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AMERICAN MORNING

Military Now Accepting Openly Homosexual Applicants; Controversial New Book Depicts Infighting in Obama White House; Interview with Rep. Jake Flake; Obama Meeting Libyan Leaders at U.N.; Georgia Parole Board to Decide on Troy Davis Appeal; Sea World Accused of Endangering Workers; The Real Sarah Palin?; Neighbor Writes Book About Sarah Palin; Link Found Between Diabetes and Dementia, Alzheimer's Disease; U.N. General Assembly Focuses on Non-Communicable Diseases

Aired September 20, 2011 - 06:59   ET

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


(BEGIN VIDEO CLIP)

CAROL COSTELLO, CNN ANCHOR: "Don't Ask, Don't Tell." After nearly two decades, this morning, the ban on gays and lesbians in the United States military is history.

ALINA CHO, CNN ANCHOR: At risk, striking new evidence about the chance of Alzheimer's that could affect 100 million Americans.

COSTELLO: Explosive allegations a new book shining an unflattering light on the White House on the Obama administration. The administration now accusing a Pulitzer-prize winning author of plagiarism.

CHO: And extramarital affairs, drugs, bulimia. Those are some of the claims in another new book about Sarah Palin. We'll talk live to the author on this AMERICAN MORNING.

(END VIDEO CLIP)

COSTELLO: It is Tuesday, September 20th already. Welcome to AMERICAN MORNING. Can you believe it? September 20th?

CHO: I know. I thought, wasn't it just Labor Day yesterday?

COSTELLO: I know. And fall begins at the end of the week.

CHO: Ay, yayay.

COSTELLO: I'm Carol Costello.

CHO: Good morning, everybody. Thanks for joining us. I'm Alina Cho. Ali and Christine have the day off.

COSTELLO: We begin with the end of the Pentagon's "Don't Ask, Don't Tell" policy. As of midnight, the 18-year-old ban is official lifted. Celebrations planned across the country and the secretary of the army says, from this day forward, gay and lesbian soldiers may serve in our army with dignity and respect, both of which they deserve.

Pentagon correspondent, Chris Lawrence, joins us now. So, Chris the big question, what about those thousands of service members who were kicked out because they were gay? What if they want to get back in?

CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT: Yes, Carol. You're talking about more than 13,000 people. The repeal of "Don't Ask, Don't Tell" means starting today, they can apply to get back in, but the reality is, there's just no guarantees.

(BEGIN VIDEOTAPE)

LAWRENCE (voice-over): Hundreds of American troops who got Kicked out of the military for being gay or lesbian are about to be hit again with a reality check.

JEREMY JOHNSON, APPLYING TO GET BACK INTO NAVY: If I was trying to get back in active duty right now versus reserves, the Navy wouldn't take me in the job I was doing before.

LAWRENCE: Jeremy Johnson was discharged in 2007.

(on camera): You basically wrote a letter to your commanding officer outing yourself?

JOHNSON: I did, and it wasn't something that I wanted to do. It was something that deep down I felt I was forced to do in order to maintain my sanity.

LAWRENCE (voice-over): Mike Almy finished a tour in Iraq, recommended for promotion to lieutenant colonel. Then he was outed by another officer and kicked out of the air force.

MIKE ALMY, APPLYING TO GET BACK INTO AIR FORCE: Obviously I've had a five-year gap at this point in my career. So nothing's going to fully repair the damage done to my career. But I'm hoping I can at least get back in there where I left off, resume my career.

LAWRENCE: Both are applying to get back in, but the repeal of "Don't Ask, Don't Tell" is no guarantee.

JOHNSON: I'll be honest. I've talked to people who wanted to go back in, and they started making phone calls to recruiters and found out their sort of circumstances wouldn't allow it. And there is let down. You can hear it in their voices.

LAWRENCE: Some are too old. Their specialties not needed or jobs fully staffed. The military is getting smaller and more people are staying in. and the Pentagon says service members who have separated under "Don't Ask, Don't Tell" will be evaluated according to the same criteria applicable to all others seeking re-entry. In other words, there's no waiver.

JOHNSON: I think it would be awesome if that could happen, but I know the hard truth is that it's not practical. (END VIDEOTAPE)

LAWRENCE: The year Jeremy got out of the service the military was taking in about 15,000 prior service folks back in. Last year, less than 5,000. With the current budget crunch going on right now, if they granted a waiver to one person from "Don't Ask, Don't Tell," they'd have to kick somebody else out of the service.

COSTELLO: What if you're gay and want to join today? Do you walk in and not worry about it at all?

LAWRENCE: Yes. You can walk into a recruiter's office and say I'm gay and I want to join up. They'd say, thanks for that information and here, fill out this paperwork. It's -- you can say whatever you want. They're not going to ask anymore, but it doesn't matter if you tell. They've actually been taking applications from openly gay applicants for weeks now, and they're going to start processing them as of today.

COSTELLO: It's a brand new world in the military. Chris Lawrence, many thanks to you.

LAWRENCE: You're welcome.

CHO: All you have to do, look at the gridlock in New York to know that the United Nations general assembly is in full swing this morning. President Obama arrived yesterday, and will meet today with the head of Libya's national transitional council to talk about Libya's future. Senior U.N. correspondent Richard Roth is here with a preview.

RICHARD ROTH, CNN SENIOR U.N. CORRESPONDENT: Let's not go heavy with the senior part, the way things are going lately.

(LAUGHTER)

ROTH: And I don't have a car, so stop with the gridlock. And there's bad traffic every day. And a water main break, using the subways --

CHO: All right, all right. So the president will be meeting with the transitional council of Libya and also with Hamid Karzai. So what can we expect to see?

ROTH: Libya has the spotlight in the morning. The new Libyan government, its Chairman Mustafa Jalil will fly in. They're expecting to hear some transitional plans. They are known as the National Transitional Council. And also the U.S. is going to say that in effect I think they've got it right. The NATO bombing that forced Gadhafi out of office, even though there's a new audiotape today where he's saying he's not giving up, in effect, and people should still challenge the rebels, but the U.S. also says they want to get it right, this transition, not just do it quickly.

COSTELLO: Libya needs a lot of money to do it right. So where might that money come from, and will that be part of the conversation today?

ROTH: Yes. There's still assets that are frozen around the world in different countries, and I think as more confidence builds in this new fledgling government, whose flag is now flying over the United Nations for the first time -- Gadhafi's green flag, everything was green in Gadhafi, in Libya, which might have been known at Gadhafi-land for all I know. I was there a few times, got the green book from the leader. Basically, there's money that's going to come forth. The U.N. plays a big role. They want to put U.N. expertise on the ground to try to rebuild.

CHO: I want to talk about something you mentioned a moment ago. An audio message that surfaced from Moammar Gadhafi himself. Obviously the big question has been where is he? So what did he say?

ROTH: Well, nothing is ever proven on the audiotape. It's purported to be his voice. He's saying the people's will will not be overthrown and the system he built up will still be in place. It took a while for Saddam Hussein to come out of the hole. Who knows where Gadhafi is? Some of his relatives have gone to neighboring countries. The International Criminal Court would also like to know where he is.

COSTELLO: But no country recognizes him as the leader of Libya any longer?

ROTH: No. There are some friends like South Africa who are really, some are slow to recognize this National Transitional Council. China, Russia, are on board, though. All of the friends of Libya will gather at the United Nations this morning and these speeches by the new Libyan chairman and president Obama.

COSTELLO: We'll be listening. Richard Roth, many thanks to you.

An explosive new book out today by Pulitzer Prize winning author Ron Suskind has the White House up in arms. That's because the book portrays the inner circles of the early Obama administration as a boys' club. Christina Romer, former chair of the Council of Economic Advisers is quoted as saying she felt like a piece of meat after being shut out of a meeting. And former communications director Anita Dunn says the White House fit all the classic legal requirements for a genuinely hostile workplace to women. Dunn and Romer now say they were misquoted. CNN's Brian Todd has more for you.

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT: For a bestselling author, serious brush-back from the White House over a new book which depicts infighting and indecision in the Obama administration's early day. In this book "Confidence Men," Ron Suskind writes the president's top advisers had doubts whether he could handle the economic crisis.

Larry Summers, former director of the president's National Economic Council, is quoted as saying in 2009 "We're home alone. There's no adult in charge. Clinton would never have made these mistakes." We couldn't reach Summers for comment, but in an email to the "Washington Post" he said "The hearsay attributed to me is a combination of fiction, distortion, and words taken out of context."

TIMOTHY GEITHNER, TREASURY SECRETARY: I lived the reality. And the reports out of this book bear no resemblance to the reality we lived together.

TODD: Treasury Secretary Timothy Geithner responding to a passage in Suskind's book saying President Obama decided early on to restructure several troubled banks, but discovered nearly a month later his directive had been ignored by the treasury.

GEITHNER: Absolutely not. And I would never do that. I've spent my life in public service.

TODD: CNN chief political analyst Gloria Borger says in books like this, former officials often try to bolster their own legacies or settle scores.

(on camera): Would it lead, do you think, to some kind of finger-pointing behind the scenes and people looking over their own shoulders? I've got to watch what I'm saying to everybody.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: I mean, this is Washington. People are trying to figure out who was the source for that? Who was the source for that story? I bet that came from him or from him.

TODD (voice-over): A defiant White House press secretary launched a separate offensive against Suskind.

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: One passage seems to be lifted almost entirely from Wikipedia in the book.

TODD (on camera): When CNN followed up with the White House after that briefing, officials indicated that Jay Carney was referring to a passage in Suskind's book about the federal mortgage firm Fannie Mae as first reported by the online publication "Politico."

(Voice-over) Quote, "In 1968 it officially became a publicly held corporation to remove its debt and related activities from the federal balance sheet." The Wikipedia passage says "In 1968 it converted to a publicly held corporation to remove its activity and debt from the federal budget."

We contacted Ron Suskind's publisher HarperCollins for response to the White House claim about Wikipedia and the other criticisms. A spokeswoman there said Suskind spent more than 700 hours with more than 200 individuals in writing the book. The spokeswoman calls it exhaustibly research and sourced, and said HarperCollins is proud to be publishing it.

Brian Todd, CNN, Washington.

(END VIDEOTAPE)

COSTELLO: Author of the book Brian talked about, Ron Suskind, will be on Wolf Blitzer's show tomorrow, "THE SITUATION ROOM." It's airs at 5:00 p.m. eastern right here on CNN.

CHO: Also new this morning, a 10th person has died in Reno following the crash of a plane into spectators at an air show on Friday. Some victims are still being identified. The 74-year-old pilot is among those killed. NTSB investigators hope the recording system and a forward-facing camera on the plane may give them clues to what went wrong. A preliminary report is expected later this week.

COSTELLO: Live pictures to show you now, towering flames. Fortunately no reported injuries after this drilling rig exploded late yesterday in Watonga, Oklahoma. That's about 68 miles west of Oklahoma City. People living with a one-mile radius of the fire have been evacuated. Authorities are going to let the fire burn itself out.

CHO: The sky is falling. NASA says a massive satellite could come crashing to the ground as early as this Friday. It's likely to break into pieces as it enters the earth's atmosphere. The problem is, those pieces could weigh as much as 300 pounds and could land anywhere from Canada to South America. Watch out.

COSTELLO: I know. Keep your eyes to the sky.

Now let's feast our eye on the stars. Our own Nancy Grace shuffling from the news desk. There she is. She made her debut on "Dancing with the Stars." And the verdict, not bad. The judges telling Nancy, she's got the moves.

CHO: As for the show's most talked about contestant, Chaz Bono, he did not disappoint with his cha-cha. Check that out. The judges raved, praising Chaz's footwork and his choreography. Afterwards Chaz thanked his fans for cheering him on.

(BEGIN VIDEO CLIP)

CHAZ BONO, "DANCING WITH THE STARS" CONTESTANT: The support has been amazing and it's interesting. That's what happened. When people are, you know, negative and hateful, it brings an equally positive response. Snd so the support that I've received has just -- it's been tremendous.

(END VIDEO CLIP)

COSTELLO: And Courtney Cox, you saw her there cheering on her ex, David Arquette. You can check him out there.

CHO: That's him? And that's Coco their daughter. Must be hard to learn the waltz. He looks great.

(WEATHER BREAK)

COSTELLO: Still to come this morning, President Obama and Republicans are drawing lines in the sand over the nation's deficit. So is there any hope for a compromise? We're going to talk to Republican Congressman Jeff Flake. CHO: And a new study suggests people with diabetes are nearly twice as likely to develop dementia. Dr. Sanjay Gupta will break it down for us.

COSTELLO: And some shocking allegations about Sarah Palin in a new book. We'll talk to the author who moved right next door to the Palins to write about Sarah Palin's life. We'll talk to Mr. McGinnis. You're watching AMERICAN MORNING. It's 13 minutes past.

(COMMERCIAL BREAK)

COSTELLO: Seventeen minutes past the hour. Welcome back to AMERICAN MORNING.

This morning, President Obama and Republicans are squaring off over how to put a dent in our debt. The president laid out his plan yesterday at the heart of that plan forcing the nation's wealthiest Americans to pay more taxes. But Republicans call this plan dead on arrival.

Joining me to talk about that, Republican Congressman Jeff Flake from Arizona. Thanks for coming in this morning. We appreciate it.

REP. JEFF FLAKE (R), ARIZONA: Thanks for having me.

COSTELLO: OK. So is the president's plan dead on arrival?

FLAKE: As it is written, yes, I believe it is.

COSTELLO: Why?

FLAKE: If you - the president himself said just a year or so ago you don't raise taxes in the middle of a recession. And I think we're probably still there. It doesn't make sense to raise taxes on those who we're - we're counting on to create jobs out there.

COSTELLO: Well, the president at least tried to put sort of a compromise in there. He said, you know, Medicare and Medicaid are on the table. Why can't raising the taxes on people making over $1 million a year be on the table, too? Why can't everything be on the table?

FLAKE: What should be on the table certainly is what the president's talked about before and Republicans have talked about for a long time. Lowering the overall rates, so we're more competitive internationally in particular, but then getting rid of exemptions and deductions and tax expenditures. There might be additional revenue that's generated there, not just as a result of additional economic growth, although that will certainly come.

So I think there's room - there's room for compromise but not in raising -

COSTELLO: But not on taxes?

FLAKE: -- not in raising tax rates. And that's what shouldn't be done.

COSTELLO: Did you sign the tax pledge?

FLAKE: Yes. I think every Republican has.

COSTELLO: Grover Norquist, right?

FLAKE: Yes. In the last - in the last election, yes.

COSTELLO: Explain to people why this guy is so important? Nobody elected him to office?

FLAKE: Well, I think everyone recognizes we shouldn't raise tax rates. Now, there's a difference between generating additional revenue that will come from tax reform. That's great. That way the economy will pay down the debt faster, but raising tax rates to levels that are unsustainable in terms of being able to compete is just not right.

COSTELLO: But let's be honest about this. Taxes are the lowest they've been since the 1970s. So the wealthiest are enjoying lower taxes and have been for quite some time. The wealthiest businesses are sitting on millions and millions of dollars and they're not hiring, even though the taxes are low.

So I think that many in America are sitting there wondering, well, what is the answer? Because we already like proposed all of these debt reduction things, right?

FLAKE: Right.

COSTELLO: So that's happening right now. The Super Committee's like planning what, to cut - what one point something trillion more from our debt? So -

FLAKE: Well, you have to remember to cut one point something million more, we're running over a trillion dollar a year deficit right now. If you cut $1 trillion more, that's over a 10-year period. So we frankly need to cut a lot more than that, but we need to do more than simply promise to cut providers on Medicare, and that's what the president's talking about.

COSTELLO: But we're - we can make all the cuts we want, but there will still be debt there and don't you need revenue to pay that debt down?

FLAKE: That's exactly it. And that's why we need to generate -

(CROSSTALK)

COSTELLO: Right, so where will that revenue come from, if it's not tax?

FLAKE: It can come from tax reform, but not higher tax rates, and - and there's a difference there. Right now our rates, the president is talking about taking the top rate all the way up into the 40s, and that's simply not competitive.

COSTELLO: He's taking them - he's taking them back to levels when President Clinton was in office. Isn't that what the - what he wants to do?

FLAKE: The president himself said just a year ago, we shouldn't raise taxes during a recession, but that's what he's talking about doing. We're not out of the woods yet, and if we want the economy to grow, we have to have competitive tax rates plus we've got to have some kind of moratorium on regulation.

I mean, when I talk to people around, it's not just uncertainty on taxes moving ahead or health care expenses. It's regulation, and these agencies right now are just a - a little out of control. I think the president recognized that last week, with the ozone regulations. We need to go much further than that.

COSTELLO: Do you know how frustrating this same argument is to voters?

FLAKE: Believe me, I do. I do. And that's why we've got to go in.

We haven't reformed the tax code since 1986. Anybody who has an attic realizes, you know, after a while you just need to take out the clutter. There are a lot of exemptions and deductions -

COSTELLO: The president said that he's interested in tax reform.

FLAKE: Right.

COSTELLO: And this is a first step to tax reform.

FLAKE: And we will join him in that. That's why I said I think there is room for - for a compromise and for work in raising - I'm sorry - in lowering the tax rate and getting rid of exemptions and deductions, and credits, which are taken advantage of, let's face it, more by those who have the means to hire lawyers than those who don't.

And so it - it will make the tax code far more fair than it is today. I think it will generate additional revenue. And, certainly, as a result of economic growth we'll have more revenue.

COSTELLO: I just - before you go, I wanted to ask you the class warfare question, because that's what we're asking our audience. You know, the Republicans are accusing President Obama of class warfare -

FLAKE: Right.

COSTELLO: -- pitting rich against poor. Is that what he's doing?

FLAKE: Yes, I have to say. And I - I'm not out to - to criticize the president unduly here, but that's what it is. It really is. It's basically saying that those who have earned more should pay more than those who - COSTELLO: No, he's saying that the playing field should be level. He's not saying the wealthy should pay more than the middle class pays in taxes.

FLAKE: No, but he is. He is. He's saying raise the top rate. That means the wealthy will pay more than they are now. They pay at a higher rate than others do as well.

And - and - but if - but if you -

COSTELLO: So what Warren Buffett says isn't true?

FLAKE: Well, what Warren Buffett is saying is that investment income should be taxed at the same rate as income, ordinary income, and it should not. Investment income has been taxed once already.

If we want to create jobs, the last thing you want to do is slap another tax or a higher tax on capital gains or dividends. That just isn't what you do.

It makes for good politics, I grant you. It's populism at its best. But makes for lousy economics.

COSTELLO: I think there are politics on both sides, and (INAUDIBLE) you of anything.

Thank you so much for coming in this morning. We really appreciate it.

FLAKE: Thanks for having me.

COSTELLO: Alina.

CHO: Carol, thanks.

Still to come this morning, find out why your mailbox could feel the effects of President Obama's debt reduction plan.

And allegations of cheating and drug use, just two of the things written about Sarah Palin in an explosive new book. We'll talk live to the author, just ahead.

It's 24 minutes after the hour.

(COMMERCIAL BREAK)

CHO: "Minding Your Business" this morning.

We could be looking at a higher opening on Wall Street this morning after some steep declines yesterday. That sell-off, fueled by lingering concerns over Europe's debt crisis. Right now the Dow, NASDAQ and S&P 500 futures are up.

The Federal Reserve is searching for ways to jumpstart the U.S. economy at a two-day meeting. Speculations growing the Fed will revive a program known as "Operation Twist." Its goal is to keep long-term interest rates down and fuel economic growth.

The U.S. is reportedly looking into whether there was any insider trading done ahead of the S&P's downgrade of America's credit rating last month. according to the "Wall Street Journal," subpoenas have been sent to several hedge funds which may have bet that the stock market would tumble.

Even without Steve Jobs, Apple unseating oil giant Exxon as the world's most valuable company, worth $362 billion. This after shares of the tech giant closed at an all-time high of $412.

And President Obama is throwing the cash-strapped Postal Service a lifeline as part of his proposal to cut the deficit. The plan would allow the agency to end Saturday mail delivery, and raise stamp prices another two cents to 46 cents.

Don't forget, for the very latest news about your money, check out all the new CNNMoney.com website.

AMERICAN MORNING will be back after this.

(COMMERCIAL BREAK)

COSTELLO: It is 30 minutes past the hour. Welcome back to AMERICAN MORNING.

A milestone for the U.S. military, as for midnight, gay men and women now free to serve openly in any branch of the armed services. The Pentagon officially ending the "Don't Ask, Don't Tell" policy. It's been in effect since 1993.

CHO: At the U.N. General Assembly today, President Obama is scheduled to meet with the chairman of Libya's Transitional National Council amid reports that troops loyal to Moammar Gadhafi are starving and massacring citizens in the Libyan city of Bani Walid.

COSTELLO: The state of Georgia could decide today whether death row inmate Troy Davis will get a last-minute appeal. David is set to die by lethal injection tomorrow. He's convicted of the 1989 murder of a police officer, Mark MacPhail.

Davis' attorneys told the board their client is innocent. Seven of the nine witnesses in his original trial have either recanted or contradicted their testimony.

CHO: In a hearing in Florida continues today over the death of a trainer who was pulled into the water and drowned by a killer whale. At issue, could SeaWorld have done more to protect its trainer? Here's CNN's Randi Kaye.

(BEGIN VIDEOTAPE)

RANDI KAYE, CNN CORRESPONDENT (voice-over): You're looking at video of SeaWorld trainer Dawn Brancheau. A tourist taped this. It was just moments before the 12-pound killer whale called "Tilikum" took the veteran trainer into his mouth and dove under water. Brancheau sways from side to side, he follows. She splashes him with buckets of water and feeds him fish, a reward for playing along. Then, suddenly, his behavior seemed to change. The wife of the tourist who took this video described what happened on NBC.

SUE CONNELL, WITNESSED SEAWORLD ATTACK: He grabbed her by the head and in a very hard thrust she went down and I screamed and she screamed. Then I started yelling to the other trainer because he wasn't he looking, I said, he just took her down, he took her down.

KAYE: Look closely at this video. You can see Brancheau's long ponytail swinging back and forth. But it may not have looked attractive to the six-ton killer whale until she got closer. The man who trained her says she made a fatal mistake.

THAD LACINAK, FORMER HEAD TRAINER AT SEAWORLD: I think she made a mistake by putting her -- allowing herself to be that close to his mouth and laying down. That's a pretty vulnerable position to be in with an animal like him. So I think -- I think even if Dawn was sitting here with me right now, she would tell you that that was a mistake that she made.

KAYE (on camera): Remember, Tilikum had killed before. In 1991, he and two other whales dragged a trainer who had fallen into their pool under water at a park in British Columbia. Thad Lucinak says that's why SeaWorld was more cautious with him. Trainers were not allowed to swim with Tilikum.

LUCINAK: He's not used to people being in the water. He was laying there looking at her. She was rubbing him down and all of a sudden the ponytail was there.

KAYE (voice-over): On this video, you can see what he's talking about. Brancheau is on a shelf that slides out into the pool, laying in about four inches of water right next to the 22-foot-long orka.

LUCINAK: The ponytail drifted there, he probably grabbed it and then pulled her in. Then went, whoa, I've got to her in the water.

KAYE (on camera): Lucinak who has worked with whales for more than three decades says he is convinced at least in the beginning that Tilikum had no idea he was doing anything wrong or hurting his trainer. He says Brancheau understandably panicked and that drama only got the killer whale even more excited.

(voice-over): The medical examiner says Dawn Brancheau likely died from multiple traumatic injuries and drowning.

LUCINAK: I constantly remind trainers, never get comfortable, totally comfortable with the animals.

KAYE: He says there's a reason these whales are called killer whales and what they may think is a game can be fatal.

Randi Kaye, CNN, Washington. (END VIDEOTAPE)

COSTELLO: Now is your chance to "Talk Back" on one of the big stories of the day. The question for you this morning, is a higher tax on millionaires class warfare? That depends. Republicans think President Bush is a modern day Robin Hood wielding his bully pulpit to pit the rich against the poor.

(BEGIN VIDEO CLIP)

RUSH LIMBAUGH, CONSERVATIVE RADIO HOST: Comes out today and starts demonizing the very people who are responsible for innovation, the very people who are responsible for economic growth, who are responsible for job creation.

(END VIDEO CLIP)

COSTELLO: Democrats say, come on. If there is a war, the middle class has already lost. If you need proof, the wage gap is growing ever wider.

Tax rates are the lowest they've been since the 1970s and the rich aren't exactly creating jobs because of it. At least on American soil. As for President Obama, he wants to tax millionaires more. T hat's not class warfare, he says. It's math.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES OF AMERICA: I rejected the idea that asking a hedge fund manager to pay the same tax rate as a plumber or a teacher is class warfare. I think it's just the right thing to do.

(END VIDEO CLIP)

COSTELLO: What is class warfare, anyway? It's a term made famous by that influential socialist Karl Marx. In short, Marx describes class warfare as when the lowly worker rises up against the wealthy class who exploited him making those rich people pay.

So the "Talk Back" question today, is a higher tax on millionaires class warfare? Facebook.com/americanmorning. I'd read your comments later this hour.

CHO: Can barely keep up with all the reading.

COSTELLO: Exploding.

CHO: It's 36 minutes after the hour. Still to come this morning, new medical evidence about a significant link between diabetes and dementia. Dr. Sanjay Gupta will join us live.

COSTELLO: And we will talk with the author of a controversial new book on Sarah Palin. That's coming out today. It's 36 minutes past the hour.

(COMMERCIAL BREAK)

CHO: Drug use, extramarital affairs, and an eating disorder. Just some of the explosive claims in a new book about Sarah Palin that lands in bookstores today.

COSTELLO: Yes, the book is called "The Rogue: Searching for the Real Sarah Palin." Author Joe McGinniss joins us now. Thanks for being with us on AMERICAN MORNING.

JOE MCGINNISS, AUTHOR, "THE ROGUE": Well, good morning. I'm glad to be here.

CHO: Good morning, Joe. You know, I have to ask you about this because you lived next door to Sarah Palin from May until September of last year. Yet you never met her. How were you able to then write this book?

MCGINNISS: Well, I was a good neighbor. So I never intruded on them, and I think she didn't much feel like meeting me. The last neighbors that she had in that house were members of an organization called "Oxford House" who had just gotten out of prison.

This was a halfway house for people, drug addicts and alcoholics doing rehab, after serving prison sentences. She was very friendly with those guys. She liked having them there.

CHO: She got wind early on what you were doing and so she didn't want to talk to you, clearly, understandably.

COSTELLO: And her husband calmed you a stalker, frankly. They weren't happy you were living next door. It's kind of an odd way to write a book.

MCGINNISS: It's kind of an odd way to react to a new neighbor to call your neighbor a stalker. I've had lots of new neighbors and I've never called them stalkers.

CHO: So who did you speak to in order to write this book? You clearly had a lot of sources?

MCGINNISS: A couple of under people I think. In fact, I was just going through the book over the weekend, and there are people talking about anonymous sources, but there are 70 or 75 people in the book who are quoted by name.

So it's not a question of not having any name sources and the anonymous sources are because the Palins scare people. The Palins intimidate. They threaten.

People in Wasilla are very scared of the Palins and this goes back to her time as mayor. They fear retribution. There were people who wouldn't even meet me socially because if Sarah found out, anything could happen.

COSTELLO: Well, let's talk about what some of those anonymous sources told you. You talked about Sarah Palin's religious extremism, her racism. You talked about the Palin sex life or lack thereof I should say. You talk about Sarah Palin's affairs and also Sarah Palin's possible eating disorder. I want to read like two passages attributed to these unnamed friends.

This one said, the cocaine was free flowing. Somebody found a 55 gallon oil drum and turned it upside-down and we're all doing cocaine lines off the top of the drum. Neither did Sarah find -- and this is another passage.

Separate from that. Another part of book you say somebody told you neither did Sarah finds nourishment in the joy of sexual intimacy with her husband.

These are sort of like gossipy things and people love to gossip. Let's say maybe she did experiment with drugs in her younger, freer days. Like who cares, right?

MCGINNISS: Who cares, right? Except that she portrays herself as a this paragon of family values who has this blameless, Christian life. It goes back to the religion thing. If she's a Christian extremist, and she -- she actually would see the separation of church and state in the United States ended.

She would -- go back to where our founding fathers did more than 200 years ago, and she would strip that away. She wants it see America as a Christian republic. This is a strain of Evangelicalism called Dominionism and this is what she represents and I think that's a danger to the country.

CHO: Joe, what Carol referred to, though, I mean, these are obviously salacious, they're getting a lot of attention.

MCGINNISS: You know why they're getting a lot of attention? I can tell you why because the "National Enquirer" stole a copy of this book ahead of time and they took out of 320 pages in that book, if you took all the stuff you're talking about salacious, that's about three pages out of 320.

CHO: All right, but it's getting attention.

MCGINNISS: Yes, it is.

CHO: You can't be upset about that. It's going to sell a lot of book. Having said that, are you confident what you wrote is true? I mean, a lot of it, it sounds pretty outrageous.

MCGINNISS: Well, Sarah Palin has lived an outrageous life. All I did was talk to people about it and they documented it for me and when I was comfortable with the veracity of what I heard, I put it into the book, and a lot of things I wasn't comfortable with I didn't put in the book.

COSTELLO: About one of her pregnancies. I mean, you intimate one of her pregnancies might never have happened. We heard this a lot during the campaign in 2008 that, you know, she didn't really have the baby. Weren't of her kids did. I mean, what is your conclusion in the book --

MCGINNISS: I don't draw a conclusion. I describe myself as --

COSTELLO: That's like throwing a bomb and waiting for it to go off.

MCGINNISS: No, actually what it's like is saying, there are still legitimate questions about that pregnancy that had never been answered, and I bring up the questions in the hope sometime in the future somebody else will provide the answers.

COSTELLO: Do you think she's going to run for president?

MCGINNISS: I wish she would, but I don't think she will.

COSTELLO: You wish she would, why do you say that?

MCGINNISS: Well, for my book, you know.

COSTELLO: OK. Well, let me ask you this, because so much of the book is negative on Sarah Palin. Is there anything likable about this woman in your mind?

MCGINNISS: Well, I --

(LAUGHTER)

MCGINNISS: I lived next to her and, of course, I never looked at what was going on on the other side of the fence. But I knew that a lot of the ducks on Lake Lucille went over towards the Palin dock. I can only think that's because she was feeding them. And feeding the ducks would be a nice thing to do.

(LAUGHTER)

CHO: I don't believe that you didn't peer over that fence once. Really? Not once? Go over and look at --

(CROSSTALK)

MCGINNISS: What do I want to see? What do I want to see?

CHO: You didn't want to look over --

(CROSSTALK)

MCGINNISS: They were peering in my fence. On her television show, the reality show, last fall, in the first episode, she told Todd she wanted him to drill a hole in the fence so she could spy on me. They're the ones who had their cameras on their side of the fence surreptitiously taking my picture. I never did that to them.

COSTELLO: If I knew, in fairness, somebody was living beside me, wanting to write a salacious book about me, I might wonder what you're doing, too.

MCGINNISS: Would you peer through the fence and drill a hole in it?

(LAUGHTER)

COSTELLO: I wouldn't want you living next door to me. I know that.

MCGINNISS: Well, you could come around and just ask me what I was doing. I would have been happy to tell her.

CHO: Yes, you would have.

COSTELLO: You were on the porch. I remember there was a story, you were on the porch waiting for the Palins to greet you, and they never came.

MCGINNISS: Well, Todd came.

COSTELLO: Todd -- oh, yes, there was a --

(LAUGHTER)

MCGINNISS: And he said, let's just see how long you stay here.

(LAUGHTER)

MCGINNISS: He greeted me with a threat, which is the -- that's the Palin way, threatening.

COSTELLO: Joe McGinniss, thank you for joining us.

The book is called "The Rogue: Searching for the Real Sarah Palin." It's out today. And I'm sure it will be a best-seller.

Thank you so much for coming in.

MCGINNISS: Thank you. I'm glad to be here.

CHO: Thank you.

COSTELLO: Still to come this morning, a new study links diabetes with a larger risk of dementia. We'll talk to Dr. Sanjay Gupta about that.

It's 46 past the hour.

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CHO: Here's what you need to know to start your day.

President Barack Obama scheduled to meet with the chairman of Libya's Transitional National Council at the United Nations today. That meeting comes amid reports that troops loyal to Moammar Gadhafi are starving and massacring citizens in the Libyan city of Bani Walid.

Two jailed American hikers in Iran will have to wait a little longer for their freedom. Bail has been paid for Josh Fattal and Shane Bauer, but their attorney says their release has been delayed again. That's because the judge that has to sign the release order is still on vacation.

An appeals court has ruled that the sentence against would-be bomber, Jose Padilla, was too lenient. Padilla was sentenced to just 17 years for conspiring to plant radioactive dirty bombs throughout the United States. The appeals panel ruled the judge who sentenced him didn't properly take into account his past criminal history as a gang member.

The first day of the Pentagon's new policy on gays in the military. Don't Ask, Don't Tell, which bars gays and lesbians from serving openly had been in place since 1993. It's now history.

You're now caught up on the day's headlines. AMERICAN MORNING is back in 60 seconds.

(COMMERCIAL BREAK)

CHO: 51 minutes after the hour. In this morning's "House Call," a new study says people with diabetes are nearly twice as likely to develop dementia, including Alzheimer's disease.

Dr. Sanjay Gupta has the details for us. He's live at the United Nations where, for just the second time, there is a health issue on the General Assembly agenda. We'll get that in just a moment.

But first, Sanjay, tell us about this link between diabetes and dementia. Is this for real?

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: It sounds like it, Alina. In some ways, people have known for some that there is likely to be a risk between diabetes and all sorts of disease of the blood vessels, because glucose, or sugar, in the blood vessels can be so toxic to those blood vessels and to the central nervous system.

I think what's surprising here a little bit, Alina, is they did the study in people over the age of 60, and what they found, roughly, was if you had diabetes, you were twice as likely to develop Alzheimer's-like dementia within 15 years. So think about that. A pretty significant correlation there. And about almost twice as likely to develop all the other forms of dementia as well.

I think people what have known is diabetes increases your risk for heart disease and increases your risk for stroke and increases your risk for micro-strokes, which could cause a type of dementia. But this was looking at all forms of dementia and finding out that the diabetes was a strong risk factor.

So, look, if you think about the numbers here in the United States, for example, by the year 2020, nine, 10 years from now, they say that half of U.S. adults will either have diabetes or be pre- diabetic.

CHO: Wow. GUPTA: Which is part of the reason people are so interested in findings like this. And obviously, what can be done about it as well, Alina

CHO: Incredible. And diabetes is in my family as well. So I paid particular attention to this.

Sanjay, I want to talk about why you're at the U.N. today. It's really incredible. It was 10 years ago that health was on the agenda. AIDS was the topic then. Today, it's non-communicable diseases. We are talking about diseases like cancer and diabetes. Talk about what is going to be discussed today?

GUPTA: And heart disease and lung cancer -- lung disease. What I can tell you -- it's fascinating. If you look across the entire earth, about three out of five people who die, die of what are thought of as non-communicable diseases, not communicable diseases or infectious diseases. And that stat alone is probably what has stimulated having this type of discussion at the U.N. assembly.

For a long time, it was thought these chronic diseases were diseases of developed counties, they were the diseases of the affluent, they were diseases of the elderly. And what it is finding is that many developing places around the world, it's quite the opposite. It is young people. It is people who don't have much in the way of resources. And it's, again, in these developing countries. So I think the whole equation is starting to change. The resources, the attention, the focus they says needs to be on non-communicable diseases, in part, because it's just -- obviously, people are dying of these diseases that can be prevented. But also because you are also starting to see the economic impact of these diseases as well. They say, if untreated, in many of these developing countries, it'll costs $7 trillion over the next 10 years, whereas it costs $10 billion to $12 billion a year to try to prevent many of these diseases.

So I think, while the health impact is what is the big topic of discussion here at the U.N. General Assembly, I think the economic impact is something that is coming up in a lot of discussions as well and I think stimulating and galvanizing a lot of these folks here.

CHO: Yes. And it's probably because it hasn't reached a crisis point, if you will. It doesn't probably get enough attention, so I think it's good that the U.N. is focusing on it today.

And, Sanjay, of course, great that you're there for that.

Sanjay Gupta, at the United Nations. Sanjay, thanks.

COSTELLO: We asked you to talk back on one of the big stories of the day. This was the question this morning: Is a higher tax on millionaires class warfare?

This from Jody, "All I know is, if I made a million dollars a year and the fed was already taking $400,000 of it, I would be ticked. Where is the incentive for these people to make more money just to have it taken away? There are so many common-sense things that could be done."

This from Casey, "It is not about class warfare, it's about right and wrong. No matter what your income, you should pay the same percentage of taxes. Someone who is barely making ends meet shouldn't pay more taxes in percentage than someone who makes significantly less and has more money to burn."

And this from Moreen (ph), "Well, that depends on which class you're in, right? Those of not making over $1 million a year have been under attack for a decade or more. So, if we are now only beginning to fight back, is that war or is it survival"?

Keep the comments coming, Facebook.com/Americanmorning. We'll read more in the 8:00 hour of AMERICAN MORNING.

CHO: No shortage of comments.

Four minutes before the top of the hour. Your top stories are next, including, purportedly, a new message that is, supposedly, from Moammar Gadhafi. What is he saying? We'll tell you.

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