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Routine Traffic Stop in Oakland Turns Deadly; Pope: Condoms Could Make AIDS Crisis Worse

Aired March 22, 2009 - 08:00   ET


T.J. HOLMES, CNN ANCHOR: From the CNN Center, this is CNN SUNDAY MORNING for this March 22. It's 8:00 o'clock here at CNN headquarters in Atlanta, Georgia, 7:00 a.m. in St. Louis, Missouri. Glad you could be here. I'm T.J. Holmes.

BETTY NGUYEN, CNN ANCHOR: Yes, good morning, everybody on this Sunday. Thanks for being with us.

HOLMES: And we'll start in California this morning where three police officers are dead, a suspect is killed as well after what police say was a routine traffic stop in Oakland. Details ahead.

NGUYEN: Plus, Pope Benedict just wrapped up morning mass in Angola, Africa. Almost 2 million people showed up for it. The Pope is wrapping up a week-long tour of Africa and he's made some interesting comments about condoms. We're going to explain that.

HOLMES: OK. Speaking of things that are interesting, this economy makes it tough on folks who happen to do some extraordinary things in these times.


HOLMES: One woman has to move back in the house with her ex- husband. Now, we've heard some of these things before.

NGUYEN: Right.

HOLMES: But there's a little twist to this one, Betty.

NGUYEN: And this is it. She's brought her new husband into the home with her, all right? You're seeing the picture here? Don't want to miss this story.

But, in the meantime, though, President Obama tells CBS' "60 Minutes" that he is sticking with Treasury Secretary Timothy Geithner. Now, some critics have called for Geithner's resignation over those AIG bonuses. Geithner's department specifically asked for a loophole that allowed those bonuses after AIG took billions in bailout money.

But even if Geithner tried to resign, the president tells CBS that he'd say, quote, "Sorry, buddy, you still got the job." And that interview airs tonight, part of the president's media blitz for his budget proposal.

CNN deputy political director, Paul Steinhauser, joins us now from Washington.

Paul, he is on TV tonight. We're going to see him again on Tuesday. What's his strategy here?

PAUL STEINHAUSER, CNN DEPUTY POLITICAL DIRECTOR: It appears to be his job to sell the budget. He's pushing his budget, Betty, as you mentioned, $3.6 trillion budget. And if you thought the battle from the stimulus was big, wait until the battle over the budget really begins in earnest.

And I guess the big thing will be Tuesday night when he has that news conference. He's going prime time on us on Tuesday night. And presidents usually don't do that very often. This will be the second of his presidency. They are usually a big deal and there's usually a big reason for it and that is his time to sell the budget.

As you mentioned, he's been doing this for a couple of days now. We saw him on "Jay Leno" on Thursday night. He became the first president to be -- a first sitting president to be a guest on late night television.

And that brings a whole different audience -- people who normally don't watch politics too much. And you know what? It was Leno's biggest ratings in four years. So, I guess, he was successful on that, in that front.

He's also, as you mentioned, on "60 Minutes." Again, one big media blitz here.

But he's also doing town halls, Betty. He's reaching out to people directly. We've seen him in the past. He held two this past week in California, one with Arnold Schwarzenegger, again, talking about the budget. This way he interacts directly with people. You'll see more of these town halls -- Betty?

NGUYEN: Well, talk about reaching out, Paul, the president also using his community service roots to help in this budget battle. How exactly is he doing that?

STEINHAUSER: Yes, I guess you could say he's kind of going grassroots. Remember the old presidential campaign? Well, the election is over, but the campaign continues in a way.


STEINHAUSER: There are still 14 million people on that e-mail list from the campaign, that's a lot of people. The president sent out a video message to those people this past week and urged them this weekend to go out there. And they did.

According to the Organizing for America, which is kind of what it morphed into, the campaign morphed into, it's now under the umbrella of the Democratic Party. They said they were over a thousand locations this weekend, trying to sign up people, urging them to support the president, and urging them to reach out to their lawmakers, their senators, their congressmen and women, and tell them to pass the president's budget. So, it's another way he's trying to get the message out there, Betty.

NGUYEN: All right. But is it working? You know, we got this media blitz. We have the grassroots effort there. Effectively, though, is it really silencing some of these critics or just giving them more ammunition to say, he's not focusing enough on D.C. and policy?

STEINHAUSER: Yes, and that has been a criticism we've seen from a lot of Republicans over the last couple of weeks, that the president is just trying to do too much, he's here, he's there, he's everywhere and this budget is too big, it's too expensive and it will put the country in the red for a long time. So, I don't think it will silence the critics. They're always going to be around. And that is just part of Washington, Betty.

NGUYEN: All right. Paul Steinhauser, as always, we do appreciate it. Thank you.


NGUYEN: And CNN is your place to catch the president's prime time news conference Tuesday night. Coverage begins with the best political team on television at 7:45 Eastern. The president's remarks follow at 8:00 Eastern.

HOLMES: Well, it ain't Heathrow but still, it's a big deal when London's second busiest airport has to be shut down for a while. And it is what happened today. It has since reopened. It's called Gatwick. But it had to be temporarily shut down today.

This comes after a report of a suspicious device was on board a United Arab Emirates Airline flight from Dubai. And the passengers and crew members were evacuated while bomb disposal units searched that plane. No word on exactly what was found.

So, we're waiting to get some more details. Certainly, when we get them, we will pass them along to you.

Let's turn to Oakland, California. This story we're getting overnight. It happened yesterday, though. A shootout in Oakland leaves three police officers dead, another officer still in grave condition, yet another officer was wounded, the gunman dead.

Here's the scene you're seeing. Kind of graphic here. You see the blood on the street here. But two motorcycles there. Those are motorcycle cops who had apparently made a routine traffic stop according to police. The suspect then in that car opened fire on those two officers, killing one of them.

Now, you're looking to the other part of the scene where they say the suspect fled. He was holed up in an apartment complex. Officers from the SWAT team then go in. He opens fire. Police return fire.

And again, you see the toll we have there. Three police officers are dead, five shot altogether. The suspect was killed in this thing as well. Now, we want to hear from the mayor of Oakland who is really trying to comfort his community.


MAYOR RON DELLUMS, OAKLAND, CALIFORNIA: In these moments that words are extraordinarily inadequate, we come together in shock, in grief, in sadness and sorrow at a set of tragic incidences that have caused the death of several of our police officers.


HOLMES: And here are the officers who were killed. Again, the first shooting took the life of motorcycle officer, Sergeant Mark Dunakin. Killed in the second standoff is SWAT Sergeant Ervin Romans, and also, SWAT Sergeant Daniel Sakai. We're also told another officer, John Hege is his name, he remains in grave condition on life support.

The suspect meanwhile, 26-year-old Lovelle Mixon killed in that second police shootout, again, at that apartment complex. Authorities say Mixon was wanted for a parole violation.

The governor of California, Schwarzenegger, he issued this statement saying, "Our thoughts and prayers are with the families of those lost, the Oakland Police Department and law enforcement officers throughout California during this difficult time." Governor Schwarzenegger is expected to meet with the police chief and mayor of Oakland today.

NGUYEN: Well, British reality TV star Jade Goody is dead at the age of 27. Goody suffered from cervical cancer and died in her sleep at her London home. Her stints on the British version of "Big Brother" led to fame and controversy at times. She got married last month knowing that she was going to die. Goody leaves behind two sons and her new husband.

HOLMES: All right. Turning to the weather situation we're keeping an eye on in Fargo, North Dakota. They are getting ready for some history, not the kind of history they want to make. The Red River is expected to crest at 22 feet above flood stage. This is expected to happen in the next week or so. So, they got a bit of a heads-up. They know it's coming.

Again, that's 22 feet. It's going to be about a half foot higher than Fargo's last record flood, which was about 12 years ago. Officials have called in, as you see there, the National Guard. They're helping out. Also, volunteers are scrambling to fill up thousands of sandbags.

And as Reynolds was telling us, this all that snow they got. They know that stuff is going to melt.


HOLMES: When it does, flood waters are coming. NGUYEN: Problems arise. And Reynolds Wolf joins us now.

I know a lot of the nation is going to be seeing some changes. It is spring after all.

REYNOLDS WOLF, CNN METEOROLOGIST: Absolutely. And the biggest change that's going to happen up there in the northern plains -- you know, the weird thing about floods, it's so just bizarre. When you think about a hurricane and you're on the coast, you see the conditions deteriorate. You see the clouds coming in, the wind picking up. The same deal with tornadoes, same deal with snowstorms, you can actually see things happening.

During flooding situations where temperatures are just warming up, the only thing you're really watching change is the water level rising. So, you could have spectacular conditions in the skies above but at the grounds, at the surface nearby, the lakes and the rivers and streams, that's where things go crazy.

And today, we could see more issues. We've got some heavy rain north of Rugby at this time and Carrington, some of these heavy showers are going to obviously, not only going to fall and add to the issues of flooding but it's also going to cause some of that snow to melt because this is falling in liquid form. It's not additional snow, it's additional rain, additional moisture and that's going to cause more flooding.

You've seen the watches and warnings all shaded in the green across the map all over parts of North Dakota. Along parts of 29, southward into Fargo, they've been stacking those sandbags. They got a lot of work cut out for them not just for today but for days to come. As we mentioned, it's going up to about 37 to about 40 feet when it crests about a week or so from now. That's going to be 22 feet above flood stage.

We could also see a type of flooding in parts of the central and southern plains and back into Arkansas and Missouri. We're talking flash flooding this time. We have low-lying areas, poor drainage systems and heavy rain, that could certainly play out for the next -- start of the workweek on Monday and Tuesday but also coupled with that, we could have some damaging winds and large hail and possibly tornadoes. So, it could be a rough time.

Anyone who has any travel plans maybe going to Will Rogers in Oklahoma City or even Dallas, even Love Field, you're going to have some rough times and certainly, some delays, especially this Monday and Tuesday afternoon.

Your forecast today, scattered showers central and northern plains, heavy snow out to the west and possibly blizzard-like conditions for portions of Wyoming. The upper elevations of the Sierra Nevada and California, you could have up to two feet of snow and some floods. And then, back up for the eastern seaboard, a mix of sunshine and clouds in New York, very dry for parts of the Carolinas.

And the high temperatures are mainly in the 60s and 50s to the east coast, Tampa with 80 degrees, 82 in Dallas, 79 in Phoenix, Los Angeles, 61.

That's forecast -- back to you, guys.

NGUYEN: All right. You talked a little bit about Texas. I want you to stick around, Reynolds, because, Houston, we have a problem.

HOLMES: We have a problem.


HOLMES: You know repairs around the house can be difficult enough, all right?

NGUYEN: No doubt.

HOLMES: Can you imagine trying to do this in space? You're bound to make a boo-boo every now and then.

NGUYEN: A mistake. And that's no easy job when you are dealing with what they are. And we are talking about the astronauts. And they were trying to fix a storage platform on the outside of the International Space Station. But, unfortunately, the astronauts inserted a wrong pin in there jamming the platform. Oops.

HOLMES: Yes. They are trying to figure out a way to fix this thing. They might actually have to get a hammer and bang this thing out or find another ...

NGUYEN: The old-fashioned way, right?

HOLMES: Hey, it's old school, it works down here.

NGUYEN: That's how I do it around my house.

HOLMES: It works up there, Reynolds, but they had a bit of a problem here.

WOLF: Yes, a pin. You're not talking about Bic or you know, you're talking about like a specific type of pin.


WOLF: You know, imagine this. You've been sleeping in a weightless environment, you've been eating, you know, freeze dried food and tang and you have to get out and you got to deal with that kind of thing -- and certainly, a rough time.


WOLF: And being in a weightless environment certainly doesn't help.

NGUYEN: Not at all.

WOLF: What's amazing is that when you get into the full rays of the sunshine, you're -- it's excruciatingly hot, now the space suits were insulated, and then you're well below freezing when you're in the shadows. I mean, very harsh environment as you're spinning in orbit around the planet trying to fix an issue that can't be fixed with scotch tape and staples.

HOLMES: We should give them a break.

WOLF: Oh, yes.

NGUYEN: And they are getting a break. They're having ...

HOLMES: Today is off, yes.

NGUYEN: Today, they are taking the day off and they are going to recoup and get back at it -- hopefully, very soon with the hammer and scotch tape or whatever it is that they need to fix it.

WOLF: If it cannot be fixed with tape, I can't -- I can't help you.


HOLMES: All right. Reynolds, we appreciate you, buddy.

NGUYEN: Thank you.

All right. So, here is one way to save money on rent. Move back with your ex -- your ex-husband, to be exact. But what happens when you bring your new husband with you?

HOLMES: OK. I'm not sure I got this right. You move in with your ex-husband ...

NGUYEN: Ex-husband.

HOLMES: ... and you move in with your new husband?

NGUYEN: And the new husband is the guy that you cheated on with ...

HOLMES: With the new husband.


HOLMES: This is a reality ...


HOLMES: It's got to be a reality show.

NGUYEN: Well, it's reality for sure.

HOLMES: It is the reality.

All right. I can't wait to hear about that one!

Also, the president -- he's in the spotlight, and someone is always watching the president and like the people keeping track of his campaign promises. We'll take a look at his promises and any promises broken so far? Stay with us.


HOLMES: All right. Five hundred promises -- more than 500, that's how many President Obama made when he was running for office. Now, he's being accused of breaking one and it's a pretty big.

NGUYEN: Yes. And it's about lobbyist.

Our Josh Levs is here to explain exactly -- what happened here, Josh?

JOSH LEVS, CNN CORRESPONDENT: Yes, I'll take you guys -- you know what this is -- it's the Obameter. We're going to take a look at that. Here it is from, "The Obameter: Tracking Obama's Campaign Promises." And they've compiled more than 500 of them. But this one which they say is the most controversial one of all.

I got to speak earlier with the head of Politifact, Bill Adair.


VOICE OF BILL ADAIR, POLITIFACT.COM: It was a cornerstone of Obama's campaign -- and his point was that lobbyists would not run an Obama administration. And he made some very strong language about that. He said that no political appointees in the Obama-Biden administration would be permitted to work on regulation or contracts, substantially related to their prior employer for two years.

So, that was an important promise. We counted it as promise number 240 of our 513. And so, once he got in office, one of his first things was to issue an executive order the day, his first full day in office, January 21st. And so, initially, we rated it a promise kept.

LEVS: But then you found out about waivers, right? And we have a quote here from what you guys say about waivers. That he basically has created these waivers under which he can kind of put aside his own rule himself, right?

ADAIR: Exactly. The waivers were essentially the administration saying it's OK, he's with the band. You know? It's just a way that the administration could grant exceptions to people that it really wanted. And it was, at that point, that we moved the Obameter to "compromise." And then, last week, we moved it to "promise broken" because we concluded that he really has broken this promise.


LEVS: So, I guess that's (INAUDIBLE) I got to talk with him a little bit earlier there.

Now, there's one more thing I want to show you and that is what Politifact is pointing to, a few people who are part of the Obama administration who are former lobbyists and let's point to them. William Lynn is now deputy defense secretary. Jocelyn Frye, the first lady's director of policy. Cecilia Munoz, director of intergovernmental affairs, and Mark Patterson, Treasury chief of staff.

They point to those four, they say these are former lobbyists whose work does kind of intertwine with their roles currently. They were allowed into the administration despite what they did in the past. So, guys, that's what they are pointing to.

But to be fair, I'm going to say, check out Right now, they're pointing to his top 10 promises they say his making progress, and many of them -- overall, they're not giving him a bad track record. But the most controversial one so far, they say he broke.

NGUYEN: All right. Thank you, Josh. We appreciate it.


NGUYEN: Keeping track.

HOLMES: And we can make a promise right here, right now that in ...

NGUYEN: That we're not going to break?

HOLMES: Well, no, not that.


NGUYEN: Just a promise, folks.

HOLMES: Well, no, we can keep this promise. We won't break this one. We promise that John King, "STATE OF THE UNION" is coming up at 9:00 o'clock.

NGUYEN: Oh, yes.

HOLMES: We can also promise right after this commercial break, John King will be with us live. Stay here.

NGUYEN: That's a promise.

HOLMES: I hope he shows up.


NGUYEN: Well, with the economy and crisis, the millions of dollars insurance giant AIG handed out in bonuses, well, that continues to fuel public outrage, no doubt.

HOLMES: Yes. And John King has a big old canister of fuel he's about to throw on this fire -- coming up on "STATE OF THE UNION" at 9:00 o'clock.

John, give me an "A," give me an "I," give me a "G"!




KING: Good morning to you guys.

We'll have some -- we'll have some fun this morning. And among the issues we will explore is the outrage over those big AIG bonuses. We're going to have the president's top economist here, Christina Romer.

We'll also get Senator Judd Gregg. Remember, he's a Republican who is supposed to join the Obama cabinet. But now, he says -- now he is staying in the Senate. And he thinks what Congress is doing, putting big taxes on those who got those bonuses -- he thinks that's a bad idea. He thinks it's bad policy. He also thinks Congress maybe should be debating bigger issues like health care, education, and the president's budget.

So, we'll kick all that around this morning and a whole lot of other subjects as well.

NGUYEN: Along the lines of these bonuses, we're getting new reports now that, hey, it may be more than 165 million bucks. Can you help us get to the bottom of this?

KING: Well, that's one of the questions we will explore. But, Betty, I'll tell you, here in Washington, it's an interesting debate, because -- you know, the president is voicing outrage, the American people are voicing outrage, Congress is saying we have to take the money away or we have tax those who got it. Well, we also did learn last week, because of reporting here on CNN, that it was the Obama Treasury Department that put some language into the stimulus bill that protected the AIG bonuses.

So, on the one hand, the administration is voicing outrage, on the other hand, some say the administration is responsible in part for protecting the bonus money. So, that's among the issues we'll explore this morning. But I will tell you this, if you talk to the people in the White House, what they say is, yes, they understand this is a powerful issue; yes, they understand the outrage of the taxpayers who say that's my money, my bailout money being used to pay these big bonuses.

But if you're President Obama and you want to do health care, you want to do education reform, you want to move on to energy, the environment, climate change, and so many other things, having Congress spend all of last week and looks like more time this week on this issue, is potentially damaging. So, the administration wants to get back on the broader economic track.

HOLMES: Well, where are we seeing? Are we starting to see whether or not the American people are beginning to put the blame -- because this is a popular thing and Chris Dodd said that (ph) everybody is getting religion on this issue, but still, everybody seems to be pointing fingers? Where are the American people? Do we get a sense if they are holding the administration responsible, the Treasury Department, Senator Dodd, the Democrats? Who is being held responsible by at least the American people now?

KING: Well, the risk for President Obama here is that he is seen as part of the political class that the American people blame for this. Frankly, now, he doesn't have an election for four years but his party has an election in two years. And the bigger issue for the president is that he has so much political capital right now. He's still in the honeymoon period. And again, he wants to get Congress moving on the broader economic debate, on his health care initiatives, on other initiatives that are tough, that are big policy issues.

Remember health care in the Clinton administration? It took the administration off the track in those days. Social Security was a big issue that took George W. Bush administration off the track.

The president and his team are well aware when you get into big, feisty debates that divide the Congress and, frankly, divide the American people, he needs all the political capital, all the influence he can get. And if he comes down just even a few points because of all the outrage over AIG, it could -- it could hurt his agenda.

And then, there's another question about whether he's being overly optimistic about the strength of the economy. And if he is, that means Washington gets less in tax revenues and that means -- where is the money to pay for all of these things?

NGUYEN: Well, and there's also some question about whether he's overly optimistic about the strength of Timothy Geithner, the treasury secretary. President Obama has said, you know, "I fully support him," but there's a lot of criticism as well out there as well about Geithner.

KING: It's quite a bit of criticism. And, Betty, the president said that again in an interview that will air tonight on CBS' "60 Minutes," saying he has full confidence. He's even joking, he says, "Hey, buddy, you got to keep that job."

You know, sometimes in Washington, when they keep saying your job is secure, that means your job is not so secure. But we are told that the highest levels of the White House, that President Obama means it, that Secretary Geithner is here to stay.

But another key test for Secretary Geithner this week, tomorrow, they will announce this long-awaited policy to help all the banks deal with those toxic assets, the loans on properties that simply aren't worth what the big loans say they were worth when those loans were made. And that's another big test for Secretary Geithner. When he announced the broad outlines of that plan a few weeks ago, the markets tanked. They thought it was too vague, they didn't have the details, they didn't like the little parts they did see. So, a big challenge for Secretary Geithner. And you're right, the president says, "He's my man and I'm sticking with him," but he's in the hot seat. HOLMES: Yes, he's in the hot seat. The president almost cannot let him go at this point because he's put so much of his support behind this guy. And if Geithner goes down, then the president would take a huge hit.

Before we let you go, I know you're a big sports guy. And we find a way to get some sports in here.


HOLMES: I really want to bring this up, because I'm embarrassed for you.

NGUYEN: Uh-oh!


HOLMES: No, your bracket you compare and everybody is talking about the president's bracket. And we know he wasn't doing so well, but to hear, you're not even doing as well as the president is doing in his bracket. John, what's going on, man?

KING: It's still early, you know? Sometimes, you come in -- we're going to put the president's bracket and my bracket side-by-side here on our big wall today and compare them. He's ahead of me by one point at the moment. He's got North Carolina winning the whole thing.

You know, my first job in journalism was in Providence, Rhode Island. Rick Pitino was the coach of Providence of those days. So, I'm a bit of a Pitino fan. I have Louisville going all the way.


KING: I'm not sure either one of us is right. But we'll see how this plays out.

NGUYEN: Well, you know what, John? We can't talk. I had Texas. He had Arkansas. See where we are with our brackets?

HOLMES: We're not even in the tournament.

NGUYEN: Yes, exactly.

KING: I'm still in the hunt.


NGUYEN: Yes, you are. Good luck to you.

HOLMES: All right. John, we appreciate you as always. It's always good to talk to you.

And, of course, John King, the brackets, the news of the day, AIG, Tim Geithner -- all that coming up at the top of the hour on "STATE OF THE UNION." Don't miss it.

NGUYEN: In the meantime, though, who would turn down millions and millions of dollars?

HOLMES: You want me to answer that?

NGUYEN: Go ahead.

HOLMES: A fool.

NGUYEN: Well, careful what you say because I'm going to have ...

HOLMES: Oh, sorry. I know you're going there. I'm sorry.

NGUYEN: Alaska Governor Sarah Palin -- she just did. And we know a lot of other governors and people are highly critical of them, saying, why are you turning down this money? Well, was it a shrewd political move or costly mistake? You'll be the judge on that one.

HOLMES: Yes, they do have their reasons for it, I certainly not calling the governor a fool. But if somebody offers me or you or anybody else in here a couple of millions?

NGUYEN: And you turn it down. Yes.

HOLMES: They would be a fool.

NGUYEN: It wouldn't be too smart to do that.

HOLMES: And also, we got controversy flaring up over in Africa. The Pope is talking about sex, condoms, and AIDS.


HOLMES: Good morning everybody. And welcome back. I'm T.J. Holmes.

NGUYEN: And I'm Betty Nguyen.

HOLMES: Well, let's start out in Oakland where three police officers are dead, a fourth officer described as in grave condition. A fifth officer recovering from a flesh wound. All of these officers were revolved in two related shooting incidents.

It started yesterday what the police are calling a routine traffic stop in which one officer was shot, another shot and wounded. Took less than two hours before police tracked down that suspect and then he engaged them in a shootout and that is when two more officers were killed.


HOWARD JORDAN, OAKLAND ACTING POLICE CHIEF: The officers returned fire in defense of their lives and the suspect was deceased.


HOLMES: The suspect you heard there mentioned there is Lovelle Mixon, age 26, he was on parole for assault with a deadly weapon. NGUYEN: Volunteers and members of the National Guard are scrambling to fill sandbags along the Red River in North Dakota. It's expected to crest 22 feet above the flood stage in the coming days and that would break the record set by a historic flood in that area 12 years ago.

HOLMES: Well the President making it clear that Timothy Geithner is stuck with the job whether he wants it or not. And he is standing by his guy in a CBS "60 Minutes" interview that's airing tonight. The President said that if Geithner turned in his resignation, he wouldn't take it. Geithner has been under fire most recently over, of course, those AIG bonuses.

Connecticut's Attorney General Richard Blumenthal has asked AIG to clarify the size and timing of those controversial bonuses. The crippled insurance giant has reported hang out bonuses of $165 million.

But Blumenthal says AIG actually paid out $218 million according to documents from the company.

Now, our Don Lemon spoke by phone with Blumenthal.


RICHARD BLUMENTHAL, CONNECTICUT ATTORNEY GENERAL: We've heard a few explanations, but, quite honestly, none of the apparent justifications hold water with me, because whether the payments were made in December or March, I want to know how much they were, because we deserve back every dollar of those $218 million, apparently now that the acknowledge -- company acknowledges were paid in bonuses.


NGUYEN: Now, AIG disputes Blumenthal's claim and in a statement, AIG's spokesperson Mark Herd told CNN, quote, "Blumenthal's claim that he has discovered additional AIG retention payment is incorrect. The payments he appears to be referring to were made months ago." He goes on to say, "and have been widely reported on were specifically disclosed to the Treasury."

Now, our Chief Business Correspondent Ali Velshi talked with Treasury Secretary, Timothy Geithner at length about the AIG bonuses. And you want to hear what he has to so say. Watch "AIG FACTS& FURY" tonight 8:00 eastern right here on CNN.

HOLMES: Well at a time when so many states are taking all of the funding they can get, Alaska Governor Sarah Palin is turning down a chunk of stimulus money.

CNN's Tom Foreman tells us why.


TOM FOREMAN, CNN CORRESPONDENT: In Alaska, spring came chilly and Governor Sarah Palin is giving the stimulus a cold shoulder, too. Taking $642 million for roads, airports and more, but turning away nearly $290 million, over 30 percent of the funds marked for her state.

SARAH PALIN, (R) ALASKA GOVERNOR: The strings attached to Washington's stimulus package are real and they're binding.

FOREMAN: The Governor is saying no to money for what she calls expanding unemployment benefits, immunization, senior care and more. Including $171 million for education, which could include new and expanded programs, she says, the state will not be able to pay for when the stimulus money runs out.

PALIN: And we can't afford to have the federal government give us back our own income tax money to build a bigger, more expensive government then leave it to us to fund this growth in two years.

FOREMAN: Some other Republican governors were already opposing stimulus money along the same lines despite opposition in their own legislatures; in Louisiana, Texas, Mississippi, and Alabama.

In South Carolina, Governor Mark Sanford wants to buy down state debt. The White House has said no. The whole point of the stimulus is to spend it. They're going back and forth. Democrats have been attacking.

UNIDENTIFIED FEMALE: South Carolina is facing tough times. But Governor Sanford is playing politics instead of doing what's right.

FOREMAN: Governor Palin says she will listen to her critics if they can show her how to take more money without taking on future budget problems.

PALIN: Public discussion has got to ensue on all those dollars that will say you left on the table.

FOREMAN: But this issue underscores a genuine difference between those who say any Governor who takes this money without looking for the strings is short-sided and those who say any governor who turns down help in these hard times is foolish.

Tom Foreman, CNN, Washington.


HOLMES: All right, let's take a look at this huge crowd that gathered in Angola. They gathered to see the Pope. We're talking about more than a million people who crowded in a huge vacant lot to see Pope Benedict XVI. Biggest crowd, it's been a seven day pilgrimage to Africa and his message was sharp and pronounced.

He talked about, the quote, "Clouds of evil that hang over Africa saying they have spawned war, tribalism and ethnic rivalry." Well, that message is certainly being heard around world as how it pales to the firestorm brewing over something else the Pope had to say.

CNN's Zain Verjee takes a look at that controversy in this morning's "Faces of Faith."


ZAIN VERJEE, CNN CORRESPONDENT: Pope Benedict XVI set off another political firestorm, even before he landed in Africa, saying condoms could make the HIV-AIDS crisis worse. He told reporters, "It's a tragedy. You can't resolve it with a distribution of condoms. On the contrary it increases the problem."

Health experts disagree.

DR. ANTHONY S. FAUCI, DIRECTOR NIAID: Condoms have been proven time and again to play a major role in the prevention of the transmission of HIV infection. There is no evidence whatsoever to indicate that the distribution of condoms to people who would be using condoms in any manner or form makes them engage in more risky sexual activity.

VERJEE: From Cameroon, the Pope will go to Angola and what the Pope says matters in Africa. 22 million people in sub-Saharan Africa are infected with HIV-AIDS. A continent where [AUDIO GAP] converts.

UNIDENTIFIED FEMALE: You could resist the Pope today.

POPE BENEDICT XVI: In the midst of greater suffering, the Christian message all of this brings hope.

VERJEE: The Vatican is pushing sexual abstinence and one-partner relationships to fight HIV-AIDS.

FAUCI: In certain circumstances abstinence is important and, obviously, if you don't have sexual relations, you're not going to get HIV through a sexual contact, but it has its place.

VERJEE: But some priests and nuns working with AIDS victims in Africa question the Churches anti-condom policy. President Bush poured billions of dollars into HIV-AIDS programs in Africa for treatment, education and prevention but like the Pope's message, those programs stressed abstinence and monogamy while downplaying the role of condoms.

Experts say people need to listen to community leaders and health care workers on how to avoid HIV infection. They say, with due respect to the Pope, that this is a health issue and not a religious issue.

The church would argue this is a morality issue.

Zain Verjee, CNN, Washington.


HOLMES: And as you can imagine, a lot of people taking issue with the Pope on this one but he does have a new ally today. The director of Harvard University Aids Research Project says the Pope got it right. Details at the "Dallas Morning News" condoms not only don't reduce incidents of AIDS and HIV but can actually exacerbate the disease.

NGUYEN: Talking about the economy once again. You know, it's affecting everybody, including young people. We're going to find out what effect it's having on students and we're going to take you inside "CNN Student News" with anchor Carl Azuz that's coming right up.

And listen to this story folks. A bride takes her second husband home to live with the first. Both men are reportedly OK with this. Details coming up.


NGUYEN: All right, time for some "Extra Credit" today. If your kids are around, you might want to bring them in front of the television because we've got some student news for you. And this is important. Because students, as well as the rest of us, are trying to figure out this whole economic mess...


NGUYEN: ...and understand it and how it applies to us and how do we survive it.

HOLMES: And this guy can break it down. He'll be here every Sunday.


HOLMES: Carl Azuz.

CARL AZUZ, HOST, CNN STUDENT NEWS: Thanks in part to you T.J. If any of your viewers are not ready for "Extra Credit," you know who to blame.

HOLMES: Well yes with the CNN -- it's really it's been we've got good feedback for having you on. So we appreciate you being here.

But explain to people first, but still just a little refresher, remind folks what is CNN Student News?

AZUZ: You've got it, we are CNN's ten-minute commercial-free news show for middle and high school classrooms. We air on three places on HLN Monday through Friday at 4:00 a.m. Eastern time. We're also available on I-Tunes as a free and downloadable podcast and everything about our show can be found as

NGUYEN: It's probably hard to break down the AIG, the economic mess, the recession and all of that into a form where students can understand how it applies to them.

AZUZ: Absolutely it can. And we have been getting some feedback from adults on this. We have a new financial glossary available at

And that's one of the tools we use to help students get it and to help adults as well -- we're having adults write in and saying, hey look, thank you for explaining what a Ponzi scheme is.

And those definitions from our show have come directly from this site you're seeing right here, I didn't understand the difference between Chapter 7 and Chapter 13.

NGUYEN: How about a toxic asset? You got that on there? If you don't, you should.

AZUZ: We'll get it on there for you, Betty.

NGUYEN: Yes, because we're still trying to figure that one out.

HOLMES: We've got to stop putting you on the spotlight. We commit you to everything right here on the air and you have to do it. What are students saying? We got to mention that everybody is being affected and a lot of kids are not working and they're going to be in the work force for a while.


HOLMES: But they say their parent is going through it, but still what are they sounding off about in this whole economic mess? Even the AIG thing, specifically, are they talking about that?

AZUZ: They are talking about everything. And they are not only feeling the pinch of the economy but they're writing in on how it's affecting them. And we actually asked them what can people do to kind of save money but still have fun. What do you do for entertainment and what do you on spring break when the economy is bad?

And we actually have some feedback coming in from Mrs. Tucker's class. They wrote in to us, that you could spend time outside with friends and pets, you could read books or play board games with friends and family, these games do not waste electricity.

So they are commenting on ways to kind of stay entertained.

And also we have a blog comment at from Mary, and she wrote in to us that movies are the way to go for her. They allow a person to escape reality, even it it's only for a few hours and nowadays that is something that is a good consolation for bad economic times.

So you see how they are coping.

NGUYEN: Yes, absolutely. And there's a lot of response. You have these blogs. You're listening to what they are saying. I'm sure you're using Facebook. I know we are, Facebook, Twitter, MySpace, all of these different outlets.

AZUZ: And Facebook's evolved because it gives us a chance to kind of converse with them so that's always fun for us. And I actually have a quick sound bite for you. Your viewers are used to seeing this angle. I kind of do a little Facebook segment showing what we see. So check this out.


AZUZ: This is the HLN studio. If you look up here, you can see all of the lights and if you look back there, you can see the couch that Robin Meade sometimes uses on her show. And if you look straight ahead, you will see the camera.


AZUZ: So that's one of the things we use. I mean, they are used to seeing your beautiful faces and my viewers have to deal with me. But this is a way that they could kind of see some behind the scene stuff and they contribute to the conversation.

HOLMES: It has great production value on that stuff.

AZUZ: Yes, I shot that myself.

NGUYEN: Yes, and I thought you got a professional photographer for that one, right?

HOLMES: It was called the shaky cam, and you've got a steady cam.

NGUYEN: That's reality TV, folks. We're looking forward to it.

HOLMES: Do you have shout outs? Do you have those as well?

AZUZ: I do. And we have students and teachers who write in regularly to Facebook into the blog and I want to give a couple of quick shout outs. One to Mr. Macleod's classes at Rimrock Jr./Sr. High School in Grand View Idaho. They are watching very early there this morning.

And Ms. Sears' classes at Canton Middle School in Canton, Connecticut. Thank you all for tuning in.

NGUYEN: All right, and keep tuning in. Here as well. Thanks for joining us this morning.

AZUZ: Thank you both so much.

HOLMES: See you next week? Right?

NGUYEN: All right.

AZUZ: Yes, sir. You got it.

HOLMES: And we appreciate you Carl.

You can, of course keep up with Betty and I as well on our Facebook pages. All these Facebook pages, you know how to look them up, you're savvy enough. But there we are. Carl there, leading the charge on the picture there.

Check us out. Keep your comments coming up and coming in. And coming up, Betty and I, right back, after the break. (COMMERCIAL BREAK)

NGUYEN: So while many companies are cutting back, the federal government is hiring 10,000 people. Yes, you heard me right. The military is looking for 10,000 civilians to help with the business side of things and CNN's Barbara Starr has that story.


BARBARA STARR, CNN PENTAGON CORRESPONDENT: A cold day and a long line at this Washington, D.C. job fair; thousands waiting for hours outside the football stadium. When the gates finally open....

UNIDENTIFIED MALE: Good luck today.

STARR: It's a rush up the escalator to meet with about 50 potential employers. One of the biggest opportunities here may be finding a civilian job with the Pentagon.

AZITA SASS, JOB SEEKER: I thought that would be a good opportunity.

STARR: Azita's background is in purchasing and logistics. We met up with her while she was talking to the Navy about a job. But the Army and the Marines are here as well.

JOE MAYER, U.S. NAVY: We have some positions right now we're trying to fill in the Washington, D.C. area for highly qualified individuals.

STARR: In fact, the Defense Department now has about 10,000 civilian job openings. Defense Secretary Robert Gates says the department has a real economic impact.

ROBERT GATES, DEFENSE SECRETARY: It's not irrelevant that the defense department hires -- employs almost 3 million people.

STARR: Michelle Davis, laid off from a publishing job, also seek employment opportunities in government.

MICHELLE DAVIS, JOB SEEKER: The appeal is you're not hearing about layoffs with the government jobs.

STARR: Azita is continuing her job search, hoping the federal government finally may come through.

SASS: It's hard all over the United States, but I think in Washington D.C. there's a better chance to find a career here because a lot of employers, government jobs, a lot of consulting companies and I'm optimistic.

STARR: Even the most optimistic folks here know there is a long road ahead, until they hear those magic words, "You're hired."

Barbara Starr, CNN, Landover, Maryland.


NGUYEN: All right. Looking for a job and then let's talk about looking for a place to live.

HOLMES: This is all yours.

NGUYEN: Are you sure?

HOLMES: Yes. You take this one.

NGUYEN: It's quite a story, folks.

HOLMES: This makes no sense to me.

NGUYEN: Essentially, it is this. This woman has moved back in with her ex-husband but she has brought along this guy, her new husband. She says it's completely fine, even though she and her ex had a messy divorce and bitter child custody battle. But four years later, she and her new husband, the kids, all of them living with her ex-husband and they say it's completely normal. Her ex-husband and new hubby, they are friends but there is more.

HOLMES: Please.

NGUYEN: The ex-mother-in-law is a huge supporter of this and -- get this -- the ex-mother-in-law did the same thing and she also lives with her ex. If you're not totally confused I don't know what will confuse you.

HOLMES: A few more details. The ex-husband is 42. How old is the new guy, Betty?

NGUYEN: Twenty-two. She says she married both younger and older. Hey look, they have a home. They have a roof over their head in this economic, you know, disastrous time right now and she says they are all happy.

HOLMES: Do we know whose idea this was?

NGUYEN: I don't know these people personally. I know this is an iReporter and she says it's working for them. We have done so many stories of people who have moved in with their exes but this was a first when you're bringing a new husband and your children to live with your ex-husband.

HOLMES: And again, she admits that the ex-husband, she cheated on him.

NGUYEN: Right.

HOLMES: She admits that this happened.

NGUYEN: It's -- yes. It's quite a story. But, hey, to each his own.

HOLMES: All right. Let's tell you -- are you okay? Our floor director is having a fit. People shaking heads all around the studio.

We're going to take a quick break. And try to get a head around that story. We just did.

We'll be right back.


NGUYEN: After making a record sale just last July, apparently these days green cars, no longer pulling in the green.

HOLMES: Yes, officials say because of low gas prices now and the tanking economy, hybrids are taking a back seat to regular vehicles. Of course, hybrids can be kind of expensive. Now dealers in the White House offering incentives to attract drivers.

Here now is CNN's Kara Finnstrom.



KENNY BURNS, TOYOTA OF HOLLYWOOD: We've had waiting lists up to 220 people deep that have all left deposits.

FINNSTROM: That was May of 2008; gas prices were rising. There were federal tax incentives to buy hybrid and in California, more incentives like free street parking.

But now in 2009, gas under two bucks a gallon, most incentives phased out and the recession crippling all car sales. It's a different story at that same dealership.

FRANK SIMON, TOYOTA OF HOLLYWOOD: You could come in and within a day or two, pretty much have a Prius that you would like.

FINNSTROM: Hybrid car sales nationwide are down almost 30 percent.

RAY MONTES, SHOPPING FOR CAR: People aren't looking for something that's going to push, you know, you into a technological age.

FINNSTROM: Ray Montes plans to buy a car within the next three months and is not looking at hybrids.

MONTES: I'm just looking for a car that can get me from Point A to Point B.

JESSICA CALDWELL, EDMUNDS.COM ANALYST: Right now, with gas prices where they are, it doesn't make a lot of sense for many consumers to buy a hybrid, so it's going to take quite an incentive financially for people to really take an interest in hybrids again. FINNSTROM: Industry analyst Jessica Caldwell says car dealers are now offering all kinds of unprecedented cash back, low APR deals on hybrids like the Priuses which run on gas and batteries. That is helping sales but Caldwell says it will take much more to get Americans buying the next generation of green vehicles electric plug- ins.

CALDWELL: People are usually resistant to change especially one that's so radical.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Because these cars won't leave the showrooms unless consumers buy them.

FINNSTROM: This week, President Obama laid out new incentives for consumers.

OBAMA: A new tax credit of $7,500.

FINNSTROM: He's hoping to build on the enthusiasm of people like Gina Zimmerman (ph) who's now leasing her second Prius.

GINA ZIMMERMAN, HYBRID CAR LEASER: An environmental choice and I'll say I liked it.

FINNSTROM: And who says she is waiting for the green car of tomorrow.

Big hopes, big plans but also big challenges. A year ago, this dealership couldn't keep a Prius on its lot. But now even with all of those dealer incentives, 28 Priuses waiting to be bought.

Kara Finnstrom, for CNN, Los Angeles.


HOLMES: Coming up here in just one minute and ten seconds, "STATE OF THE UNION" with CNN chief political correspondent, John King.

Don't go away, you want to catch that.

NGUYEN: Now in the news, an Oakland, California police officer is fighting for his life this hour. At least three police officers and a suspect are dead after a shootout in Oakland. Now, officials say the suspect first opened fire on two motorcycle cops during a traffic stop and one of them was killed, the other critically injured. Police say the suspect then fled and there was a manhunt as well as a standoff. But before it was over, two more officers and the suspect had been killed.

We are following that story for you and keep you updated.

Also this, President Obama tells CBS's "60 Minutes" that he is sticking with Treasury Secretary Timothy Geithner. Now some critics have called for Geithner's resignation over those AIG bonuses. But even if Geithner tried to resign, the president tells CBS that he'd say, "Sorry, buddy, but you still got the job."

That interview's tonight.

And a record-breaking flood could possibly hit North Dakota in the next week or so. The Red River is expected to rise 22 feet above flood stage. We will be watching that.

But in the meantime, we want you to watch this: "STATE OF THE UNION" with John King is next.