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THE SITUATION ROOM

Obamacare Fireworks On Capitol Hill; Guardian: U.S. Spied On 35 World Leaders; Sources: Box Cutter Used To Kill Teacher

Aired October 24, 2013 - 17:00   ET

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


WOLF BLITZER, CNN ANCHOR: Me too, Jake, thanks very much. Happening now, fireworks on Capitol Hill --

(BEGIN VIDEO CLI)

UNIDENTIFIED MALE: Will the gentleman yield?

UNIDENTIFIED MALE: No, I will not yield to this monkey court or whatever this is.

UNIDENTIFIED MALE: This is not a monkey court.

(END VIDEO CLIP)

BLITZER: Monkey court. Lawmakers face off over the problem- plagued Obamacare web site. Contractors blame each other for the mess. The two congressmen in that heated exchange, they will join us live for a debate this hour.

And we've heard all the complaints but is it really all that difficult to sign up for Obamacare? These people are getting ready to go online and try to enroll right here in THE SITUATION ROOM live.

Plus, new details on the murder of a young Massachusetts teacher. Sources allege the 14-year-old suspect used a box cutter to kill her. But why?

I'm Wolf Blitzer. You're in the SITUATION ROOM.

All right. Take a look and see what's going on live in the SITUATION ROOM right now. These three people are interested in signing up for Obamacare. They're about to log on to the website and try to enroll. We've heard about all the problems with the system, including new details during that testy House hearing today. But we're going to try something very different with the help of our guests and CNN's Tom Foreman.

We'll be able to see how the Obamacare website works or doesn't work in real-time. The clock starts ticking right now.

The sparks, meanwhile, were flying on Capitol Hill today as lawmakers squared off and Obamacare contractors blamed each other for the website problems. Let's begin our coverage right now with CNN's Joe Johns. He's up on Capitol Hill -- Joe. JOE JOHNS, CNN CORRESPONDENT: Wolf, if there was one big loser today, it was CMS, the Centers for Medicare and Medicaid Services. Contractors testifying at this hearing, put a lot of blame on the government for making one key terrible decision.

(BEGIN VIDEOTAPE)

JOHNS (voice-over): Fireworks on Capitol Hill as lawmakers took aim at the botched rollout of Obamacare's website.

REP. TIM MURPHY, (R) PENNSYLVANIA: $500 million later, we find the American public have been dumped with the ultimate cash for clunkers.

JOHNS: But as to who's to blame for the Obamacare website, government contractors weren't taking responsibility.

CHERYL CAMPBELL, SENIOR VP, CGI FEDERAL: The federal exchange, including the SFM, is not a standard consumer website.

LYNN SPELLECY, EQUIFAX WORKFORCE SOLUTIONS: Equifax Workforce Solutions role in the federally facilitated marketplace is limited.

UNIDENTIFIED MALE: We have no role in the development of the website.

JOHNS: One company, CGI, blamed another company seated at the very same witness table without naming names, of course.

CAMPBELL: The first set of issues on the exchange concerned another contractor's enterprise and daily management or EIDM function.

JOHNS: That other company, Optum/QSSI, owned by United Health Insurance Company, passed the buck to the federal government's Centers for Medicare and Medicaid Services or Cms, which made what amounts to a last minute call.

ANDREW SLAVITT, GROUP EXECUTIVE V.P., OPTUM/QSSI: One of the reasons for the high concurrent volume at the registration system was a late decision requiring consumers to register for an account before they could browse for insurance products.

JOHNS: Because of that last minute call, the contractors admitted the system had not been fully tested before the website went public October 1st. A member of Congress who used to program computers for a living asked a key question.

REP. STEVE SCALISE, (R) LOUISIANA: CMS made a decision. How late in the game did they make the decision to change address at system like this?

CAMPBELL: For CGI, they asked us to turn that flag off or functionality off at two weeks before go live.

(END VIDEOTAPE) JOHNS (on-camera): CMS said today that making consumers essentially register before browsing was a business decision. CMS is expected to testify on Capitol Hill next week. Kathleen Sebelius, the head of HHS, is also expected to testify next week. Thirty-two House republicans have now called for her to resign and a letter. Obama applications we're told are now up to 700,000 so far -- Wolf.

BLITZER: Let's see what happens. All right. Thanks very much, Joe Johns up on the Hill.

As the Obamacare blame game escalates, let's go in depth right now. "Time" magazine's Washington bureau chief, Michael Scherer, is joining us. The latest edition of "Time," by the way, is on the stands right now. There you see the forgotten prince on the cover. Also joining us, our chief political analyst Gloria Borger.

You know, they used to say the buck stops here, referring to the president of the United States. Should we be seeing, hearing more from him as opposed to others right now?

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Well, at some point, he's going to have to decide where the buck does stop because that hearing today was the buck stops there, not here. I think the president has come out, spoken about this. He said he's angry about it. He has to address it periodically, Wolf.

He has to let the technocrats fix it, brief regularly on it, expresses anger, see what happens in a couple weeks, and then maybe take some more action. I think, you know, right now, he has to kind of let this play out and make sure the American public understands that the website is not Obamacare itself.

That there's a difference. Just because you don't like the website doesn't mean that the product isn't good for you.

BLITZER: Yes. They're trying to be a little bit more transparent right now, but they still have a long way to go. They're not releasing official numbers at least until next month sometime.

MICHAEL SCHERER, TIME WASHINGTON BUREAU CHIEF: That's right. And they're not saying what the technical problems are. They won't confirm the things that we've been finding through our reporting. They won't discuss how bad it is on the back end. We basically know the website is broke because we can't use it.

We know the user experience on the front and we know the insurers are complaining on the back because the data they're getting from the few who go through the system is oftentimes garbled or not usable. But we don't know how bad the inner workings of this are or how long it will take.

BORGER: And so, the insurers have now said, OK, we're going to work together with the federal government, finally, by the way. It's amazing this did not happen before because if the data that they're getting is unclear about who's enrolling, then they can't insure people. BLITZER: There's a lot of pressure also coming in from Republicans, but even a few Democrats right now, Michael, to delay some of the individual mandate parts of this, maybe the penalty phase or whatever. You think the White House is ready to make that kind of concession?

SCHERER: They're not ready now and they have time. I mean, this is a six-month enrollment period. They really don't need people to be totally signed up until March of next year, and they're hoping that most of the people, they've always kind of been expecting, most of the people won't really sign up until the last minute because that's what happened in the Massachusetts case when they had a similar system.

The question, though, is if they can't get this online and we're getting through November into December, you're going to hear the insurers start making a lot of noise about this, and the pressure will grow so intense that I think it will at that point become in the interest of the White House to do a delay, but we're not there yet. We don't know how long it's going to take to fix this.

BORGER: And the point is you want the young people like the ones we've got here trying to log in today, you want the healthy ones to get in, because otherwise, the whole risk pool becomes a problem. So, you need young, healthy people to affirmatively want to have this experience of loving it.

BLITZER: And we've asked three educated young people who are all healthy to go ahead and try to log on --

BORGER: They're not under any pressure, are they, with that clock?

BLITZER: -- to see how they do it. We're going to watch them over the course of this program to see how difficult it is, see what's really going on, because you're absolutely right. In order for the system, the Obamacare system, to work, to subsidize the people with pre-existing conditions, the poorer people, older people, if you will, you need young healthy people to come in and start buying health insurance.

Gloria, you saw the story in the "New York Times" about Ted Cruz and his wife who's an executive at Goldman Sachs. She's on the Goldman Sachs health care plan and he's on the Goldman Sachs health care plan. What do you make of this, if anything? Democrats charging hypocrisy here on his part?

BORGER: Well, look, she -- he's on her plan, nothing wrong with that. And she gets an employer contribution on her plan just like we do on our health care plan which is that Goldman pays into a certain portion, right, for her healthcare. What he wanted to get rid of on Capitol Hill was the employer contribution that the government pays for people who work on Capitol Hill and their staffs.

And that's where there's a little bit of hypocrisy, because there's always an employer buy-in and there is one on the Hill. It's just that in that case, the employer happens to be the federal government.

SCHERER: I agree. The scandal is not that Ted Cruz's wife is giving him health care. It's that Ted Cruz was trying to take away the health care of members of Congress and their staffs while arguing that it was really about Obamacare when it wasn't.

That whole argument about changing health care for people on the Hill was really about taking away the employer contribution of people who get it, just like we get employer contribution. It had nothing to do with people without insurance right now, with the exchanges, with the programs we have.

BLITZER: And we did get a statement from a spokeswoman for the senator saying the senator is on his wife's plan which comes at no cost to the taxpayer and reflects a personal decision about what works best for their family. So, obviously, they're sticking by that plan. Guys, thanks very much --

BORGER: Probably pretty good.

BLITZER: -- for coming in.

Coming up, a stunning new allegation about U.S. spying, this time, a report that the NSA secretly monitored the phone conversations of 35 world leaders. And they've been at it for a few minutes.

Take a look at this. They're trying to sign up for Obamacare. They're doing it live here in the SITUATION ROOM. We're going to find out soon if they're making headway, if they're just getting frustrated. Stay with us. You'll see what's going on. The first eight minutes now over.

(COMMERCIAL BREAK)

BLITZER: A little experiment going on in the SITUATION ROOM. We invited three people to sign up for Obamacare. Tom Foreman is here watching this process. Got a clock, seeing how they're doing, Tom. Very early so far, it's only been, what, 12 minutes.

TOM FOREMAN, CNN CORRESPONDENT: Yes. And it's not a scientific experiment but we wanted to see what would happen as people tried to come in here, knowing that the chief complaints people have had are connectivity, can you get online and make it work easily, ease of use once you get there, can you figure out what you're doing and third, bottom line, is that good for you.

And our three folks here right now, Laura and Gabe and Hazami (ph) have been dealing with very difficult problems. Laura here has had it fairly simple. She's been able to move forward. Gabe has had a series of problems trying to get on to the D.C. site. Laura is using the federal site. And Hazami down here is using the federal site.

And we're almost 13 minutes in and she has been locked out time and time again, maybe making a little bit of progress now. But Wolf, we'll keep checking back and see if they can get to the finish line. BLITZER: All right. We'll see what happens. I know Laura had originally managed to get at least part of the process earlier. So, she got a little advantage there. We'll continue to watch it. Thank you, Tom, for that. Let's see what happens.

Meanwhile, other news we're following, including a new blockbuster allegation about U.S. spying. Just a day after Germany's leader called President Obama to complain, to complain about alleged U.S. monitoring of her cell phone, Britain's "Guardian" newspaper says a classified document shows the National Security Agency monitored phone conversations of 35 world leaders.

CNN's chief national security correspondent, Jim Sciutto, is here in the SITUATION ROOM looking into this story. What are you finding out?

JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT: Well, it's really incredible. I have that NSA memo here as first reported in the "Guardian" which gives the details. It's dated 2006. Remarkable detail they were going into, going after the direct line, fax, residence and cellular numbers of these leaders, but it also notes in this document that these calls have noted little reported intelligence value which begs the question why were they taking this risk, including of going after the phone calls of some of our closest allies.

We already know there's been a very uncomfortable phone call between the German chancellor and President Obama yesterday, where in that call, the White House tells us he assured her that the U.S. is not and will not listen to these calls, but did not specify that they had never done this in the past.

And the White House has been pressed on this a number of times and as far as Jay Carney has been willing to go is to say we are not going to comment publicly on every specified alleged intelligence activity. Of course, more difficult when you have so many of them.

BLITZER: But it's causing enormous diplomatic headaches for the United States.

SCIUTTO: No question. Today, you already have the German chancellor, the American ambassador summoned. You had the German defense --

BLITZER: In Germany.

SCIUTTO: In German. You had the German defense minister saying there must be consequences for the relationship and you have Angela Merkel saying today in very strong words that trust between the U.S. and Germany has been threatened. Here's how she described it.

(BEGIN VIDEO CLIP)

CHANCELLOR ANGELA MERKEL, GERMAN (through translator): We are closely tied in with the U.S. and trust is an important part of the relationship, and now, that trust has to be reestablished between us. Spying among friends is never acceptable.

(END VIDEO CLIP)

SCIUTTO: That trust has to be reestablished. The White House has said they are reviewing this surveillance to get a better balance between security and privacy which presumes they haven't gotten that balance right, but they haven't told us how they're going to change this. Are they going to rein it in, how far are they going to rein it in? Still some hard questions.

BLITZER: The headaches for the secretary of state, John Kerry, must be huge right now. It makes his life a lot more complicated.

SCIUTTO: No question. We have a lot of big asks from these allies, too, on Iran (INAUDIBLE) going forward.

BLITZER: We need their help.

SCIUTTO: Yes.

BLITZER: Jim Sciutto, thanks very, very much.

Up next, sources say they now know how a young Massachusetts teacher was murdered. The big remaining question, why?

And they're trying to sign up as we've been reporting for Obamacare coverage live here in the SITUATION ROOM. Tom Foreman is keeping tabs on how they're doing. Some are moving along faster than others. We're going to get a fresh report, an update when we come back.

(COMMERCIAL BREAK)

BLITZER: Chilling new details emerging right now about the gruesome killing of a beloved high school teacher in Danvers, Massachusetts and the student allegedly behind it. CNNs Don Lemon is on the scene for us. He's getting new information. What are you learning, Don?

DON LEMON, CNN CORRESPONDENT: According to our sources, Wolf, you know, the suspect really did a hopscotch around this town from the school into the woods with the teacher's body, then to a local restaurant, even to a local movie theater all while changing clothes at the same time. The details are really gruesome and they are not for the faint of heart.

(BEGIN VIDEOTAPE)

LEMON (voice-over): As Danvers High School mourns the loss of popular math teacher, Colleen Ritzer (ph), following her shocking homicide, new details are emerging in the killing. A source close to the investigation tells CNN around 3:30 Tuesday afternoon, her 14- year-old student, Philip Chism (ph), allegedly beat and slashed her with a box cutter in a second floor student restroom.

The source says he then stuffed Ritzer's body into a recycling bin, rolled it out of the school, and dumped her body about 20 feet into the woods behind the athletic fields. The bin was found thrown over an embankment approximately 100 feet away. Chism allegedly changed clothes, went to a local Wendy's, and then on to the Hollywood hits movie theater nearby, according to sources familiar with the investigation.

Police caught up with Chism wandering the streets past midnight in a nearby town. By then, 24-year-old Colleen Ritzer (ph) had been reported missing. A combination of statements Chism gave to investigators as well as surveillance tape helped investigators discover Ritzer's body sometime later, according to the criminal complaint. Kai Silva was a friend and teammate of Philip Chism.

UNIDENTIFIED MALE: He was a really nice kid. You know, he had a great smile. Of course, you know, he's in a new town so he would be, you know, kind of shy and kind of quiet.

LEMON: Silva says when Chism didn't show up for soccer practice and a team dinner, he knew something was wrong, but not this wrong.

UNIDENTIFIED MALE: That's what gets to us. He didn't demonstrate any signs, any signs of aggression, any signs towards any teachers.

LEMON: Ritzer's family and friends continue searching for answers.

JENNIFER BERGER, FRIEND OF COLLEEN RITZER: Colleen is a good person like it just doesn't make sense to me why something so terrible would happen to someone who is completely the opposite. She just would never, ever want to hurt anyone.

(END VIDEOTAPE)

LEMON (on-camera): And we are told that the suspect is cooperating with investigators. When last we saw him, it was 24 hours ago when he was in court but still, no plea as of yet. We've reached out to his attorneys, Wolf. We have not heard back. And of course, the prosecutor is charging him as an adult and they are seeking to try him as an adult as well. They're waiting for a grand jury to convene.

BLITZER: Even though he's only 14 years old, as you noted. What can you tell us about the parents of this young suspect?

LEMON: We saw the mother yesterday caught on videotape as well leaving court. She did not say anything. We went by the home this morning. And according to the kids here who knew him, the students who knew him, they say he moved here this summer with his mom and with his sister, not with his father. He moved here from Tennessee.

Apparently, his father is in the military reportedly and he doesn't have much contact with him, although, the father does come to his soccer games every now and then. But again, a quiet kid here with his mom and sister and really, nothing out of this kid until this bizarre happening that happened here yesterday just a little bit more than 24 hours ago, 48 hours ago, I should say, Wolf. BLITZER: What a very, very, very sad story. Don Lemon on the scene for us. We'll stay in close touch with you. Thank you.

Just ahead here in the SITUATION ROOM, two U.S. congressmen squared off in that fiery House hearing today. One called it a monkey court. We'll continue their heated exchange in the SITUATION ROOM. Live debate, that's coming up.

And also coming up, Maryland's attorney general and gubernatorial candidate now under fire after being seen at a party where underaged drinking was reportedly taking place.

And they're trying to sign up for Obamacare coverage live here in the SITUATION ROOM. Tom Foreman is keeping tabs on how these three people are doing. Some may be moving along a little bit faster than others. They've been at it now for 24 minutes. We'll give you an update when we come back.

(COMMERCIAL BREAK)

BLITZER: We're trying something very different here in the SITUATION ROOM today. We have invited these three people to sign up for Obamacare during this program. It's a mixed bag, we're told, so far. One is making some progress. The others, going slow and slower. Now, one person is reaching out to get some help online. We're going to find out how all of this is going, 26 minutes into their efforts. Stay with us.

(COMMERCIAL BREAK)

BLITZER: We're going to check in with Tom Foreman to see how these three young people are doing. They've been trying, what, for 29 minutes or so to get online to get log on to Obamacare. We'll see how they're doing. We'll get a progress report momentarily. So, stand by for that.

In the meantime, let's go over to the White House. Athena Jones is watching what's going on over there. The Obama administration still deep into damage control over the problems with the rollout of the website. What's the latest, Athena?

ATHENA JONES, CNN CORRESPONDENT: Hi, Wolf. Well, damage control is right. And the president tried to pivot to a new issue today, immigration, but the questions about the Obamacare website woes have continued to dominate. The White House is trying to answer those questions with the help of regular briefings for reporters by the Center for Medicare and Medicaid Services. Those are the folks who are managing the federal government's Web site. And CMS revealed today that nearly 700,000 people have submitted applications for health insurance, and they have handled 1.6 million calls at the call center.

We also learned from CMS that it was a, quote, "business decision," to defer this window shopping feature on healthcare.gov. That's the feature that would have made healthcare.gov a lot more like the Amazon type site the president promised. CMS said they wanted to focus first on the application processing feature of the site. That of course wasn't working so well at first and they've been making improvements on that.

Now there are no plans to change the requirement that people buy health insurance by the end of March 2014, but I can tell you the White House is and will continue to be under a lot of pressure from Democrats, from Republicans, and from the general public about this until they get all these things fixed -- Wolf.

BLITZER: Athena Jones, thanks very much.

We heard what the White House has to say. Let's check back with the folks who are actually trying to sign up for Obamacare right now live here in the SITUATION ROOM. They've been at it now for more than half an hour.

Tom Foreman has been watching what's going on.

Tom, give our viewers an update.

TOM FOREMAN, CNN CORRESPONDENT: Wolf, this isn't a scientific experiment. It's just a demonstration. But we brought these three people in, we've given them no coaching. These are the young healthy people this system needs. We gave them working computers and said give it a shot. Seeing there was connectivity, getting on the system, ease of use and the bottom line.

Let's go to Laura first over here.

Laura, you actually had your account set up before you came in. I sort of thought you might fly through it. It looked like you were. What's happened?

LAURA MCNEIL, TRYING TO ENROLL IN OBAMACARE: I did fly through it. Actually I thought it was really easy to fill out. But the problem is once it was completed, it told me that my application was incomplete and then directed me back to the beginning to re-enter my information.

FOREMAN: And I've seen you do this at least twice already.

MCNEIL: Twice. Yes.

FOREMAN: Yes. So we thought Laura was going to be done in about four or five minutes. And now we're a half hour in and she's still waiting.

Gabe, tell me what's happening with yours. You're trying to apply through the D.C. system, not the federal one. What's happened? The screen does not look good right now.

GABE COHEN, TRYING TO ENROLL IN OBAMACARE: I think I might have just crashed.

FOREMAN: What's happening overall? COHEN: Overall, it's pretty slow and it doesn't seem to be loading correctly. A lot of errors and just a lot of blank spaces.

FOREMAN: So even when you get into it, though, you're also running into some use issues because it's asking all sorts of questions that maybe don't work.

COHEN: Yes. It's not very streamlined. It's kind of a lot -- it's a lot to sort through for my first time on this Web site.

FOREMAN: And you said that you're a new resident to the area here. It wants proof that you live here and some idea what your income is, even though you're looking for a job right now. And a little bit complicated for you.

COHEN: Yes.

FOREMAN: Yes.

And Hazami, you have the -- you've had worst problems. You've had something red on your screen, or saying you can't move forward since you sat down. Have you connected yet?

HAZAMI BARMADA, TRYING TO ENROLL IN OBAMACARE: I have not. I haven't been able to make an account at all. It won't even let me make a log-in.

FOREMAN: You're trying to go to the federal account.

BARMADA: That's right.

FOREMAN: And you pulled up over here a help screen, is that correct?

BARMADA: A help screen. Absolutely. And they said that they'll call me back to help me work through the issues within two business days. And I asked her if they could e-mail me instructions. And she said it would have to be by phone during business hours.

FOREMAN: So everything you've done so far, you haven't even been able to get an account established. Are you surprised at all this?

BARMADA: I actually am surprised. From what I heard, it was supposed to be an easy process. I was looking forward to it. It's pretty surprising. It keeps reverting me back to the very beginning where I have to enter security information and it goes back to the same freeze screen.

FOREMAN: Let me ask each of you. Let me have you all turn around here. I'm going to ask you all the same question in general. If you were at home trying to do this, and you had been at it for half an hour like this, and you weren't on TV, you were just trying to make it on your own, would you be pressing on at this point or would you have since said, I'm taking a break, I'm giving up, I'm doing something else? COHEN: I mean, I'd be pretty frustrated, frankly. But I mean, this is important to me. And it is something that I would pursue but to be doing this for half an hour and get only here, where I am, it's frustrating.

FOREMAN: What about you, Hazami?

BARMADA: I think I would definitely try to call the hotline and see what they can do to offer help on the phone, although I don't really seem to -- it doesn't seem to look like they can do much. I'd probably try to push through myself just to --

(CROSSTALK)

FOREMAN: This is an idea that you all like?

MCNEIL: Of course.

FOREMAN: Yes. You're in favor of the idea. You just -- it's just the practicality of it right now that's sort of hanging you up?

MCNEIL: Absolutely. And like I said, I have already tried at home. I already did my log-in. I was ready to start applying immediately. But it's not going through.

FOREMAN: Went through now. With yours in particular.

MCNEIL: I'm going to try the live chat, I'm going to try calling them and I will keep trying. It is important to me.

FOREMAN: OK. So let's look at our board over here and get a sense while you guys get back to work and try the best you can.

Bottom line is what we have right now. For Laura for connectivity, she's connected easily, ease of use is turning into a big problem. I'm going to leave it yellow for now. But that's bordering on red. Gabe over here is having both connectivity issues. He had a hard time getting on and ease of use is not going well. And Hazami down here, she is flat out in the red on connecting, can't get there.

Bottom line, Wolf, if you're the White House, you want all of this to be green. We only have one green box so far and look at the country out there right now, all the states output here have -- that are run by the feds, that's every yellow state here has to rely on one of those sites that's not been working well. State exchanges in blue have done a little bit better. And then we have the joint exchanges in green.

But this is the landscape, Wolf, and on that landscape, they have got to get a way to get more of these green or you'll have a lot of these people out here that they've got to have in the system having this exact same experience.

Again, it's not a scientific experiment, Wolf. But this is an example of what many people seem to be going through and why there's been so much frustration -- Wolf.

BLITZER: All right, Tom. We're going to keep checking in with them and see if there's a breakthrough, what's going on. We'll stand by. But you're absolutely right. For the entire system to work, young people like these three young people, they have to manage to get in there and get some health insurance and they've got to do it relatively quickly. We're in week four right now of this process. And we see some, still, some serious problems.

Let's continue to check in with you, Tom. Thank you.

Just ahead, lawmakers at the center of an angry exchange in today's Obamacare hearing. They will resume their heated debate, guess where, I'll do it live right here in the SITUATION ROOM.

And Maryland's attorney general running for governor takes heat after being seen at a party where underage drinking was reportedly taking place.

(BEGIN VIDEO CLIP)

DOUGLAS GANSLER, MARYLAND ATTORNEY GENERAL: There could be Kool- Aid in the red cups but there's probably beer in the red cups.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

BLITZER: Once again, we're almost halfway into our live Obamacare sign-up efforts. So far, we're seeing a little bit of progress, some serious setbacks. We're going to keep on checking in throughout the rest of the program to see how far these three young people are getting in their effort to sign on. Sign up for Obamacare. We'll check back with Tom Foreman and then get all the day's other news right after this.

(COMMERCIAL BREAK)

BLITZER: Maryland's attorney general, a Democratic gubernatorial candidate, is under fire after being seen in this picture at a party where underage drinking was reportedly taking place. You'll see that picture in a moment.

Brian Todd is outside of Gansler's campaign office in Silver Spring, Maryland. That's just outside Washington, D.C. where he addressed the controversy surrounding the photo.

What's going on, Brian?

BRIAN TODD, CNN CORRESPONDENT: Wolf, Douglas Gansler is minimizing his presence and his responsibility at that party, saying he was only there to talk to his son and that he left quickly. But considering everything that was going on around him in those moments, the state attorney general is very much on the defensive.

(BEGIN VIDEOTAPE) TODD (voice-over): A wild beach week party in Bethany Beach, Delaware, with teenagers dancing on tables. But look at the man near the center in the white shirt. That's Maryland's attorney general, Douglas Gansler, who is running for governor. He says he was at the party in June just to talk to his son, but underage teenagers reportedly admitted they were drinking alcohol. And now the photo has surfaced and Gansler is taking serious heat for not stopping it.

Substance abuse expert Michael Gimbel.

MICHAEL GIMBEL, SUBSTANCE ABUSE EXPERT: You have an obligation to protect our children, to stop them from hurting themselves. Now call the police, stop the party, do something to protect the children. It's all of our obligations as parents.

TODD: The "Baltimore Sun" which broke this story quotes Gansler as saying he doesn't have moral authority over other people's children, and he defended himself at a news conference.

GANSLER: I wasn't the leader of the party, for -- you know, I wasn't the chaperone. I didn't buy the beer or anything. I showed up, talked to my son and left.

TODD: He also says he didn't have legal authority to stop anything at this house, since he's the attorney general of another state. But another embarrassment, Gansler has been in a PSA speaking against underage drinking.

GANSLER: Parents, you are the leading influence on your teen's decision not to drink.

TODD: I asked about accusations that he's hypocritical.

GANSLER: Hypocritical, be strong, again, should I have recognized -- should I have decided -- I could -- what I could have done was to investigate whether there was drinking going on and then taken action on that.

TODD: Gansler says at the time, he wasn't sure there was drinking going on.

GANSLER: There could be Kool-Aid in the red cups but there's probably beer in the red cups.

(END VIDEOTAPE)

TODD: This comes on the heels of another scandalous story involving Douglas Gansler. The "Washington Post" reports that he often ordered state troopers who drove him to speed, to run red lights and to drive on the shoulders with lights flashing, even on routine excursions.

Gansler says those accusations are untrue --Wolf.

BLITZER: What a story that is. All right. Brian, thank you very much. Brian Todd in Silver Spring, Maryland. Let's check back with Tom Foreman, see how these three young people are doing. They're trying to sign up for Obamacare.

What's the latest?

FOREMAN: Wolf, we've been telling you that the system really needs healthy young people like this to make it work, and Roland tweeted why does Obamacare need youth to make it work? Can you please explain this? We do want to explain it because this is an important point. This is just how insurance always works. If you think about it. Bottom line is if this system is working right now, what they have to have -- they're saying they have about 500,000 applications as of a few days ago. Now they're saying 700,000.

It's about 25,000 per day. They need seven million by March 31st, according to the White House itself, and to the CBO. They're on track right now, based on this, for about four million but about 40 percent of them need to be these young and healthy people. The reason that is so is just like any insurance system, the way you pay for it is the people who don't ultimately end up needing it, those premiums pay for the people who do need it.

So if this system gets a whole bunch of people in it who are older and sicker, and you don't get enough people like this who really probably won't use that much health care, then it starts what some people say, you get an economic death spiral. It's sort of adverse selection is the term they use for it. If you have too many people coming in just because they think they really need a lot of service, and not enough people who are doing it because they think it's responsible health care, that's why it's a problem.

These people become the cash that makes the system work if they all get in it. It's just the way insurance works and it will work in this as well if it's going to work at all. So that's why we have that question out there and that's the answer to that question -- Wolf.

BLITZER: Tom, 45 minutes into the process, do a quick survey. With all three of them, how they're doing.

FOREMAN: Yes, Laura, have you made any progress?

MCNEIL: No.

FOREMAN: No.

MCNEIL: Unfortunately I haven't.

FOREMAN: She's still back to your application is incomplete, no matter how many times you do it.

Gabe, you seem to be moving on a little. What's happening now?

COHEN: I was just browsing plans to see if I could move forward, how much it might cost me.

FOREMAN: OK. And what about you down here? BARMADA: I'm trying a different browser to see if I can log in.

FOREMAN: You are trying to shift all together. Because you still haven't logged in yet.

BARMADA: I haven't logged in yet.

FOREMAN: OK.

BARMADA: I looked up how to trouble shoot the Web site.

FOREMAN: Yes. I notice she's been going to all sorts of information out here to just try to get past that essential problem.

So, Wolf, right now we're still back where we were a moment ago in terms of overall board here. Connectivity OK for Laura. Ease of use is still a problem. Gabe, connectivity, ease of use, still a problem. He's sort of OK on connectivity now, at least he's in. And Hazami still held up -- Wolf.

BLITZER: All right. Tom Foreman, we'll check back with you and see how this process goes.

Sparks were certainly flying earlier in the day when a House panel held hearings on the messy rollout of the Obamacare Web site. Contractors blamed each other, lawmakers accused each other of playing a partisan blame game.

(BEGIN VIDEO CLIP)

REP. FRANK PALLONE (D), NEW JERSEY: Once again, here we have my Republican colleagues trying to scare everybody --

REP. JOE BARTON (R), ENERGY AND COMMERCE COMMITTEE: Will the gentleman yield?

PALLONE: No, I will not yield to this monkey court or whatever this thing is.

BARTON: This is not a monkey court.

PALLONE: Do whatever you want. I'm not yielding.

(END VIDEO CLIP)

BLITZER: All right. Joining us now, two members of the House Energy and Commerce Committee, the Democrat Frank Pallone of New Jersey, you just heard him, and Republican Joe Barton of Texas.

Congressmen, thanks very much for coming in.

All right, Congressman Pallone, you called it a monkey court. There are serious problems with the Web site, so why is it a monkey court if this committee which is in charge of overseeing the executive branch of the government oversight -- if they're trying to do their job, why is it a monkey court? PALLONE: Because they're strictly ideologically driven. You know, this is the Tea Party. They come in when I say not with clean hands, they just try to shut down the government, if we didn't delay or defund Obamacare, and now all of a sudden the Republican leadership is saying oh, well we care so much about this, we want to fix it.

Most of what they discussed wasn't about fixing it. And then I got upset with Congressman Barton, I like Congressman Barton, but he started to suggest that somehow, people were going to have to provide health information and that HIPAA applied, and that gave people the impression that their privacy was going to be compromised in some way, and I think that scares people into saying well, I won't go on the Web site because my privacy's going to be compromised.

And I'm very worried that the Republicans are strictly trying to scare people not to go on the Web site, not to sign up, because then the whole system becomes a failure. And they don't have clean hands because they have done everything they can to get rid of the Affordable Care Act and I think today was just another example of it.

BLITZER: All right.

PALLONE: I'm sorry, Joe, but that is -- whether that's what you intended or not, people are going to come back from that hearing thinking, I better not go on the Web site because I'm going to have a privacy problem. And it's not true. There's no HIPAA involvement here.

BLITZER: All right.

PALLONE: There's no requirement of providing health information in order to sign up or browse the Web site.

BLITZER: Go ahead, Congressman Barton.

BARTON: Well, I like Frank Pallone, too, but he's wrong on this particular point. As you can see, my hands are clean. My main point was that the Obama administration claims that they're protecting privacy in what the individual sees when he signs on, but if you accept that you're going to go through and fill out the application, what you don't see is a provision that says you have no reasonable expectation of privacy.

That's in the hidden code. That's a conscious decision by somebody in the Obama administration, not Congressman Pallone, but somebody in the Obama administration, and I think that's wrong.

And on the -- on the HIPAA issue, that's a privacy protection law that was passed in 1996 to protect people's individual medical history, and in this application, it asks if you have health insurance, it asks your Social Security number. It asks if you have any mental, physical or emotional condition that would preclude you from any activity, and if you're a female, it asks if you're pregnant.

Those are health issues. So if you -- if you combine what you have to answer the questions with, if you have health insurance with your Social Security, that's private information that should be private, and under their disclaimer that you waive the right to privacy, I think that is a violation of HIPAA.

BLITZER: All right.

BARTON: But whether it is or not --

(CROSSTALK)

PALLONE: It doesn't say that you're waiving. It doesn't say that you're waiving.

BARTON: Congressman Pallone should agree with me that we want to protect people's privacy. And this Web site explicitly does not do that.

PALLONE: It doesn't say you're waiving the right to privacy. No. It doesn't say you're waving your right to privacy.

BARTON: It explicitly does that, Frank.

PALLONE: And keep in mind --

BARTON: Read the code.

PALLONE: It doesn't say you're waiving your right to privacy. And here we go again.

BARTON: Yes, it does. It says, you have no reasonable expectation to privacy.

PALLONE: This is the same thing. This is the same thing, Joe, and again, I -- I respect you, but trying to give the impression that somehow people's privacy is going to be compromised, and -- is going to give them the impression that they shouldn't go to the Web site --

BARTON: That's not an impression, Frank.

PALLONE: -- and they shouldn't sign up. Well, that is what they're going to do.

BARTON: That's what it says.

PALLONE: And it seems to me that you're almost --

BARTON: That's what it says.

PALLONE: And it seems to me that you're almost -- it's seems to me you're almost suggesting to people now they shouldn't use the Web site for those reasons. There's no --

BARTON: No. No, I'm simply saying that that --

PALLONE: There's no privacy compromised here.

BARTON: That code says you have no reasonable expectation of privacy.

PALLONE: You know, this is -- this is the problem --

BARTON: You should help me eliminate that.

PALLONE: You know, I --

BARTON: We can fix this next week when we -- when we question the secretary.

PALLONE: It's just the same old, same old, all over again Republicans trying to make -- scare people, don't sign up, you're going to have a problem, you know, let's repeal, let's defund --

BARTON: I'm not trying to scare anybody. I'm reading the plain language --

PALLONE: The bottom line is --

BARTON: -- of the -- of the --

PALLONE: It's not -- it's not the plain language.

BARTON: Yes, it is.

PALLONE: You found that language somewhere, and it doesn't say that you're giving up your privacy to sign up.

(CROSSTALK)

BARTON: You define for the -- you define for the American people what no reasonable expectation of privacy is.

PALLONE: There is no -- there is no --

BARTON: What does that mean to you?

PALLONE: You know that the Affordable Care Act abolishes your -- any health condition as a basis for getting insurance or charging more for the insurance. So HIPAA, and the health issues simply do not apply. And again, you know, even having this conversation, which we're having now, which suggests in some way that your privacy is compromised, there are going to be hundreds, if not thousands of people who will simply not go on the Web site.

BLITZER: Congressman, hold on for a moment because I want to continue this conversation. We'll take a quick break.

More from these two members of Congress right after this.

(COMMERCIAL BREAK)

BLITZER: We'll continue the debate between these two members of Congress on Obamacare. Frank Pallone, Joe Barton, they're both standing by. Much more of the debate right after this.

(COMMERCIAL BREAK)

BLITZER: We're continuing the debate over the Obamacare Web site with two members of Congress who grilled representatives from the contractors earlier in the day. Democratic Representative Frank Pallone of New Jersey, Republican Representative Joe Barton of Texas.

Congressman Pallone, if the system, if the Web site were working well, we probably wouldn't be having this debate right now. So here's the question, how frustrated, how angry are you that they didn't get it right?

PALLONE: Well, they have to get it right. I don't think there's any question of that. But, you know, keep in mind that the Republicans -- and again, I'm talking about Congressman Barton. The state of Texas has more uninsured people than any other state. And the governor refused to take Medicaid, which is 100 percent federally funded. So all the people eligible for Medicaid still remain uninsured.

Then they refuse in Texas to set up a state exchange, forcing everybody or most people to go to the federal exchange, which now has this glitch, but people can still sign up, they can call the 1-800 number, they can go to various nonprofits, they can call an insurance agent, and they still can get enrolled.

So focusing on this federal Web site misses the point. But the point again is they're trying to scare people, trying to scare the seniors with the death panels. And now, Joe, even if it's not his intention, is scaring people with this privacy argument.

People need to sign up. They need to try to get on the Web site or call the 800 number, or go to an insurance agent, or find some other means and there's a lot available to sign up. The people need health insurance and the Republicans aren't doing anything but scaring people or making it more difficult particularly in Texas.

BLITZER: All right.

PALLONE: To get health insurance.

BLITZER: Congressman Barton, go ahead.

BARTON: Well, I'm going to make two points. First of all, the truth shouldn't scare people, number one. Number two, I will put on my congressional Facebook page the disclaimer that I've been talking about, and I'll let the American people that want to look at my Facebook page make a decision for themselves, whether it violates their privacy protection.

And number three, I'm assuming that Congressman Pallone, who was subcommittee chairman when this was passed, when he was still in the majority, will work with me to protect people's privacy, if it is as I say it is. If I'm right, that you waive your privacy rights if you go through this application process, and I'll ask Congressman Pallone and the other Democrats on the committee to work with me to protect people's privacy. This is a solvable problem. They could delete that hidden code, we can put an explicit privacy protection probation in it, and I guarantee you every Republican on the committee, and I would assume every Republican in the House of Representatives and the United States Senate will vote with me to protect people's privacy as we go through Obamacare.

BLITZER: All right.

PALLONE: We just go down the same road again of scaring people and making people feel that this is not going to work. There's not a privacy issue here. There's not a death panel issue here. These are just all -you know, different things trying to scare people.

BLITZER: Congressman --

PALLONE: I know it's not your intent, but that's what happens.

BLITZER: We got to leave it there.

(CROSSTALK)

BLITZER: I'm going to invite both of you back. I'm going to invite both of you back, Congressmen. We're going to continue this debate, because there's a lot of sensitive issues. I want to hear both sides.

(CROSSTALK)

BLITZER: Frank Pallone, thanks very much. Joe Barton, thanks to you as well.