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American Morning
Battle Lines Drawn at Taxes; Goldman Blasted in Financial Crisis Report
Aired April 14, 2011 - 07:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEO CLIP)
ALI VELSHI, CNN ANCHOR (voice-over): Another air traffic controller accused of sleeping at the switch, this time, as a medical flight carrying a sick patient tried to land. Now, the FAA is making changes, giving these guys some company on the overnight shift, on this AMERICAN MORNING.
(END VIDEO CLIP)
KIRAN CHETRY, CNN ANCHOR: I guess they're going to hedge their bets if they put two people in there, one has to stay awake, hopefully. Wow. A lot of trouble, of course, brewing there. We'll have more on that on this Thursday. It's April 14th. Glad you're with us on this AMERICAN MORNING.
CHRISTINE ROMANS, CNN ANCHOR: Yes, good morning. Also new this hour, President Obama unveils his long awaited deficit reduction plan. We're going to show you how his plan stacks (ph) up against what Republicans have proposed.
VELSHI: Plus, LensCrafters taking on Minnesota Congresswoman Michele Bachmann. Find out why the eye care company is not happy with her choice of words in her attacks against Planned Parenthood.
CHETRY: And a story that has a lot of people talking. Just days after a toddler in Detroit, at least according to his parents, was served tequila at an Applebee's, another mom claims her son was served alcohol at another popular restaurant chain. What the heck's going on?
VELSHI: All I know is there a lot of toddler asking their moms if they can go to chain restaurants now.
ROMANS: We begin with a wake-up call for the FAA, officials ordering an immediate end to the practice of having just one air traffic controller on duty during the overnight. They're adding a second controller at 27 towers across the country. That's in response to the latest incident of an air traffic controller falling asleep on the job. It happened in Reno, Nevada.
CNN's Jeanne Meserve is live in Washington. Jeanne, what happened in Reno?
JEANNE MERSERVE, CNN HOMELAND SECURITY CORRESPONDENT: Well, this happened early yesterday. The flight was coming in to Reno from mammoth lakes, California, with a critically ill passenger. The pilot tried to reach the tower not once but seven times. The controller slept through it all. Here's part of the pilot's conversation with a regional controller.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Yes. We're here.
UNIDENTIFIED MALE: You weren't able to get through to the tower?
UNIDENTIFIED MALE: No.
UNIDENTIFIED MALE: We're going to call them on the phone line.
UNIDENTIFIED MALE: All right. We'll circle some more.
UNIDENTIFIED MALE: OK.
UNIDENTIFIED MALE: We've got a pretty sick patient. We may just have to land whether we have clearance or not.
(END VIDEO CLIP)
MESERVE: And they did. And the official said the delay did not hurt the patient. The secretary of transportation calls the episode "inexcusable," but he might wish he had used different word.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: I guarantee the flying public we will not sleep until we can guarantee that there's good safety in the control towers when these planes are coming in and out of airports.
(END VIDEO CLIP)
MESERVE: And the Federal Aviation Administration immediately made changes putting two controllers in 27 towers that been had staffed with only one on overnight shifts. But Congressman John Mica was harshly critical, saying only in the federal government would you double up on workers averaging $161,000 per year in salary and benefits that are not doing their job. Christine?
ROMANS: You can see the point. I mean, they should be doing their job. If you need to put $161,000 babysitter in with them, that's a problem.
VELSHI: More people work the night shift. The understanding is you is to stay awake to do your job.
ROMANS: Can we assume there are others?
MESERVE: Yes, we can. The FAA disclosed that there were two additional controller screw-ups in recent weeks. A controller in Seattle fell asleep during his morning shift on April 11 and two in Lubbock, Texas are in suspension for failing to hand off the control of a departing aircraft and being late taking control of an inbound aircraft. So the number of these incidents keeps going up.
ROMANS: Jeanne Meserve, thanks.
CHETRY: This could have gotten bad. You heard the patient say the patients pretty sick. And they had already circled for 60 minutes. If you're talking about a heart attack or stroke, where every second counts --
VELSHI: There are also fuel issues on plane. Sometimes planes don't plan to circle for a long time if they can't get down.
CHETRY: North Korea has identified an American they have in custody. American citizen Jun Yungsoo was arrested back in November of last year for entering North Korea for committing a crime against the nation. They go on to say he will be indicted. They're not saying what this alleged crime is. They say he's a Korean-American businessman. They're working with the Swedish embassy in Pyongyang since there are no diplomatic ties between the two countries.
VELSHI: OK, $4 trillion in cuts, President Obama laying out his most ambitious plan yet to slash the massive national deficit including something once considered untouchable, Medicare. Also he wants to erase the Bush tax cuts for the heist tax brackets.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The past decade, the average income of the bottom 90 percent of all working meshes actually declined. Meanwhile, the top one percent saw their income rise by an average of more than a quarter of a million dollars each. That's who need to pay less taxes?
(END VIDEO CLIP)
VELSHI:. As you can imagine, that has the GOP fired up this morning. A new A.P. poll shows 54 percent of Americans think the taxes they pay are fair or somewhat fair. Most don't want them going up. Just 29 percent say raising taxes -- say to raise taxes to fix the deficit, 62 percent say cut government programs instead. This is, of course, the battle of the ages.
Ed Henry live as in person with us right now, our senior White House correspondent.
ROMANS: It is the battle of the ages. We're writing history right now. How the U.S. and its role in the world turns out depends on how well they can do this.
ED HENRY, CNN SENIOR WHITE HOUSE CORRESPONDENT: And the president has been criticized for being on the sidelines for this. Yesterday he stepped up. But the question is will he have the guts moving forward to bring both side to come to some sort of an agreement and make some of these tough choice.
He said we're going to keep domestic spending low, although in the next breath he talked about spending new money on all kinds of other program like education, high speed Internet. He talked about cuts in the defense budget but then said look, we'll have to have a review at the Pentagon to see how much we can cut. Immediately Robert Gates said can't cut too much or we can't cut too much or we'll have problems there.
You saw another issue popping up right away. But then Medicare and Medicaid savings, but immediately the president was casting himself as protector of senior citizens, saying that Paul Ryan wants to invent Medicare as we know it.
And finally he said let's repeal the Bush era tax cuts, although, reality check here, the president had a chance to do that in December when they had the big tax deal and he declined to do it. He did not politically have the votes in the Senate to stop the Bush era tax cuts from continuing, those tax rates.
Paul Ryan, the Republican who laid out his plan a couple weeks back, was pretty fired saying he thought this speech was a lot more partisan than expected.
(BEGIN VIDEO CLIP)
REP. PAUL RYAN, (R-WI), BUDGET COMMITTEE CHAIRMAN: What we heard today was not fiscal leadership from our commander in chief. What we heard today was a political broadside from our campaigner in chief. I guess it's no coincidence that last week when the president launched his billion-dollar re-election campaign was the week we launched our effort to try to get this debt and deficit under control and get our economy growing.
(END VIDEO CLIP)
HENRY: Now, when you talk to White House aides, they laugh off the idea that the president had a partisan blast here. They say he's been attacked for weeks and weeks for not getting in the game. He gets in the game, people beat him up.
They say bottom line his approach was put a choice out there. The Republican have their plan on the table. They've been demanding the White House to do it. They think this is a more balanced approach than the Republicans'.
CHETRY: He also said this is a democracy. I don't expect that what I'm putting out here is what it will end up --
HENRY: There's a lot of heavy lifting to do. He deputized Vice President Joe Biden to basically go up to Capitol Hill in early May, meet with Democratic the Republican leaders and start making these tough choices.
You got the left saying we don't want more spending cut, the right saying any sort of tax increase is dead on arrival. Got news for you, you got to do a little of both or you'll never solve the problem. He's giving the vice president to end of June to get a deal. That's pretty ambitious.
ROMANS: We keep saying $4 trillion in cuts but for every $3 in cuts he wants $1 in tax increases. So it's getting new revenue --
VELSHI: Which economic speaking is probably the formula that we're going to have to go with.
ROMANS: That's why they say balanced. They say the Republicans just want to cut spending. That's the ideological battle here. One side wants tax increases included and the Republicans want to cut spending.
HENRY: You don't have enough money to put a dent in the deficit if you only do one or the other.
ROMANS: The national debt, no matter what, just keeps going up. We're talking about cutting deficits. But we're still adds to the debt all the way.
VELSHI: One final question. If we can have Ed on camera three for a second. Were you in my closet this morning?
(LAUGHTER)
HENRY: I wore this, I had to run into --
VELSHI: The pocket square with circle on it, a striped suit and a differently striped tie.
ROMANS: All the same Easter egg.
HENRY: Is that a shot or is that a positive thing?
ROMANS: That's good this time of year.
CHETRY: I want you to stick around for this one as well. You just mentioned the vice president getting tasked with this new trying to bring all sides together on this. I don't know if he knows that this morning. It appeared that he was sleeping when all this was announced.
This is Vice President Biden seeming to be nodding off, actually, while president Obama was outlining his plan for dealing with the deficit. To make it worse, this is when the president made that announcement that he's going to have a new job, that Biden would be meeting with the lawmakers.
VELSHI: He's doing better than the woman behind him.
CHETRY: Then the woman to his left behind him, right behind Tim Geithner.
HENRY: Tim Geithner looks earnest. I thought about this when I was in Ali's closet this morning picking out his suit.
(LAUGHTER)
I think there is only one explanation is that last year when the vice president and the big presidential event like this over the health care signing and the vice president said it's a "big bleeping deal." I think the vice president made a statement yesterday. He doesn't think this budget is a big deal.
CHETRY: Or else he can get in less trouble.
HENRY: If he's sleeping. The other thing is, and I want to be careful with this one, but if this vice president thing doesn't work out, the FAA is always looking for people.
VELSHI: Ouch!
(LAUGHTER)
VELSHI: Vice President Biden is not first one. There's a history to people nodding off. A couple years ago, president's chief economic adviser Larry Summers, remember this, he fell asleep during a very high profile meeting.
ROMANS: There's so much going on in his brain, he has to shut down.
HENRY: That might be yoga, he might be meditating. Larry Summers doing hot yoga.
(CROSSTALK)
ROMANS: Here's another political story I want to talk to you about. A Lens Crafters this morning telling Congresswoman Michele Bachmann to back off. She used the one stop shop for health care in a speech against Planned Parenthood. It's not the first time she's made this particular comparison. Listen.
(BEGIN VIDEO CLIP)
REP. MICHELE BACHMANN, (R) MINNESOTA: The executive director of Planned Parenthood in Illinois said they want to become the Lens Crafter of big abortion in Illinois. This organization has now become a big box retailer, big abortion, in other words.
The executive director in Illinois for Planned Parenthood said, we want Planned Parenthood to be the Lens Crafters of big abortion.
(END VIDEO CLIP)
ROMANS: Well, now the problem is this. Bachmann's actually misquoting the CEO of Planned Parenthood, Illinois, who once said in an interview, "I like to think of it as the Lens Crafters of family planning." Michele Bachmann substituted "big abortion" instead of "family planning."
VELSHI: A big difference.
ROMANS: There is a huge difference, although maybe not to Michele Bachmann and maybe not to people who are incredibly conservative. Meantime, Lens Crafters is saying just leave us out of it, please. They say Bachmann's using their name without their knowledge or permission. There's a difference between big abortion and family planning.
VELSHI: Yes, sure.
CHETRY: But you can use Lens Crafters' name all she wants. Misquoting the person from Illinois is perhaps more troublesome, but politicians use trademark names all the time.
ROMANS: Right.
VELSHI: They just feel it's misrepresenting them.
A Florida mom says has hired an attorney after her two-year-old son was mistakenly served a glass of sangria at Olive Garden. The restaurant chain has apologized for the March 31 incident, blaming an employee which failed to follow proper procedures, which included not serving kids sangria.
CHETRY: He looks happy.
VELSHI: He was having a good time. The mother noticed that the toddler was acting strangely after finishing most of the drink. The child was taken to a hospital, checked out and everything was OK.
ROMANS: The NBA's fining Kobe Bryant $100,000 for using a gay slur during a game last night. He was caught on camera yelling it at a ref also with an expletive after he was called for a technical foul. Bryant released a statement saying he said it out of frustration and he didn't mean to offend anybody.
CHETRY: A San Francisco jury has convicted Barry Bonds of one count of obstructing justice, but they did not reach a verdict on three perjury charges against baseball's homerun king. So the judge declared a mistrial on those counts. A sentencing date on the obstruction conviction is set for next month.
VELSHI: And by the way, we've got more baseball stuff coming up with Ed Henry in the 8:00 hour. He has the fantastic story of the decision that led Jackie Robinson to be the first African-American to play in baseball.
ROMANS: The latest on a search for a serial killer in suburban New York. It's about to go high tech.
VELSHI: A scathing report puts the white hot spotlight on Goldman Sachs, saying it was part of the financial snake pit that brought the economy to its knees.
CHETRY: Also, what you had to say about the J. Crew ad with the little boy wearing pink toenail polish. Your emails are ahead. It's 13 minutes past the hour.
(COMMERCIAL BREAK) CHETRY: All right. Sixteen minutes past the hour. Welcome back to AMERICAN MORNING. Time to check in with Reynolds Wolf.
I know that you're talking about some tough weather, especially in Texas today.
REYNOLDS WOLF, AMS METEOROLOGIST: Exactly. You know, Texas is really going to get a very different weather in different parts of the state. Out towards the west, it's going to be the big threat of wildfires. Very, very low humidity. At the same time very strong wind gusts could really fan the flames for fires that still rage as we speak.
But on the eastern side of the state, once you get north, east of Dallas, Fort Worth and then back into the Red River, we're talking about the possibility of some strong thunderstorms, perhaps even some tornadoes late into the afternoon, into the evening and they may even spill on over into tomorrow's forecast.
Into parts of the central Rockies, the northern Rockies, snow continues to fall. Same story for parts of the cascades. Eastern seaboard looks just delightful. Plenty of sunshine from New York's southward to even Florida. Looks pretty good even for the Florida Keys.
Highs today -- 79 in Atlanta, 75 in St. Louis. Sixty-five, the high for Albuquerque, 60s for San Francisco, 46 in Seattle, Boston 51, and Chicago with 55, your expected high.
All right, guys. More forecasts coming up. In just a few moments, we're going to hone in really on the chances for severe weather not just for today, for tomorrow in our next update. See you then.
VELSHI: OK, Reynolds. Thanks for that.
Coming up next, Italy's embattled Prime Minister Silvio Berlusconi on trial for allegedly paying an underage teenager for sex. Dropping a bombshell about his political future.
CHETRY: And the economy is still fragile, but one big bank just announced record earnings and huge raises to go with it.
Eighteen minutes past the hour.
(COMMERCIAL BREAK)
ROMANS: Welcome back to AMERICAN MORNING. Time to talk taxes. We're not talking about filing your returns. We're talking about tax increases.
If the president has his way, the country's very top earners, families making more than $250,000, they'll see a return to higher taxes. That's shaping up to be the main battle in the budget war. It's getting underway in Washington. Presidential adviser Gene Sperling is with us this morning. He's the director of the National Economic Council. He's at the White House this morning.
Gene, good morning.
GENE SPERLING, DIRECTOR OF THE NATIONAL ECONOMIC COUNCIL: Good morning, Christine.
ROMANS: It's been a big couple of days. The president unveiling what he wants to do to get the nation on a more sustainable path in terms of these big debts and big deficits. It's clearly going to be a fight about taxes, too. The Republicans saying it's a nonstarter to raise taxes on the rich. Are you ready for this fight? And will he compromise?
SPERLING: You know, we don't want to have a fight. What we want to have is put forward a comprehensive $4 trillion deficit reduction plan that is balanced. And the plan that the president put forward asked for $3 of spending cuts including cutting our interest payments for every dollar of revenues that would be raised through bipartisan tax reform. You have to have a sense of balance and shared sacrifice when you're doing deficit reduction. If not, it's just too difficult to ask all sorts of Americans to tighten their belt.
And then at the same time say, while we're getting savings from you, we're not really using those savings to lower the deficit. We're using those savings to help us borrow more to get the most fortunate among us a larger tax cut. And that's just not something the president thinks is fair or right or the type of shared sacrifice that we've ever seen when you've had a bipartisan deficit reduction plan.
ROMANS: You talk about tax reform. So what if part of that is raising -- is getting rid of those Bush era tax cuts, as people like to call them. Although some budget folks call them Bush/Obama tax cuts now, because the president has already extended them once. Getting rid of that, maybe going to a simpler tax code. What does tax reform look like and do middle class Americans pay higher taxes?
SPERLING: No, the president has cut taxes for people under $250,000 and in fact, today, Americans are benefiting from the fact that the president proposed, passed and signed a payroll tax cut that is lowering taxes by about $1,000 for the typical family today this year.
ROMANS: Right.
SPERLING: Which has been a big help for helping people deal with higher gas costs and really helping this recovery. So the president's plan and what he's done has been cutting taxes for people under 250,000. But he just does not believe we can afford to extend the tax cuts for people who are making a million dollars and more on average.
ROMANS: Are there small businesses in that group? Because what you hear from the right and when you hear from people who are opposed to higher taxes is small businesses are going to get nailed? Is it going to hurt small businesses?
SPERLING: You know, just not true. In fact, the president's cut taxes 17 times for small businesses. And in fact, in December, not only did he do a payroll tax cut, but he put forward for the first time a plan that allowed 100 percent expensing for any small business or large business that's going to invest in the United States today. That's affecting four million or five million small businesses that's very helpful.
What we're talking about is asking those who are doing the best, who've had the highest income gains to just be part of an overall comprehensive deficit reduction plan, to just do their share, their part --
ROMANS: Right.
SPERLING: -- in a program of shared sacrifice that in purpose of shared prosperity that would benefit everyone if we increase confidence that we can live within our means and encourage investment on our shores.
ROMANS: Well, live within our means is the tough part here because when you look at the Ryan plan, you look at the current trajectory, you look at the president's plan, we still have $14 trillion national debt that gets bigger and bigger. When you're cutting deficits, you're cutting -- it's almost like a double negative. You know, I mean, we're bending the curve maybe on how fast we're growing our national debt, but we still have an awful lot of work to do and meanwhile, a fight about the debt ceiling. What is the president prepared to give up to get -- to make sure that everyone goes along and raises the debt ceiling?
SPERLING: You know, I think every leader in Congress has been responsible in making clear that, of course, we're going to extend the debt limit. In other words, of course, America is going to meet its obligations. America is not going to put itself on a path to default.
I don't think any responsible congressional leader, certainly not the president would even think about that. But the president also believes that at the same time we need to show that we can get our House in order. And what he'd like to do is just make clear at a minimum, that we are bringing our debt down as percentage of our economy. That's very important to give confidence not just to the public but to markets, to investors that America is still a solid, secure place to invest in, to create jobs in, to be part of an economic expansion.
ROMANS: All right. Getting our debt down as a share of our economy is certainly something that has to happen for our investors, our international investors, our partners, allies, and the future of the country. How to do that though is the political problem.
Gene Sperling, thank you so much from the White House. Best of luck to you.
SPERLING: Thank you. Thanks. ROMANS: Back to you guys -- Ali.
VELSHI: Thanks, Christine.
Just ahead on AMERICAN MORNING, we're going to tell you which companies promising to make your home Internet almost 60 times faster.
CHETRY: Wow. All right.
Well, also, one golden child of Wall Street. Goldman Sachs now getting blasted for misleading investors and the government about its financial dealings before the crisis. We'll have more on the story as well.
VELSHI: Twenty-five minutes after the hour.
(COMMERCIAL BREAK)
CHETRY: All right. Crossing the half hour right now.
Goldman Sachs is getting slammed in a Senate report for its role in pushing the country into the deepest recession since the Great Depression. Our Stephanie Elam is "Minding Your Business" now.
We're talking about record profits when people were really struggling at the heart of the financial crisis, but did they really do anything illegal or wrong?
STEPHANIE ELAM, CNN BUSINESS CORRESPONDENT: According to this panel, it's a 600-page document that they came up with, and as far as they're concerned, yes, they did do things wrong. And you know, when you look at it, they call it a case study of recklessness and also greed on Wall Street. And they mentioned Deutsche Bank, but they really focused in on Goldman Sachs and talking about the things that they did.
Basically, they're saying that they misled clients. So take a look at some of the ideas that they're giving here. They're saying that they're accusing Goldman Sachs of selling mortgage securities but at the same time betting against those mortgage securities so that they would actually still make money on them on the other side. They also believe that while they say a third party was involved in the pricing of it, that all of it was done in-house internally at Goldman Sachs. The other thing is they believe that Goldman Sachs also misled Congress and gave inaccurate testimony. Obviously, that would be a problem as well.
And so you look at Goldman Sachs, keep in mind they've already paid a record fine of $550 million. That was for a transaction they made in 2007. They paid that to the Securities and Exchange Commission in July. But overall here, they're saying that the problem with Goldman Sachs has been chronic. It's been a chronic problem that needs to be addressed. And also, Senator Levin saying, you know what? They have just not acted as quickly as they should about the SEC. We're still going to point out any of the areas where there could have been conflict and let the SEC know about it and the Justice Department in case they need to go after that. Of course, Goldman Sachs saying they believe that they don't agree with all these cases.
VELSHI: Right.
ELAM: But they're trying to have more transparency.
CHETRY: Right. But is there any teeth to actually making them change their ways? I mean, is government --
ELAM: From this panel, it's not going to come from this.
CHETRY: Right.
ELAM: It has to go to the SEC and the Justice Department.
VELSHI: Right.
ROMANS: And this is Carl -- this is Carl Levin's Senate subcommittee, is that right?
ELAM: Yes.
VELSHI: Right. Remember that -- remember that vote?
ROMANS: That was the amazing image between Lloyd Blankfein, Carl Levin --
VELSHI: One of the few Senate hearings that was actually interesting to watch.
ROMANS: Thirteen hours?
VELSHI: Yes.
ROMANS: I remember nine hours in, guys, they were still locked in battle these two. So this is Carl Levin with his, I guess final report.
ELAM: 600 pages of it.
Let's also look at the markets yesterday. A quick check for you. Let you know what's going on. The Dow up seven points, but hey, it was up. NASDAQ better and the S&P 500 better as well. It actually started off good because we had a good numbers coming in yesterday from JPMorgan Chase, but then that kind of faltered. And the president came out with his deficit plan.
KIRAN CHETRY, CNN ANCHOR: Wall Street liked it.
ROMANS: Wall Street liked it. Because they say in the (INAUDIBLE) finally in Washington getting about getting out the scissors.
(CROSSTALK)
CHETRY: That's right.
VELSHI: All right. Stephanie, thanks.
ELAM: Thank you.
ROMANS: Another air traffic controller caught sleeping on the job. This time it happened in Reno, Nevada. An air ambulance carrying a sick patient got no response from the tower was forced to land on its own. The FAA says effective immediately they're putting two air traffic controller in 27 towers across the country that previously had just one on the overnight shift.
Treasury Secretary Tim Geithner says he believes Congress will vote to raise the nation's debt ceiling by June. Many Republicans are saying they won't do it without major reforms in government spending without big strings attached. But Geithner says lawmakers know the stakes are too high to play politics.
(BEGIN VIDEO CLIP)
TIM GEITHNER, U.S. TREASURY SECRETARY: A letter to Congress a couple of weeks ago. We have into June to solve this basic problem. We don't have much more time beyond that. Again you don't want to do and again I think the leadership in both Houses recognize this, you don't want to take it to close to the edge. Because you don't want to call into question the commitment of the United States and its ability to meet its obligations.
(END VIDEO CLIP)
ROMANS: And a source close to Donald Trump says tune in to the season finale of "Celebrity Apprentice" on May 15. That's when the Donald plans to reveal a date for a big announcement, maybe about his plans to run for president.
VELSHI: Sounds like a ratings trick to me.
(CROSSTALK)
ROMANS: With Trump you never know if politics, ratings or --
VELSHI: Don't do it on the "Apprentice." There's something wrong (INAUDIBLE) when you're announcing on television.
CHETRY: Wait, who announced on late night. Somebody announced on late night as well.
VELSHI: Do you know the answer to this one?
CHETRY: No, it was a rhetorical question.
What did you say?
VELSHI: Was it Ron Paul? That's why we have excellent producers to tell us these things.
All right.
CHETRY: Thanks, Jim.
VELSHI: The search for a serial killer on Long Island is about to go high tech. Starting today FBI planes and helicopters will be flying above the suburban New York beaches. They'll be shooting high resolution aerial photos where at least eight separate sets of human remains have been found.
Allan Chernoff joining us live from Long Island's Oak Beach this morning. Allan, we were just speaking to a former Long Island police officer who says the landscape around there makes this more difficult than people who don't know about it would imagine it to be.
ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: Oh, indeed. Very tough. The investigators have to wear special outfits. There's lots of poison ivy and bramble. It's not easy at all.
Ali, this investigation started with the disappearance of this woman Shannon Gilbert. She disappeared about a year ago, May 1st last year. She has been working as a prostitute and had visited a client not far from where we're standing right now. Now, that night she went to a home begging for help, begging for assistance.
Since that night, she has not been found anywhere. She has not been identified either. Of all those remains that have been uncovered. We spoke yesterday with a man, the homeowner who saw her that very day. And he told us that it was months before the police actually questioned him.
(BEGIN VIDEOTAPE)
GUS COLETTI, RESIDENT OF OAK BEACH, NEW YORK: Missing persons detective came here like in August and was asking about her. I said "Where have you been?" He said, well the kind of thing of New Jersey Police Department didn't take them --
CHERNOFF: They didn't come. She was missing May 1st.
COLETTI: Yes.
CHERNOFF: But the police didn't come to visit you until August?
COLETTI: That's correct.
CHERNOFF: Nothing. May, June, July, finally in August.
COLETTI: Right.
CHERNOFF: Four months.
COLETTI: Right. And that was missing persons.
CHERNOFF: You called the police immediately.
COLETTI: Well, they came in here. But as far as investigating it, no.
(END VIDEOTAPE)
CHERNOFF: The police say they did question Mr. Coletti. They have questioned him several times since May 1st. They also say they did receive a written statement from him in June, the month after Ms. Gilbert disappeared.
Ali?
VELSHI: All right. Allan, thanks very much.
This is just captivating people, the story. And we appreciate you being out there for us. Allan Chernoff in Long Island.
CHETRY: Also new this morning, we're following the latest with Libya as well. It's what we were not told. The Pentagon acknowledging that U.S. war planes are still bombing Libya. A military spokesman tells CNN that the U.S. have flown 97 sorties since the NATO handover. Most were support, refueling and for signal jamming but on at least three occasions U.S. jets have fired on targets.
VELSHI: Italian Prime Minister Silvio Berlusconi says he is not running for another term in 2013. He told reporters at a dinner earlier this week he wants to change Italy's judicial system and Constitution, and then he plans to step aside. Berlusconi's involved at the moment with Italy's judicial system. He's facing trial for allegedly paying for sex with an underage prostitute.
ROMANS: Heavy rains leaving parts of Cape Cod under water this morning. Cars stuck in deep puddles, partially submerged in the town of Falmouth. Eight Massachusetts counties are now under flood watches, warnings or advisories. Drive carefully.
CHETRY: And if you use Comcast for your internet at home, it's getting a whole lot faster. The company is getting set to announce a new residential service called Extreme 105. What is that? Well, they say it can transmit internet data faster than 60 times faster than a typical T-1 line. It will be available in some 40 million homes nationwide.
ROMANS: Remember we just had a phone line?
CHETRY: Yes.
VELSHI: I have to say, I don't quite know -- I hear it's fast, but I'm not sure how much faster than T-1 line means. You know (INAUDIBLE) Comcast has been very creative. They renamed all their resident services Xfinity a year or a year a half ago. I remember thinking what on earth does that mean and now they're calling it this -- whatever they're calling it now. They really have been quite cutting edge about this fast internet to your house in the face of Verizon and Fios. I guess I should move on to something else?
ROMANS: I guess you like technology stories.
VELSHI: I do. But I like politics stories as well. Up next, two college students who are trying to use Facebook and a web site to change the course of the 2012 presidential election.
ROMANS: OK. Speaking of technology, are you dreaming of a white iPhone? Well, your wait finally may be over.
CHETRY: Or maybe not.
ROMANS: We talked about this. Everyone wants a white iPhone. We'll tell you when it's coming and how you can get it?
VELSHI: I think we're hinting that it's coming. That banner says white iPhone coming soon.
ROMANS: I think -- we're going to tell you it's coming.
VELSHI: It's coming. Trust me, it's coming. But tune in anyway.
37 minutes after the hour.
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CHETRY: 40 minutes past the hour. Welcome back to "American Morning."
A couple of college students at Yale University are trying to single-handedly influence the 2012 presidential election. And what they're doing is they're using the internet and Facebook to spread the word on campuses across America about a potential candidate in Indiana who hasn't even decided to run.
Our Jim Acosta joins us in Washington with more on this story. Hey, I mean, 2008 became the year of launching campaigns on the internet.
JIM ACOSTA, CNN CORRESPONDENT: That's right.
CHETRY: So what's next?
ACOSTA: Here we go again, Kiran, and not a moment too soon. The mounting national debt we've been talking about that for weeks, well, it has younger voters already thinking about the presidential race in 2012. And no surprise as you said they are taking to social media. Twitter and Facebook, where some have already fallen for a little known governor from Indiana.
(BEGIN VIDEOTAPE)
ACOSTA (voice-over): It might be a stretch to call him the big man on campus. But Indiana Governor Mitch Daniels is getting some presidential buzz at colleges across the country. Thanks to Yale University students, Max Eden and Michael Knowles, founders of the Students for Daniels web site and Facebook page.
(on camera): How quickly did that take off? MAX EDEN, STUDENTS FOR DANIELS: I mean we went from 20 to a thousand people in a couple of weeks.
MICHAELS KNOWLES, STUDENTS FOR DANIELS: Yes. The really incredible thing has been You Tube.
ACOSTA (voice-over): As in their You Tube video about their search for a Daniels for President campaign slogan, starring a certain eccentric ex-candidate governor of New York.
UNIDENTIFIED MALE: Debt is dangerous but wait a minute.
UNIDENTIFIED MALE: The debt is too damn high.
ACOSTA: The result, nearly 60 colleges now have students for Daniels chapters all dedicated to his message on the national debt.
GOV. MITCH DANIELS (R), INDIANA; It's the new red menace this time consisting of ink.
ACOSTA: Max is a former Obama volunteer who says he has traded in the president's campaign message of hope for solvency.
EDEN: It's not hope. It's not change, it's solvency. It's like basic math.
ACOSTA: Then there's election math. When President Obama carried roughly two-thirds of the youth vote in 2008 Frank Costa and Danielle Thomson were on board. Frank still is.
FRANK COSTA: I do still support Obama.
ACOSTA: Danielle, not so much.
(on camera): You were an Obama supporter in '08?
DANIELLE THOMSON, FORMER OBAMA SUPPORTER: Yes. A registered democrat, still am for that matter.
ACOSTA: But he's lost you a little bit?
THOMSON: I think he's lost a lot of us.
ACOSTA (voice-over): As for the movement to draft Daniels, there's one problem. He may not run.
DANIELS: I've been more affected or moved, I guess you'd say, by their activities than any of the others. Given my thoughts about the condition of the country, this appeal from younger people made more of an impression on me than anything else.
ACOSTA: Meanwhile these campus candidate crushes are spreading. One just popped up for Mitt Romney.
UNIDENTIFIED MALE: Can we afford to graduate into this economy?
UNIDENTIFIED MALE: No, we can't.
(END VIDEOTAPE)
ACOSTA: Now back to Mitch Daniels. He has a mixed fiscal record, something the college students also admit.. He was George W. Bush's budget director when the deficit went up, but later on as governor he put Indiana's fiscal -- financial house in order. Daniels says he'll have an answer on running for president after the end of the month.
And Kiran, one thing that struck us when we talked to Governor Daniels yesterday was that he's really impressed by these younger students. And he used the word reciprocate. He wants to reciprocate in some way. He wouldn't tip his hands in term of what he's doing in terms of his presidential ambitions but it sounds like he's getting serious.
CHETRY: That's really interesting. I mean, stranger things have happened, right?
ACOSTA: That's right. Absolutely.
CHETRY: All right. Jim Acosta for us this morning. Thanks.
ROMANS: All right. Still to come on "American Morning," the economy's still fragile but one big bank has announced record earnings and huge raises. The banks are back.
VELSHI: And a new J. Crew ad showing a mother with her young son who is wearing pink toenail polish has sparked a debate on child gender identity. We asked you to weigh in and we're going to read your e-mails just ahead.
It is 44 minutes after the hour.
(COMMERCIAL BREAK)
VELSHI: A lot going on this morning. Here's what you need to know to start your day.
(BEGIN VIDEO CLIP)
VELSHI (voice-over): Another air traffic controller accused of sleeping at the switch. This time as a medical flight carrying a sick patient tried to land in Reno. That controller suspended while the FAA investigates.
Former Senator Rick Santorum of Pennsylvania took his first step toward running for president. Announcing he has formed a presidential exploratory committee.
How big was your raise this year? Because bankers at J.P. Morgan Chase are reportedly in line for a 34 percent raise after posting record first quarter earnings.
What if you could predict the traffic like you predict the weather? A team of researchers at IBM say they're working on a computer that will predict traffic use in the future. It uses past databases of traffic patterns and sensors that are embedded in roadways throughout California already.
No more going to the black market for a white iPhone. Apple says it will start selling the elusive white iPhone 4 in the next few weeks following a ten-month delay.
(END VIDEO CLIP)
VELSHI: Well, you're caught up on the day's headlines. AMERICAN MORNING is back in 60 seconds.
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ROMANS: All right. Well, I hope wherever you live, you're going to have a nice day for the weather. Let's check in with Reynolds Wolf and find out if indeed that's the case. Good morning, Reynolds.
WOLF: Guys, it's going to be great for parts of the northeast, the eastern seaboard all the way into the south eastern U.S., but for many of you head out and about going to airports, you might be a little perplexed as what might await you in terms of travelling.
Well, in Chicago you've got the wind that could keep you grounded for a half hour to a full hour. Las Vegas wind will also be an issue. In Denver and Seattle, low clouds and showers, but notice Dallas and Houston, low clouds, thunderstorms, possible delays up to an hour.
Now why would that be, especially in Dallas? The reason is pretty simple. We've got a decent shot of strong storms at least a moderate risk now for parts of Texas, Oklahoma, Kansas even a little sliver of Missouri and Arkansas.
With that you've got a chance of strong storms without the potential tornados that will extend not just into today, but as we fast forward into tomorrow, we're going to see that possibility develop into Alabama, Mississippi and even Tennessee, again a moderate risk posted by the Storm Prediction Center. This could involve some tornadoes.
A very classic setup that we all could see this time of the year, things very volatile, Gulf of Mexico wide open. With that storm system coming across from west to east, there will be a chance of those tornadoes.
Another big weather story we've been following is on towards the west, West Texas, the wind has been howling with that very low humidity with the strong winds and with that low humidity, we have a chance of those fires that have been out in West Texas to spread even a bit more so certainly a rough day for the firefighters.
That's a quick snapshot of what we can expect weather wise around the nation. We've got more coming up right here on AMERICAN MORNING, the Most News in the Morning. (COMMERCIAL BREAK)
CHETRY: It's 53 minutes past the hour, welcome back to AMERICAN MORNING and we've a lot of response on this controversial J Crew ad.
Well, some thought it was controversial, others thought it was silly, but it is a little boy and his mom. He is wearing pink toenail polish.
In the ad, the mom has a caption that says, lucky for me I ended up with a boy whose favorite color is pink. So here is a look at of what you are saying.
Jen writes, it's ridiculous that this is even an issue. Guess what? Little boys like nail polish, just as little girls like nail polish, because it is colorful and fun! End of story. Why not let little boys do what makes them happy without having to put labels on their behaviour?
VELSHI: Aretha writes, whatever your sex, your child is please teach them it is not cool to put on lipstick, fingernail polish, makeup, anything adult's do until they're of age to make decisions for themselves. Point blank.
ROMANS: All right, well, Kelsey writes, color should not be related to sexual identity if a boy's favorite color is pink, let it be acceptable.
The second person, the response you read, that was originally my kind of initial reaction is this about kids being too young to wear nail polish and I realized the controversy, it was a boy wearing nail polish.
There is also a conversation maybe kids were sexualizing them to early in general. We are dressing little girls up in outfits for Halloween that are too trampy and, you know, maybe that's another conversation.
VELSHI: There's a lot of conversations there. I mean, the pink color on the nail polish as opposed to the little boy wearing nail polish in the first place. I think little kids like to play around with these had things.
CHETRY: Christine also three boys. I have a girl and a boy, my girl is older so my son, he likes nail polish, an old brother it would be a different story.
ROMANS: They mostly beat on each other.
VELSHI: Now here's another story that we are asking to you weigh on, Christine?
CHETRY: Yes, we're asking you.
ROMANS: This story is really an interesting one, an officer who shot and killed a college student last year has just been awarded officer of the year. The PBA in Pleasantville, New York, that's the policeman's benevolent association, which is a union.
It gave Officer Aaron Hess the honor, his fellow officers all voted on it unanimously we are told. Hess shot student DJ Henry outside a bar at a shopping center back in October. DJ Henry was just 20 years old.
VELSHI: A grand jury cleared two police officers of criminal responsibility in his death. We spoke to his parents on this show. Henry's mother says this demonstrates the department's arrogance. We want to hear what you think.
CHETRY: Some of the other context, reading more, the headline sounds really bad. What they said is this officer was actually injured badly in that -- in the altercation that led to the tragic death of Mr. Henry.
And that this was his first time actually being able to appear somewhere and that the PBA was private so they did not mean for this to sort of get out there and in some way upset the family but again, very strong feelings on both sides.
ROMANS: We want to know what you think about this, do you think it is appropriate that the officer is being honored? You can weigh in on our blog, cnn.com/am. We're also on Twitter at cnn -- cnnam rather, we're going to be reading some of your thoughts later on the program.
VELSHI: All right, top stories coming your way in just two minutes. It is 55 minutes after the hour.
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