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AMERICAN MORNING

New Overtime Rules Reduce Americans Eligible For Overtime Pay

Aired August 23, 2004 - 07:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


BILL HEMMER, CNN ANCHOR: Three letters known around the world -- CIA. Will a new proposal bring an end to the U.S. spy agency?
The Scott Peterson murder trial resumes today, possible cross- examination of Amber Frey. Does Mark Geragos have any surprises for the star witness today?

And panic for the "Scream," thieves steal one of the most famous paintings in the world, and they did it in broad daylight on this AMERICAN MORNING.

ANNOUNCER: From the CNN Broadcast Center in New York, this is AMERICAN MORNING with Bill Hemmer and Soledad O'Brien.

HEMMER: Good morning. Starting a whole new week here. Soledad is out and Daryn Kagan here with us in New York.

Good morning to you.

DARYN KAGAN, CNN ANCHOR: Good morning. Still no babies?

HEMMER: No babies yet.

KAGAN: I thought for sure we'd come in this week saying the babies were here.

HEMMER: What day did you have, by the way?

KAGAN: Is there a pool?

HEMMER: Well, there was.

KAGAN: I've got to get in.

HEMMER: My pool expired yesterday because I...

JACK CAFFERTY, CNN ANCHOR: Bill is the only one in it.

KAGAN: Cool, one.

HEMMER: I guessed Sunday.

KAGAN: We just wish for a happy, healthy baby.

HEMMER: That we do. Exactly right.

KAGAN: Exactly. HEMMER: Good morning, everyone.

Controversy again today over this commercial questioning John Kerry's war record, still talking up a lot of headlines again today. Some interesting comments over the weekend from Bob Dole here on CNN about the war injuries from Vietnam and a new challenge from the Democrats.

Kelly Wallace has a report on that and where we stand today.

KAGAN: Also this week, we are looking at the convergence of entertainment and politics. We'll have the first segment of our five- part series looking at what happens when the stars come out on the campaign trail.

HEMMER: Also, remember at the beginning of the year, the five people who answered the challenge from Sanjay Gupta to get fit.

KAGAN: They were brave.

HEMMER: Yes, they were. And they are back, too.

The "New You" series back today -- all week, in fact -- looking at how they're doing and what happened when the cameras went away. There's a big question as to whether or not they could stay on the schedule. So, they're back with us this morning.

KAGAN: And so is Jack, back from vacation.

CAFFERTY: Sort of AMERICAN MORNING's answer to the "Real World," isn't it?

KAGAN: Yes.

CAFFERTY: So it's been more than a month, now, since the 9/11 commission issued these recommendations on how to change our intelligence community to better deal with the threat from terrorism. Now that someone on the Senate intelligence committee is actually proposing doing something in the way of making changes, well don't you know the folks screaming it's a terrible idea are everywhere.

We'll take a look at whether Congress might be starting to get on the right track with this in a few minutes.

HEMMER: All right, Jack, thanks.

KAGAN: Very good. Well, back to you. Right now, let's go to Carol Costello. She is at CNN Center with a look at what is happening now in the news.

Good morning, Carol.

CAROL COSTELLO, CNN ANCHOR: Good morning, Daryn. Thank you.

Numerous explosions and heavy gunfire being reported around the Ali Imam mosque in Najaf. A U.S gunship blasted targets around the mosque where fighters loyal to Muqtada Al-Sadr remain in control.

In the meantime, journalist Micah Garen has been released bay his kidnappers after more than a week in custody. We'll have a live report out of Baghdad coming up for you.

New overtime rules are in effect this morning for the first time in five decades. The labor department claims the changes will benefit millions of Americans with about 100,000 people seeing cuts on future paychecks. But large labor groups argue that as many as six million American will lose overtime pay.

Andy Serwer has more on the changes in "Minding Your Business" 20 minutes from now.

The star witness in the Scott Peterson double murder trial could be back on the stand today. Amber Frey was set to be cross-examined last week, but a judge delayed her testimony because of what he called a potential development -- in a few minutes, a live update from CNN's Rusty Dornin.

And in Michigan, a temporary bypass is set to open this morning around a major sinkhole. These pictures just in to CNN within the last 90 minutes. Take a look, gee.

A sinkhole 150 by 45 feet opened up yesterday after a sewer line broke. It knocked out power to several hundred customers and forced several homes to be evacuated.

Keeping you informed, CNN, the most trusted name to use. Back to you, Daryn.

KAGAN: All right, Carol, back to you in a little bit.

Right now, though, a look at a proposal for a vastly different American intelligence service. It has been laid on the table by the Republican chairman of the Senate intelligence committee.

Ed Henry is live in Washington to tell us more about the proposal. Ed, good morning.

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: Good morning, Daryn. That's right, a very aggressive plan from the Senate intelligence chairman, Pat Roberts. This would break up the CIA into three different pieces, spread it out underneath the wings of the national intelligence director.

That is the other key piece of this plan. It would create a very strong national intelligence director. We've heard that proposal from the 9/11 commission. But, in fact, Chairman Roberts would give it even more power than the 9/11 commission envisioned:

Give it full hiring and firing power; also give it full budget authority, something that a lot of people on Capitol Hill have been saying is critical to making sure that there is one person who is in charge, one person, as the commission said, who is the quarterback and is actually calling the shots and will be responsible in order to prevent another 9/11.

Also, a key part, removing agencies like the national security agency away from the Pentagon -- that's why we're seeing resistance already from the CIA since that would be broken up; but also we will see resistance from the Pentagon because they will be losing a lot of power under this plan.

Here's how Chairman Roberts explained it.

(BEGIN VIDEO CLIP)

SEN. PAT ROBERTS (R), INTELLIGENCE COMMITTEE: We think it's real reform, and we think it's good for national security. And what we did is we stepped back, stood back from the trees and said, all right, what are the national threats that face our country today either asymmetrical or what will happen down the road.

And we didn't pay any attention to turf. We didn't pay any attention to boxes. We didn't pay any attention to, say, the agencies. And what we have proposed is a national intelligence service with a national intelligence director that has real line-item budget authority and personnel authority.

So we think it's a good plan.

(END VIDEO CLIP)

HENRY: It's very important to emphasize, however, that this plan to break up the CIA, this is really only the first stage. It has to go through a lot of channels. The White House has been noncommittal about this plan so far.

Also Democrats on the Senate intelligence committee are complaining a bit that they did not have enough advance word about exactly what this plan would say. They want to take a closer look at it.

Also worth noting, that within the Senate itself, Senate Majority Leader Bill Frist has actually not deputized Chairman Roberts to run all of this legislation in terms of crafting it. It's the Senate governmental affairs committee.

Chairman Susan Collins, the ranking member Joe Lieberman, they've had most of the hearings. They're going to have a very influential voice as well. So a lot of people will be weighing in, in the Senate, also in the House of Representatives and also from the White House.

This is really one of, still one of the early stages. There are more hearings going on, three more hearings today: one about border security for example, FBI reform. There are going to be a lot more hearings, but this serious business of legislating is finally getting under way - Daryn?

KAGAN: So, are you suggesting that Senator Roberts is being a bit of a renegade by coming out and suggesting this? HENRY: Maybe not a renegade, but I think he obviously is trying to lay down a marker. He wants to get out there as early as he can. As you were mentioning a moment ago, there's been a lot of talk in Washington; but some people are saying it's time to act.

I think Chairman Roberts is trying to get out ahead a little bit, show that he is going to be an influential voice in this. A lot of people are trying to slow it down. He wants to lay a marker down saying it's time to really shake up the intelligence community. Don't do it halfway, shake it up -- Daryn?

KAGAN: All right. Ed Henry shaking it up for us on Capitol Hill this morning. Thank you.

HENRY: Thank you.

KAGAN: Bill?

HEMMER: Daryn, the Kerry campaign is stepping up calls for President Bush to denounce these television ads criticizing John Kerry's war service, and today it's firing back with an ad of its own.

Kelly Wallace has that this morning.

(BEGIN VIDEOTAPE)

KELLY WALLACE, CNN NATIONAL CORRESPONDENT (voice-over): Senator John Kerry facing some uncertainty in the polls after weeks of largely unanswered attacks pushes back and hard.

KERRY-EDWARDS CAMPAIGN COMMERCIAL: Instead of solutions, George Bush's campaign supports a front group attacking John Kerry military record, attacks called smears, lies.

WALLACE: That ad starts running today in the same three battleground states where anti-Kerry ads are already airing. It's all part of a weekend full-court press by the Kerry-Edwards team to try and step up the pressure on President Bush.

SEN. JOHN EDWARDS (D-NC), VICE PRESIDENTIAL CANDIDATE: Mr. President, the clock is running. The American people deserve to hear from you, and they deserve to hear from you that these ads should come down.

WALLACE: In a complaint to be filed today with the Federal Election Commission, the Kerry campaign accuses team Bush-Cheney of coordinating with the group Swift Boat Veterans For Truth.

The Bush campaign called that complaint frivolous.

KEN MEHLMAN, BUSH-CHENEY CAMPAIGN MANAGER: There's absolutely no connection between the Bush campaign and this organization. In fact, our president from the beginning has praised Senator Kerry's service in Vietnam.

WALLACE: A lingering question for the Kerry team, why did it wait weeks to respond to the attacks, and did it wait too long?

DEBRA DESMONG, KERRY CAMPAIGN SENIOR ADVISOR: There's overwhelming evidence that they are liars. They are dishonest. They are dishonorable. And so finally John Kerry stood up and said enough is enough. And as far as we're concerned, that's it.

(END VIDEOTAPE)

WALLACE: But this story is not going away because there was former Republican senator, former presidential candidate, World War II veteran Bob Dole stepping into the fray yesterday on CNN's "LATE EDITION WITH WOLF BLITZER."

He seemed to question some of Kerry's purple hearts and seemed to give some backup to some of Kerry's strongest critics.

(BEGIN VIDEO CLIP)

BOB DOLE (R), FMR. PRESIDENTIAL CANDIDATE: I said months ago, John, don't go too far. And I think he's got himself into this wicket now where he can't extricate himself because not every one of these people can be Republican liars. There's got to be some truth to the charges.

(END VIDEO CLIP)

WALLACE: And the Bush-Cheney team says Senator Dole was acting on his own. The Kerry campaign says it's a shame that Senator Dole is talking about accusations that have been disproven by U.S. Navy records.

HEMMER: It seems that just about every day there's another angle to this story that we continue to pursue. What's the Kerry campaign strategy when you are consistently talking about this issue as opposed to health care, the economy, the war on terror, Iraq, what John Kerry would do if elected president?

WALLACE: Well, clearly Bill, the Kerry campaign wants to get back to the issues because on issues like the economy, the polls show Americans favor the Kerry approach over President Bush. But it's having a hard time because it's trying to fight back.

We understand that the Senator is going to give a speech tomorrow in which he's going to continue the fight back, accusing Republicans of engaging in negative, personal attacks, but trying to say his message, America can do better, trying to put the focus on the issues.

The Bush strategy, for its part, is accusing the Kerry team of engaging in false and libelous attacks saying this as is baseless.

HEMMER: Kelly, thanks.

WALLACE: Sure.

HEMMER: We'll explore throughout the morning here. Kelly Wallace, thanks -- Daryn? KAGAN: All right.

Police in Oslo say they have located a getaway car used in the theft of Edward Munch's masterpiece "The Scream."

Sunday's heist, caught by a surveillance camera is the second time in a decade that a version of the painting has been stolen. Munch's "Madonna" was also taken.

Police say that armed thieves entered the Munch museum and ordered tourists to the floor while they grabbed the artwork. No one was injured.

HEMMER: Broad daylight, huh?

KAGAN: Yes.

HEMMER: Security did nothing? Go figure, Daryn.

A check of the weather now with Chad Myers, first check on a Monday morning. Good morning, Chad. What are you watching today?

CHAD MYERS, CNN METEOROLOGIST: You know, watching one thing out in the Pacific, a super typhoon out there. Talked about that a few minutes ago, I'll get that in the next half hour as well.

(WEATHER BREAK)

MYERS: Bill, Daryn, back to you.

HEMMER: That's OK on a Monday, right?

MYERS: Sure is.

HEMMER: Makes your job easier?

MYERS: And it's flying out better, too.

HEMMER: So true. Thank you, Chad.

MYERS: You're welcome.

KAGAN: Still to come, remember those pesky New Year's resolutions? Six months after we last saw them, are the "New You" participants still on the straight and narrow? Dr. Sanjay Gupta has that.

Also, Amber Frey is back on the stand today. This time the defense gets a shot at her, and there could be more revealing taped phone calls as well. How strong does Mark Geragos play it? We'll look at that.

KAGAN: Question also, is the line between politics and entertainment too blurry? Part one of a week-long series.

That's all ahead on AMERICAN MORNING. (COMMERCIAL BREAK)

HEMMER: In Scott Peterson's double murder trial, the defense expected to cross-examine the star prosecution witness Amber Frey today, all this after a surprise delay at midweek last week.

And Rusty Dornin live in Redwood City with a preview now. Rusty, good morning.

RUSTY DORNIN, CNN CORRESPONDENT: Good morning, Bill. You know, so much of this trial has been conducted behind closed doors. It's unclear just how much we're going to hear about the real reasons for that surprise delay last week.

Meantime, again, the highly anticipated cross-examination of Amber Frey by defense attorney Mark Geragos, some observers likened it to the prosecution's star witness in the "Grand Inquisitor."

(BEGIN VIDEOTAPE)

DORNIN (voice-over): Just what is fair game for defense attorney Mark Geragos in his questioning of Scott Peterson's former mistress Amber Frey. That's the question the court may address when it resumes Monday morning after an unexpected delay last week.

A source close to the case tells CNN the delay in Frey's cross- examination came after prosecutors tried to stop the defense from using additional recordings of phone conversations between Frey and Scott Peterson beyond the 43 calls that were already played in court.

According to the source, the judge approved their request but only if Frey refers to those additional calls when answering questions during cross-examination. Frey's attorney says her client has already revealed intimate details of her private life and for her the delay has been unnerving.

GLORIA ALLRED, AMBER FREY'S ATTORNEY: She may have to reveal more on the witness stand. And I'm sure that's not going to be easy.

DORNIN: Scott Peterson's father, Lee, was expected to be called by prosecutors as a witness last Thursday. Lee Peterson testified at the preliminary hearing that he did not know his son bought a boat nor did Scott tell him he went fishing in a phone conversation on Christmas Eve the day Laci Peterson disappeared.

Amber Frey is due back on the stand Monday morning. The cross- examination is expected to last one to two days.

(END VIDEOTAPE)

DORNIN: According to Frey's attorney, she had really steeled herself for that cross examination last week and then now has had to do it all over again for this morning. But a source is telling CNN there might be a minor delay. There could be an out of order witness that does appear on the stand before Amber Frey -- Bill?

HEMMER: Well, that's interesting to watch. What are analysts saying, Rusty, about how tough Mark Geragos gets on Amber Frey?

DORNIN: That's a tough spot for him because he could really alienate jurors. She's been a very sympathetic witness and that sort of thing. So they are saying now probably just a day or two.

He wants to highlight, you know, a few things, even in the phone calls where Scott Peterson is talking about how much he loved his wife and how much he was involved in the search.

Also these additional phone calls, if Frey had -- if Scott Peterson -- had said anything in there that was supportive to the case. Also, he might want to point out that perhaps she was trying to get back at him because she was so angry over what had happened.

HEMMER: We'll be watching. Rusty, thanks. Rusty Dornin, in Redwood City this morning -- Daryn?

KAGAN: On to politics now, just 71 days until the presidential election, politics dominating the airwaves. And now it's even difficult to see an entertainer without seeing or hearing about the candidates. But with this kind of celebrity involvement, many say the line between politics and entertainment is getting too blurry.

Heidi Collins has more in the first of her week-long series on "Politics and Hollywood."

(BEGIN VIDEOTAPE)

HEIDI COLLINS, CNN ANCHOR (voice-over): Go to a concert these days and you might hear more than music.

BRUCE SPRINGSTEEN, ENTERTAINER, FROM ABC NEWS "NIGHTLINE": I actually feel we're going out and we're trying to level the playing field with a lot of the kinds of corporate donations and different things that the Republican can raise, you know.

COLLINS: You can't escape politics at the movies either.

MICHAEL MOORE, FILM DIRECTOR, "FAHRENHEIT 9/11": Members of Congress, this is Michael Moore.

COLLINS: The Democratic National Convention spared no expense to glamorize what many said would be a dull show. They drafted famous actors and even a film produced by a Spielberg protege.

UNIDENTIFIED COMMENTATOR: For this, John received the bronze star.

COLLINS: Many political analysts say the line between politics and entertainment has now been blurred. Some of them give this development a bad review.

JOE KLEIN, "TIME" MAGAZINE: You know, Ben Affleck may have studied Marlon Brando, but he didn't, he hasn't studied the history of tax policy the way a guy like Bill Clinton or even George W. Bush has.

The celebrities should understand that they are not dealing in the world of fantasy and of happy endings.

GOV. ARNOLD SCHWARZENEGGER (R), CALIFORNIA: If they don't have the guts, I call them girlie men. They should go back to the table...

DAVID GERGEN, FORMER PRESIDENTIAL ADVISER: If you want to create buzz, you want to create fizz around your campaign, and celebrities can help you do that. But if you seem engulfed in celebrities and their values go, you know, against the mainstream, you can pay a real price for that, too

COLLINS: But the consequences may be more serious than that, says political commentator and former Nixon speechwriter, Ben Stein.

BEN STEIN, AUTHOR, "CAN AMERICA SURVIVE?": We cannot have people in Hollywood who call themselves stars saying America. You stink. America you are terrible. America you are no better than the al Qaeda.

The real stars are the guys riding who are around in their Bradley armored vehicle in Kirkuk or Mosul fighting the terrorists.

COLLINS (on camera): How have the Hollywood stars come to be where they are? How do they have this type of strange influence?

Well, I think it's confusion on the part of people. They see a person playing a president and they think he is the president. They see a person playing someone of moral authority or someone of great bravery, and think he's brave.

These people in Hollywood are not brave. They're just reading lines.

COLLINS (voice-over): Actor Richard Dreyfuss bristles at that.

RICHARD DREYFUSS, ACTOR: I wonder what the Republican actors are thinking when liberal actors are told that they should shut up. And I'm wondering what plumbers and teachers are thinking when they're told that actors should shut up.

Actors are citizens like anybody else, and it's a kind of silly waste of stupid people's time to think that they should be quiet about being a citizen.

(END VIDEOTAPE)

KAGAN: Heidi is going to continue her five-part series -- we're calling it "Pollywood" - tomorrow, with a look at what happens when an actor runs for office. Does a great on-screen performance automatically mean rave political reviews?

That is tomorrow, right here on AMERICAN MORNING.

HEMMER: Still to come here, a major overhaul of the nation's overtime rules into effect today. Millions could feel the impact. How will that affect you? We'll check it out "Minding Your Business."

And guess who's back today? Andy is back in the house today.

KAGAN: Does he still work here?

HEMMER: He still does, yes.

KAGAN: OK, just checking.

HEMMER: Also, today's Olympic challenge, which Olympic event is based on the legend of the ancient Greek soldier Phidippides? Ponder that one.

Back in a moment after this.

(COMMERCIAL BREAK)

HEMMER: All right. Before the break we asked you which Olympic event is based on the legend of the ancient Greek soldier Phidippides. And the answer is...

KAGAN: The marathon.

HEMMER: The marathon, that's right. According to legend, Phidippides ran from the town of Marathon all the way to Athens announcing to the Athenians at the time that they had defeated the Persians.

"Be joyful, we win," he was quoted as saying before he gasped and dropped dead of exhaustion.

KAGAN: But he won.

HEMMER: That's what happens when you run 26 miles.

CAFFERTY: Urban legend?

HEMMER: Athenian legend.

Week number two is under way. Here's Mark McKay live in Athens, and a very fast man on the track. Mark, hello.

MARK MCKAY, CNN CORRESPONDENT: Hello again, Bill.

Yes, it was a stirring Sunday night at Olympic stadium. And as the world's fastest man title switched hands one more time. It was the closest men's 100-meter dash in Olympic history.

Justin Gatlin of the United States got out of the blocks and hit the finish line in 9.85 seconds. Gatlin wins by .01. Maurice Greene, the reigning champion here, took bronze.

A little later, Gatlin's coach admitted that he was indeed the unidentified one who had most recently launched the most recent international drug scandal that's on the board. Trevor Graham said that he provided a syringe with the designer steroid THG to U.S. antidoping officials. That led to the raid of the Balco Laboratories, and things continued there, of course. What a story in the Olympic marathon. The gold goes to Japan. Mizuki Noguchi won the gold, but Deena Kastor of the United States, she was on the podium at the end of Sunday night with the bronze medal in hand.

And in just a couple of hours time, the United States women's softball squad, they will go for the gold medal. Team USA has been rolling here at the games, Bill, as you well know. They meet an Australian team that they've already beaten 10-0 and 5-0.

The U.S. has won eight straight without giving up a run. Bill, I know you're not a betting man, but if you were I'd bet you would put your bucks on the U.S.

HEMMER: I'm telling you. No one's scoring yet. Mark, thanks. Mark McKay in Athens, see you a bit later this morning.

Now, Daryn with more.

KAGAN: And time for this morning's gold medal event, Jack Cafferty.

CAFFERTY: Phidippides.

KAGAN: Phidippides.

CAFFERTY: Fascinating story.

KAGAN: I'm sure.

CAFFERTY: When are the Olympics over?

HEMMER: Another week.

CAFFERTY: Quick check of the scorecard reveals, vacations still pitching a shutout over doing the job they were elected to do.

Thirty-two days now since the 9/11 commission issued recommendations on how to make the country safer from terrorists. Number of ideas adopted by the Congress, which is still on vacation, none.

However, some members are apparently thinking about what to do. Over the weekend, the chairman of the Senate intelligence committee unveiled a surprise plan to completely revamp the CIA, remove most of the intelligence gathering operations from the Pentagon and create a national intelligence director.

Of course the idea was criticized on many fronts quickly. Democratic Senator Carl Levin of Michigan called it a mistake. An unnamed senior intelligence official said the plan makes no sense.

Our question is this, do you think Congress is moving in the right direction when it comes to intelligence reform?

We are presuming something in the question here, which is that at some point they will actually move. So far they haven't done anything. But they are talking about it, and they are thinking about it.

And, who knows, you know, a trip around the world starts with a single step.

HEMMER: That it does. Thank you, Jack.

New overtime laws out, workers and employers scrambling to try and figure them out. We are, too. And who better than Andy Serwer.

ANDY SERWER, "FORTUNE" MAGAZINE: Fresh off of two weeks of vacation, back here "Minding Your Business." Good morning.

SERWER: Good morning to you. Good to see you, Bill. And this is complicated stuff, just what I wanted to look at first thing in the morning getting back from vacation.

Kind of a journey into the unknown for millions of American workers and employers this morning, new overtime rules, the first in many, many decades.

Basically three criteria, three questions you need to answer here. First of all, do you get a set salary? If you get a set salary, you are not going to be eligible for overtime. You have to get paid by the hour.

Then let's talk about salary here. If you make over $100,000 a year, you cannot get overtime anymore. If you make less than the $23,000 there, you will get overtime. In between, you go to question three.

Question three -- and this is the real fuzzy part. Are you in a position where you are doing administrative, professional or executive-type of work? In other words, are you sort of a white- collar bee?

In other words, they are trying to get white-collar people off of overtime and that is really, really fuzzy stuff because there are people who are -- you know, say you are running a fast-food restaurant, you're a manager, but you are on the clock. That's sort of a white-collar job, it sort of isn't. And there are going to be a lot of questions.

Let's take a look at some of the jobs now eligible for overtime. It includes police, firefighters, first responders -- and interesting, the people who will no longer be eligible in many cases, chefs. Sorry Emeril. He probably makes over $100,000 anyway.

And look at this, funeral directors, embalmers and journalists. That's the big three, those three categories right on the bottom there. Here are some other, insurance claims adjusters, dental hygienists and administrative assistants. So, we're going to be sorting through this stuff. It will be interesting to see how it plays out.

HEMMER: It may take us three hours to sort through this.

SERWER: Yes, it will. Well we did it very quickly, though, didn't we?

HEMMER: Welcome back.

SERWER: Good to see you.

HEMMER: Great to have you here.

SERWER: Thank you.

HEMMER: Let's get a break here. In a moment, "90-Second Pop," a dose of that on a Monday morning coming up after this.

He's the "King of Pop," but there's one nickname Michael Jackson says he could do without.

Plus, 12 years from the original "Dream Team," is this group a nightmare?

Stay with us on AMERICAN MORNING.

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