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Anger Erupts Over V.A. Scandal Report; How Long Can Shinseki Survive; Malaysia Airlines Flight 370 Search Has Reached a Dead End; Unlikely Pings Came from Plane; Separatists Shoot Down Military Helicopter; Shinseki Should Go

Aired May 29, 2014 - 13:00   ET

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


WOLF BLITZER, CNN ANCHOR: Right now, the outrage over V.A. health care delays is expanding. More Democrats are calling for the V.A. secretary, Erik Shinseki's, resignation. And there's intense pressure on President Obama to do something to control the damage. The White House press secretary is about to take questions for the first time since the inspector general's preliminary report came out. You're looking at live pictures from the briefing room. We'll have live coverage once it gets underway.

Also right now, a bungled search, Australian officials now saying the area where they focused the search for Malaysia Airlines Flight 370 was wrong, this after a U.S. Navy official tells CNN those infamous pings did not come from the plane.

And right now, a horrifying story out of Pakistan. A pregnant woman stoned to death by family members after she refused to marry the man they had chosen for her. All this coming just days after an American doctor was brutally gunned down in front of his wife and young son.

Hello, I'm Wolf Blitzer reporting from Washington. The scandal is growing bigger and the calls are growing louder for the secretary of Veteran Affairs to resign. Just 24 hours ago, on this newscast, we first reported preliminary findings from the inspector general's report on the V.A. scandal. That's when Senator John McCain, for the first time, called for Secretary Erik Shinseki to step down. Since then, events have unfolded at a furious place.

Here are the latest developments. A White House official says Secretary Shinseki is, quote, "on thin ice with President Obama." The administration says the president found the report on the scandal, quote, deeply troubling. The scathing report says at least 1,700 veterans waiting to see a doctor at the Phoenix V.A. hospital were never scheduled for appointments and they were never put on a waiting list. Members of the House Committee went ballistic at a hearing last night.

(BEGIN VIDEOTAPE)

REP. PHIL ROE (R), TENNESSE: How you can stand in a mirror and look at yourself in the mirror and shave in the morning and not throw up --

UNIDENTIFIED FEMALE: It's unforgivable.

UNIDENTIFIED MALE: There's question about destruction of documents and you don't even know who did it or their motive.

REP. TIM HUELSKAMP (R), KANSAS: This is nearly a decade of excuses.

REP. JACKIE WALORSKI (R), INDIANA: The House is on fire and nobody is going to survive.

REP. MIKE COFFMAN (R), COLORADO: All of you, I think, have got to find something else to do.

(END VIDEOTAPE)

BLITZER: One person who is still not calling for Secretary Shinseki's resignation is the House speaker, John Boehner. Here's what he said just a little while ago.

(BEGIN VIDEO CLIP)

JOHN BOEHNER, U.S. HOUSE SPEAKER: I'm going to continue to reserve judgment on General Shinseki. The question I ask myself is is him resigning going to get us to the bottom of the problem? Is it going to help us find out what's really going on? And the answer I keep getting is no. But the real issue here is that the president is the one who should be held accountable.

(END VIDEO CLIP)

BLITZER: So, how long can Secretary Shinseki survive? And what happens next in the widening V.A. scandal? Joining us now, our Chief Political Analyst Gloria Borger and our Senior Investigative Correspondent Drew Griffin who first broke the V.A. story.

Gloria, what's the latest? How much longer can Shinseki survive?

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: I don't think very much longer. You heard the White House official say he's on thin ice, he's on probation. John Boehner would rather blame President Obama than blame General Shinseki. I think what everyone is looking for is an exit strategy here. Shinseki is going to deliver his own evaluation of the problems to the president in the very near future.

And, if I had to guess, they're looking for some way for him to resign. Don't forget, General Shinseki is a decorated war hero. And I think there needs to be a certain amount of dignity assigned to this. And I think, you know, this is a president who is probably looking for that way. But they've given every signal, starting with the president himself when he said he was holding him accountable and then starting from signals we're getting from the White House, it's clear that he's probably going to have to leave.

BLITZER: Drew, you've spent some time going through this preliminary inspector general's report on the Phoenix V.A. facility. What's your take?

DREW GRIFFIN, CNN SENIOR INVESTIGATIVE CORRESPONDENT: My take is Phoenix is worse than we thought and the problem nationwide is bigger than we thought. When we're talking about four different schemes that people in the V.A. were using to manipulate data and trick veterans into thinking they had an appointment when they don't. And then we're also talking about 42 facilities now that are being investigated by the Office of Inspector General, I think you do have, as the V.A. said in this just preliminary report, it is a systemic problem.

BLITZER: And it's not just Phoenix. The presumption is this is happening all around the country.

GRIFFIN: Far wider than we thought. We've gotten whistle-blowers from several different hospitals. Two weeks ago, it was 10, then it was 26, now it's 42 hospitals that the OIG is at. I mean, this is getting large.

BLITZER: You know, Gloria, we're standing by. We're waiting for the White House press secretary, Jay Carney.

BORGER: Yes.

BLITZER: He's going to be going to the microphones over there in the White House briefing room. You're looking at live pictures from there. He's going to be pounded with questions about Shinseki and the V.A. We'll have live coverage of that.

BORGER: Right.

BLITZER: One of the criticisms of the president, you hear it not just from critics but even some of his supporters that he's often such a nice guy, if you will. He's reluctant to fire people. He gives them a lot of time and for his own benefit, his political benefits or whatever, --

BORGER: Well, --

BLITZER: -- he should fire people more readily.

BORGER: -- you know, politically -- I was talking to a senior White House advisor the other day. Politically, you would argue it would be easier for him to have just said, Shinseki's gone, because then you wouldn't have had all these calls for Shinseki's resignation and it sort of makes the story even bigger.

But, as you know from the history of the way this president operates, he didn't fire Kathleen Sebelius when the Web site of health care didn't work very well. He didn't fire someone who was to blame who didn't check on BP Oil. On the IRS, he didn't immediately fire people.

This is somebody -- according to this White House source, he said, look, this is not a president who looks for scapegoats. He wants to get to the bottom of the problem first, figure out what's going on, and then take action which is why, I think, he'll let Shinseki submit a report and then -- and then allow him to resign. I think it would be politically more expedient to just have gotten -- said to Shinseki, you have to go immediately. But that's not the way he --

BLITZER: They could've found a way -- BORGER: -- operates.

BLITZER: -- earlier from Shinseki's point of view, --

BORGER: Yes, exactly.

BLITZER: -- to make it a little bit more palatable to him.

BORGER: Yes.

BLITZER: There was one suggestion, Drew, and you've been studying this carefully, that some of those individuals who were maybe cooking the books were doing it because they stood to gain, personally, financially as a result of those kinds of bookkeeping maneuvers, if you will, that undermine health care for these veterans?

GRIFFIN: I'll tell you, that was a very, very contentious point of the arguments being made last night in this Congressional hearing which I was telling Gloria before we went on, packed, Democrats, Republicans, overflow Congress people from different committees coming in to do the questioning. They wanted to know. The explanation is there were performance targets in the V.A. to meet these appointment dates.

And Dr. Thomas Lynch, the under secretary -- the assistant under secretary, Hale, said, yes, we lost sight of the fact that in trying to reach performance targets, we lost sight of the fact that we're supposed to care for veterans. He could not directly tie it to bonuses. But we all know performance goals determine bonuses. So, there seems to be some link between what these administrators are getting monetarily and whether or not they have long or short wait times.

BORGER: And this is a larger problem for the president because I think it really goes to the core of his presidency which is a question of competency in big government operations. You know, he's brought us health care reform and then you saw the incompetent health care Web site. He has made veterans' care an important cornerstone of his presidency and you see the incompetence or malfeasance over at -- over at the V.A. And so, this is a larger problem for the president and that's, I think, what you heard John Boehner talking about and that's what you will hear Republicans talking about.

BLITZER: And now, you're hearing a lot more senators, Democrats and Republicans, Senator Blumenthal there other day here with me, Senator McCain yesterday --

BORGER: Right.

BLITZER: -- calling for an FBI criminal investigation into criminal allegations potentially.

BORGER: That's right.

BLITZER: Down the road. All right, we're standing by. We'll wait for the White House press secretary, Jay Carney, to head over to the microphones. We're going to monitor that briefing. We'll have live coverage as soon as it starts. I know he's going to be asked a lot of questions about what's going on.

By the way, at the bottom of the hour, I'll talk with the executive director of the American Legion to get his reaction to all of these latest developments.

Back to square one. The search for Malaysia Airlines Flight 370 hits a dead end. We're going to tell you why plus a stunning revelation about the origin of those pings. The story, that's coming up next.

And how television changed the world. We're taking a closer look at the turmoil in the United States during the 1960s brought right into your living rooms.

(COMMERCIAL BREAK)

BLITZER: Eighty-three days after Malaysia Airlines Flight 370 disappeared, the search has effectively reached a dead-end. Australian officials now say they believe the plane is not, repeat not, in the 330 square mile area of the southern Indian Ocean where a series of pings were heard. Crews have been scouring that focused area for seven weeks now. But a U.S. Navy official tells CNN those pings are no longer believed to have come from the plane's so-called black boxes.

Let's discuss what's going on with our Aviation Analyst, the former NTSB managing director, Peter Goelz and our Law Enforcement Analyst Tom Fuentes, a former FBI assistant director. It's pretty shocking, when you think about it. Early on, when everybody was talking about those four pings that they --

PETER GOELZ, CNN AVIATION ANALYST: Yes.

BLITZER: -- thought were coming from the black boxes. There were voices saying, not so fast. They weren't exactly the same megahertz or whatever --

GOELZ: Yes.

BLITZER: -- ping boxes were supposed to deliver. They said, well, maybe the ocean changed that a little bit. But they were pretty insistent that those were the real pings for the black boxes.

GOELZ: Well, the only thing they had, and there were questions raised, it was the wrong frequency, even the distribution of where the pings were heard was questionable. But before, they had nothing else. And, you know, the reality is even if they had said, well, we don't think this is it. They were obligated to search. And they've done it. It's not there. We're in this for the long haul.

BLITZER: But now, they're suggesting maybe those pings actually came from the vessel that was searching and that it was emitting some sort of sound and that's where it was coming from. But you would've thought technical experts would be able to determine that because even at the time, I remember we were reporting some skeptics saying, you know, these may not be from the black boxes. It may be from another vessel or from that vessel itself which was conducting the search.

TOM FUENTES, CNN LAW ENFORCEMENT ANALYST: No, that's true. And people were criticizing, at the time, the Chinese search vessel where they said they were putting their ping locator in the water and saying, well, they're probably hearing their own boat. That must be their -- what they're locating. But here, you know, you would think, these are the most professional searchers available, they wouldn't know better than this? This just sounds incredible to me that they didn't consider the possibility or realize the possibility, at the time, that they're listening to their own boat or a nearby boat.

BLITZER: How does a blunder like that occur? Because you would think the greatest ping experts in the world would be able to determine, does it come from the black box or is it coming someplace else? It may not necessarily be a natural sound coming from the ocean. It may be coming from some man-made mechanical device, maybe something else. You'd think they would be able to determine that without spending so many weeks, so much money, so much effort, raising the hopes of these families all for naught.

GOELZ: They were under enormous pressure. The clock was ticking on the life span of the battery. They had to get the device in the water. When they heard something, they did not take the time to examine it as carefully as they should have. Now, they recorded the ping, and I think that's where (INAUDIBLE) has come to the conclusion, they've looked at other pings and they said, this just doesn't ring true.

BLITZER: It's not the same (ph).

GOELZ: There were questions raised, but, you know, they were under pressure and there was a little bit too much enthusiasm.

BLITZER: I always thought it was very coincidental that on that arc, that southern arc, the satellite, the Inmarsat satellite handshakes, which showed the southern Indian Ocean, where this plane may have run out of gas and gone into the ocean, I said, these -- the pings from a black box, they only go out a mile or two, not very far. I said, wow, what a lucky break that they heard those pings because they were, you know, thousands and thousands of miles out there in that southern arc.

TOM FUENTES, CNN LAW ENFORCEMENT ANALYST: Right. But at the time you recall that you had oceanographers, other experts saying, oh, no, that's not true, you know, the thermal layers of the ocean, pings can carry thousands of miles. Other ocean sounds can carry thousands of miles. So even -

BLITZER: But all the experts we spoke to said a ping from a black box goes maybe two miles, two and a half miles.

FUENTES: Right.

BLITZER: That's about it, right?

FUENTES: About three miles. Right.

BLITZER: That's it. So, you know, it was a pretty lucky break. GOELZ: You have to -

BLITZER: They, all of a sudden, hear four pings along that southern arc.

GOELZ: Yes. Yes, you (INAUDIBLE) at that depth you've got to be almost over it to hear it. And it did seem extraordinary lucky, but, you know, there should have been some more skepticism in the public statements by the Australians.

BLITZER: Yes, what a blunder that was. All right, guys, thanks very much.

Up next, militants in Ukraine score a victory against the military. We'll go there live.

Then later, we'll get reaction to the new report of problems over at the V.A. I'll talk to the head of the American Legion about the findings and the future for the V.A. secretary, Eric Shinseki.

(COMMERCIAL BREAK)

BLITZER: In Ukraine, pro-Russian separatists have shot down a military helicopter. The Ukrainian government says 14 people were killed, including a top (ph) Ukrainian army general. It's the latest bloodshed in the growing battle between the pro-Russian militants and the government. Nick Paton Walsh is joining us from Ganets (ph) in eastern Ukraine right now.

Nick, you saw troops fighting back militants at the airport there earlier in the week. This helicopter attack, is it linked to that operation? What do we know?

NICK PATON WALSH, CNN SR. INTERNATIONAL CORRESPONDENT: Well, the death tolls, Wolf, in this conflict are rising rapidly. Yes, there's 14 dead, killed (INAUDIBLE) we're seeing five, potentially one of the missiles that the militants have in their possession and they showed me some heat-seeking ones, man pads, they're known, that were in possession of the (INAUDIBLE) mayor of Ganets (ph) saying the tubes of them were -- have taken a helicopter out of the sky near Slaviansko (ph). The general, as you say, among the 14 dead. And that is possibly the worst single loss of life the Ukraine military have had since the start of this crisis.

But, too, the separatists here admitting today in a morgue in this town of Donetsk that among the dead they had on Monday in that Ukrainian army onslaught against the international airport here, which they'd briefly taken over, were 33 Russian citizens. A big admission for a separatist movement. As always, said it was staffed by Ukrainian. There's very few if little foreign involvement at all. Actually saying there were 33 Russian citizens who come from Russia to assist them.

Also, they admitted the death toll in total could have been as high as about 70 in that one day alone amongst their militants. So that's potentially the most deadly day since the start of this crisis when a shooting happened in Sanshokia (ph).

But also today, remarkable scenes here in central Donetsk (INAUDIBLE), because there's a large administration building which separatists have always claimed as being their headquarters. Well, today, it was surrounded by their own militants and they said they were cleaning it, looking for looters. They've thrown everybody out. They're now dismantling the barricades around it with a bulldozer. A new set of militants have seemed to come in and declaring all or some of them are Chechen, which suggests they might have some links to Russia. And they're saying there's still the same political leaders in charge of separatists but they're just cleaning out also around (INAUDIBLE) bunch of guys we saw inside that building with stakes (ph), masks (ph), et cetera, who were kind of often had to understand who they work for, if anybody.

And they're trying to instil a new order (ph). So a day of fundamental change here. And the separatists have said, yes, we have Russians in our ranks. They've sent Chechens in amongst other militants to clean up this building here, trying to instill new order while, at the same time, the Ukrainian military must be seething because this large loss has been inflicted upon them.

Wolf.

BLITZER: We'll stay on top of this story together with you, Nick. Thanks for that update. Nick Paton Walsh on the ground in eastern Ukraine.

Egypt, meanwhile, has elected a new president in a landslide. The former army chief, Abdel-Fattah el-Sissi, is projected to get over 90 percent of the vote. But only about 40 percent of the population cast ballots. That's half of what was hoped for. El-Sissi lead Egypt as army chief after the ousting of the former president, Mohamed Morsi, last June. He resigned in March as chief of the army to run for president of Egypt and he has now been elected.

Systematic problems with the V.A. That's the assessment from investigators in a new report. I'll get reaction to the report from the executive director of the American Legion.

And later, a new twist of the drama surrounding Donald Sterling and the sale of the L.A. Clippers.

(COMMERCIAL BREAK)

BLITZER: Welcome back. I'm Wolf Blitzer reporting from Washington. Let's get back to our top story.

Another voice has joined the chorus calling for the resignation of the Veterans Affairs Secretary Eric Shinseki. Only moments ago, New Mexico Senator Martin Heinrich became the seventh Senate Democrat to ask Shinseki to step down. This is all part of the fallout from the investigation into problems at the Veterans Administration. General Shinseki has called the results reprehensible. Many of the issues were first raised here on CNN by family members who lost loved ones while waiting to be seen. (BEGIN VIDEO CLIP)

PRISCELLA VALDEZ, DAUGHTER OF PEDRO (ph) VALDEZ: In October of 2013, I remember him telling me that he was going for an appointment. He was very excited. He was finally going to get seen. He ended up showing up to my house that morning and I'm like, dad, you know, he beeps and I come out and I'm like, dad, you know, what did they do? What did they tell you? What's going on? He says, (INAUDIBLE), they didn't see me again. Three months later is as soon as she had an appointment. There's no questioning why it was taking so long to get him in, in three months. That's just as soon as she had. There was no questions, if, ands or buts.

UNIDENTIFIED MALE: And he didn't make that appointment.

VALDEZ: He didn't make that appointment.

(END VIDEO CLIP)

BLITZER: Joining us now is Peter Gaytan. He's an Air Force veteran, now executive director of the American Legion.

Peter, thanks very much for coming in.

As you know yesterday on this program, John McCain, when he heard about this preliminary report from the inspector general of the Veterans Administration, he called on Shinseki to step down. That was the first time he did so. I know the American Legion, your national commander, has been saying Shinseki should leave, what, for about three weeks already. But Nancy Pelosi, the Democratic leader in the House, just a little while ago said this.

(BEGIN VIDEO CLIP)

REP. NANCY PELOSI (D), MINORITY LEADER: We have to be careful about thinking that just because you remove the top person means that you've changed the systemic problem that exists in the organization 10 years before Shinseki or five years at least before Shinseki became the secretary.

(END VIDEO CLIP)

BLITZER: All right. So would a change at the very top, Shinseki gone, and the American Legion has been saying he should be gone for weeks now, would that really make a difference?

PETER GAYTAN, EXECUTIVE DIR., AMERICAN LEGION: Well, if the fear is to -- if we take Shinseki out that things will fall apart at the V.A., I think there's proof now -- irrefutable proof now that the leadership that's in place now is not effective. The failings you're seeing are attributed not only to middle management leadership and leadership at these individual V.A. medical centers, but it goes all the way to the top. And that's what the American Legion and the National Commander Dan Dellinger have said for the past three weeks.