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Bernie Madoff's Nightmare; Battle Over Wisconsin's Budget; Oscars Night Hits and Misses

Aired February 28, 2011 - 10:00   ET

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

CAROL COSTELLO, CNN ANCHOR: It's 10:00 a.m. on the East Coast, 7:00 a.m. on the West. I'm Carol Costello, sitting in for Kyra Phillips.

Here are some of the stories that had us talking this morning. Wall Street swindler Bernie Madoff is talking about a surprising victim of his pyramid scheme. That would be himself. He tells "New York Magazine" that it was a nightmare to carry the burden of his multi-billion dollar fraud and he says he cried for two weeks after learning that his son committed suicide in the scandal's aftermath.

Due in court, the California couple accused of kidnapping Jaycee Dugard and holding her captive for 18 years. Phillip and Nancy Garrido are charged with the 1991 abduction, and the years of abuse that followed. The case riveted the world when authorities discovered Dugard and her children in 2009.

And the Academy Award goes to "The King's Speech," as if you haven't known that for months. That movie was bound to win and it did. Four Oscars, including the highly prized best pictures. The star of the period piece, Colin Firth, also won for best actor.

We begin this hour though in Libya, a defiant Moammar Gadhafi still clings to power, and just a few minutes ago, CNN crews told us that his military jets bombed an abandoned base where weapons were stockpiled. In the meantime, Moammar Gadhafi security forces have defected to the opposition, and have many of his own diplomats. They have skedaddled, too. The deepening crisis has led to an exodus of tens of thousands of refugees.

Those refugees now stuck in a no-man's-land between Libya and Tunisia. Their ordeal and the violence they left behind is pushing the world's diplomatic community into action. His morning, Secretary of State Hillary Clinton is addressing the concerns in Geneva where she is meeting with U.S. allies to discuss the crisis. Clinton says the Libyan government's killing of protesters is ongoing. The Gadhafi family denies it.

In fact, this is one of Gadhafi's sons apparently cheering on security forces. He's urging them not to desert as many of their comrades have done and he's also promising them that more weapons will be delivered.

And speaking of weapons, here at home, two U.S. senators say it may be time for Washington to step in and begin arming the opposition. Joe Lieberman and John McCain says the world cannot sit on the sidelines.

(BEGIN VIDEO CLIP)

REP. JOE LIEBERMAN (I), CONNECTICUT: The world has to do more. I'd begin with an imposition of a no-fly zone so that Gadhafi can't be attacking his own people from the air or flying in more mercenaries. I think we ought to recognize the opposition provisional government as the legitimate government of Libya and we ought to give that government certainly humanitarian assistance and military arms. Not to go in on the ground ourselves but to give them the wherewithal to fight on behalf of the people of Libya against a really cruel dictator.

(END VIDEO CLIP)

COSTELLO: CNN Pentagon correspondent Chris Lawrence joins us now with a closer look. So Chris, what about Senator Lieberman's urging the U.S. to help enforce this no fly zone over Libya. Where does that stand?

CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT: Well, Carol, it's not something that the U.S. would ever do by itself, unilaterally. Officials are talking with their counterparts in Europe and NATO, to see if that is something that could be done. The word that we're getting is that it would have to increase. In other words, the violence would have to tick up. The use of Gadhafi's air power would have to tick up, to warrant such a step, but there was a development over the weekend when Italy suspended its friendship treaty with Libya. That would seem to open the door to Italy, the bases that are there in Italy, being used to, say, stage a no-fly zone if it ever came to that.

COSTELLO: I can see why because a lot of those refugees are going into Italy, and Italy has to, you know, kind of pay for that, too. So back to the no-fly zone though, what would it take to enforce it?

LAWRENCE: It's not as easy as it sounds. People throw around the idea of a no fly zone but they haven't always worked. It worked when the U.S. imposed one in northern Iraq because the Kurdish forces controlled the ground. It wasn't as effective in southern Iraq. Remember Saddam Hussein was still able to go down south and commit massive violence against the Shiites there. Because we did not control the ground. So controlling the air is a limited scope. Also, it worked there because you had a way to stage the no-fly zone from Turkey, from bases in Europe.

It may be a little more difficult in Libya, and if you do stage from, say, Europe, that limits the amount of planes because it's a greater distance. They'd have to spend a lot more time in the air. That limits the amount of planes you can actually have flying.

COSTELLO: OK. So let's move on to other military options. What about arming the opposition. Is that even on the table anywhere?

LAWRENCE: A lot of options are on the table. They are hesitant to take any particular option off the table. But what is being sort of being considered is whether the U.S. military may be able to say, disrupt communications by Gadhafi to his forces. Another could be having possibly the U.S. military set up sort of a corridor in Tunisia or Egypt to help with the humanitarian assistance. That is really starting to come to the fore as sort of the number one military concern is how the military may play into a humanitarian crisis that may be emerging there in Libya.

Also, the U.S. military had started some very initial steps to re-establish some mill to mill ties with Libya. That's all been suspended and scrapped with the developments there now.

LAWRENCE: Yes.

COSTELLO: Complicated situation with no easy answers. Chris Lawrence, reporting live from Washington, thanks.

LAWRENCE: Yes.

COSTELLO: You're feeling the unrest in Libya every time when you fill up your gas tank, the average cost of a gallon of regular in regular is now $3.37. That's up nearly 17 cents in the past week and there doesn't seem to be an end in sight. Experts predict the prices will keep going up.

A Democratic senator in Wisconsin is hoping to turn the tables on the governor. He says Democrats are trying to get at least three Republican senators to join efforts to prevent the governor cutting most collective bargaining rights for public workers. So let's head to the Wisconsin state capital in Madison and Ted Rowlands. So Ted, you spoke to one of those 14 Democratic senators who left the state rather than vote on the legislation. Does he really think he can convince other Republican senators to switch over?

TED ROWLANDS, CNN CORRESPONDENT: Well, (INAUDIBLE) he's not single-handedly thinking that he's going to have folks with children. He truly believes that when level heard he can get folks to switch over. He believes when level heads prevail, two more people will switch over. The democrats think they have one Republican already. A Republican senator by the name of Dale Shultz. And Shultz about a week and a half ago came out with a plan that would have brought the two sides together.

Basically, he said, "let's give - let's enact this collective bargaining restriction for just two years. Let's get all those financial concessions and we'll have some collective bargaining restrictions for a two-year time and then revisited after that. What the Democrats are hoping is that as time moves on during this stalemate where both sides seem entrenched, are entrenched, they'll get two more Republicans to come over. The Republican caucus and the leadership says no, way, you can hope all you want, we are standing firm. They say Shultz may be leaning but at this point, say nobody else is. Democrats say behind the scenes they are trying to get others and they believe they will make Congress. To that end, the stalemate continues here. Nobody seems to be budging, the governor is not budging. He wants the collective bargaining restriction enacted and held permanent. The 14 senators, the supporters are now calling the fab 14 remain in Illinois, and this morning that senator that we talked to, Chris Larsen, said they will stay there for a month if they have to, because they feel so strong about the collective bargaining part of this proposed deal that the governor has put forward. So the bottom line here, a lot of back-door politicking going on and lobbying going on.

COSTELLO: I'm just going to ask you, Ted.

Ted, is there anything the Wisconsin governor can do to force a vote in the state Senate?

ROWLANDS: No, because he doesn't have a quorum. So he needs at least one of the democratic senators to come back to the capitol. As soon as they establish a quorum, then they can vote it in, they can establish a vote but they cannot start this session without a quorum of senators. So he's in a tough spot with all 14 of them in Illinois and seemingly all 14 of them together. They say they are a united group and that they will not budge and they don't have anybody that seems to be leaning. Who knows whose going to blink here? At this point it just seemed to drag on and drag on.

COSTELLO: No check mate at least yet.

Ted Rowlands, live in Madison, Wisconsin. Well Wisconsin lawmakers are battling over their budget, and a compromise over the federal budget is in the works. It appears that deal on that temporary budget plan will be done before Friday when the current spending measure expires. A compromise will avoid the first government shut down in 15 years. The Republican-led House passed its version of a temporary spending bill last week, cutting $4 billion. The Senate Budget Chairman, tells CNN the Republicans short-term fix is acceptable.

There are disturbing new questions about the four Americans who were killed during that standoff with Somali pirates, specifically concerns now focus on whether the U.S. bungled the face to face negotiations. A maritime source tells CNN that U.S. officials took the two pirates into custody during the talks, and that's a move that apparently goes against standard negotiation practices. There are reports that when the pirates left for the negotiations they told their comrades to kill the hostages if they did not return.

The last living U.S. veteran from World War I has died. Frank Buckles family said he died peacefully in his West Virginia home. Buckles was 110 years old. He had been working to get a monument on the National Mall for his comrades. A memorial that honors D.C. veterans of the war will be restored as part of that plan.

A 4.7 magnitude earthquake rumbled through central Arkansas just after 11:00 p.m. Eastern last night. The epicenter was about 35 miles from the capital, Little Rock. There are no immediate reports of damages or injuries.

In Oklahoma, this ominous looking funnel cloud was spotted late yesterday near the Kansas border. Much of the state was under a tornado watch at that time. The storm system produced hail but no damage being reported here either, at least right now.

And that nasty weather system moving across the midwest and southeast, and it will continue to move through today. Severe thunderstorms, flooding even tornadoes all possible. Let's get to Rob Marciano for more details. Hey, Rob.

ROB MARCIANO, AMS METEOROLOGIST: Hey good morning and snow and ice. So we got everything with this. I want to show you some video coming in to the CNN NEWSROOM. Out of St. Louis where yesterday afternoon, late last night, they had some damage to stand by severe thunderstorms rolling through there in that area. There were a couple of tornadoes that officially touched down and this probably some of the residual damage from that. So rough weather across Missouri. A lot of that now moving off to the east and expanding its way from the Canadian border all the way down parts of the Gulf of Mexico.

As far as where the severe weather threat is today, the bull's eye is in through parts of eastern Tennessee and actually you can stretch it all the way up through parts of D.C., too. So that's what we are seeing on the radar. Tornado watches are posted and a couple of them, this one right in the heart of it, just east of Nashville, we're seeing quite a bit of action. We're not seeing rotating or clouds or damaging wind. We're seeing a tremendous amount of rainfall, and we've had reports of flooding rains across southern Indiana, parts of Ohio and Western parts of Pennsylvania.

And this is all moving off to the east. Even the parts of Western Virginia and Maryland under a tornado watch until later on this afternoon. It looks like mostly just rain across New York, and go far enough north, and temperatures are cold enough for freezing rain, in Hartford and back through Manchester, New Hampshire and all the way farther to the north, we're looking at some snow. The warm air eventually will take control of most of this.

We do have flood watches and warnings that are posted. Tremendous amount of rainfall with this system. So we are ending February on a fairly rough note and all of this while unusually cold air dove into the dessert southwest, Tucson and snowed in parts of L.A. over the weekend.

Let's bring no spring.

COSTELLO: Winter is going out like a lion.

MARCIANO: Yes. Well, it's - I don't know if it's going out yet. Still trying to.

COSTELLO: I was just going to say that little rodent was wrong.

MARCIANO: Yes. He's been wrong before.

COSTELLO: And he'll be wrong again. Thank you, Rob.

MARCIANO: Okay. See you in a bit.

COSTELLO: Sometimes, having your flight delayed by a couple of hours is a perk. Passengers who got a late start on a flight from Orlando to Richmond last week got to see the final launch of the space shuttle "Discovery" right from their windows seat. A great view. Check out that perfect arc trailing behind the shuttle. How often do you get to see that launch from this perspective? Lucky passengers.

Anne Hathaway and James Franco hosting the biggest name in tinsel town. So will the Oscar score a hit or miss?

(COMMERCIAL BREAK)

COSTELLO: It was Hollywood's biggest night. No bomb shells last night but there was an F-bomb dropped by an excited winner. That was highlight of the show. Entertainment correspondent Kareen Wynter is in Los Angeles. We'll get to the amazing dresses in a moment because that's the only thing that people cares about.

KAREEN WYNTER, CNN CORRESPONDENT: I know, right?

COSTELLO: That's true.

If there weren't any big surprises -

WYNTER: Caroline, I love bantering with you. You get it. You get the showbiz thing, girl. I love it.

COSTELLO: We all know who's going to win by the time the show rolls around. So why watch it except for the dresses?

WYNTER: I know. We'll get to some of the fashion hits and misses in a sec. You mentioned Melissa Leo. She was definitely the woman of the night. She should probably have taken over as hosts because according to critics, Anne Hathaway and James Franco, they just didn't get the job done. There was so much hype surrounding their chemistry. They are going to pull in younger viewers. People were saying it was just an absolute snore-fest.

I don't know if you want to play it again. Those who have missed it but Melissa Leo, her wonderful, memorable acceptance speech last night where she said that naughty word. Let's listen, if we have it.

All right, you know what. Even if we played it, you wouldn't hear it because it was the F-bomb, folks. I'll give you the abbreviated version. She walked up on stage and after saying "um" several times, she just was so clueless.

COSTELLO: There it is. She just said it. WYNTER: Melissa, you were the favorite going into this, so after that awkward moment, she just spit out that bad word and that's all people have been talking about because the show fell so flat. So there you have it. That was last night in a nutshell, Carol.

COSTELLO: So sad, it's just so very, very sad that we have to get excited about someone dropping the f-bomb.

You know, Christian Bale, we should talk about him because I can't even believe he went on this sort of rant.

WYNTER: It's incredible. Well, here's the deal, John Galliano, he designs Christian Dior. There's this video that surface where last week he apparently made anti-semitic remarks saying that I love Hitler. The problem here is a lot of actresses reportedly boycotted Christian Dior last night. For example, Natalie Portman. She is, of course, the spokesperson for Christian Dior perfume. And she had opted for another designer and just looked amazing in that violet off the should gown.

Another actor celebrity who dared to take it bare, Nicole Kidman. She wore Christian Dior but every one is saying that she bombed. It was an Asian inspired couture gown. Critics compared it to a napkin. It was bone colored again and just, you know, Nicole Kidman, she either dazzles on the red carpet. Last night she didn't do it but again a big headline what John Galliano apparently said we're going to be getting that video. We're going to be getting that video.

COSTELLO: What is it?

WYNTER: What's interesting one of my producers just e- mailed me and said that a reporter tried asking Portman about it backstage after her big win, and that the Academy stepped in, and that Portman really had this uncomfortable look on her face. So a lot of people were buzzing about that last night. Sorry to cut you off, Carol.

COSTELLO: What they didn't think anyone would ask Natalie Portman about that? She's Jewish, right?

WYNTER: Absolutely. And she's very outspoken. She is one of those politically savvy actresses as well and she probably would have had a mouthful to say about that but they stepped in to make sure that she didn't say anything that would take away from her big win. But yes, this is a little disappointing. A lot of stars turn to Christian Dior when they're sporting their stuff, starting those stuff on the red carpet and it's really interesting these (INAUDIBLE) developments. I can't wait to see that video though once it comes in to us, Carol.

COSTELLO: Me, too. Sadly, me, too. Thank you very much. Kareen Wynter reporting live from Los Angeles. Any information on everything, breaking in the entertainment world, only one place to go, "Showbiz Tonight" at 5:00 p.m. and 11:00 p.m. Eastern on HLN. Bernie Madoff says his monster ponzi scheme was a nightmare for him. Just ahead the jailhouse interview you have to hear to believe.

(COMMERCIAL BREAK)

COSTELLO: Congress is playing "let's make a deal." It looks like there could be a compromise on a temporary spending measure for the federal government. The Republican-led House bill cuts $4 million in spending, but is it enough for those Tea Party followers who want that red ink erased?

Congressman Mike Burgess is a member of the House Tea Party caucus. He says we don't need to raise the debt ceiling. We need to cut, cut, cut and he joins us now from Washington. Thank you so much for being here.

REP. MIKE BURGESS (R), TEXAS: Good morning, Carol. It's great to be with you.

COSTELLO: So are you happy about this apparent compromise that will keep the government up and running?

BURGESS: I don't think happy is the operative word I would use. I'm always a little nervous when I hear words like "deal" and "compromise" but let's be honest, this is a reasonable step to take. I wish that the congress had stayed in session this past week, House and Senate both, and worked through this thing. If you recall, a week before last, we stayed up until 3:00 in the morning every night and the speaker allowed us to bring every amendment to the floor that anyone would wanted to bring. Where was the senate doing their work, that same week.

Because ultimately you are going to have to put both sides together. You're going to have to forge whatever kind of conference report or compromises out there and passing by both Houses before it becomes law. We know it has to happen so I don't see why the delay.

COSTELLO: So this compromise between Senate Democrats and House Republican, this will keep the government open for two more weeks and then you guys are going to start hashing things out once again. This $4 billion in cuts, you said you're not exactly happy about that. What would you like to see done?

BURGESS: Well, honestly, there has to be a much more aggressive stance taken toward federal spending. Now, I voted for the cuts 10 days ago that the House put on the table. Criticism I get back home is that, "wait a minute, you really cut $61 billion only, and with a $1.5 trillion deficit for this year alone, how are you ever going to fill that hole with that type of timid response." And that's a legitimate question. Clearly, at some point with the spending in Medicare, Medicaid, social security has to be talked about. One thing that no one is talking about is we're fixing to explode the deficit with the subsidies in insurance exchanges under Obama-care and that kicks in two short years. COSTELLO: Let me ask you this quickly before we run out of time.

BURGESS: Sure.

COSTELLO: You know this $61 billion in cuts that the Republicans wants in their totality, I mean, even Goldman Sachs says they would hurt the economy. You know and the economy -

(CROSSTALK)

BURGESS: No, it will hurt Goldman Sachs, and maybe that's a good thing. Look, who profits from the selling of all of this debt every week down on the world exchange? It's the middle man, it's Goldman Sachs. So no wonder they're upset.

COSTELLO: Well, that maybe true, but some people are wondering, within that budget, there are no real - like for example, oil companies, why not cut subsidies to oil companies? Why not get rid of those tax breaks that big companies have? Wouldn't that save lots of money, too?

BURGESS: Yes, bring up the plan. I'd love to see it, and no question about it, everything should be on the table. We made some cuts in defense spending last week, and I think all in all, that was good, and they're programs that I have supported in the past but at the same time, it's a new day, we are borrowing $0.42 out of money dollar spent and we just can't do it.

COSTELLO: OK. I could go on and talk to you forever. Thank you so much for joining us.

BURGESS: Thank you.

COSTELLO: Senator Burgess.

The instability through much of the Arab world is pushing oil prices higher and higher. So how high will they go? We'll take a look next.

(COMMERCIAL BREAK)

COSTELLO: You're feeling the unrest in Libya every time you fill up your gas tank. AAA says the national average is $3.37 and that may go up. CNN's Christine Romans is here. Christine, we don't get much oil from Libya. Saudi Arabia says, oh, we'll sell more oil and yet our gas prices here in the United States are going up. That old feeling is back, they're just trying to gouge us.

ROMANS: It's a reaction to oil prices getting above $100 a barrel, Carol. They've come off a little bit here today, but the gas prices keep moving up. And you're right. Libya is not our big supplier of oil --

COSTELLO: Two percent! ROMANS: -- but it does supply a lot of oil to the European markets. It's the kind of the oil that industrialized countries like, light, sweet crude. It can be more quickly and easily refined into kerosene and diesel and gasoline that we use for our factories and our cars, and if the European market is not getting the oil it needs, that means it is competing with the U.S. on the world stage in Nigeria and Algeria and other places for that light, sweet crude.

So, every drop that comes out of the ground, it's accounted for. And when you have concerns about Libya, that's why it is the largest proven reserves in Africa. It's what they're not producing yet, too --

COSTELLO: In other words, we're stuck, and just deal with it. And our gas prices could go up to $5 a gallon?

ROMANS: Maybe - maybe they couldn't go up to just $5 a gallon. Maybe just $4. Maybe - it's hard to tell. I mean, seriously, if you have the economy start to weaken because of what oil prices are doing, that means demand for oil and gas starts to go down.

Let me show you where we are. We were at $3.37 -- 17 or 18 cents in a couple of days. You can see right in the middle there, that's where oil hit $100. You know, I got to -- there's a lot of apps and things you can look at. You can go to aaa.com, to learn how to drive a little better. Jerks don't get good gas mileage.

COSTELLO: That's right! Aggressive driving takes more gas.

ROMANS: Take some stuff out of the trunk of the car, by the way. That also lighten the load on the car. There's a few little things you can do. But for the most part, we are just mostly watching the prices go up.

COSTELLO: OK. I'll inflate my tires.

ROMANS: Yes. Properly, please. Not too much, Carol! Not too much!

COSTELLO: I'm going to do it. Thanks, Christine.

ROMANS: You're welcome.

COSTELLO: Half past the hour. Time to check some of our top stories. Moammar Gadhafi still clings to power in Libya, and the deepening crisis has led to an exodus of tens of thousands of refugees who are now stuck in a no-man's-land between Libya and Tunisia. In the meantime, more of Gadhafi's security forces have defected to the opposition as have many of his own diplomats.

In Wisconsin, the sit-in continues at the state capital building. Protesters upset about Wisconsin's budget plans refused to budge when they were ordered to leave, and police decided not to forcibly remove them. The governor says if the stalemate continues, layoffs may soon begin.

It's the end of an era. Today, we are remembering Frank Buckles. He was the last living American to have served in World War I. Buckles was 110 years old. He spent the last several years trying to get a Washington monument for his comrades.

Bernard Madoff wants the world to know he is a good person and that his epic Ponzi scheme was not all his fault. Some eye-opening statements phoned in from prison.

(BEGIN VIDEOTAPE)

CAROL COSTELLO, CNN CORRESPONDENT: In more than a dozen phone calls, convicted Ponzi schemer Bernard Madoff opens up to "New York Magazine" about his multibillion dollar fraud, his victims and the fallout for his family. But mostly Madoff talks about himself, the stress of running the fraud, and even insists he is quote "a good person."

BERNARD MADOFF, CONVICTED PONZI SCHEMER (via telephone): It was a nightmare for me, yes of course. Only for me.

COSTELLO: But he says, quote, "Look, imagine going home every night not being able to tell your wife, living with this ax over your head, not telling your sons, my brother. Seeing them every day in the business and not being able to confide in them."

Madoff is serving a 150-year sentence in a federal prison after admitting he ran the scheme for at least two decades. But he says quote, "Everyone was greedy. I just went along. It's not an excuse." Madoff says in his view, several hedge funds and banks were complicit. He believes many of his victims will get a substantial amount of money back, but he shows little sympathy for investors.

"These people would have lost all that money in the market. I'm not trying to justify what I did for one minute, I'm not."

Madoff maintains that his family new nothing about the fraud, and says his wife, Ruth, who initially stood by him, has cut him off.

MADOFF: She is angry at me, of course. How could she not be angry at me? You know, she tries not to be, but it's hard not to be. I destroyed our family.

COSTELLO: In December, Madoff's younger son, Mark, committed suicide. Madoff says, quote, "Let me tell you, I cried for well over two weeks. I cried and cried. I didn't come out of my room. I didn't speak to anybody and so on. I have tears in my eyes when I'm talking to you even. Not a day goes by that I don't suffer."

(END VIDEOTAPE)

COSTELLO: Madoff has harsh words for the SEC, too. He called regulatory reform a joke and he claimed that the whole government is a Ponzi scheme. Want to find out what Madoff's victims are saying about all of this? We have a former client with us right now. Richard Freedman joins us from West Orange, New Jersey. Thank you so much for joining us, Mr. Freedman.

RICHARD FREEDMAN, MADOFF VICTIM (via Skype): Yes, good morning. It's always something with Madoff.

COSTELLO: Oh, it was a bizarre interview. How much money did you lose?

FREEDMAN: I lost a lot of money. No point telling how much I lost at this point. I'm just going forward with my life. It was substantial. My mother, 85 years old and is currently being sued by the trustee, lost a tremendous amount of money.

It's very interesting that you have a person here who shuns publicity for 40 years and all of a sudden, he wants to become a media superstar. It is difficult to decide what is truthful and what is not since the last 40 years perhaps he lied through his teeth to everybody.

COSTELLO: Do you believe he carried his burden, this nightmare? This Ponzi scheme was a nightmare for him? And wow, it was tough. What do you think when you hear him say stuff like that?

FREEDMAN: Well, there is no doubt when you are carrying a Ponzi scheme with billions of dollars that there is pressure. I mean, it's in a sense, suffer in a nightmare (ph). Now he's in prison is with no pressure. So, the nightmare remains with the all the investors who lost all their money.

If there is any credibility, he should tell the trustee that he has proof that the arbitrage trades he did in the 1980s were actual trades. The trustee says he never traded any stocks ever. So, for him to establish credibility, that's what he has to do, show proof that he had these trades. I mean, after all, his sons, his wife and brother, all thought he was doing trading, and my God. They were so surprised that for 40 years he didn't trade one stock? That's very difficult to believe.

COSTELLO: Well, the interesting thing he said too is that he blames others and says there are other bad players out there, and they're not paying for it. So, I guess my question to him might have been, if there are other bad actors out there, why aren't you coughing up some evidence so that the SEC or regulatory agencies can go after them?

FREEDMAN: I agree with you. The problem is that Madoff has this culture in prison that he's a hero, that he went to prison without tattling on anyone else. And he has said that banks are complicit. The trustee supposedly has evidence to show which banks are involved, JP Morgan Chase, perhaps CitiBank.

So, I mean, the main problem I see going forward is that the American investor is not protected whatsoever. The trustee and (INAUDIBLE) has said you can't even depend upon your own statements that you get every month. If you don't have stocks, you can't rely on your statements. What is there to rely on? There's absolutely nothing. So nobody is safe.

In fact, there's legislation in front of Congress, HR-757, the Equitable Treatment of Investors Act, which seeks to reiterate the SIPA Act of 1970 which protected investors. They're no longer protected.

COSTELLO: Yes. I know, I know. A lot of people agree with you and a lot of people share your pain. And thank you so much for opening up for us this morning. We appreciate it. Thank you, Mr. Freedman.

FREEDMAN: Thank you.

COSTELLO: Actor Charlie Sheen opens up about the "Two and a Half Men" fiasco. He says he plans on suing CBS and Warner Brothers for breach of contract. Next.

(COMMERCIAL BREAK)

COSTELLO: Charlie Sheen is on a tear. After a rant last week, his show "Two and a Half Men" got the ax for the rest of the season. And this morning, he went on ABC's "Good Morning America" and said he was unapologetic and clean, but is on something.

(BEGIN VIDEO CLIP)

CHARLIE SHEEN, ACTOR: I am on a drug. It's called Charlie Sheen. And it's not available because if you try it once, you will die. Your face will melt off, and your children will weep over your exploded body. Too much?

(END VIDEO CLIP)

COSTELLO: Sheen also talked about hearing his No. 1 show had been cancelled for the season.

(BEGIN VIDEO CLIP)

SHEEN: I was actually disappointed because thought - you know, I think the mistake -- mistakes I made is that people misinterpret my passion for anger.

UNIDENTIFIED FEMALE: Stopping the show is costing an estimated quarter of a billion dollars all around --

SHEEN: It's going to cost them a lot more because they're on a battlefield. And they let their emotions and ego -- basically, they strapped on their diapers. And so, they're in breach. They're in radical breach. And sorry, guys. You screwed up.

(END VIDEO CLIP)

COSTELLO: I think he's going to sue. Delusional - delusions of grandeur. Extreme rage. Not commonly how you would describe an actor in Hollywood. Or maybe you would. But you know, let's go to Dr. Jeff Gardier because you know better than I about his behavior during this interview. It was disturbing.

DR. JEFF GARDIER, PSYCHOLOGIST: It was very disturbing. It really appears, Carol, that this is a guy who not only has a substance abuse issue, but he is also in the middle of a breakdown. He's in an acute manic phase.

He's got some real issues going on. Either he is going to end up in a rehab or psychiatric hospital. Either way, if he gets the medical attention, that's what we really want for him.

COSTELLO: He says he's not on any kind of drug, so is this just sort of some kind of -- maybe mental illness?

GARDIER: Well, we really don't know. This is what he's saying, and he's not a reliable reporter as we can see. This is a guy who is very, very delusional. I mean, I heard him say they are changing the name of Warner Brothers studio to Charlie Brothers Studio. He talks about having tiger blood and Adonis DNA. He is someone who is very, very delusional. It may be because he is still very high, and the drugs have done a number on his brain, and/or he has some underlying psychiatric issue, whether a bipolar issue being in that manic phase that I talked about. Or experiencing some sort of a deeper depression with psychosis attached to it.

But either way, he is very, very unbalanced mentally, as is obvious to you and the people watching.

COSTELLO: What's even more disturbing is he has a long history of bad behavior and he's gotten away with it. And his show continued to be a big number one hit on CBS. And those show creators did nothing. They didn't cancel the show. I mean, they sent him to get help every now and again, but what does that really mean? He is still on a No. 1 show, and he's still making gobs of money, and so is everyone else.

I mean, who is to blame here?

GARDIER: Well, this is the double-edged sword. This is a guy who we are very happy, who can still work and still make that money. But at the same time, the major studios enable these actors and actresses because they are making money. And, therefore, you really cannot get help for a substance abuse problem if you haven't hit rock bottom. You can't hit rock bottom if you're making a couple of million dollars per episode.

COSTELLO: Exactly. Dr. Jeff Gardier, thanksfor enlightening us today. We appreciate it.

GARDIER: Thank you, Carol.

COSTELLO: Police say an Arizona lawmaker was involved in a domestic violence incident, but he wasn't detained because he has immunity from arrest. That story next in our Political Update. (COMMERCIAL BREAK)

COSTELLO: It's getting a tad more tense, if that's possible, in the standoff between Wisconsin governor Scott Walker and union protesters. Our senior political editor Mark Preston is here with more on this. Hello, Mark!

MARK PRESTON, CNN SENIOR POLITICAL EDITOR: Hey, hello, Carol.

Yes, you know, Governor Scott Walker and Democrats and unions up in Wisconsin remain at odds over the whole issue of collective bargaining and his efforts to try to curb it. Yesterday, there was a deadline to move the protesters out of the state capital. However, the police relented and allowed them to stay another night.

But as we speak right now, there still seems to be no progress up in Wisconsin right now, Carol, between the governor and the unions and the Democrats.

Another group is weighing in in Wisconsin, though, Carol. They are running a campaign ad on 16 local television stations as well as statewide on cable, on CNN and Fox News. The Campaign to Defeat Barack Obama is applauding Governor Walker for taking a stand to fight for fiscal discipline. And in the ad as well, they are showing a clip from Massachusetts congressman, Michael, Capiano, who is quoted as saying, "Every once in a while, you got to get out on the streets and get a little bloody when necessary."

Now, Capiano, speaking about the issue in Wisconsin, has rescinded that comment, but the Campaign to Defeat Barack Obama has included it in this 60-second commercial. I should note that the Campaign to Defeat Barack Obama is part of the Tea Party Express. They're going to hold a presidential debate later this year, which will be broadcast here live on CNN. Carol?

COSTELLO: Interesting. So, tell us about the Arizona lawmaker who was involved in that domestic dispute.

PRESTON: Yes, this is one of the issues, Carol, which I think really just frustrates voters and people. But Arizona State Senator Scott Bundgaard avoided being charged after he got into an altercation with his girlfriend. Now, they were coming home from a charity event, a "Dancing With the Stars" fundraiser when she accused him of inappropriately touching his dance partner. He, of course, denies that.

But in the whole wake of it all, he said he was trying to push her back and stop her from hitting him, which resulted in her getting marks on her knees. Well, the police showed up, but they could never arrest him because he's a state lawmaker. The Arizona state constitution says that legislators are immune from arrest in all cases except for treason, phony (ph), and the breach of peace.

Now, I have to say that the state senator, Carol, has denied the fact that there was any domestic violence, and it's not surprising that the two of them have decided to break up and they're asking for privacy.

COSTELLO: No?

PRESTON: Oh, yes.

COSTELLO: That story is sad on so many levels.

PRESTON: Yes, no doubt.

COSTELLO: Mark Preston, thanks. We'll have your next political update in an hour. And a reminder, for all of the latest political news, go to our Web site, CNNpolitics.com.

Well, your child has a fever. Do you grab a pain reliever or not? We will separate fever fact from myth, next.

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COSTELLO: A lot of parents worry when their child has a fever and quickly reach for a pain reliever to bring it down. But a new report from America's leading group of pediatricians says this fever phobia may be getting in the way of properly treating children.

Senior medical correspondent Elizabeth Cohen is here to help us break down the myths and tell us what's true and not true. So, how should you treat your kid if your kid has a fever?

ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: Well, let's try to go over this in terms of myths and facts. I'll go over the first one -- I'll do the first one here.

You have to bring down a child's fever. Is that a myth or a fact? Well, it turns out that is actually a myth. That a fever - as long as your child is comfortable, you don't even have to treat that fever. That fever is doing its job. That's helping to recover them from their illness. There are a couple of exceptions here. One of the big ones is that a child under the age of two months who has a fever, you want to call the pediatrician. But over the age of two months, you don't necessarily need to contact the pediatrician.

COSTELLO: So, how high should a fever be before you become concerned?

COHEN: You know, there are no hard and fast numbers here. If you go to CNN.com/thechart, we have a couple more details about numbers on the Web site. But there's no hard and fast numbers. And what doctors want to you do is pay attention to things other than the number. Is your child alert? Do they have a rash? Are they having trouble breathing? Pay attention to those things rather than the actual number.

COSTELLO: Don't freak out, in other words.

COHEN: Right, right. Don't freak out.

COSTELLO: Let's talk about the proper dosage of medication, should you decide to give your child medicine.

COHEN: Right. Here's another myth and fact. We'll go over this one. And that is, is Tylenol is just as good as Advil in treating fever? Is that a myth or a fact? I know mommy brigade is always talking about that one.

Studies show, according to the American Academy of Pediatrics, that both are good. One is just as good as another. In fact, many doctors recommend alternating them when your kid is sick.

Again, something you really need to keep in mind here is that some products have Tylenol and Advil or ibuprofen and acetaminophen. Those are the technical names for them. You don't want to be double dosing that.

So, if you are going to be giving Tylenol and Advil, make sure you are giving just Tylenol, just Advil. A lot of products have different things in them. So, you want to be giving pure one or the other if you are going to give both.

COSTELLO: Gotcha. OK, so, what's the message we are supposed to be getting here from pediatricians about fever?

COHEN: Right. The message here is that a fever is what your child's body is supposed to do when they have a virus, and most of the time it is just a virus and that fever will help them recover. And things like Advil and Tylenol are meant to make them feel better. But if that fever doesn't come down, it's usually okay.

COSTELLO: Gotcha. If it doesn't come down for a couple of days, though, you should --

COHEN: Yes, yes. And you know what? It's always good to call the pediatrician if you as a mom or dad have that mom or dad instinct that something's not right. That this isn't just a regular old virus. Make the phone call.

COSTELLO: Oh, definitely. I mean, I don't have children, but I can only imagine if my two-year-old had a fever, I would be freaking out.

COHEN: Right. And parents do.

COSTELLO: Elizabeth Cohen, many thanks. We appreciate it.

Frightening moments for a family at a rodeo when an out-of-control bull jumps into the stands! See how this plays out, next.

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COSTELLO: Seems that anywhere and anytime, a camera is rolling, so you never know what you might just catch on tape.

Case in point, let's go to Massachusetts. Watch this driver create her own drive-thru lane at this coffee shop. She said she had just but on the brakes when the van suddenly accelerated. Ooh! Police call it an accident. She will not be charged, but she is pretty depressed.

Check out this dash cam video from the Fort Myers Police Department in Florida. Look closely. The officer is helping several ducklings that were a bit reluctant to cross the road. The officer said when he saw the baby ducks, he thought of his daughter. He said he could hear his daughter's voice saying, "Get out and save those ducks, Dad!". And that's just what he did.

Front row seats aren't always a good thing, especially if you're at a rodeo in North Carolina. Two spectators up front got a closer view of the action then they actually wanted. You saw why. The bull cleared that five-foot wall. One suffered a broken foot. The spectator, that it. The other suffered a bruised leg. They were scrambling to get out of the way! As for the bull, he actually went on with the show. He's just fine.

And a woman in Miami is recovering after a run-in with purse snatchers that could have turned deadly. Look at that! They nearly ran her over. It happened when thieves stole her purse from her car at a gas station. She confronted them, jumping in front of their car. Not really a smart move. Luckily, she was able to call for help after toppling to the ground.

That is unbelievable. Just let the purse go!

Now we head to Suzanne Malveaux for the 11:00 edition of NEWSROOM.

SUZANNE MALVEAUX, CNN ANCHOR: It's not worth it. Let the purse go!

COSTELLO: Let it go!

MALVEAUX: Carol, so nice to see you here.

COSTELLO: I'll join you in about five minutes.

MALVEAUX: OK, good. And dinner later! I'm expecting dinner.

COSTELLO: Absolutely!

MALVEUAX: OK. Good. Thank you.