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Muslim American Soldier Had Bomb Materials; House To Vote On Debt Plan; Senate To Vote On Boehner Plan Today; USA Loves AAA; Aftermath Of A Massacre; History Of The Debt Ceiling; AWOL Soldier Arrested; Warren Jeffs Fires Lawyers; GOP House Leaders Speak

Aired July 28, 2011 - 13:00   ET

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


SUZANNE MALVEAUX, CNN ANCHOR: CNN NEWSROOM continues right now with Randi Kaye. Hey, Randi.

RANDI KAYE, CNN ANCHOR: Hi, Suzanne, and thank you.

Thirty minutes and counting until speaker of the house, John Boehner, takes the podium for a 1:30 press conference. Are we any closer to the deal or will it be more volleying back and forth between the White House and the Hill? We will have it for you live.

And a story breaking in the last hour, the details just coming in. An AWOL Muslim American soldier now in custody in Texas found with what the FBI is now saying is a large amount of bomb-making material near Fort Hood. Our Barbara Starr is all over the story and will join us a few minutes.

But first, debt, debate but no deal. It all comes down to numbers, and I don't mean 13-digit numbers with dollar signs in front of them. I mean this number, take a look here, five days until the treasury says it will run out of borrowed money. Five hours, give or take, until the House votes on the so-called Boehner plan, which needs 217 votes to pass. Republicans hold 240 seats, so it's a slam-dunk, right? Wrong. Sixty Republicans are Tea Party members who want huge cuts in spending and no hike in the debt ceiling.

OK, here is where the big numbers come in. The Republican speaker has pretty much staked his leadership on the plan to let the treasury borrow $900 billion right away, while cutting $915 billion in future spending. Contrast that with the Senate plan from majority leader Reid which would hike the debt by $2.7 trillion while cutting spending by $2.2 trillion in spending. They have one thing in common, neither plan has any chance in the other chamber. It's not even clear when the Senate will vote on anything, actually.

And that brings me to CNN congressional correspondent Kate Bolduan. Kate, let's start with the House first. Does the speaker have the votes in his own caucus?

KATE BOLDUAN, CNN CONGRESSIONAL CORRESPONDENT: It sounds like they're cautiously optimistic, as one member put it to me as they were leaving the meeting this morning. I am told by a Republican source that Speaker Boehner said in the room that they do not have the votes yet but today will be the day that they pass that bill. But some news to bring you really quickly on the Senate side, and on the Senate action, Randi. Just a few minutes ago, the Senate majority leader Harry Reid, he took to the floor and said that this evening, tonight, the Senate will move to act on the Boehner bill. This, of course, assumes that Boehner secures the votes and it does pass in the House.

But this is significant, because all along we've been hearing that there was a sense that the Senate was waiting to act to see what -- waiting to act until they see what happens with the Boehner bill, and harry Reid was clear on the floor that he said they will -- they will take it up tonight, and it will be defeated. Of course, he's talking about defeated, because he has his Democratic caucus behind him. Senate Democrats released a letter, I believe it was yesterday, saying that they really were unanimous is opposing the Boehner bill and thus it would be defeated.

So, there is news there that there is going to be even more action beyond the vote on House speaker John Boehner's bill, this evening, in the Senate -- Randi.

KAYE: And Kate, we heard Boehner talking, he's saying that he wants Republicans to fall in line, as he put it. Is this a great departure for him?

BOLDUAN: We know that they are very candid in these meetings. But you can be sure, as you said, he staked a lot of political capital, not only in this debt ceiling fight but in this proposal that he's putting forward. And he was very blunt with members telling them to get in line yesterday, and as members were leaving, you could hear that at least some of them probably were getting the message, because more and more we started hearing conservative members saying -- and they might have been leaning no, but they were leaning more towards yes and I kept hearing the message that the perfect should not be the enemy of the good or the doable, as one person put it in this case. So, it seems like they might be getting the message. But of course, we don't count the votes until they happen, so we will watch to see how close it is this evening.

KAYE: Sure, and I guess a lot of people are wondering, certainly hoping even maybe, that there is some back channel negotiations taking place, that maybe we're not aware of. Are you hearing anything like that from your sources there on the Hill?

BOLDUAN: We keep hearing that the communication lines are open and they are always talking. We know that the leaders do communicate back and forth. But as it's been told to me, there's not that kind of communication, that negotiation, that we saw over this past week when Congressional leaders were here on the Hill. And then, we saw people shuttling back and forth with pieces of paper between offices. It seems that the path forward, at the moment, they are waiting to see what happens with this -- with this Boehner proposal in the House, and of course, then we'll be watching to see what happens in the Senate.

And then at some point, we know that if they want to move forward and actually act to raise this debt ceiling, there's going to have to be give on both sides, it appears, some compromise and it doesn't seem quite yet, Randi, we may be getting close, but not quite yet, but anyone's ready to blink at this point.

KAYE: And is there any type of voting schedule for the Reid plan at all?

BOLDUAN: We're actually trying to get that information right now. He announced on the Senate floor right as I was running down here to get into the room. So, we're trying to figure out what exactly -- what type of vote, let's not get technical, it could be a procedural vote or it could be a lot of things, but they -- he made it very clear that they are going to take it up and take some action on it this evening, and we're working to check out exactly when and what they are going to be doing.

KAYE: All right, I find the voting process quite fascinating, actually. How they -- first they that they have to vote on the rules of how to vote and then they spend all those hours reading the legislation and then voting. It's no wonder it's taken this long coming down to the wire, isn't it?

BOLDUAN: Exactly. Hard to explain on television, of course.

KAYE: Certainly, well you're doing a great job. Kate, thank you very much. We'll check back with you later on. Now, I'm going to steer clear of numbers entirely and look at letters -- three letters, AAA, that is the top of the line credit rating enjoyed by U.S. Treasury notes, and I do mean enjoy. Pristine credit means rock bottom interest rates on the trillions of dollars the U.S. owes. Just like a ding in your credit score, a downgrade of U.S. government bond ratings would very likely send ratings higher and that means the White House and Congress are not the only ones holding cards in the poker game.

The credit rating companies that appeared before a House committee yesterday, wheels enormous power. And their track record, well, that is not AAA. My colleague, Richard Quest, joins me now from London with a look at what these companies do and how they go about it. Richard, we know the names, there's Moody's, S&P, Fitch, but how did they become so important?

RICHARD QUEST, CNN INTERNATIONAL CORRESPONDENT: They became important because they are the arbiters in your life of credit worthiness. They have, supposedly, independent analysts, they spend many hours looking at the minutia of data, they have what they describe what S&P says is quantitative and qualitative data. And then, they assign a rating to a particular bond or a particular country, or a particular company. And that is the basis upon which that country, bond, or whatever, is traded and rated.

Now, during the great debacle of the great recession with the subprime mortgage crisis, Randi, we know it was a fiasco. They were rating rubbish as being top notch grade investment quality vehicles. And so, they've been bitten.

KAYE: They --

QUEST: Yes?

KAYE: Yes, they certainly have. I mean, these were the companies, the very same companies that gave -- that gave the high ratings to those mortgage-backed securities. So, why should we trust them now? Should we?

QUEST: You've got no choice, they are the only game in town, they are the rule makers, they are the ones that set the ratings, and any -- this is the funny bit, because they've got the same problem in Europe, here. We've got exactly the same problem with Greece, the ratings agencies keep saying that they'll downgrade Greece to default, and what the answer is of everybody from the regulators and the governments, get rid of them now! Well, the only problem there is what will you replace them with? Frankly, who wants an official rating agency? And who wants anything of a rating agency that does smacks of any form of influence.

So, the rating agencies, at the moment, are the only game in town, they are the barometers and the arbiters of what will happen on credit events. And finally, bear in mind, when they do make a decision, they can be ignored, but you ignore them at your peril.

Yes, I mean, they're really the driver here, I mean certainly S&P seems to be, I mean they're telling America how much debt it actually has to shed. But I'm curious though, that these firms actually rate private credit, too, as well, right? In other countries?

QUEST: Oh, absolutely. I mean, S&P and Moody's and Fitch, they rate companies, so your top companies like AAA, AA, or whatever it is, they rate other countries, whether it's Greece or the U.K., they are the massive, massive arbiters and deciders of credit worthiness across the entire financial spectrum. Now, do they do their job well? The critics will say no, and they point to the subprime mortgage, mortgage-backed securities crisis, they'll point towards a dozen examples where the rating agencies have rated something top notch only for it to be turned into garbage a week next Thursday, however, as long as they say AAA or AA plus or C minus and a reverse thrust, as long as they say that, they are the rule makers.

KAYE: Richard Quest from London for us, great to have you on the show, Richard. Thank you very much.

We are learning that New Jersey governor Chris Christie checked into a hospital this morning, Christie was having a difficult time breathing. His press secretary issued a statement that said that out of an abundance of caution, the governor went to the hospital and was given routine tests to check on his asthma.

New exclusive video shot moments after the blast in Norway, see more of these very powerful images, and hear from the man who actually shot this amazing video, next.

We're also following the breaking news story out of Fort Hood, Texas. We're going to have the very latest on the Muslim American soldier now in custody, next.

And of course, we are waiting for speaker John Boehner to tell us the latest on the debt ceiling negotiations. We will be watching that podium for you there and bring you the very latest as soon as we get it. He will be speaking before his vote on his bill this afternoon.

(COMMERCIAL BREAK)

KAYE: A CNN exclusive, dramatic new video taken just moments after last Friday's terror bombing in Oslo. Johan Christian Tandenberg is a real estate agent who was passing through a tunnel in downtown Oslo beneath the city's government plaza when a bomb went off killing eight people. Tandenberg says he wasn't sure he'd live to tell about it, but he survived and was able to record some pretty amazing video just seconds after the blast. Listen as Tandenberg walks us through his experience.

(BEGIN VIDEOTAPE)

JOHAN CHRISTIAN TANDENBERG, TOOK VIDEO DURING EXPLOSION IN OSLO, NORWAY: I was sitting in my car next to the government office, and I heard this huge bang. I did not know if it was the ceiling coming down, so I immediately laid down in my car to protect myself. Obviously, the ceiling does not didn't come down, so I was able to drive out of the tunnel, and the first thing I saw on the left side was this building that was totally damaged.

My initial response was OK, now the terror attack is in Oslo? I let the pictures of 9/11 came back to me, and I wanted to videotape, record this for further investigation for the police and to make a documentary of what happened at this spot. I have been in some rescues before, and I had to calm people down. I had to talk to them and tell them to get as far away as possible, because of more danger from the building, that it can collapse, and take them away from the place, and I tried to empty it and went inside the building as well to see if there were more injured people.

UNIDENTIFIED FEMALE: Didn't you think about your own safety?

TANDENBERG: I did, (INAUDIBLE), but it was there, and after when I look at it, I can admit that it was a little stupid.

UNIDENTIFIED MALE: (INAUDIBLE.)

UNIDENTIFIED FEMALE: Why did you say that you were part of a rescue team?

TANDENBERG: I said that because -- to calm people down, and make them aware that there were people there to help them. I had messages from people working in the government building in the last two days that they were very happy, telling me that they met me inside and that I was able to get them out without any damage.

That means a lot that people can call me and say thank you, and we appreciate that you were there at the spot and you helped us out. I can see myself on the movie that you made and I'm very happy that we both are OK. (INAUDIBLE).

We're shaped (ph) as a person is the crazy guy will over me, and I will not let that happen. So, well, what I saw is what I saw. It's not nice, but life has to go on.

(END VIDEO CLIP)

KAYE: Tandenberg also talked to us earlier today on "American Morning." He says the morning after the terror attacks was even more devastating.

(BEGIN VIDEO CLIP)

TANDENBERG: People all over Norway, when they woke up Saturday morning and turned on the television, the number of dead had increased from I think eight on Friday evening to more than 80 kids on Saturday morning. People all around the country are crying in front of the TV and they're still sitting crying. That's what they're doing. They're still in shock.

(END VIDEO CLIP)

KAYE: Norway's police are now facing tough questions over their response to last Friday's attacks. Many are asking why it took an hour for armed officers to arrest the suspect, 32-year-old Anders Behring Breivik.

We now have some breaking news to tell you about. An AWOL Muslim soldier, seen in this file video right here, has been arrested near Ft. Hood, Texas. The scene of a deadly shooting rampage, you may recall, from two years ago. Officials say the soldier told them he wanted to attack troops outside Ft. Hood. Pentagon correspondent Barbara Starr is working her sources on this, getting more details right now. And as soon as she can, she'll join us live and we will bring that to you.

Gridlock in Congress. Markets getting skittish. All because of that debt ceiling. But why do we even need a debt ceiling in the first place? We'll explain after the break.

And also a reminder, we are waiting to hear from House Speaker John Boehner. He has a scheduled vote on his plan for the debt ceiling this afternoon. Two hours of debate will follow this press conference, we understand, but we'll bring him to you as soon as he starts speaking from the podium. Keep it here.

(COMMERCIAL BREAK)

KAYE: The battle over raising the debt limit is not a new one for Congress. And while they have battled before over numbers, in the end, the borrowing limit has always been raised. This latest battle over the debt limit has renewed a question asked before, why do we even have a limit? Carl Azuz is here to explain why.

So, Carl, the credit rating agency Moody's, suggest that the U.S. eliminate the debt ceiling altogether. Why do we have it? CARL AZUZ, CNN CORRESPONDENT: There's an interesting reason for that. The origins of the debt ceiling have to do with checks and balances, basically. What it does is it gives Congress more power of the purse strings to limit what the rest of the government can spend.

So, for instance, let's say the Treasury wants to borrow money, spend money. Congress says, not so fast. We're going to institute this limit to prevent reckless borrowing.

Now, that's the theory. But in practice, it's done very little to contain U.S. spending because of the fact that the debt limit has always been raised when we've hit it, it's never actually stopped the accumulation of debt. That's one of the reasons why Moody's says, look, maybe get rid of it altogether because of the fact that it's not actually containing your debt. All it's doing is creating this periodic uncertainty when this debate comes up.

Randi.

KAYE: Well, we're certainly paying a lot of attention to it these days, but how long has it actually been around?

AZUZ: The debt limit started -- we've got to go back to 1917 and World War I for that. And what was interesting is, prior to 1917, prior to the U.S. involvement in World War I, Congress had to approve every instance of government borrowing. So the U.S. government wants to work on the Panama Canal, Congress had got to approve that.

World War I came around and Congress essentially said, look, we cannot approve every instance of borrowing for U.S. entry into this war. We'll just set a limit. Don't go over that. And that's essentially how the debt limit got started.

KAYE: And that's how government borrowing changed since it was put in place?

AZUZ: Oh, it's gone up. That's the simple way to explain it. I mean we have a chart to illustrate that not only has the debt limit increased, it hasn't been a steady increase, it's been an exponential one. And if you look at this chart, you'll see from 1970, we're looking at debt -- a debt limit of around $395 billion. Now, today, $14.3 trillion. And there are a couple takeaways from this.

One, the accumulation of U.S. debt cannot be blamed on a particular administration. It can't be blamed on a particular party. For decades in America, it's just been how we roll. And essentially what's going to be interested to see is whether or not this government or any government in the future is able to not only put a limit, but to try to reduce that level of U.S. debt, Randi.

KAYE: Yes, I think a lot of people are watching how Washington is rolling these days and not liking it very much. But do the debt limit battles tend to happen when one party controls one branch of the government?

AZUZ: Well, I would not say it's necessarily one party, one branch. Politics definitely plays a role. I mean back in the mid 90s you had President Clinton in the White House, you had GOP controlling both branches of Congress and they'd butt heads over the debt limit, although it was eventually raised. Then in 2006, you had President Obama, who was then-Senator Obama under President George W. Bush, and he voted against raising the debt limit, saying government spending had gotten out of control. So you definitely see politics playing into this debate on both sides, Randi.

KAYE: Carl Azuz, great information. Glad you're here.

AZUZ: Thank you.

KAYE: Thank you.

Polygamist leader Warren Jeffs has just fired all his attorneys. We'll bring you the latest on his trial from Texas, next.

And, of course, once again a reminder, we waiting to hear from House Speaker John Boehner, facing a lot of opposition about his answer to the debt ceiling. We'll bring that press conference to you live right here when it happens.

(COMMERCIAL BREAK)

KAYE: Breaking news now. Pentagon correspondent Barbara Starr has just gotten some new information on the AWOL soldier arrested near Ft. Hood, Texas.

Barbara, what do you have?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: This is Private First Class Naser Abdo of the United States Army. Twenty-one years old. Under arrest and possibly now facing federal charges on bomb-making.

What we now know is when he was arrested yesterday in Killeen, Texas, by police authorities at a traffic stop after leaving a gun store and a surplus store, they went to his hotel and found a disturbing situation there. Pentagon -- a U.S. military official now telling us that they found enough material in his hotel room to make two bombs. Two bombs.

And I want to read you what they found. I want to be very precise here. They found gun powder, shotgun shells, pressure cookers, 18 pounds of sugar that investigator believe would have been used to enhance an explosion and Christmas lights that would have been used as a possible timer. They found a backpack of his in his possession with so-called jihadi literature in it, according to the initial investigation. And during an interview with law enforcement officials, Private First Class Abdo said he wanted to stage attacks outside of Ft. Hood.

This is very significant because investigators also found -- after leaving the gun store where he had purchased some weapons and some weapons making material, he went to a surplus store in Killenn, Texas, bought an Army uniform and asked that Ft. Hood patches be sewn on to that uniform. So there's growing indications here that there was some sort of thinking on the part of this private first class that he was going to do something related to Ft. Hood. And, of course, this is always a very sensitive issue for the Army. Very concerning to them, Randi, because it was back in late 2009, of course, there was that mass gun attack by Major Nidal Hasan, an Army psychiatrist. He killed a dozen people on the Army base, wounded about 30 more. And it has really forced the Army in recent year to examine its own and think about security on its own bases.

Now, another case whereby all accounts a private first class had some plot in his mind or was at least assembling the materials, should add Private First Class -- this man, Private First Class Abdo was facing charges in the Army for being in position of child pornography. And he was AWOL at the time. He knew he was facing a court marshal proceeding and he had gone AWOL some weeks ago. Now turning up in Ft. Hood, Texas, from Ft. Campbell, Kentucky, turning up in Texas with all of this in his possession.

Randi.

KAYE: Barbara Starr, incredible story. Thank you staying on top of that and do bring us any new information as you get it. Thank you.

And now I want to take you to San Angelo, Texas, where polygamist leader Warren Jeffs trial was set to begin today on sexual assault charges. CNN's Gary Tuchman just got out of court. He joins us live from there.

Gary, we are expecting opening arguments, but instead Jeffs fired his attorneys. What happened?

GARY TUCHMAN, CNN NATIONAL CORRESPONDENT: Well, that's right, Randi, and the trial may still begin today. But here's what we know.

This trail of Warren Jeffs, the polygamist leader, may indeed turn into a circus. A circus that would make the Ringling Brothers be in envy. What has happened is Warren Jeffs has fired all of his attorneys and says he wants to represent himself. There are no cameras in the court, so I'm going to describe it to you.

But Warren Jeffs, who we've really never heard speak, and I've been covering him and the polygamist cult for more than five years, I've never heard him say more than a couple of words in court, spoke for 20 minutes. He sounded like he was drunk. But I just saw him in court. I would think he was drunk. He's not drunk. That's the way the guy talks.

And he basically says, I want to fire my attorneys because, quote, "I need to do this for justice to be served. For the truth to be presented, I can't use them. They don't have an understanding of my defense." And his attorneys just sat there. The judge asked his attorneys what they thought about that, and his attorneys said, "Mr. Jeffs gives us no permission to talk." She then asked the judge, the other attorneys -- there are seven attorneys there -- and they all said they couldn't talk. So, she has given Warren Jeffs permission to represent himself in this trial. A trail in which if he's found guilty of sexual assault of children under 14 years old, he could go to jail for the rest of his life. And she said the trial will begin today or Monday. She's about to make that decision.

But it will be a circus. The man knows nothing about the law, Randi.

KAYE: Yes. I was going to say, Gary, this sounds like a bit of a risk considering how serious these charges are. Warren Jeffs is not a lawyer. Will he get any legal assistance at all?

TUCHMAN: We are told by his attorneys who aren't allowed to talk in court, but who have talked to me and they have said he sees this as a religious defense that his lawyers can't possibly understand. He doesn't know how to do it in a statement. He doesn't know how to do cross examination. He doesn't know how to do closing arguments. But he says he wants to do it.

And it takes him so long to talk -- I mean, he literally pauses for 30 seconds before he continues into the second sentence. This trial could last forever.

But the judge has to agree to it. You have the right to represent yourself. And Lord knows and that's the appropriate thing to say in this kind of trial -- Lord knows what will happen.

KAYE: And, Gary, you've been c covering this guy for a long time, this is not the first time that he's actually fired his lawyers.

TUCHMAN: Well, that's right -- especially, in this case, he has fired numerous lawyers. And the judge was thinking that he was doing this because he wanted to delay the trial. So, he said today if you are going to represent yourself, and fire your lawyers again, you are not going to delay the trial. It's going to start today.

Well, he said, I need a few days. And the prosecution said, we don't object to a few days, for it to start Monday. The judge will surely make the decision whether it starts today, whether it starts Monday.

But there's already a jury, the jury is ready to go. They have been sitting in the courtroom since 9:00 a.m. Central Time ready to go with this trial. So, either way, this trial will begin shortly and Warren Jeffs will be representing himself in court.

KAYE: He is a man that is full of surprises. We've certainly learned that over the years.

Gary Tuchman in Texas -- Gary, thank you.

And minute now, we'd like to remind you, House Speaker John Boehner will be standing at the podium that you're looking at right there in these live pictures, to tell us what progress, if any, Congress has made in this ongoing debt crisis. We'll take you there live as soon as it happens.

(COMMERCIAL BREAK)

KAYE: Time right now, about 33 minutes past the hour, time for the news that you missed.

Speaker John Boehner's revised debt plan is up for a House vote today. We're waiting for him to speak there. We're looking at this live picture. It should happen any moment.

Boehner says that his plan is not perfect but it's doable. Boehner's proposal which calls for an immediate $900 billion increase in the debt ceiling now means his pledge to match any debt ceiling hike with a dollar for dollar spending cut. Even if the bill passes the House, it still has to face the Senate. And Senate Democrats say the Republican plan has no chance of passing.

An AWOL Muslim soldier seen in this file video has been arrested near Fort Hood, Texas, a scene of a deadly shooting rampage two years ago. Officials say in the latest incident, the soldier told them he wanted to attract troops outside Fort Hood. FBI agents say they found bomb-making materials in his hotel room.

In 2009, 13 people died in a shooting spree at Fort Hood. Another Muslim American soldier is charged in that case.

The woman who says the former head of the International Monetary Fund sexually assaulted her made a public appearance today at a church in Brooklyn. Nafi Diallo thanked organizations and community leaders for their support. She met with prosecutors for several hours yesterday. Strauss-Kahn has pleaded not guilty and prosecutors questioned the hotel maid's credibility.

Home plate umpire Gerry Meals now admits he made the wrong call to give the Atlanta Braves a 4-3 win over the Pittsburgh Pirates. The call came in a 19th inning in 6 1/2-hour game Tuesday. Meals says he realized his mistake after reviewing video of the play.

The bad call is renewing debate over whether Major League Baseball should allow umpires to make instant video reviews of controversial plays.

"Jeopardy" game show host Alex Trebek tore his Achilles tendon chasing down a burglar. He explained what happened when he showed up at a geography competition in crutches.

(BEGIN VIDEO CLIP)

ALEX TREBEK, JEOPARDY GAME SHOW HOST: Yesterday morning, chasing a burglar down the hall at my San Francisco hotel until my Achilles tendon ruptured and I fell in an ignominious heap.

(END VIDEO CLIP)

KAYE: The 71-year-old Trebek says he'll have surgery tomorrow. Police arrested and charged a 56-year-old woman for possession of stolen property.

Once again, we have been watching this debt ceiling negotiation in Washington now. Well, we are expecting to hear from House Speaker John Boehner any moment now. He will take that podium.

He's -- there will be a big vote this afternoon, after his press conference was rescheduled for 1:30. Big vote, two hours of debate should follow the press conference on the bill and then probably another news conference after that. The final vote today would probably happen sometime around dinnertime.

He's pretty much staked his leadership on a plan to let the Treasury borrow $900 billion right away, while cutting $915 billion in future spending. You know, he was sent back to the drawing board to work on his plan a bit more. Well, now, that plan will be voted on today.

And if you think about how that contrast with the Senate plan from Majority Leader Reid, well, that would hike the debt $2.7 trillion while cutting $2.2 trillion in spending.

The one thing they have in common, of course, as we wait for the House speaker to take that podium, neither plan has any chance, really, of passing in the other chamber. So, we will continue to watch that as we wait for Speaker Reid.

We'll take a quick break. But keep it here on CNN.

(COMMERCIAL BREAK)

KAYE: We want to take you right now to House Speaker John Boehner talking about his bill that should be voted on this afternoon. Let's listen.

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: Listen, this is a challenging time for our country. Americans are worried about their jobs, they are worried about our economy, and they are worried about our debt.

Today, the House will take action, again, on a solution to end this debt limit crisis. We'll take action, again, just like we did on our budget, on solutions to the problems that are facing our nation.

After today, the House will send to the Senate not one but two different bills that will rein in spending, increase the debt ceiling, and bring an end to this crisis.

When the House takes action today, the United States Senate will have no more excuses for inaction.

The bill is not perfect. I have never said it was perfect, nobody in my caucus believes it's perfect. What this bill reflects is a sincere, honest effort to end this crisis in a bipartisan way, to send it to the Senate where it can receive action.

Throughout this debate, we promised the American people that we'd cut spending more than what we would increase the debt limit, and we also said we would not entertain any increases in taxes.

So, today, the House is going to vote on a bill that meets that test. It's been certified by the nonpartisan Congressional Budget Office, and there are no gimmicks, there are no smokescreens, that races the debt limit and cuts government spending by a larger amount than the increase in the debt ceiling.

Listen, for the sake of jobs and for the sake of our country, I am asking the representatives in the House, in a bipartisan way, and asking my colleagues in the Senate, let's pass this bill and end this crisis.

REP. ERIC CANTOR (R-VA), MAJORITY LEADER: You know, we have heard a lot from the majority leader in the United States Senate, and when he says that we are going to face economic collapse if we don't get something done by Tuesday, but yet he keeps killing the measures that we send over and threatening to do the same with the one we will send over today.

Now, Harry Reid can't have it both ways. The fact is the president has asked us to compromise. We compromised. We send over our idea, the vision of how we would take this country forward if we were in control, and that was cut, cap and balance. The Senate dispensed with that immediately and tabled it.

The bill today represents a bipartisan negotiated agreement, something that fixes the problem past August 2nd and allowed us to continue to focus on the issue of trying to get the fiscal house in order.

So, the way I see it is Harry Reid has three different options. One is to suffer the economic consequences of default -- which I hope, which all of us hope -- he doesn't choose. Two is to bring up the bill that we sent prior, the one that he claims to be opposed to. Or to accept the compromised bill that we are sending over today so we can resolve this crisis and get on about the business of this country.

REP. KEVIN MCCARTHY (R-CA), MAJORITY WHIP: The country is very stark. You have two different types of leadership in this government. You have one in the White House that doesn't know how to lead except from the back -- a man that knew that the debt crisis was coming even when he voted against it a number of years ago. He said he has changed his ways, but has never produced a plan. You have a Senate that has never produced a budget in more than 800 days, and let known only talks about what they can't bring up, but can't produce an idea.

You have a speaker and leader in this House that sat down with the other party for months to find compromise. When it could not find an end that the other side could not agree to, we produced our own bill that would layout a framework of where we could go, cut, cap and balance, sent it to the Senate as the way the Constitution tell us to do. The difficulty is the Senate never even took it up, but never even sent back any other ideas.

That's contrary to everything we believe as Americans. It's contrary to everything we believe as elected representatives. You have a responsibility to lead, you have a responsibility to join the debate, you have a responsibility to put an idea out when the country is in a time of crisis.

Well, once again, this Republican conference will lead. What I am ashamed of, the Democrats on the other side, is not whipping up ideas but whipping up just to say no.

America is a better place than that. Americans deserve an honest approach. No more tricks, no more accounting gimmicks, no more broken promises.

So, what our speaker did was sit down over the weekend with Democrats sand Republicans in the room and found compromise. Republicans don't think this bill is perfect. Why? Because we did compromise.

But I will tell you -- the momentum is moving in our direction. We will put out our ideas, that will include Democratic ideas as well. We will rise to the occasion one more time.

But as the Constitution says, it will have to go to the other House, and the responsibility will be on their side to make sure it moves forward.

REP. JEB HENSARLING (R-TX), GOP CONFERENCE CHAIRMAN: Days before the president's August 2nd deadline, he has yet to submit his first plan to deal with the nation's debt crisis. Days before the president's August 2nd deadline, the Senate is yet to pass their first plan to deal with the nation's debt crisis. Days before the president's August 2nd deadline, not only have House Republicans passed their first plan to deal with the debt crisis, later today, we will vote on our second plan to deal with the nation's debt crisis.

Now, this plan is not the ultimate solution. The president has made sure of that. He has not come to the table to address spending in a meaningful way. And make no doubt about it, this is a spending- driven debt crisis.

But our legislation will insure that the nation keeps current on its bills today. It will insure that we have a process to cut spending by $900 billion, and the ability to cut even more. In what I believe is that for the first time in 15 years, we will have an opportunity to actually put forward a solution, a solution to the debt crisis, that being a balanced budget amendment to the Constitution. One that failed by one vote in the United States Senate 15 years ago.

With the passage of this legislation, we have the opportunity to bring to the American people the ultimate solution to the debt crisis, and that is a balanced budget.

Mr. President, we still don't have your plan. Mr. Reid, we still don't have your plan. Let's move on a plan that's a product of what you said you want, but let's solve the crisis going forward for future generations to create jobs, hope, and opportunity. Let's finally pass the balanced budget member to the United States Constitution. KAYE: And just to wrap up what you have been listening to there. That's the Republican House leaders speaking in Washington as we get ready for a vote on House speaker Boehner's plan to solve the debt ceiling crisis. Certainly very critical of the president, of the Democrats saying the president has not put forth his own plan for solving the debt crisis or -- and certainly hasn't addressed spending in any meaningful way.

But the Democrats have said that they certainly won't approve the Republicans' answer to the debt ceiling crisis. They call it a short- term Band-Aid. So, we will hear from the Democrats, I'm sure, a little bit later on. But Speaker Boehner you heard it there, for the sake of the country he is calling on the House and Senate to pass a bill and end this crisis. He said this is not about gimmicks or smokescreens, this is what the country needs.

We will continue to follow that as they plan to have that vote this afternoon. We will bring you the results as soon as we get it right here on CNN.

So, do you think you have a unique tattoo? Yes, very interesting subject here. Up next, digital tattoos. Don't go anywhere.

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KAYE: All right. Well, this is the time of day that we do the "Big I," as we like to call it here. It's about big ideas, big innovations. We do it everyday on the show, and we are glad you are here to share in this one today.

Soon, people may be getting tattoos, believe it or not, at science labs and doctor's officers. That's if my next guest, Heather Clarke, actually has her way. She's leading research on what are being called digital tattoos. Implants for diabetics that monitor the wearer's blood levels. She believes tiny sensors can be injected under the skin like tattoo ink and wirelessly send readings to a computer, even an iPhone.

Heather, an associate professor at the department of pharmaceutical sciences at Northeastern University, joins us now from Boston. Heather, thank you very much for coming on the show. This is such an interesting topic here. How does this all work, and what exactly would we be putting in our bodies to make this work?

HEATHER CLARK, ASSISTANT PROFESSOR, NORTHEASTERN UNIVERSITY: So, our nanosensors are the main component, and they're a tattoo that's composed of small, plastic spheres, about 100 nano-meters in diameter, and they fluoresce. And they're completely harmless. And they are embedded in the skin a lot like a tattoo, but maybe not quite as painfully. And then we pair it with a fluorescent device that can be as simple as your iPhone, which shines a light on the area of the tattoo and takes a reading.

KAYE: So, this would be -- how would this simply life, say, for diabetics? CLARK: So, right now a lot of people with diabetes are pricking their fingers several times a day. This would be one injection a week and then a very, you know, easy reading. Just light through the skin.

KAYE: And I understand you've only tested this on animals so far. How did it work with them?

CLARK: So in animals, everything looked very positive.

KAYE: And how long would this type of dye -- or whatever you might want to call it officially --stay in your body?

CLARK: So, our goal is for it to last seven days. What we want to do is inject it into a layer of the skin that is not as permanent as where a tattoo goes. And so it would slough off naturally as your skin sloughs off, and that process takes about a week.

KAYE: So, you quickly mentioned the iPhone. Can you quickly understand how the iPhone plays a part here. Do you hold it to your skin and ten it sends the information? Can you explain that a little bit more?

CLARK: Yes, sure. So, we were talking about developing the reader for this tattoo. My students and I were talking in the hall. It just kind of got more and more complex, and I said, you know, this should be as simple as my iPhone, and I held up the iPhone, and it was kind of a moment where we all said, oh, wow. Everything that we need except for the light source is in the iPhone.

And so what my students did as part of a student competition actually is developed this case. And it snaps right on to the iPhone, and basically just has a light, and you shine that onto the skin, and the camera itself takes the reading.

Right now, we are processing that data on a computer, but we hope to develop an app someday where it will take the data, process it and give a real-time reading of, let's say, glucose levels.

KAYE: All right. Dr. Heather Clark, thank you so much. Appreciate it. Very interesting. And for much more or digital tattoos, I have all the details on my Facebook page, facebook.com/randikaye.CNN.

Now I want to talk more about this AWOL, the arrest of an AWOL soldier near Fort Hood. On the line with us is Greg Ebert. He's a former police officer, and he actually worked at the gun store -- works the gun store and helped tip off police to what might have been happening here. The plans allegedly that this soldier may have had in mind.

Greg, thank you for making time to speak with us. Tell us what alerted you that something may not be quite right with this soldier.

GREG EBERT, GUN STORE WORKER/ FORMER POLICE OFFICER (on the phone): Well, he came to the store to purchase a quantity of smokeless gunpowder and did not seem to know what it was. It was just really odd, his behavior.

KAYE: And what -- what was odd about his behavior, and how much gunpowder was he looking to purchase?

EBERT: Well, he selected six canisters of smokeless gunpowder, placed them on the counter and then asked the manager well, what is smokeless powder? If you don't know what it is, why in the world would you buy that much?

KAYE: Mm-hmm. Did anybody ask him any questions about why he was buying it or what his plans were for it?

EBERT: No. It was out of the norm, but he had not done anything unlawful or illegal that would prevent the sale, so we went ahead and made the sale to him. But after the fact, once he had departed the store, we discussed amongst ourselves and came to the conclusion that it would be prudent to notify the authorities and allow them to make whatever inquiry was necessary.

KAYE: We're talking about Private First Class Naser Abdo. Tell me what -- when you called authorities, what was their reaction and how quickly, if you know, did they move to take some action?

EBERT: I would -- I would acquiesce to the police department to tell you how quickly they responded. I'm a retired officer from the agency so I called one of the lieutenants that I know. He was certainly receptive. I gave him what information I had and told him of my concerns, and he assured me that they would look into it. And from that point on, you know about as much as I do.

KAYE: Mm-hmm. And do you know how he got to the store? Was it in a personal car, a taxi? Was he with anyone?

EBERT: Well, that's what also drew our attention to this young man. He arrived in a local taxi cab, which is kind of out of the norm.

KAYE: Obviously you're on alert. We know that Fort Hood was the scene of that deadly rampage back in 2009. Is that why maybe you were just a little more concerned about what this guy might have been up to?

EBERT: I don't know if it was cause for us to be more concerned. We as a rule of thumb like to think that the safety of the community is important enough that if something does something or exhibits behavior that would be out of the norm, that we have an obligation to notify police and allow them to pursue it from that point.

KAYE: And we understand from our Pentagon correspondent, Barbara Starr, who has been working her sources on this, that authorities also found, according to her sources, 18 pounds of sugar and also Christmas lights that might possibly be used as a timer to set off whatever device he allegedly was planning to build.

How does this sit with you? What does that sound like you to? EBERT: Well, I'm certainly not an expert. That would be something that someone from the ATF would be better qualified to answer for you. But with a military background, it potentially could be used for an explosive device.

KAYE: And how do you feel now knowing that he's in custody?

EBERT: Relieved. I think we've done the right thing for our community and certainly for the fine young men and women at Fort Hood.

KAYE: Is this the talk of the town there in Killeen? What are people saying?

EBERT: You know, I really haven't had a lot of feedback. I was unaware of what was going on until I came to work this morning. I was kind of besieged by reporters. So, I'm getting in on it the same as you folks are.

KAYE: Well, Greg Ebert, certainly nice to know that you have a police background and you certainly knew what to look for. And you probably did the right thing here, so thank you very much. Appreciate it.

All right. We'll take a break here and have much more news on the other side.

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