nor the u.s. government whom they informed about this thought it was a serious offer. it was far, far more than anything we know has been paid for some of the other european hostages that have been released. >> woodruff: karen deyoung with "the washington post," we thank you. >> you're welcome. >> woodruff: now, we learn more about the threat the islamic state poses and how they're recruiting westerners, from steven simon, who served as a senior director for middle eastern and north african affairs on the national security council staff from 2011 through 2012 and shadi hamid, a fellow at the brookings institution's center for middle east policy.

he's also the author of "temp takes of power: islamists and a democracy in the middle east." welcome to the "newshour". steven, we have been reading so much about i.s.i.l., islamic state recently. how are they different from these other extreme groups and particularly al quaida? >> they're different in terms of their tactics and i think in terms of their overall strategy. their tactics, as we've seen, are savage. they deploy savage rias a tactic. this is a tactic that has been repudiated by core al quaida, you know, the al quaida leadership in south asia and zawahri, the current leader for al quaida and the replacement for bin laden. he has specifically enjoined the

leader of i.s.i.s. from doing the kinds of things he is doing because, from an al quaida point of view, it aliennates most muslims, and that's a serious defect in the strategy. >> woodruff: shadi hamid, is that the main difference? that this is an extreme group far more willing to take extreme actions? >> that's a key difference but it goes beyond that. they're not the terrorists mid to early 2,000s blowing things up and killing innocent civilians without any vision of how to build something. what's scary about i.s.i.s. is they have a governing program. they control and hold territory, provide social services, run local government, provide some modicum of law and order so they actually are able to obtain some local support in iraq and syria precisely for those reasons. so the viciousness along with

governing. >> woodruff: steven simon, is that one of the reasons they have been able to retract the supporters -- attract the supporters, the young men who have come not only from the middle east, from that part of the world, but we also know westerners from europe, even from the united states? >> well, this successful muslim movement challenging the west, in particular, challenging those who are perceived to want to kill muslims is a galvanizing thing, i think, for muslim young men in many places including europe. in iraq, in particular, though, i.s.i.s. is benefiting from the mismanagement of iraqi affairs by the iraqi government. the exclusion of sunnis from public goods, the disregard for sunni interests in the wake of the massive dislocation that followed the american invasion of iraq in 2003, there's a lot

of unhappiness among the sunni majority population, especially those sunnis who are concentrated in the areas where i.s.i.s. has gotten a foothold, so i.s.i.s. has been able to join forces with the baathists, former saddam people and other disaffected individuals to gain a pretty serious grip. >> woodruff: what about in syria, shadi hamid? i mean, they were clearly able to swell their forces, draw more adherence in syria and, again, from the west, from europe, from the united states. what's the appeal? we saw in the video, the terrible video with james foley, the man who was there with him had a british accent. >> this actually worries me we're focusing so much on iraq and senior administration officials focus on that part of it. they barely mention syria, obama clearly doesn't want to talk about that. but the rise of i.s.i.s. is more directly tied to syria than

iraq, and syrian experts were warning this administration ayear and a half ago saying if this power vacuum continues and we can't support the more main stream rebel forces, extreme groups like i.s.i.s. are going to gain ground. so i think we have been kind of asleep at the wheel. americans are waking up to the threat right now that i.s.i.s. has been beheading arabs and muslims for over the past year. >> woodruff: so why is that an appeal? what's the appeal to young people to join? >> i think part of the problem with the kind of arab spring is that peaceful protest didn't work, working within the democratic process didn't work, so we had peaceful protesters in syria but they were being shot down and slaughtered by the assad regime, we had extremist movements like the muslim brotherhood trying to work within the democratic process -- yes, we americans don't share their values, we were deeply

conservative and liberal -- but there has to be a process. i.s.i.s. says you can have an islamic state through brute force and you don't have to wait and be graduist about it and there's kind of an appeal for radicalized europeans, they see a purity to their vision. >> woodruff: let's pick up on that, stevennen, for young men who are muslim living in europe and the united states, what is the draw? >> i think they see themselves engaged in a noble and virtuous endeavor. they're doing something they feel is a fight for a really good cause, and it's interesting because they don't see themselves as going to join a terrorist movement. they see themselves going to join liberators, and for this reason, for example, they tweet and facebook their way to the battlefield, to the delight, i have to say, of law enforcement and intelligence officials in

western europe and the united states. >> woodruff: so i guess, you know, stepping back, the question on everyone's mind, shadi hamid, is what is the threat here both to the region, the wider region beyond syria and iraq, and then ultimately to europe and then to the united states? >> so we shouldn't underestimate i.s.i.s. i worry that with all this rhetoric about i.s.i.s. being inex plekably evil, to use john kerry's words, that we look at them as these fringe extremists, but we have to understand their rise and their staying power. if we don't have a plan to understand the roots of the rirson conflict, i.s.i.s. will be with us for the foreseeable future -- three, five, ten years, god knows how long. so that's what's so scary is they are a reality on the ground. in some ways they're the most successful extremist group in modern history.

so there isn't an easy solution unless there is a coherent vision that addresses both iraq and syria. >> woodruff: and what would you add to that, steven simon? we heard secretary hagel say this is a threat beyond anything we've ever seen. >> well, you know, look, there aren't that many i.s.i.s. fighters. the numbers vary really widely depending upon who's counted as being an i.s.i.s. and who isn't. the initial i.s.i.s. attack in iraq consisted of about 3,000 fighters. okay, this is essentially a minuscule force. the iraqi army consists of 900,000 individuals, 900,000 soldiers. the pentagon says about a third of those are workable, you know, that the united states could help about a third of that army fight i.s.i.s. that's a huge advantage. the peshmerga, the kurdish forces haven't fired a shot in anger in a long time.

they folded initially but have come back. where is i.s.i.s. actually going to go is really the question. they can't invade iran, they're not going to invade saudi arabiaia they can't invade jordan, they're not going to invade turkey and won't invade israel. >> woodruff: so you see them as contained? >> i think they are. their tactics will earn them enemies and the tacit alliances they formed in iraq won't last. >> even if they don't gain additional terrorist, they control a large swath of territory in iraq and syria so there is an extremist islamic state in the middle of the middle east and that destabilizes iraq and syria and spillover effects in jordan, in lebanon, so even if we contain it, it's still a huge problem. >> we verl have gotten a lot of people's attention. shadi hamid, steven simon, thank you both. >> good to be here.

>> woodruff: the u.s. justice department today announced it had settled its investigation into bank of america with a record-breaking financial penalty. hari sreenivasan has the story. >> sreenivasan: under the terms of the deal, bank of america will pay a total of nearly $17- billion for its role in writing and securitizing risky home loans in the run-up to the housing crisis. many of those loans eventually failed. almost $10 billion of that figure will go to the u.s. treasury, six states, and other government agencies. $7 billion is earmarked to aid struggling consumers, particularly distressed homeowners. at a press conference this morning, u.s. associate attorney general tony west said it was an important part of the deal. for a closer look at today's deal and what impact it and other, earlier bank settlements might have-- both on wall street and on main street-- i am joined by lynn stout, professor of corporate and business law at cornell law school and dennis

kelleher, president and c.e.o of bettermarkets.com, a nonpartisan, non-profit organization that promotes the public interest in financial markets. we invited bank of america and the major banking industry trade groups to join us-- they all declined our requests. so, lynn stout, let me start with you. how big of a deal is this? >> i think this really is a big deal, and it's overdue. i think we should all be glad to see it. $17 billion is real money, even to a bank. it amounts to about 10% of the value of all bank of america stock and a year of two of their profits so this should really get the bank's attention. >> sreenivasan: dennis kelleher, is it big enough? >> it's not $17 billion. they will get a $4 billion tax deduction so the taxpayers will sukdz dies the settlement, taking it down to 13-. of the $7 billion of so-called soft money and home owner relief, that really never will amount to more than 50 cents on the dollar

so you cut off another $3 billion or so there. in fact, if you really want to know how incredibly tough this is, the biggest mover on the financial stocks was bank of america which went up over 4%. when the stock goes up because they announce a settlement, that tells you how wall street perceives the toughness or lack of toughness this settlement really is. >> sreenivasan: did the punishment not fit the crime? was it too small, lynn stout? >> i think it's the best we could hope for, really. the reality is i don't think there's any amount you could ask the banks to pay that would make up for the damage they've done to the economy. we've now had several settlements in the billions. the damage is measured in the trillions. without shutting down the banking industry entirely, there's no way to make up for that damage, but compared to what's going on in the past, where regulators have settled the banks for far smaller amounts that really were just a slap on the wrist, this will inflict real pain, it will get the bank's attention, it will

help to discourage unethical and fraudulent behavior in the future. so i think eric holder and tony west deserve a pat on the back. it's hard to say this isn't a lot better than what we've seen before. >> the problem with that analysis is that, unfortunately, these settlements are carefully crafted more to conceal than to reveal. so, for example, it's impossible to say whether or not $17 billion is appropriate or not. after all, this is supposed to punish crime and deter future crime and the only way to know whether or not this is a reasonable amount or should be lauded and patted on the back is to know how much did the bank make from its years of systemic fraudulent conduct or, conversely, hari, how much did investors, customers and clients lose? so for example if the bank made $200 billion, $17 billion subject look good for the

$100 billion was lost by investors and clients, $17 billion doesn't look good. so they didn't provide any of the key information that anybody would need to elf wait the settlement. most importantly, if you want to deter crime and law breaking on wall street or anywhere else, you ought to punish individuals. banks do not commit crimes, bankers do, and not a single banker was punished here, not one. they get to keep their bonuses, their positions, their promotions and everything else, and the bank gets to use shareholders' money to pay off and buy a get-out-of-jail-free card for them. >> sreenivasan: what about the it that no individual is held accountable? >> banks and institutions do commit crimes. people inside bank of america were driven by incentives and pay for performance schemes widespread in the industry. we could call them pay for

unethical performance schemes. a lot in the schemes were demanded by the chair horldz of the banks themselves. so it doesn't trouble me the shareholders will pay some of the settlement. they are responsible for some of the pay practices and procedures that led to this problem in the first place. so the reality is corporations are huge institutions. they influence the behavior of the people inside them. at some point you have to focus on the institution and not just on the individuals. the people in the banking industry who knew it was going on but for the most part at the very low level, they were the mortgage brokers, they were the underwriters, it wasn't the c.e.o.s and top executives, many of whom found it quite easy to look the other way and not know what was going on. criminal prosecution of individuals is very hard in these cases. the most effective strategy may be just what the department of justice is pursuing which is to hit the corporate entity where the corporate entity hurts and that is its wallet. > i wish that was true.

no one has enough information to know whether it is or not. what did executives know and when did they know it? it is not credible to think that literally hundreds of people were involved for years in disterchg fraudulent -- systemic fraudulent tracts. if you read the statement of facts put out by the department of justice, they identified people by their titles including chairman of countrywide sending e-mails in 2006, clearly indicating a knowledge of fraudulent practices that were widespread at the time. so you have to focus on individuals and hold individuals accountable, and i don't -- i'm okay with using shareholder money for an institution to pay some of the fines, but if individuals get off scot-free and they don't have to be criminally prosecuted though could be, but they're not even held civilly liable, so if there's no down side for

individuals collecting bonuses, banks are bailed out with taxpayer money, years later a cup billion of shareholder dollars makes it go away, that actually rewards past crime and incentivizes future crime. you have to go after bankers, not just bank. >> sreenivasan: dennis kelleher, what about some responsible came from merrill lynch, countrywide, institutions bank of america purchased, should bank of america be held liable? >> as lynn knows, it's standard corporate practice and has been for 100 years that an acquirer acquires the assets and liabilities of an institution and that's what happened in this case. it's routine and boring and happens all the time. they took the position or tried to claim that they should get extra credit because they did it as a service to the country in a middle of a crisis. that was factually false and the department of justice rejected it as they should have. they closed countrywide in early

2008 and bought merrill lynch after trying for years so took an advantage of an opportunity. there was an upside notwithstanding the down side largely to countrywide. so that's a red herring the bank's trying to distract people with. >> sreenivasan: lynn stout, the door has been left open for criminal investigation, but what's the likelihood that's the avenue pursued? >> that will depend on things we're not privy to. i would have to say this department of justice seems to be somewhat serious so we can all hope they're going to do the in-depth investigation dennis is calling for. it's important to note this settlement does not preclude future criminal proceedings against the bank or individuals. it's in addition to, not a substitute for criminal prosecutions. but whether we're going to be able to show any top executives had the kind of deep knowledge that you need to show to get a criminal prosecution or criminal conviction, that remains to be seen. >> i think criminal prosecution

is a sideshow. the bar is so high and so difficult, particularly as lynn alluded to earlier, the senior executives get to pretend like they look the other way and there's no e-mails, but civil litigation and civil prosecution should be at the front and top of the list. >> sreenivasan: dennis kelleher and lynn stout, thank you for joining us. >> thank you, hari. you're welcome, hari. >> woodruff: former virginia governor bob mcdonnell found himself back on the witness stand today fighting charges of political corruption and talking openly about his marital struggles. it marked a startling fall for the republican, who just two years ago was on mitt romney's short list of potential vice presidential candidates. reporters swarmed former governor bob mcdonnell as he arrived at court today to take the stand for a second day, in his public corruption trial.

>> governor, in the spectrum of difficult things you've done in your life, how does this rank-- what you're going to have to do today? >> 38 years of public service, i never thought i'd be having to testify in a trial like this. so it's difficult, sure. >> woodruff: in court, mcdonnell described in detail how relations with his wife, maureen, had broken down, including clashes over the way she treated her staff. it's part of a defense strategy to show the couple could not have engaged in a criminal conspiracy because they were barely speaking to each other. prosecutors allege they accepted more than $165,000 in gifts and loans from richmond businessman jonnie williams, sr. to promote his dietary supplement company star scientific. the items included a rolex watch with a price tag of more than $6,000. mcdonnell testified wednesday

that his actions on behalf of the company did not go beyond typical constituent outreach. the trial represents a stunning turn of events for the one-time rising star in republican politics. if convicted, virginia's former governor and first lady could be sentenced to as much as 20 years in prison-- each-- and face large fines. craig carper is a political reporter for w.c.v.e in richmond, virginia, public radio and was in the courtroom today. thank you for being with us. first, if you could, lay out for us the essence of the prosecution's case against the governor and his wife. >> sure. well, thank you for having me, judy. the prosecution alleges here that the mcdonalds accepted these gifts and loans, now revised figures show it's $177,000 worth of gifts and loans in exchange for official

acts. there's a lot of talk about what constitutes an official act from the defense. >> woodruff: and in terms of the prosecution's case, who were their main witnesses? what was the main evidence they showed? >> sure. now, it's fair to point out that a lot of these witnesses were called by both defense and prosecution and, of course, they got the opportunity to cross-examine them. but, first, we saw some of the mcdonald family, two of the children testified. we saw mcdonald's sister later on testify for the defense. she was also his business partner in some of these real estate investments that she made, the center of a lot of what these loans were going toward. we saw members of the mcdonald cabinet -- friends, family -- we've seen accoun accountants, f focus on the accountants and the

mcdonalds' personal finances. >> woodruff: what is the thrust of the case they're presenting in the defense of the governor and mrs. mcdonald? >> really, it's twofold. they're trying to high light, basically, a broken marriage is what they're trying to show, that the mcdonalds spent 22 years in public service in different capacities and, with that, he spent less and less time at home as his seniority grew in the house of delegates and then later as attorney general and finally coming to a head as governor. that's one of the things the defense is trying to highlight. the other is that mcdonald really gave no special treatment to mr. williams that he wouldn't give any other virginia business. he ran on the platform bobs for jobs. so he's saying this is not unlike what he did for thousands of others. >> woodruff: and what are he and the other defense witnesses saying about the gifts -- the

rolex watch, i guess the clothes that mrs. mcdonald got, the vacations and so forth? >> sure. well, there's been, you know, an effort on the part of the defense to isolate governor mcdonald as much as possible. really, you've got the defense lawyers for mr. and mrs. mcdonald kind of putting that blame on his wife maureen, really -- really pulling the blame on his wife maureen, the argument being she was not a public official, not an elected official and there were no laws against her doing things to benefit companies. you can't really regulate private citizens in terms of gifts for acts. >> woodruff: right. so the separation technique. how tees governor himself doing on the stand? he was on the stand yesterday, back again briefly today.

>> jeff shapiro from the richmond times dispatch summed it up well, he said this is governor mcdonald's final campaign. he's in campaign mode. he's very relaxed. he's very calm, at times somber, and he's certainly got an little more tired late into the day today, but very poised, very composed. >> woodruff: but he was also, as i understand it, from what i've read, emotional in describing his relationship with his wife. he got into some personal details about the two of them. >> that's true. that's true. he did. you know, he opened his testimony today saying that, you know, he's a private person, this makes him very uncomfortable, but he did not pull any punches today when highlighting his wife's role in this scandal. >> woodruff: so is there any kind of consensus, craig carper, about whether the governor is helping the defense or not? what are people saying? >> i think he is, at this point. i think that's the general sense

right now. they needed to turn things around because yesterday they heard some pretty -- i don't know, it was negative -- there was some negative cross questioning from the prosecution of one of their own witnesses who is a financial expert, and the prosecution was able to high light several holes in his testimony and the evidence he had presented. >> and final question, we know mrs. mcdonald not expected to testify. is this case getting a lot of attention in the state of virginia, people paying close attention to it? >> absolutely. absolutely. we've got just about every media outlet in the state here. >> woodruff: all right, craig carper, wcve public radio, we thank you, in richmond. >> thank you, judy. >> woodruff: following this week's cease fire collapse,

there was heavy fighting again today between israel and hamas. members of the palestinian group's military leadership were among the casualties. hari is back with that. >> sreenivasan: thousands marched through the streets of gaza today in the funeral procession of three senior hamas military commanders. the men-- identified as mohammed abu shammala and raed al-attar, mohammed barhoum-- were killed by a pre-dawn israeli air strike. the militant group quickly decried the killing. >> ( translated ): the assassination of the al-qassam leaders in rafah is a big israeli crime that will not succeed in breaking the will of our people and won't weaken the resistance. and the occupation will pay the price, god willing. >> sreenivasan: but israeli prime minister benjamin netanyahu hailed the intelligence behind the attack and vowed there's more to come. >> ( translated ): i want to commend the excellent work of the operational and intelligence units of the shin bet security service, and all its people, and its head, yoram cohen.

we will continue to work together to reach the targets, to restore peace and security for an extended period to the citizens of israel. >> sreenivasan: a day earlier, an israeli air strike missed mohammed deif, the top hamas commander, but his wife and infant son were killed. ordinary gazans appealed today for an end to the aerial assault. >> ( translated ): every day there are people and men, women, elderly and children getting killed, everybody. they mock us by giving us a bit of food to distract us, they are killing us and burying us at the same time. >> sreenivasan: meanwhile, a mortar round fired from gaza seriously wounded one man in southern israel today. overall, more than 100 rockets were fired, leaving israelis within their reach to ponder staying, or going. >> this is my home, and i'll stay here, and i just hope these people, maybe it will calm down, it has to calm down, it can't get much worse. >> sreenivasan: it was the june killing of three israeli teenagers and the apparent revenge killing of a palestinian teen that sparked this conflict. a top hamas official has now acknowledged for the first time that his group kidnapped the israeli teens.

there were also accusations about the collapse of peace talks in egypt this week. officials of the palestinian authority-- which rules the west bank-- claimed the gulf state of qatar pressured hamas to scuttle the effort. for more on the fighting between israel and hamas, i spoke to josef federman of the associated press a short time ago. josef, how significant of a blow to hamas was the killing of these three leaders? >> well, we can tell that they're definitely high-quality targets. we could tell by the reaction we saw in the streets of gaza today, thousands, maybe even tens of thousands of people were out at the funeral today, clearly they are valuable people, it's clearly a demoralizing blow to hamas and a big moral victory, i think, to israel. the question is what effect it has on the battlefield and what we've seen in the past is every time israel kills a senior target, another one seems to spring up and they can their place. >> sreenivasan: what do we know about israel's ability to

track and target these three individuals in. >> yeah, it seems to be kuwait a sophisticated intelligence operation. you heard the prime minister benjamin netanyahu praising his intelligence services. what made this so interesting is these three men were underground, they have been in hiding for the duration of this war the past month or so and, from what we understand, literally they came out of a tunnel, had been in hiding and in a matter of minutes israel tracked them down and killed them. so that tells you something about israel's tracking abilities. >> sreenivasan: there seems to be something different about this round of fighting than in the past few weeks before the cease fire. what is it? >> well, i think you see by this killing today, israel seems to be moving into a new phase. in the past, there have been lots of casualties, over 2,000 palestinians have been killed but most have been in the heat of battle, ground-level soldiers. now israel seems to be going after the higher level after political operatives, in

addition to these three, israel, yesterday, went after the chief of hamas' entire military wing, the highest-quality target they could get. it's still unclear. hamas says he survived. they haven't provided evidence. israel's remaining quiet about that so it's not quite clear what happened to him, but we do feel like we're in a new type of phase when iael's going after political type targets. >> sreenivasan: we reported today a number of hamas took responsibility for the kidnapping and killing of those three teenagers that really started this newest round of conflicts. was that a surprise in the region? >> it was a big surprise because hamas has been keeping quiet about this. actually, they've been very proud, or they praised the kidnapping repeatedly but have always been careful to say that they didn't do it or didn't know who did it. suddenly one of hamas' top people, an compiled leader who lives in turkey, is claiming

responsibility. that seems to change the equation in many ways because now hamas is essentially admitting they played a role in setting off this whole chain of events that led to this war. >> sreenivasan: let's talk a little about what's happening on the diplomatic front. what happened in the talks in cairo and why did they end? >> well, we're never going to know exactly what happened in these talks. it was behind closed doors, obviously. egyptian intelligence were hosting things. but what we do understand is, you know, two sides were taking maximalist positions. israel wants hamas to give up all its weapons, hamas wants a complete end to the gaza blockade. that's not going to happen so they're wrangling, i think, over how to find a compromise and israel -- neither side, really, was willing to give enough to reach something in the middle. now that diplomacy appears to have failed, now that we have been involved in a war the past month, israel went in with ground troops, heavy force, neither one of those scenarios

seemed to bring an end to this and it makes you wonder how long the latest phase will go on. seems like it could drag on for a while. >> sreenivasan: are there any plans by either side to try to return to a negotiating table of any sort, possibly in cairo or elsewhere? >> you don't hear it directly from the size but you hear egypt is calling for a cease fire behind the scenes, urging people to return to the negotiating taifnlt we with see developments elsey, qatar, a gulf country close to hamas, is hosting palestinian president mahmoud abbas and mahmoud's leader this evening, so there is hope on this evening. we see movement in the european security council. some european countries are trying to put together a resolution with international support calling for an international cease fire with the possibility of an international presence to help enforce it. so there is some movement but doesn't seem like anything will happen in the next 24 hours.

>> sreenivasan: josef federman of the associated press, thanks so much. >> thank you. >> woodruff: finally tonight, some good news in what has been a very troubling story, an american doctor who contracted ebola in west africa was discharged from an atlanta hospital today. he and the hospital staff spoke to reporters after his release. a smiling doctor kent brantley was greeted by applause inside atlanta's emory university hospital where doctors today announced the 33-year-old had made a full recovery after being infected with the ebola virus while working in a hospital in liberia. >> today is a miraculous day. i am thrilled to be alive, to be well and to be reunited with my family. >> woodruff: standing alongside the medical team that treated him, brantley recalled the first day of what would be a near-

month long battle for his life. >> on wednesday, july 23, i woke up feeling under the weather, and then my life took an unexpected turn as i was diagnosed with ebola virus disease. >> woodruff: on august second, doctor brantley was admitted to emory university hospital after being flown out of liberia. where he had contracted the virus. >> thank you to emory university hospital and especially to the medical staff in the isolation unit. you treated me with expertise, yet with such tenderness and compassion. for the last three weeks you have been my friends and my family. and so many of you ministered to me not only physically, but also spiritually, which has been an important part of my recovery. i will never forget you and all that you have done for me. and thank you to my family, my

friends, my church family and to all who lifted me up in prayer, asking for my healing and recovery. please do not stop praying for the people of liberia and west africa, and for a quick end to this ebola epidemic. >> woodruff: after his remarks, brantly and his wife hugged each one of the physicians and nurses that cared for him. doctor bruce ribner, medical director of the hospital's infectious disease unit, touched on the bond his team developed with brantly. >> there was a very strong emotional as well as health care interaction that occurred and the hugging and handshaking was just a demonstration of the strong feelings that developed over that three week period of time. if the hugging transmit the message that we don't think he's contagious i think that would be accurate. >> woodruff: doctor ribner also said that 59-year-old nancy writebol, who was also being treated at emory for ebola, had been discharged earlier this week. at her request, her departure was not announced at that time. >> the medical staff here at emory is confident that the

discharge from the hospital of both of these patients poses no public health threat. ebola virus is a new infection on this continent, but our colleagues across the ocean have been dealing with it for 40 years now and so there is strong epidemyologic evidence that once an individual has resolved ebola virus infection they are immune to that strain. recognizing that there are five different strains of ebola virus. >> woodruff: both brantly and writebol received treatment with the experimental drug "z-mapp" while in liberia, but the emory team said the role it played in their treatment is unknown. >> they are the very first individuals to receive this agent. there is no prior experience with it and frankly we do not know whether it helped them, whether it made no difference or even theoretically if it delayed their recovery. >> woodruff: ribner went on to

say his staff would pass along guidelines to those doctors still fighting ebola in west africa. >> we are in the process of working with a number of medical journals and other organs to disseminate the observations we made in the care of these two patients. the providers in africa will be able to read the article we write but in addition we are planning to make some provider specific information available to them. so again, we are hopeful that what we learned here will assist our colleagues in africa in caring for these critically ill patients. >> woodruff: kent brantly told reporters he will take some time off with his family before addressing the media again, but doctors will continue to monitor him and nancy writebol through follow up visits. online, we take a look at the

ebola virus at the molecular level to explain what makes it so deadly. read that, on our science page. again, the major developments of the day: the justice department opened a criminal investigation into the murder of american journalist james foley in syria and pentagon leaders defended a raid that tried and failed to find foley and other hostages. bank of america agreed to pay nearly $17-billion in a record settlement. it involves federal charges over mortgage-based securities that collapsed in the housing meltdown. and the governor of missouri ordered the national guard to begin withdrawing from ferguson. unrest over the police shooting of a black teenager has eased some the last two nights. on the newshour online right now-- she was just a girl when a taliban gunman stormed her school bus and nearly ended her

life, but now, at 17, the human rights activist malala yousafzai has not paused on her mission to educate girls and promote democracy. she was in new york this week and sat down with hari to talk about recent protests in her native pakistan. watch their conversation on the rundown. tomorrow hari will be speaking to the woman who inspired "orange is the new black." he is asking fans to submit questions for piper. you can read those on the rundown. all those and more on our web site pbs.org/newshour. on friday, margaret warner continues reporting from the front lines in the battle against islamic extremists in iraq. i'm judy woodruff. we'll see you online and again here tomorrow evening. from all of us at the pbs "newshour", thank you and good

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this is "nightly business report" with tyler mathisen and susie gharib. >> 28th record close, the s&p 500 finishes at a new record, the dow back above 17,000. is your best bet in this market investing in an index fund that just taxed the market, or should you try fixed stocks? >> in their own words, tom federal reserve officials speak out on the economy. when to raise interest rates. >> lighting up the sky, why natural gas is being deliberately burned across the oil richfields of north dakota. that and more tonight on "nightly business report" for thursday, august 21st. good evening, everyone. a sweet spot for stocks