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President Responds To Privacy Debate; Obama Faces Surveillance backlash; Tropical Storm Andrea Hammering East Coast; Unemployment Rate Rises; Transgender Ex-Navy Seal; Norwegian Navy Blows Own Ship Up

Aired June 07, 2013 - 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: Cleaning up after tropical storm, Andrea, and it is not over yet. The risk of flash flooding all along the East Coast.

Also, unemployment is up and the stock market is now reacting. What it means for your wallet.

This is CNN NEWSROOM, and I'm Suzanne Malveaux. The president responding now to the growing debate over privacy versus national security. Watch.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Our goal is to stop folks from doing us harm. And if every step that we're taking to try to prevent a terrorist act is on the front page of the newspapers or on television, then presumably the people who are trying to do us harm are going to be able to get around our preventive measures.

(END VIDEO CLIP)

MALVEAUX: The president's comments come on the heels of new reports now about government surveillance. According to "The Washington post" and "The Guardian" newspapers, intelligence agencies, they're gathering massive amounts of information from major Internet companies. We're talking about Microsoft, Apple, YouTube, Yahoo, Google, Facebook and others. Many of the companies deny giving access to information. Well, the director of national intelligence says that Internet data collection does not target U.S. citizens. We heard the president reiterate that point. He says investigators don't look at the vast majority of data because it's not terror related. That the program is legal under the patriot act and that it is reviewed by a court every 90 days.

I want to bring in our Chief Political Analyst Gloria Borger. And, Gloria, it was really interesting to see how the president went through these two different programs. And he made the distinction between the programs, the Verizon, the phone call records and also what was reported regarding the Internet. Now, he made this case and it was rather private. He said, look, I'm going to be out of office in three and a half years. I'm going to be at the top of the list if you want to listen to my phone conversations or read my e-mail. I want to protect your privacy because I'm going to be a citizen -- private citizen myself. I want you to listen to this and tell me if you think it's convincing.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I will leave this office at some point, sometime in the last -- next three and a half years. And after that, I will be a private citizen. And I suspect that on a list of people who might be targeted, you know, so that somebody could read their e-mails or listen to their phone calls, I'd probably be pretty high on that list. So, it's not as if I don't have a personal interest in making sure my privacy is protected.

(END VIDEO CLIP)

MALVEAUX: What do you think, Gloria?

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Well, I think a few things. First of all, this is President Obama, former senator, former constitutional scholar, right? Or who still considers himself a constitutional scholar. What have the controversies been, Suzanne, he's been dealing with? Surveillance, drones, leak investigation. All of these three issues go to the heart of what he's really about, OK? He believes in protecting privacy. That's one thing. Now, he's also president of the United States. And he understands the difficulty in doing that.

So, we see the struggle internally that he is having with this. And he says, look, there's got to be a balance between privacy and national security. And, by the way, I think he also implied, look, you can't have it both ways. If you want to connect all those dots and you want the government to be on top of things because you don't want to have another terror attack, then you cannot be guaranteed, as he put it, 100 percent security, 100 percent privacy and zero inconvenience.

MALVEAUX: Yes, I noticed, too, he actually -- he acknowledged that there are trade-offs in all of this as well.

BORGER: Right.

MALVEAUX: I mean, it's a very different Obama here, candidate Obama, senator Obama and --

BORGER: Sure.

MALVEAUX: -- (INAUDIBLE) Obama who asked the government to protect the country. I thought it was also interesting, too, Gloria, here he really emphasized, he said, look, you know what? Go to members of Congress. There's a federal court as well. Don't blame me on this. Listen to how he put it.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: That's also why we set up Congressional oversight. These are the folks you all vote for as your representatives in Congress. And they're being fully briefed on these programs. And if, in fact, there was -- there were abuses taking place presumably, those members of Congress could raise those issues very aggressively. They're empowered to do so.

(END VIDEO CLIP)

MALVEAUX: So, Gloria, you know, does that kind of take the air out of the balloon here? He says Congress has to authorize this every 90 days or so, every three months.

BORGER: Right..

MALVEAUX: And there's a federal court that's in -- you know, in play here.

BORGER: Well, you have heard complaints from Congress, presumably from members who have been briefed on the Democratic side of the aisle, more liberal members of Congress like Mark Udall, for example, Senator Udhal. But you've also heard from a Republican or two who says, you know what? I didn't know the extent of this. What the president is saying is that he is not doing anything without the full knowledge and support and approval of members of Congress who know about this.

So, what he is saying is, look, I'm not some renegade rogue president who's going around the Congress and trying to put these things in place to snoop on you. I am doing this in concert with the Congress as is required by law to make sure that we don't have another terror attack. So, he was trying to tell the American public, look, all of us know about this. We understand what we're doing, and we're doing it to protect you and it's not easy. And, by the way, as you know, Suzanne, the president also said, look, this is a debate that I welcome. That we're going to have to have in this country because we have to -- you know, as the world gets more complicated, we have to figure out ways to deal with these privacy issues and our security.

MALVEAUX: All right. Gloria, thank you. Very --

BORGER: Sure.

MALVEAUX: -- interesting to see the president really --

BORGER: Yes.

MALVEAUX: -- walking that fine line, the balance that he has between national security and privacy concerns that a lot of people have been raising lately.

BORGER: And unapologetic about it, Suzanne, right?

MALVEAUX: Yes.

BORGER: I mean, there wasn't any shrinking away from this.

MALVEAUX: Yes. No, and everybody has some credit here to go around, all three branches of government. Thank you very much. I appreciate it, Gloria.

Tropical storm Andrea hammering the east coast now. Heavy rain, strong winds. Right now, it is moving over the Carolinas. Folks there could see dangerous storm surges, flash floods, possibly some tornadoes as well. Already several tornadoes ripping through Florida damaging homes, hurting at least -- one person was injured. Some people who saw a tornado touch down say they even couldn't -- they couldn't even believe what they were seeing. Watch this.

(BEGIN VIDEO CLIP)

MATT EDISON, LIEUTENANT, FERNANDINA BEACH FIRE DEPARTMENT: That was the first time I'd ever seen anything like that. I've seen waterspouts working here before but something to be actually on land like that, I've never seen that. Kind of neat but in a way it's scary when you see the damage, it was a minimal storm that it caused.

(END VIDEO CLIP)

MALVEAUX: Tropical storm Andrea also going to soak millions of people all over the Eastern seaboard this weekend. I want to bring in our Nick Valencia who's in Wrightsville Beach, North Carolina. And, Nick, we've been kind of seeing you there on the monitor from time to time being blown around, barely standing there. How are the conditions?

NICK VALENCIA, CNN CORRESPONDENT: Yes. Well, it seems as though the worst of it has passed, Suzanne. There are of course these sustained winds that come or gusts of wind, I should say, that come about 40 miles per hour. Probably the most dangerous thing right now for the residents are the beach -- is the sand. It's just brutal. It's just pelting us. It is just brutal here. But for so many residents here, it has been a non-event. You've got to remember this is a part of the United States and particularly part of North Carolina that is accustom to hurricanes. It's accustom to severe weather. So, for a lot of people here, residents aren't hunkering down. They're leaving -- they're going about -- they're not leaving. They're going about sort of their everyday life.

MALVEAUX: And what do we expect, Nick, in the hours to come?

VALENCIA: Well, you know, we've seen the sun come out and the water sort of recede back. Earlier, those waves looked a lot more angry than they do right now. We do know that there's -- there has been a dozen homes or so here that have lost power. I spoke to a resident earlier who was without power and that still seems to be the case for her in the last couple of hours. But this storm for all intents and purposes, Suzanne, it's moving towards the northeast. It's going towards New York. It's going towards our colleagues there in New York and Boston and the northeast area. So, for those of you watching at home in that area, you know, expect some heavy rain to hit you in the coming hours -- Suzanne.

MALVEAUX: All right. Nick, we're going to check in with the New Yorkers and those in Boston. Thanks, Nick. I appreciate it. Stay safe.

I want to do a quick check of the markets right now. You see the Dow, it is at 15 -- more than 15,000, up 169. It follows the release of the May jobs report this morning showing the unemployment rate is up but just barely, 175,000 jobs were added in May. Now, it's actually more than analysts expected. We -- and actually better than we did in April. I want to bring in Alison Kosik at the New York Stock Exchange. Is this overall good news, Alison?

ALISON KOSIK, CNN BUSIESS CORRESPONDENT: You know what, Suzanne? It's a good report. It's just not great. Because, to be honest with you, it's still just kind of average when you look at how job growth has been in this country over the past three years. And then, you look at the unemployment rate. It ticked up to 7.6 percent. Kind of a good reason there, more people jumped back in to look for a new job. But the problem is a lot of them, they haven't gotten a job yet. And that's why you saw the unemployment rate go higher. So the market -- you see the market doing real well.

MALVEAUX: Yes.

KOSIK: Stocks have been all over the place this week with investors very worried about whether the kind of a good reason there, more people jumped back in to look for a new job. But the problem is a lot of them they haven't gotten a job yet. And that's why you saw the unemployment rate go higher. So the market -- you see the market doing real well. Stocks have been all over the place this week with investors very worried about whether the Federal Reserve is going to start to pull back on its economic stimulus.

So, when you look at this job number, at least when investors look at this job number, they wanted it to be good, maybe not so good. So, this may have been their kind of sweet spot they were looking for which is why we're seeing the rally today. And that's not to say Wall Street wouldn't have welcomed a better number for jobs, but status quo seems to be sitting well with them today -- Suzanne.

MALVEAUX: All right. Alison, we know it's not an increase across the board when it comes to jobs. Where are we seeing the biggest gains, the biggest jumps here? What kind of industries?

KOSIK: OK. So, some of the places that have been doing well continue to do well. They include professional and business services. They added 57,000 jobs, and that includes 5,000 architect and engineering jobs. So, what you see there playing out is the housing recovery pushing that along. Food service jobs, meaning restaurants and bars, there continues to be growth there. There was an additional 38,000 jobs added in May. That sector has actually added more than 300,000 jobs over the past 12 months. The problem with those jobs though, they're low paying jobs. You can't necessarily pay the bills easily on those kinds of jobs.

All right. So now, let's go to the not so bright spots in this -- in this jobs report. Government jobs got hit hard. The federal government lost 14,000 jobs. And we know how spending cuts have been a real drag on the economy. Now, we can actually see it in the numbers how it's a drag on jobs. Manufacturing sector also got hit losing 8,000 jobs -- Suzanne.

MALVEAUX: All right. Alison, have a good weekend. Appreciate it.

KOSIK: You too.

MALVEAUX: Here is what else we're working on for this hour. He was a decorated Navy SEAL spending years fighting for our country, but he was also living what he felt was a lie.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I just recently came out. I'm starting to live my life as a full female. I live -- this is my life.

(END VIDEO CLIP)

MALVEAUX: Plus, the Norwegian Navy blowing up one of its own ships. We're going to tell you why straight ahead in the NEWSROOM. And most guys, right, they want a man cave. Well, wait until you see what some workers did with your money to set up their own private playroom in a government warehouse.

(COMMERCIAL BREAK)

MALVEAUX: You're looking at the Norwegian Navy blowing up one of its own ships to test out a new long-range stealth missile. You can see it was effective in taking out -- this is a decommissioned 300-foot- long ship there. Scandinavian defense firm is developing the missile system. It's also going to be used to arm the Polish Navy as well.

In a scene of the deadly building collapse. This is in Philadelphia. It has now been turned over to accident investigators. Officials are now saying, quote, "they are absolutely sure there are no more victims in that rubble."

Six people were killed on Wednesday when that four-story wall of a partially demolished building collapsed on to the neighboring Salvation Army store. One of them was 24-year-old art student Anne Bryan. Her family says she was brilliant, caring, had the ability to find beauty in everything. Philadelphia's mayor promises a wide ranging investigation.

And as we mentioned, the government can find out more about you, electronic communications, than you might have imagined. So what is the government specifically looking for? Tom Foreman explains.

TOM FOREMAN, CNN CORRESPONDENT: Imagine that the billions of phone calls being made in this country every week were boiled down to a single neighborhood, so we can comprehend this, and a computer was recording every time a call was made, where it was answered and how long it lasted.

That is metadata. You don't know what's being said, you just know contact was made.

Now, that computer could analyze all those contacts to come up with essentially networks. Who was talking to whom most often? Because we all talk to the same people over and over again.

Then, along comes some kind of event in the middle of all this. A terrorist event. What investigators could do if they had a suspect in particular, is go back to all of that metadata and say look at all of the activity on the phones before this happened, around the time this happened. Did some groups stand out as being much more busy than all the others when this occurred, and should we focus on that group more, not just for our suspect but for everyone connected to that suspect?

Privacy groups of course are having a fit over this. They say this is like posting a police officer outside of every single person's house and saying just write down every time somebody comes or goes in case they might be involved in crime some day.

The government says no, no, no it's not really being used that way. They say that information is being held by the computer, and the information is not accessed without suspicion and additional FISA court orders to say now investigators who have a real crime on their hands can go into that data.

That still leaves a lot of things unanswered at this point. It's not clear how detailed or extensive this data is. For example, if you have GPS on your phone, is the metadata included that tells people where you were the whole time? We don't know how long the data is being kept. We also don't know about possible future uses for that data. We're talking national security now, but the fear for many privacy advocates is maybe in the future it won't be just about that.

MALVEAUX: As you can see here, also appears to be a generational divide over privacy versus security. This is according to a CNN/Time ORC poll, 57 percent of people under the age of 50 are not willing to give up some civil liberties to curb terrorism. Half of those over 50 are willing to give up some things.

He was an elite member of the Navy SEALs, now she's a warrior princess. Coming up, how a transgender former SEAL waited to retire before becoming a woman. Why she says she was afraid for her life.

(COMMERCIAL BREAK)

MALVEAUX: He was an elite member of the Navy SEALs, and now she is a warrior princess. This is Chris Beck before and this is Kristen Beck now. She says living life as a woman was not possible while living the life of a Navy SEAL. Well, Beck is out with a book about her experience and Anderson Cooper sat down and talked with her.

(BEGIN VIDEOTAPE)

ANDERSON COOPER, CNN ANCHOR: Christopher Todd Beck enlisted with the military in 1990 with the dream of joining the U.S. Navy SEALs, the elite unit with the reputation for being one of the toughest, the fittest, and most secretive forces in the U.S. military.

Beck realized that dream serving for 20 years with the SEALs in some of the most dangerous battlegrounds around the world including Iraq and Afghanistan.

A former Navy SEAL who knew beck says he had a stellar reputation with his comrades. By the time her retired from service in 2011, Beck had a long list of medals and commendations including the bronze star and the purple heart.

But for 20 years, while Beck was fighting for his country, he was also fighting an inner battle - a battle over his gender identity.

Chris Beck wanted to live his life openly and honestly as a woman, which is what he started doing after he retired in 2011. Chris Beck is now Kristen Beck, she's currently on hormone replacement therapy and feels like she's becoming the person she was always meant to be.

It's been a long journey for Kristen to get to this point. She's written a book about her experience called "Warrior Princess, Hoping to Help Others." The book comes nearly two years after the Department of Defense repealed its "don't ask, don't tell" policy allowing gays and lesbians to serve openly in the military. But gender identity has nothing to do with sexuality. Transgender, men and women, are still banned from service. The 20-year decorated combat veteran would not be allowed to serve in the military as she lives her life today. Anderson cooper, CNN.

(END VIDEOTAPE)

MALVEAUX: And Kristen Beck spoke with Anderson about keeping the desire to be a woman bottled up. Listen.

(BEGIN VIDEO CLIP)

COOPER: It's got to be so -- just sad to think that for 20 years you have to -- that you have this incredible bond with these people you're fighting with, and you want it to be the closest bond imaginable and yet you can't really let yourself be yourself.

KRISTEN BECK, FORMER U.S. NAVY SEAL: It's definitely tough. It's -- I mean, it's strength and honor. It's like one of the ones that we do. When we shake hands, you know, we shake hands and we say strength and honor. And that's still what I gave true. I gave true brotherhood. I did my best -- 150 percent all the time. And I gave strength and honor and my full brotherhood to every military person I ever worked with.

And I feel that pretty much any transgender person that's in the military right now -- and there's a lot of them right now probably doing service, they're doing the same thing. And you would never know that they're transgender or anything. It's just too bad because they're doing a great job. And nobody even knows it.

COOPER: What would have happened if you had said to some of the SEALs you were serving with that this is who you are?

BECK: Well, it's probably very similar to some of the support I'm getting right now. But it would have been only that, a few of them that would have accepted saying, hey, you're my brother and I've never seen you do anything wrong and totally honorable and it's good to go. And they might have accepted it and maybe half and half. Maybe less. I don't know. That's a chance that if I took it, I might be dead today.

(END VIDEOTAPE)

MALVEAUX: And you can see more on that story on CNN.com.

We are following this -- couches, TVs, personal items hidden throughout this government warehouse. How an audit uncovered secret "man caves" that, yes, you pay for. Up next.

(COMMERCIAL BREAK)

MALVEAUX: Well, you heard President Obama just this last hour trying to reassure everyone that the government is not spying on your e-mails and your phone calls. Well, now the president is shifting his focus to China. This afternoon he is hosting the new Chinese president Xi Jinping at an estate near Palm Springs.

The setting, less formal than the traditional summits between the top leaders. This is really so the two presidents can get to know each other. Observers say the weekend talk's really a chance to set the agenda for future relations between the two most powerful countries in the world.

President Obama highlighted his signature health care law, the Affordable Health Care Act, today during his stop. That was in San Jose, California, earlier. The president touted the affordability of the new health exchanges, they're being called, being set up for millions of uninsured Americans.