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THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.WILLOW BAY, HOST: Ahead on BUSINESS UNUSUAL, reaching new heights in the airline industry. A battle boils over water. And on the job with a man in tune with his career. That's all ahead on BUSINESS UNUSUAL. Hello and welcome to BUSINESS UNUSUAL. I'm Willow Bay.Thirty months ago, David Neeleman had a very detailed business plan, $130 million and a fair amount of experience starting up low cost airlines. Today, he's got a $1.9 billion publicly traded company that's shaking up the airline industry and breathing a bit of fresh air into airline travel. I sat down with him recently at New York's JFK Airport, and began by asking him what he was trying to accomplish with his young upstart, JetBlue.(BEGIN VIDEOTAPE)DAVID NEELEMAN, CEO, JETBLUE AIRLINES: What we tried to do at JetBlue is what we call, you know, the old adage is if you build a better mousetrap, people will beat a path to your door. And what we tried to do is to create the best coach product in the industry. It creates word of mouth. It creates people, wow, this is amazing, I'm going to go, you know, tell everybody about this.BAY (voice-over): From passengers to aviation insiders to Wall Street analysts. JetBlue is the buzz in the airline industry, offering budget travel with a twist -- the security of brand new planes, the comfort of leather seats, the entertainment of free satellite television at each seat, all for a discounted price, as much as 65 percent lower than the competition. CEO David Neeleman insists his cheap but chic airline just found smatter ways to please passengers and cut costs. Those seats -- leather is easier to clean and lasts twice as long as fabric. Those planes -- they're not just new, but all one model, Airbus A-320s, which means lower training and maintenance costs. And the live digital TV? Well, Neeleman says it's worth the cost. Passengers love it. JetBlue only took to the skies in February of 2000, but it has already outperformed its rivals, turning a profit of nearly $40 million in 2001. (on camera): So how in your second year of -- in operation and in one of the toughest years the airline industry has ever seen, were you able to achieve profitability?. NEELEMAN: Number one, I think we've put together a great business plan, and we really did create, you know, a better mousetrap in that we created this better product with the lowest cost in the industry, and going lower because we get better economies as we get bigger. Our revenues were up; our costs are down, and you know, we've made money, but we not only made money, but we've made money in every single quarter last year. And we made it without the help of government aid. We did get the government aid money that they distributed, but if you ax that, we still made a profit in the third and fourth quarters last year. BAY (voice-over): Neeleman's carefully crafted business model is at the heart of JetBlue's success. One key element is his choice of airports. With the exception of its home base, New York's JFK, Neeleman avoids the big, congested hubs. (on camera): And then you chose as your other airports smaller, out of the way, and therefore cheaper airports? NEELEMAN: Well, what we try to focus on is take large metropolitan areas, like New York, and say, OK, there are three -- usually when you have three airports in a big city, two of them get all the attention and one's kind of -- one that doesn't get a lot of attention from domestic service. So we said, big market, largest travel market in the world, underutilized airport, let's go there. And then we looked at L.A., which is the second largest travel market in the world. Large market -- LAX, Orange County. Then there was an airport right in between, Long Beach, that was completely underutilized. So we went in and took that airport. BAY: And the value to you of setting up shop in an underutilized airport is what? NEELEMAN: Well, you can get the planes in and out of there a lot quicker. You are not subject to congestion. You know, like in the Bay Area, we have San Francisco International. The runways are too close together, and so when you have a weather event, you know, the flights are all delayed a couple of hours. Even if the wind's blowing, the flights are delayed. And at Oakland, you know, we're coming and going and coming and going, and everyone else there is delayed. BAY (voice-over): JetBlue is coming and going at Long Beach Airport 22 miles outside Los Angeles, too. Looking for a West Coast base, JetBlue secured 27 of the airport's unused flight slots, and plan to fill them by the summer of 2003. But now this sleepy little airport has become a hot spot in the latest airline industry showdown. Other airlines protested JetBlue's control of empty slots, suddenly eager to add slots and flights of their own. American and Alaska Airlines ultimately won rights to seven of JetBlue's slot on a temporary basis. JetBlue accelerated its plan, adding 17 flights by this fall. As airline industry competition heats up, this may be a sign of more big battles at little airports to come. (on camera): You are no longer flying below the radar screen. It means that the big guns take you very seriously now. NEELEMAN: Right. BAY: In an extremely competitive business. Are you concerned? NEELEMAN: I'm not. I think we have customer preference. You know, I think flying cross-country, you know, from Washington, D.C. to Long Beach, California, watching TV sitting in a leather seat munching on some blue chips is a pretty dang nice way to fly. When you have a product that you feel is better, and you are well capitalized and you have lots of cash, and you have a better balance sheet, and you have the lowest cost, it -- you know, if you are prepared, you shall not fear. So I think we're prepared for that. (END VIDEOTAPE)BAY: And yet another sign that JetBlue has hit the big time. It's just announced the creation of its own frequent flier program, called "true blue." Now, in typical JetBlue fashion, it's just a bit different from the miles awarded at the big airlines. JetBlue passengers receive points, and until the end of the year, double points for booking on their Web site. A hundred points earns a free round-trip flight anywhere JetBlue flies. The airline says that "true blue" is just its way of saying thanks. Just ahead: A war over water. Inside a battle on the U.S.-Mexico border. And later, a modern day gold rush? Well, it's a far cry from San Francisco in 1849, but residents of this Scottish village are looking to strike it rich. Is it just a flash in the pan? Find out when BUSINESS UNUSUAL continues. (COMMERCIAL BREAK)BAY: Immigration is not the only hot button issue between the U.S. and Mexico. These days, you can add water to the list. Mexico has been using more than its share of water for a decade, and now has an enormous water debt with the United States. And so far, there is no plan for how to pay it back. Casey Wian has the story from Mexicali, Mexico. (BEGIN VIDEOTAPE)CASEY WIAN, CNN FINANCIAL NEWS (voice-over): The all-American canal stretches through 82 miles of desert along California's border with Mexico. It brings water to nearly half a million acres of Imperial Valley farmland. But some seeps out of the canal, underground, ending up just across the border in Mexico. From backyard swimming holes to alfalfa fields in the Mexicali Valley, it's enough to irrigate 20,000 acres of farmland. But not for long. California plans to spend $126 million to line the All-American Canal with concrete, and stop the loss of water to Mexico. Ten percent of the water, now used by the Mexicali Valley, instead will flow to urban southern California, which is losing water from the Colorado river to Nevada and Arizona. JESSE SILVA, IMPERIAL IRRIGATION DISTRICT: Our reservoirs are at very low levels. The state of California has been drawing more than their allotment from the Colorado river. We need to use whatever resources we can to make up the difference. WIAN (on camera): But Mexican officials want the project stopped. The all American canal is just one piece of a much wider border water dispute. During the past decade, Mexico has run up a water debt with the United States, now totalling nearly 500 billion gallons. (voice-over): Border water rights are governed by a 1944 treaty that didn't foresee an eightfold increase in border population. In Texas, farmers drove their tractors to the border in a recent protest against Mexico's failure to pay back extra water they've taken from the Rio Grande. Despite a region-wide drought, Mexican President Vicente Fox vows to repay the water debt. But Fox canceled a planned U.S. visit because he failed to meet his own deadline for a proposed solution. JUAN PABLO HERNANDEZ, AGRICULTURE SECRETARY, BAJA CALIE: Between both federal administrations, President Fox and President Bush, there's enough commitment from both sides to work out this promise and make me feel positive about it. WIAN: Mexico is struggling to upgrade its water infrastructure to improve quality and reduce waste. And it wants the United States to help pay. Casey Wian, CNN Financial News, Mexicali, Mexico.(END VIDEOTAPE)BAY: Specifically, Mexico is asking for a financial help from the U.S. It plans to use the money for infrastructure improvements, such as new water treatment plants to help the country use the water it has more efficiently. Just ahead: Hollywood's voice in Washington weighs in on the power of public speaking. We'll be back. Stay with us. (COMMERCIAL BREAK) BAY: Jack Valenti has been a Washington insider since the 1960s, learning the art of politics from one of its masters, Lyndon Johnson. As president of the Motion Picture Association of America since 1966, he is equally fluent in old-fashioned Hollywood showmanship. A skilled and polished orator, he's Hollywood's voice on Capitol Hill, a regular in front of congressional committees. In his book, "Speak Up With Confidence," updated and rereleased this week in paperback, he offers some advice on public speaking and grades a few public speakers we know, from top CEOs to U.S. presidents. (BEGIN VIDEOTAPE)JACK VALENTI, PRESIDENT, MOTION PICTURE ASSOCIATION OF AMERICA: The greatest president speaking was Franklin Roosevelt. Any young kid, 20 years old, who watches Roosevelt on those newsreels or listens to his voice will be mesmerized. I give him A-plus. (BEGIN VIDEO CLIP)FRANKLIN DELANO ROOSEVELT, PRESIDENT OF THE UNITED STATES: Let me assert my firm belief that the only thing we have to fear is fear itself. (END VIDEO CLIP)VALENTI: Of all the presidents since, there are three that deserve A. One was the first television president, and that was John Kennedy. Two, Ronald Reagan. And three, in spite of all the criticism you can hurl justly at Bill Clinton, he was probably the greatest political campaigner I've ever seen on television. (BEGIN VIDEO CLIP)BILL CLINTON, PRESIDENT OF THE UNITED STATES: If everybody thought that if they worked hard and played by the rules they could get ahead -- I'm tired of seeing people who do that ground down and I want them to be lifted up. (END VIDEO CLIP)VALENTI: Clinton, Reagan and Kennedy understood that if you can win the affection and the admiration of people who watch you on the small and not so small careen, you will be invulnerable to defeat. (BEGIN VIDEO CLIP)RONALD REAGAN, PRESIDENT OF THE UNITED STATES: I'm going to do it just one more time. You ain't seen nothing yet! (END VIDEO CLIP)BAY (on camera): How would you evaluate President Bush as a speaker? VALENTI: I heard him speak when he was governor of Texas, and he was pretty bad. But he is a learner. He rose to speak on September 20, 2001, nine days after 9/11, it was one of the most extraordinary speeches I've ever heard. (BEGIN VIDEO CLIP)GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Terror unanswered cannot only bring down buildings, it can threaten the stability of legitimate governments. And you know what? We're not going to allow it. (END VIDEO CLIP)VALENTI: It was almost flawless. BAY: You call Warren Buffett the greatest public speaker in American business community. Why? VALENTI: Without question he is without parallel. Because Warren Buffett understands the fragility of making a business speech. (BEGIN VIDEO CLIP)WARREN BUFFETT: If you make rational decisions based on ascertainable facts, you will get a good result over time. And if you don't, you won't get a good result in all likelihood, unless you happen to die at the right time or something. (END VIDEO CLIP)VALENTI: He has great humor. He's able to take arcane subjects and break them down into small bits that are understandable. Most public -- most business chieftains cannot make a good public speech. They just can't do it. BAY: Any business leader that you'd like to single out to give a copy of your book to? VALENTI: No, I wouldn't do that, but I do -- I do believe that if I were the head of a large corporation, I would really spend some time on improving the way you speak. I think the reason why most business leaders aren't very good at public speaking, they don't spend a lot of time working at it. Every time I make a speech, I spend hours and hours and hours preparing myself. I wouldn't dare to get up and try to wing it, as I'm doing here with you today. (END VIDEOTAPE)BAY: Still to come, hitting the high note. On the job with the conductor of the Los Angeles Philharmonic. And later, going for the gold. A modern-day gold rush hits a Scottish village. The story after this. (COMMERCIAL BREAK)BAY: Even the most accomplished musicians need help hitting the right now sometimes. Esa-Pekka Salonen, conductor of the Los Angeles Philharmonic, has been leading international orchestras since he first made his mark in a 1983 performance in London when he stepped in for an ailing conductor. Behind the waving arms and jabbing hands is a silent language that communicates volumes to his musicians. We take a look at the art of conducting "On the Job." (BEGIN VIDEOTAPE)ESA-PEKKA SALONEN, CONDUCTOR, LOS ANGELES PHILHARMONIC: A typical performance day usually starts with a dress rehearsal between 10:00 and 12:30. And then I have a light lunch and try to sleep in the afternoon, just to clear the mind. Two times. Long and short. In rehearsals, I am trying to organize things. Just play the first (UNINTELLIGIBLE). I am trying to give the musicians a concept to work with. I am taking care of the form, I'm taking care of the basing, I'm taking care of the details and the technical level of the performance also. Of course, in the moment of the performance itself, I try to go for the core, for the expression, for the whatever spiritual or emotional or expressive content there is in the work. And the only means I have to achieve that are the gestures, of course. What is quite wonderful is that as I have been working with these musicians for such a long time, we know each other very well, and they almost telepathically do what I want them to do. And sometimes, I swear, they have been moments when I kind of think maybe I'll speed up a little bit in the next bar or so -- and they do it already. This is kind of silly to say after 10 years of having done hundreds of concerts on that stage, but anyway I try to treat every concert as if this was my first. It never feels quite normal. It never feels quite like going to supermarket to buy milk. There is always this sort of unknown factor, which actually makes the whole thing worthwhile. (APPLAUSE) (END VIDEOTAPE)BAY: Esa-Pekka Salonen and the Los Angeles Philharmonic wrapped up their regular season last month, but you can still catch them this summer. They kick off the Hollywood Bowl season with the third annual Hollywood Bowl Hall of Fame. That's later this week. And finally, Scotland is known for many things -- heather-clad hills full of sheep, lochs rumored to have mysterious creatures. Now one of Scotland's hidden treasures has been brought to light, and it's no flash in the pan. Jim Boulden has the story. (BEGIN VIDEOTAPE)JIM BOULDEN, CNNfn CORRESPONDENT (voice-over): It's said that Scottish hills are full of surprises -- none more so than those surrounding Scotland's highest village, Wanlockhead, just south of Glasgow. It's a place where fireplaces are still needed in June, and grazing sheep outnumber inhabitants. But there is something else lurking amongst the heather -- people like George Paterson. You see, he spends his days panning for gold. With a pan and a plastic tube, Paterson has spent the last two years up to his knees in water looking for gold. And earlier this month, he struck the big one -- a six-gram nugget. GEORGE PATERSON, GOLD PROSPECTOR: It was just a normal day like today (UNINTELLIGIBLE), and it was basically the first time I lifted the stone, threw some gravel in the pan, and the nugget was sitting in the pan. BOULDEN: This little gem is the biggest gold nugget found in the area for 60 years. Paterson, like many panners, does this as a hobby, not for profit. But he's already had offers to sell the big one, and he may test his luck on the Internet. PATERSON: Well, I've heard about 600 pounds, but that was before any of this publicity came out. So, I may start it on E-Bay next week and see how we get on. BOULDEN: Dozens of people pan these waters. The hills have been giving up gold for centuries. Big finds are usually kept quiet. But this one got out, and now the locals are bracing for those looking for treasure. UNIDENTIFIED MALE: Gold rushes are partly fueled as myths. I think they -- the only people that really made out any money out of the gold rushes where the service sector. BOULDEN (on camera): Well, you have a restaurant here. UNIDENTIFIED MALE: Exactly. And a museum. BOULDEN (voice-over): Despite Paterson's find, few prospectors make money panning in this area. Charlie Smart is still looking. There are a lot of areas in Scotland where no one has been panning for gold. And if you find the right ones, you get some wonderful gold. The biggest piece of gold ever found in the U.K. was found in this area. BOULDEN (on camera): So what do you think of that one there? UNIDENTIFIED MALE: That one looks like it, but it's too light. BOULDEN: Too light. Well, I thought I'd give it a go and see if I could find some gold nuggets. Can't even find any gold flakes at the moment, so I guess I won't be retiring today. But because of George Paterson's six-gram find just a few days, tourism in this area is sure to explode. The panners around here are certainly happy to let you know how they do it and they'll show you, but be warned, they are not about to let you know where they think the big nuggets are to be found. Jim Boulden, CNN, Wanlockhead, Scotland. We should give it another try, I think. (END VIDEOTAPE)BAY: And that is BUSINESS UNUSUAL. We want to hear what you think of the program, so send us an e-mail. Our address is I'm Willow Bay. Thanks for joining us, and goodbye from Los Angeles. TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.comMexico Clash Over Water; On the Job With Esa-Pekka Salonen> href='' - -