[Betty Nguyen, Cnn Anchor:] "Now in the News." Take a look at these pictures coming in from Kiryat Shmona, Israel. You can see the smoke billowing into the air. Two different areas there it appears. And when we had pictures of it a little bit earlier, it looked like it was in a residential area. Now we are still waiting on word on casualties as these missiles have hit in Kiryat Shmona, Israel. And as soon as we get that, we will bring it to you. But no doubt the shelling continues on both sides. Across the border explosions in Israel. Earlier this morning we showed you live images of rockets slamming into an Israeli village in Metulla. Haifa has also been hit in recent hours. Now Israeli police say nine people were wounded there. And as this crisis continues we have more word on Israel launching an aerial assault on the Lebanese city of Tyre. Look at the damage here. Israeli jets and gunships converge on the city as the offensive escalates. Israel says at least eight of its commandos were wounded while trying to disarm the Hezbollah stronghold. In other news, results of a second doping test on Tour de France winner Floyd Landis just this morning was positive. He was immediately dismissed from his cycling team. It is still undecided though whether Landis will lose his championship. Landis is appealing. He says he is innocent. And out with the old, check this out, and in with the new. Look at that come down right there to the right of the screen. This is video from Hartsfield-Jackson International Airport in Atlanta. Just a few minutes ago crews leveled an old air traffic control tower. They need room for continued work at the airport. But you see the new tower still standing after the implosion. "OPEN HOUSE" with Gerri Willis begins right now.
[Gerri Willis, Cnn Anchor:] The energy crisis gets worse and relief seems nowhere in sight. We'll talk to one senator about solutions. Plus, Martha Stewart is back with a new project, Martha Homes. Can they breathe new life into her company? I sit down with the domestic diva. Good morning, everyone. I'm Gerri Willis and this is OPEN HOUSE. We'll get so Martha in just a few minutes. But first we need to talk about power problems. Temperatures soared above 100 degrees across the country this week. Electric companies and cities urged users to cut back as New York, Washington, and Boston set all-time records for electric demand. And in Chicago, part of the city's Southside was evacuated, up to 15,000 people, after the power went out. More than 180 deaths have been blamed on the heat in the last two weeks alone. New York City Mayor Michael Bloomberg says the country lacks a clear energy policy. Can Washington fix the problem? Senator Craig Thomas, a Republican from Wyoming, is a member of the Senate's Energy and Natural Resources Committee. Thanks for joining us today, Senator. I know you're busy. We appreciate your time.
[Sen. Craig Thomas , Wyoming:] My pleasure.
[Willis:] All right. Well, let's get down to it. You know, we have got people dying in cities across the country. Chicago, large neighborhoods being evacuated. What is Congress doing?
[Thomas:] Well, Congress has a policy and we're moving towards it. You can't implement it in a minute. Bloomberg is wrong. There is a federal policy. We're moving forward. We've also you have to admit that we have had a real problem with energy recently. It didn't have near the impact it did a few years ago, partly because some of the things have been done but there's a great deal more to do. There's no question.
[Willis:] And let me interrupt you there. Because I want you to hear exactly what the mayor of New York City had to say and get you to react. Listen to this.
[Thomas:] OK.
[Mayor Michael Bloomberg, New York City:] Everybody seems to lack the political courage to stand up and have a long-term policy that would require sacrifice and change. And unless we do that, unless we go to alternative sources of fuel and reduce the consumption, we are going to continue to denigrate the atmosphere and the quality of life that we are going to leave for our children.
[Willis:] Senator, what do you have to say to that?
[Thomas:] Well, I don't disagree with it. The only thing I disagree with is that's what we're doing now. We're looking at new corridors for transmission. We're looking for ways and the policy includes giving some incentives to increasing the capacity of lines. We're looking at the opportunity to produce fuel in the different way, to turn convert coal, for example, to electricity and to gas and all these things are happening.
[Willis:] And in fact, your state is a big producer of coal, we should mention. Let's talk about the bill. Because you mention those incentives to encourage these companies to make the kinds of improvements they should. Why give these companies incentives? Wouldn't it be smarter to slap them with fines for not upgrading the transmission lines? For not fixing the generators?
[Thomas:] Well, it's not a matter of fixing the generator, it's a matter of the capacity and demand. And quite frankly, part of the problem and part of the issue, the resolution is going to be more efficient use, more conservation, not only in gas and oil but also in electricity. So that is part of it. And that's part of the plan. The incentives are there is a good deal of investment going on and there should be because there's a good deal of profit being made in energy now. It ought to be reinvested and that is happening.
[Willis:] All right. Well, you know, your bill would suggest even more profit out there opening up the Arctic National Wildlife Refuge for development for producing oil. You know, it begs the question here, can we find solutions to this energy crisis, green solutions or is it impossible to do that, Senator?
[Thomas:] No. It's very possible. I think you have to understand, though, that there's at least two elements to this thing. One is the long term where we find alternative sources, where we're looking for wind and energy and sun and all those things. The other one is what are we going to do next year and five years from now by doing the things we already know how to do and that's what we're providing incentives to move towards the short term, plus research for the long term. It's not easy, you know, the mayor is just saying, well, the government ought to say you have to do this. Saying you have to do it is not enough.
[Willis:] Well, and I know a lot of people out there, it's not just Mayor Bloomberg who is losing his patience, it's a lot of consumers out there who have been struggling with a lack of power and are seeking answers. Senator, we're happy to come back to you in a month or two and see how progress is getting along on this very topic. Thanks for joining us.
[Thomas:] Thank you, very much.
[Willis:] And we'll continue on this program to follow the energy problems in this country. Just as we continue to follow the soft landing of the housing market. Slumping sales have some home builders slowing down. But one CEO is pushing forward with an ambition plan involving a controversial celebrity.
[Bruce Karatz, Chmn. & Ceo, Kb Home:] Well, there is no one like Martha Stewart. If you think of who else you would select when you think of somebody who knows homes and living, I think you'd be tough time trying to find a number two.
[Willis:] Do you worry, are you concerned that she has been through a lot in the last year? That your effort could be hurt? Could it hurt sales and earnings at KB if Martha Stewart's star were to fall or become tarnished in any way?
[Karatz:] I don't think there was any risk of that today. Back when we were thinking about this over a year ago and she had just come through her problems, I would not be totally candid if I didn't say that thought crossed our mind. Very quickly, I realized that, one, people Martha, you know, whatever she did, I'm not sure many people understand what she did wrong, but whatever she did she paid the price. She's gone on. From the time I met her until today, I have never heard her complain. I think it's quite secure, her future and people's desire to be somehow connected to her.
[Willis:] Who is the target market? Is it Martha wannabes? Is it people who followed her career for a long time? Or is it anybody at all?
[Karatz:] What I found is, one, women as a general rule have a huge amount of respect for Martha. They believe in her. They believe her ideas have merit. And they like her. And so I would say, while you can't pigeonhole who that market is, I think it's very broad. I think it goes through an enormous breadth of incomes. And finally what it comes down to is, what we know being in the home building business for 50 years. Women make the decision about who buy if it's a couple, the woman is the one that makes a decision.
[Willis:] Which is as it should be, Bruce.
[Karatz:] Well, of course, of course. I'm not going to argue with that.
[Willis:] We have so much more for you today OPEN HOUSE. Coming up, what it's like to be surrounded by Martha? We take you on a personal tour of the new development from the domestic diva herself. But what about the Martha brand? The magazine, the products, the TV show? Can she and her company finally overcome what she calls her personal problems? We'll ask her next. But first, your "Tip of the Day." Building a new home is exciting, but be careful about getting into business with the wrong people. Obtain bids from at least three licensed contractors. And make sure you understand the reasons for the variations in price. Ask for references or better yet ask to see some of the contractor's previous work. You can also call your local Better Business Bureau to check on any disputes or canceled contracts. Speaking of contracts, make sure yours has all the details, including start and end dates, material specs and a payment schedule. Put just 10 percent down. Pay 25 percent when plumbing and electrical work are done, 25 percent after cabinets and windows, and 25 percent for flooring and painting. And don't hand over the last 15 percent on the final day. It's called retainage and you should keep it for 30 extra days just to make sure everything is in working order. More importantly make sure your contractor is properly insured, otherwise, you could be held accountable. And that's your "Tip of the Day."