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American Morning: Wake Up Call
Debt Debate Limbo; News Corp Scandal; Petraeus Hands Over Afghan Command; Berlusconi's Sex Trial; TSA Agent Groped
Aired July 18, 2011 - 05:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ALI VELSHI, CNN ANCHOR: Good morning. It is Monday, July 18th. This is your A.M.: WAKE-UP CALL.
I'm Ali Velshi, joining you live from New York this morning.
Well, it's Monday. We're still suck in debt debate limbo. No breakthroughs over the weekend. And the clock is ticking down to August 2nd, the day the government could start defaulting on its bills.
(BEGIN VIDEO CLIPS)
SEN. JIM DEMINT (R), SOUTH CAROLINA: We need to realize, setting all politics aside, that our country is on course for a financial disaster. We can't take another $10 trillion in debt that the president has proposed.
JACOB LEW, WHITE HOUSE BUDGET DIRECTOR: We think that the president said clearly we should do as much as we can to reduce the deficit. But we have to avoid the kind of chaos that would result from default.
(END VIDEO CLIPS)
VELSHI: Well, instead of focusing on the "end of days" rhetoric, let's talk about possible solutions -- plans A through D in no particular order.
Here's the fall-back plan built in case Congress and the White House can't make a deal. It would shift how the government goes about raising debt ceilings. Senate leaders from both parties are hammering that one out right now.
There's the "kick the can" deal -- a short-term deal that would raise the debt ceiling for a few weeks or a few months. The president has said he doesn't like that idea.
Coming up next, the "just get to 2012" deal -- a compromise that would give the government spending power to get through the president elections.
And, fourth, there's the grand compromise, the big kahuna, the one the president is pushing for. It's a long-term deal that could take a big bite out of the deficit.
All right. Two big headlines in the News Corp hacking and bribery scandal. The casualties keep coming and the scope keeps widening.
Headline one: Rupert Murdoch's protege, Rebekah Brooks, arrested. The woman once headed up his British papers. She's now out on bail.
And headline two, the head of Scotland Yard resigns. Sir Paul Stephenson is quitting over criticism of how he handled the saga.
(BEGIN VIDEO CLIP)
SIR PAUL STEPHENSON, METROPOLITAN POLICE COMMISSIONER: As commissioner, I carry ultimate responsibility for the position we find ourselves in. With hindsight, I wish we had judged the matters involve this affair differently. I didn't and that's that.
(END VIDEO CLIP)
VELSHI: And brace for an explosive few days ahead. Rebekah Brooks, Rupert Murdoch and his son are scheduled to be questioned by British lawmakers on Tuesday.
Here's your 15 seconds of news from Canada. Classic rockers Cheap Trick got a scare as their stage collapsed at the Cisco Ottawa blues fest. Now, the stage blew over in severe weather according to the band's Web site. That's where we snagged these pictures.
Check out the stage before -- and after. It's barely recognizable. Good news: no serious injuries.
All right. You hear the words grope and airport and these junk- touching security checkpoint horror stories may pop to mind.
But there's a twist to this one: Phoenix police arrested a would-be passenger, a 61-year-old woman shown, here for allegedly squeezing and twisting a TSA officer's breasts. They say she rushed through the screening on Thursday and started arguing with officials and that's what led to the alleged grope.
(BEGIN VIDEO CLIPS)
UNIDENTIFIED MALE: Surprise you that somebody did that to the TSA?
UNIDENTIFIED FEMALE: I don't know. I mean, nothing really surprises me, I guess.
UNIDENTIFIED FEMALE: I'm surprised it hasn't happened sooner.
(END VIDEO CLIPS)
VELSHI: The woman spent a night in jail. She is facing felony sex abuse charges.
Casey Anthony is a free woman, whereabouts unknown. She was released from an Orlando jail early Sunday morning.
Here's a snapshot of the life she walked out to. About two weeks after she was acquitted of killing her daughter Caylee. She's broke. She's facing several pending lawsuits. She's not communicating with her family. And her lawyers say she's been getting death threats.
The big question:, here does she go from here? Your guess is as good as mine.
A heart-stopping, nail-biting finale to the women's World Cup final but the American women couldn't clinch it. Japan took the title in penalty kicks after overtime ended a 2-all tie. The U.S. was favored to win but Japan, the sentimental favorite, rallying their country after January's devastating earthquake and tsunami.
Here is U.S. forward Abby Wambach.
(BEGIN VIDEO CLIP)
ABBY WAMBACH, U.S. FORWARD: Evidently, it wasn't meant to be. We worked so hard. We believed in each other through everything.
(END VIDEO CLIP)
VELSHI: But no matter where -- who you were rooting for, this was a nail-biter to the very end. It even kept the first family on the edge of their seats. You can see President Obama, the first lady, Sasha and Malia with laser focus on the game.
Let's take a look at how the world's money is doing this morning. The Nikkei closes up, Hang Seng and DAX and FTSE are all down at this hour.
Let's go to Kristie Lu Stout live from Hong Kong.
Kristie, good morning. How are investors reacting to markets this morning?
KRISTIE LU STOUT, CNN INTERNATIONAL ANCHOR: Hey there, Ali.
Well, let's start Down Under. Australia's main index is flat today. But shares of News Corp fell nearly 4 percent. That is a two-year low. And the reason, we all know why, the phone-hacking scandal.
Here in Hong Kong, the market closed down about a third of 1 percent.
The big headline here was that 8 percent slide in China's largest chipmaker SMIC. Tokyo was actually closed today for public holiday.
Now, in Europe, stock marketed all in the red given those ongoing debt fears in U.S. and Europe.
But one bright spot, Ali, gold. Gold is going the other way. In fact, it is hitting a record high.
VELSHI: Continued concerns about debt in Europe and U.S. having this effect on gold. This is another big week for Wall Street, independent of these debt ceiling concerns.
STOUT: That's right. America's biggest, most influential companies are handing in their Q2 report cards this week. And investors expect this will be a crucial moment for the market given the concerns about the U.S. economy. But we should keep in mind that historically speaking, second quarter earnings are usually the weakest of the year.
Today, we got to look out for big names, Halliburton, Wynn Resorts, IBM and Hasbro, which makes toys related to big summer movies like "Transformers" and "Thor." Have you seen those Nerf Thor hammers? The movie was terrible but hat toy was amazing -- Ali.
VELSHI: I hope to try one out. Kristie, by the way, I always talk about earnings. Let's talk about moneymakers at the box office. This just doesn't end. "Harry Potter," we knew it was going to do well. But it did particularly well. The "Harry Potter" finale, so they say, is scoring the best opening weekend ever, a record $168.6 million here in the U.S., $476 million worldwide. "Transformers: Dark of the Moon" fell 55 percent from its debut but it still came in second with $21.3 million. That comedy called "Horrible Bosses" was third with $17.6 million.
Have you seen any of these?
STOUT: No, I haven't seen any of them. And I hate to say it, the one movie I'd probably be most likely to see is "Horrible Bosses." But a quick note about "Harry Potter," I was checking out the CNN business "360" blog and it says as movie franchises go. It has banked more than billions than "Star Wars," "Pirates of the Caribbean," even the James Bond franchise. It's incredible --
VELSHI: Which is why -- which is why I don't believe any of these things are done when they say they're done. When you make that much money, why be done?
Kristie, good to see you and let me know if you ever get to any of these movies. I don't know how much time you get to watch movies. But let's check in with you later on in the show -- Kristie Lu Stout in Hong Kong.
Let's get to Rob Marciano, live from Atlanta.
Good morning, Rob. Any flight delays out there this morning?
ROB MARCIANO, AMS METEOROLOGIST: Nothing yet, but we're looking at New York City to be the main threat. Speaking of threats, I want to start with tropical storm Bret. This is the second tropical storm of the season. Just to the east of Florida. Just north of the (INAUDIBLE) island in the Bahamas. Winds of 50 miles an hour at this hour.
And where's the forecast track? It's that close to the U.S. right now. We think it's going to go out to sea. That's the good news.
Bad news is the southeast could use the rainfall, including much of Florida. So we'll take a weak tropical storm for the rain. But this one looks like it's going to go out to sea.
Expected delays in New York City and Chicago with thunderstorms expected there. Afternoon boomers in Detroit and Cleveland as well. The other big story continues to be the heat. As far north as Minneapolis, temperatures will easily get into the 90s and it will feel well over 10 as a searing heat wave continues for folks who really are used to enduring more in the way of drastically cold temperatures.
But if you're trying to stay cool, Ali, check out what they're doing in Japan. There's a new product out there on the market. You know, they're very energy-conscious. They try to save money. A lot of people there, they don't want to strain on the grid.
They have this foam they spray on their skin and it cools them down. And on top of that, I'm not sure how it works. At first I thought it was alcohol that would help evaporate things, but it kind of turns into a bit of a fashion statement. You can wear it as a bracelet, put it around your neck, cool yourself off that way. It hardens, and you wear it all day long.
VELSHI: It keeps you cool? Is that the point?
MARCIANO: Yes, it keeps you cool.
VELSHI: What an interesting thing. I must try some of that.
MARCIANO: Put that around your head like a crown before you get on the subway this afternoon.
VELSHI: I like that. I'll try it out.
Rob, good to see you. I'll check in with you in just a little bit -- Rob Marciano.
All right. All those fees you get charged whenever you fly. Now, there's a push to get airlines to better explain what they're charging and how much they're collecting.
But, first, check our quote of the day. Quote, "I think that the Republican Party would be well-advised to get the heck out of people's bedrooms and let these things get decided by states," end quote. Which newsmaker do you think said that over the weekend about same-sex marriage? The answer after this quick break.
It is nine minutes after the hour.
(COMMERCIAL BREAK)
VELSHI: It is 12 minutes after the hour.
Before the break, I asked you which newsmaker you thought said -- made this quote about the same-sex marriage. It's from former New York Mayor Rudy Giuliani, sitting down with our own Candy Crowley on "STATE OF THE UNION."
Listen to it in his words.
(BEGIN VIDEO CLIP) RUDY GIULIANI, FORMER NEW YORK MAYOR: I think that marriage should be between a man and a woman, but I think the Republican Party would be well-advised to get the heck out of people's bedrooms and let these things get decided by states.
(END VIDEO CLIP)
VELSHI: We're just learning of a home invasion at the home of an Iowa congressman. Representative Leonard Boswell's office says an armed man attacked Boswell's daughter in the home and demanded money. The 77-year-old congressman heard his daughter screaming and ran to help. He tried to disarm the man. But it was his grandson who ran the man off with another gun. So far, no arrests have been made.
Well, time now for your Political Ticker with Tim Farley, host of "Morning Briefing" on Sirius XM POTUS live from Washington.
Good morning. Good morning, Tim.
It's -- I don't know if this week is going to look like last week. But President Obama on Friday said he had told all the parties to go back and figure out some kind of solution, that we thought there might be more discussions on Saturday.
Bottom line is: we are still apparently no closer to a debt ceiling increase deal.
TIM FARLEY, SIRIUS XM POTUS: Yes, two weeks and a day. And I think your beginning of the show, you opened with those options. But I think you forgot one of the possibilities is maybe Harry Potter brings in a wand and gets all the muggles to behave for once.
VELSHI: That could be it.
FARLEY: But I think it probably got something in there that's going to happen. It looks like there's going to be some sort of a plan that will get us through 2012 election, whether you want to use the expression kick the can down the road or something else.
There's I think a realization on both the Republican and Democratic side that you can't afford to let the debt ceiling stay the way it is. It has to be raised. So, it's just a matter of how to get there -- probably closer to the McConnell plan. We never know for sure. That's why they play the games. We'll see how it works out this week.
VELSHI: All right. In the meantime, President Obama is expected to nominate someone named Richard Cordray to head the Consumer Financial Protection Bureau. In fact, most people would have guessed it was going to be Elizabeth Warren, but she was facing opposition.
Is Cordray likely to get through? And what does he stand for?
FARLEY: Well, he obviously has a better chance. And just imagine you build and house and you're not able to live in it. That's pretty much the way Elizabeth Warren was. Today is the first anniversary of the signing into the law of the Dodd/Frank Act, which was supposed to keep us from having too big to fail anymore. The question is whether that will take place.
But, meanwhile, this Consumer Financial Protection Bureau you're talking about will at least get control of things like credit card rates and so on. And that is probably going to be a battle getting Richard Cordray confirmed by the Senate. But he has a better chance than Elizabeth Warren. It is something we'll see probably shaping arguments over the next couple of weeks, couple of months.
VELSHI: Tim, good to see you, my friend. Have a great show and have a great week. We'll talk all week.
Tim Farley is the host of "Morning Briefing" on Sirius XM POTUS Radio.
All those extra fees you pay when you're flying, whether it's for a pillow or seat selection. Well, the government wants airlines to be more transparent. Right now, airlines must only disclose baggage fees and reservation change fees. They've collected nearly $6 billion from those fees alone last year.
Under the proposed new rules, they'll be required to be more detailed about 16 other fees they collect from you.
And if it's not airline fees you're concerned about, maybe you're keeping a close eye on prices at the gas pump. AAA reports the national average for a gallon of regular unleaded rose to two-tenths of a percent to $3.68 over the weekend. That is the 12th consecutive increase.
However, a year ago, the same gallon of gas would have cost you $2.73. We're paying almost $1 more.
Space shuttle Atlantis astronauts awoke overnight to the sound of "Days Go By" by country star Keith Urban. It's the four-member crew's last full day at the International Space Station before they begin their journey home. But before they close the hatch around 9:00 Eastern this morning, they've got to finish picking up trash and old equipment.
Atlantis will undock tomorrow when it returns Thursday to earth. NASA will retire all three space shuttles for good.
OK. So, you remember the Marines who used YouTube to get Justin Timberlake and actress Mila Kunis to go to the Marine ball with them? Well, now, another Marine is trying to get betty white to attend the ball as well. We'll tell you about that on the other side.
But, first, grab some fish eggs on your way home from work today. It is national caviar day. And at 5:00 in the morning was the best I could do in New York.
It is 17 minutes after the hour.
(COMMERCIAL BREAK) VELSHI: Nineteen minutes after the hour.
Here are three minutes you need to have on your radar today:
With an August 2nd deadline quickly approaching, President Obama and congressional leaders still trying to work out a possible deficit reduction deal, a debt ceiling increase deal actually.
Around 9:00 Eastern this morning, the shuttle Atlantis crew will bid farewell to the space station crew before closing the hatch and preparing to return home. I'm going to talk to those folks on Wednesday morning on this show.
And around 1:00 p.m. Eastern, President Obama will nominate Richard Cordray to head the new Consumer Financial Protection Bureau. It is scheduled to formally open for business on Thursday. The bureau is intended to make basic financial practices such as taking out a mortgage or loan clearer and more transparent.
OK. New this morning, General David Petraeus hands over command of Afghanistan. The outgoing top commander of NATO forces transferred authority this morning to Marine Lieutenant General John Allen. Petraeus plans to retire from the Army at the end of August before taking over as CIA director on September the 6th.
The former South African President Nelson Mandela is celebrating his 93rd birthday today. He's celebrating with his family by his side as birthday wishes pour in from around the world. Here are just a few of them.
(BEGIN VIDEO CLIPS)
CHARLIZE THERON, ACTRESS: Madiba, happy birthday.
WHIOOPI GOLDBERG, ACTRESS: Happy birthday.
MORGAN FREEMAN, ACTOR: Happy birthday to you. Happy birthday. Happy Birthday, Madiba.
(END VIDEO CLIPS)
VELSHI: The United Nations and Nelson Mandela Foundation have one request for his special there, asking each person to devote 67 minutes to helping others. One minute for every year of Mandela's own service to humanity. Sixty-seven minutes, that's a challenge we can all rise to.
This typhoon you are looking at is headed straight for Japan. That's got workers scrambling to protect a reactor at Japan's crippled nuclear plant. Even though the typhoon is expected to strike well south of the plant, authorities say they are not taking chances. Typhoon Ma-on is expected to make landfall on Tuesday.
Even by Iceland's standard, it's a very hot. Temperatures got up to 70 degrees over the weekend. IReporter Haldor Siggerdson (ph) sent us this video of people flocking to beaches in the balmy 70-degree weather. He says the natives are sweltering under unusually high temperatures.
Just to give you some perspective, it's normally in the 50s and 60s during summer in Iceland.
OK. You've probably al heard about these Marine corps balls. They are pretty extravagant affairs, always a hot ticket. But this year, they're getting a healthy dose of Hollywood.
Marines keep asking celebrities. And celebrities keep accepting invitations. Mila Kunis and Justin Timberlake both snagged dates. And now, a third celebrity is being courted online.
Listen to this.
(BEGIN VIDEO CLIP)
SGT RAY LEWIS, U.S. MARINE CORPS: I would like to take Betty White. She's just funny. She's sweet. She's mature. She's the all-around perfect woman.
(END VIDEO CLIP)
VELSHI: That, by the way, is Sergeant Ray Lewis. He's asking America's senior citizen sweetheart Betty White to join him at the ball.
All right. Before we go, our "Businessman Special" today is the fork. Find out how the size of your fork can actually make you fat. It's coming up after the quick break.
It is 22 minutes after the hour.
(COMMERCIAL BREAK)
VELSHI: Twenty-six minutes after the hour. Good morning. It's Monday, July 18th. It's your WAKE-UP CALL.
I'm Ali Velshi, joining you live from New York this morning.
America could start defaulting on its bills in the just over two weeks. And still, D.C.'s all talk, not a lot of action when it comes to reaching a debt crisis deal. There was some private weekend wrangling between the White House and congressional leaders. They'll be back at it this week. No progress to report just yet.
But Republican Senator Jon Kyl says the GOP needs details from the president before shaking hands.
(BEGIN VIDEO CLIP)
REP. JON KYL (R), ARIZONA: I'm a little frustrated. You heard it in the press conference of the president. You heard it today from the administration spokesman. They're never willing to be specific about the reductions in spending that they would be willing to do.
(END VIDEO CLIP) VELSHI: The debt ceiling, possible default, and Washington rhetoric are a little too wonky for you to get excited about. So, let's talk about your bottom line.
No one knows exactly what will happen if we don't raise the debt ceiling. But we talked to Alan Blinder. He's a former vice chairman of the Federal Reserve.
And he says government payments could be slower to come out if they come out at all. Interest rates could rise. And some of the experts we talked to said the U.S. could -- could -- get pushed back into a recession.
It looks like Microsoft may be getting into the social networking game. A reporter happened upon the welcome page for what's being called Tulalip. It was quickly taken down. Now in the page, a note saying it's an internal design project from Microsoft and was mistakenly published to the web.
Hmm, we'll have to see about that.
It seems not everything is friendly in the social media world. App developer Michael Johnson was looking for a way to invite his Facebook friends and others to join Google Plus. So, he placed a Facebook ad headline, "Add Michael to Google Plus."
Facebook wasn't amused. According to CNET, it erased the ads and disabled his account.
Lose a bag, get a check. New York Senator Charles Schumer says it should be that simple. A new regulation says airlines have to refund your bag fee if they lose your bag. But here's the rub, if it's never returned. Schumer wants to change that so you'll get a refund if your bag doesn't arrive when you do.
A volcano is causing people to take flight in Indonesia. More than 5,000 people left their homes yesterday after a Mt. Lokon erupted again. It sent smoke so high that authorities were concerned about flight disruptions at nearby airports. The volcano has erupted several times since Thursday.
And Volkswagen off to a good start for the first half of the year. Europe's largest automaker reports that it sold a record 4 million cars in the last six months under all its brands. Its new 2012 VW Beetle hits showrooms this fall. It's being manufactured at the largest auto plant in Mexico.
Let's go around the world with Monita Rajpal, live from London.
Good morning, Monita.
This News Corp scandal continues to unfold -- a high-profile resignation this weekend, a high-profile arrest. What's the latest?
MONITA RAJPAL, CNN INTERNATIONAL ANCHOR: Yes, Ali, absolutely. It's also followed the prime minister of Britain, of the U.K., all the way to South Africa where he is on a trip to try to drum up some more business.
But as you were saying, the head of Britain's largest police force has resigned. That's Sir Paul Stephenson. Commissioner of the Metropolitan Police stepped down as questions surrounding his relationship with editors of the now defunct "News of the World" newspaper.
While Stephenson maintains he had no knowledge of the extent of the activities at the paper, he said he was resigning because, quote, "As commissioner, I carry ultimate responsibility for the position we find ourselves in."
Now, his resignation comes as News International's former chief executive, Rebekah Brooks, was arrested Sunday and underwent 12 hours of questioning by police. That came as a surprise that she was arrested. She didn't know that she would do. She thought she was just going to be helping in their investigation.
Brooks is set to appear before a parliamentary inquiry on Tuesday, alongside James Murdoch and Rupert Murdoch. Now, there are questions if she'll be able to testify -- Ali.
VELSHI: Monita, those bombings last week in India. Hillary Clinton had a trip planned there. She's still going ahead with that trip?
RAJPAL: Yes, we understand, Ali, that this is a key trip for Secretary Clinton. It comes less than a week after a series of explosions in Mumbai that left 19 people dead and about 100 people injured. She says it's, quote, "more important than ever that we stand with India." No one has claimed responsibility for those blasts, and counterterrorism measures are set to be high on Clinton's agenda during the three-day trip.
She's likely going to press for better ties between India and Pakistan, right next door. That relationship has been shaky for some time now, but Clinton will also focus on economic ties. As you know, India has a $1.6 trillion economy. So, it's quite vital for India and The U.S. to have good economic relationships -- Ali.
ALI VELSHI, CNN ANCHOR: Big economy and a growing economy. Monita, thanks very much. We'll check in with you later. Monita Rajpal live from London.
Let's go to Carter Evans live here in New York. He's at the NASDAQ market site. Good morning, Carter. Good to see you, my friend. How are futures shaping up? We look to some big news from Wall Street. So, Wall Street's got to deal with earnings and with debt ceiling stuff this week.
CARTER EVANS, CNN CORRESPONDENT: Well, overall, heading into this week, considering all of that our futures right now are a little bit lower. Many of the biggest and wealthiest companies in this country are preparing to release our quarterly numbers this week. We're going to hear from General Electric, Goldman Sachs, McDonald's, Apple, Intel, you name it, IBM. There are just a handful of the companies investors are keeping an eye on. So, we're going to get a good idea of how some of the biggest companies in the country are doing in the third quarter.
Today, we're going to hear from Charles Schwab, Gannett, Halliburton, and Hasbro before the bell. After the bell, we're going to hear from Stanley, Black and Decker, and Wynn Resorts. So, that should really give us an idea of how companies are doing. You know, Ali, earnings are really, really important.
And if it weren't for all the other things that are going on in the world economy right now, I think there would be a lot more focus on these numbers, but we've still got this debt ceiling deadline hanging over our head, and a lot of focus is going to be on that this week as well --
VELSHI: Right. For the average investor, it's tough to figure out what you're putting your money on. Is it the earnings? Is it what's going on in Europe? Is it growth around the world or is it this debt ceiling problem here in the United States? In the meantime, for wealthy Americans and high earners, a warning has gone out. Talk to me about this.
EVANS: Well, you know, this is really interesting. And, we're hearing also that people are saving a little more as a result of the recession, but when it comes to people retiring now, there's a new Harris interactive survey for some American (ph), and it finds that most people now, 55 and over, are waiting until they're 69 to retire. Now, the average age before the recession was 64.
Now, you see people are worried right now. They don't think they're going to have enough money to live on. Forty-four percent of those surveyed say they feel secure about their financial situation these days compared with 62 percent who felt secure before the recession began. And about two-thirds say they'd like to continue to do some work, whether it's just for the stimulation or for the money.
Thirty percent say they're really just down right angry about the whole situation that they're going to have to work for many more years than they thought.
VELSHI: Very good. Carter, good to see you this morning. Carter Evans at the NASDAQ market site for us. We'll chat with him a little bit.
Now, back to the businessman's special of the day. In the quest to find something else to blame for our fat, today, the excuse is the size of your fork. "Fast Company" magazine published a study from "The Journal of Consumer Research" in which researchers weighed plates of food after they were eaten by people with large forks and people with small forks. The big-fork people ate less, believe it or not. So, the moral of the story is next time you go out to eat, ask for a big fork. Wow!
Before we go, your get smart question of the day in honor of the Women's World Cup. can you guess how much the Women's World Cup weighs? Is it 3.9 pounds, 10.1 pounds, or 17 pounds? The answer after this quick break. It is 33 minutes after the hour.
(COMMERCIAL BREAK)
VELSHI: Thirty-seven minutes after the hour. In today's get smart question of the day, we asked if you could guess how much the Women's World Cup trophy weighs. Is it 3.9 pounds, 10.1 pounds, or 17 pounds? The answer is just 3.9 pounds. In comparison, the men's trophy weighs more than three times that.
Time for now for our "Political Ticker." Let's bring in our deputy political director, Paul Steinhauser on the phone from Washington this morning. Good morning, Paul. Michele Bachmann, presidential candidate, is changing her mind on a pledge that most other presidential candidates have already signed. What's this about?
PAUL STEINHAUSER, CNN DEPUTY POLITICAL DIRECTOR: Yes, it's a big deal for her today. Bachmann, you know Ali, as you know, she's one of those matured Republicans running for president. She'd previously refused to sign this pledge. She changed her mind. She's going to sign it today in South Carolina. Why? Two things. South Carolina, the first southern primarily, crucial state, but it's also the home state for Senator Jim DeMint. He was the man behind this pledge. It's called cut, cap, and balance.
People -- you've heard a lot about it, but let me quickly tell you what it means. Cut a substantial amount of spending to bring down roughly $1.5 trillion from the deficit expected this year. Cap federal spending at 18 percent of the GDP. You know, right now, Ali, it's at 24 percent. And pass a balanced budget amendment to the constitution that would include spending caps to make it really difficult to raise federal taxes. She's adding her name today, Ali.
VELSHI: All right, let's talk about Rick Perry, governor of Texas. A lot of people calling for him to get into this race, and now, some hints that he might actually be thinking about it?
STEINHAUSER: Oh, yes, yes. He's been thinking about it for a while, but here's another hint for sure if you need it. In an interview with "The Des Moines Register," remember that, the big newspaper in Iowa, Iowa, of course, the state that kicks off the race for the White House. Here's what he told them over the weekend. "I'm not ready to tell you that I'm ready to announce that I'm in, but, I'm getting more and more comfortable every day that this is what I've been called to do. This is what America needs."
That's some pretty strong signals there from Rick Perry, the Texas governor, that he's probably going to be jumping into the race for the White House, Ali.
VELSHI: All right. Well, a lot of people calling for someone else to be in there, some other big name. He'd certainly be a very big name. He took over as governor after George Bush left as governor to become president. Paul Steinhauser, always a pleasure to talk to you, my friend.
It is 39 minutes after the hour. Here are three things that you have to put on your radar for today, for this week, actually. Tomorrow, News Corporation owner, Rupert Murdoch and his son, James, are scheduled to appear before British politicians to answer questions over the widening phone-hacking scandal.
On Thursday, the shuttle "Atlantis" crew is due to land at NASA's Kennedy Space Center. We'll bring it to you live, but I'm going to talk to them on this show, live Wednesday morning. Tune in for that.
Also on Thursday, it will be the first official day that the new Consumer Financial Protection Bureau goes into business. The bureau is intended to make basic financial practices like taking out a mortgage or a loan clearer and more transparent while ferreting out unfair lending practices.
All right. Let's take a look at sports. For hours and hours last night, the Boston Red Sox were tied with the Tampa Bay Rays. The score 0-0. It took 16 innings. The Red Sox finally scored for a 1-0 victory.
The Texas Rangers won their 11th straight game, this time, against the Seattle Mariners. They won 3-1. That's the longest winning streak in history, 26 wins. That is not the longest winning streak in history, by the way, 26 wins for the San Francisco Giants was back in 1916.
And ever seen a golfer do this? Twisting with a cigar in his mouth at the British Open. Miguel Angel Jimenez is a pro-golfer from Spain who placed number 20 at the open.
U.S. Women's soccer team World Cup quest sadly over. The Americans watched the title slip away to Japan on penalty kicks. An overtime ended in a 2-2 tie. Japan was the underdog in this match. Now, they're the first Asian team to ever win the tournament. Let's go to Zain Verjee who's in Germany. Zain, what a game. A nail-biter to the end.
ZAIN VERJEE, CNN INTERNATIONAL CORRESPONDENT: I was biting my nails so hard, Ali, I don't think I have any left. The atmosphere in the stadium was absolutely electric. The U.S. started off, Ali, really aggressive. They were looking good. They took so many shots at goal, but they kept missing the opportunities. Finally, in the 68th minute, they managed to score. Alex Morgan, the youngest on the team, got it right then.
And then, just a few minutes later, the Japanese equalized because there was a mess up in the U.S. defense line. Then, in extra time, Abby Wambach, a beautiful header got it in the goal. And it looked like the game was the U.S.'s. They were only a few minutes away from victory. And then, in the very last few minutes, the Japanese pulled it out.
They equalized, and the U.S. lost on penalties. It was an amazing game to be there. You know, good for the Japanese, but we all feel bad for the U.S. I mean, they really put up a great fight -- Ali.
VELSHI: You make a good point. While America was rooting for America, the whole world's got to be rooting for Japan right now after the year they've had.
VERJEE: Yes. Japan was really the sentimental favorite going into this. You know, everything they've been through with the earthquake and the tsunami. The coach was even showing them pictures of the devastation in the locker room, and one of them matches just to get them motivated. Many of them lost their friends, their family. Many know people that are suffering because of the tsunami.
Even one of the players worked at the Fukushima Daiichi Nuclear Plant. So, the Japanese, people here are saying, may not have had the height, but they had the heart -- Ali.
VELSHI: I'm hearing about an "S" on your shirt, though, I can't see a shirt, because you're all bundled up in the middle of summer. It must be cold in Germany. Do you have an "S" on your shirt? And if so, why?
(LAUGHTER)
VERJEE: You know, I was really torn. I wanted the Japanese to win, but you know what, Ali, you're going to force me to flash you on television. So, yes. I was rooting for team USA.
(LAUGHTER)
VELSHI: Oh, I see there was more than an "S." I get it. OK. I thought it was a superman shirt or something like that. I could see the outline of it.
(LAUGHTER)
VELSHI: Very nice. Zain, this is what we love about you. You can have fun even if the team you're rooting for didn't win. What an exciting time. What a great job for all the teams in there and the fantastic U.S. team. Zain, we'll catch up with you later. Good to see you, my friend.
And before we go, this day in history, July 18th in the year 64 A.D., 64, the great fire of Rome started. Nearly the entire city was destroyed, you may recall. It is 43 minutes after the hour.
(COMMERCIAL BREAK)
VELSHI: It is Monday, July the 18th. This is you're A.M. WAKE-UP CALL. I'm Ali Velshi joining you live this morning from New York. It's 46 minutes after the hour.
New this morning, General David Petraeus hands over command of Afghanistan. The outgoing top commander of NATO forces there transferred authority this morning to Marine Lieutenant General John Allen. Petraeus plans to retire from the army at the end of August before taking over as CIA director on September the 6th, the day after Labor Day.
It is Monday morning. We are still stuck in debt debate limbo. No breakthroughs over the weekend and the clock continues to tick down to August 2nd, the day the government could start defaulting on its bills.
(BEGIN VIDEO CLIP)
SEN. JIM DEMINT, (R) SOUTH CAROLINA: We need to realize, setting all politics aside, that our country is on course for a financial disaster. We can't take another $10 trillion in debt that the president has proposed.
JACOB LEW, WHITE HOUSE BUDGET DIRECTOR: We think that the president has said clearly we should do as much as we can to reduce the deficit, but we have to avoid the kind of cast that would result from default.
(END VIDEO CLIP)
VELSHI: Instead of focusing on all the end of days rhetoric, let's talk about possible solutions. Plans "A" through "D" in no particular order. There's the fall-back plan, built in case Congress and the White House can't make the deal. It would shit how the government actually goes about raising debt ceiling. Senate leaders are hammering that out right now. Then, there's kick the can, a short- term deal that would raise the debt ceiling for a few weeks or months.
Next up, the just get to 2012 deal, a compromise that would give the government enough spending power to get through elections. And fourth, there the grand compromise, the big kahuna, what the president is pushing for. It's a long-term deal that could take a big bite out of the deficit. Out of the question, but some say it's just not likely to happen.
Now, we've just learned that a judge in Italy has rejected all of the defense motions in the trial of Prime Minister Silvio Berlusconi. He is set another hearing for October 3rd. He's charged with abusing office and paying for sex with an underage prostitute known as Ruby the Heart Stealer. He was set to meet Ruby in court for the first time since the trial began.
And here's your 15 seconds of news from Canada. A classic rockers cheap trick got a scare when their stage collapsed. The Cisco Ottawa Blues Fest was the venue. The stage blew over in severe weather according to the band's website. That's where we snagged these pictures. You can see the before, which is the lower part of your screen, and then the after on the top part. It's barely recognizable. The good news, though, no serious injuries.
You hear the words grope and airport security, and junk-touching security checkpoint horror stories pop to mind. There's a twist to this one. Phoenix police arrested a would-be passenger, a 61-year-old woman for allegedly squeezing and twisting a TSA officer's breasts. They say she refused to go through screening on Thursday, started arguing with officials, and that's what led to the alleged grope.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Surprise you that somebody did that to the TSA?
UNIDENTIFIED FEMALE: I don't know. I mean, nothing really surprises me, I guess.
UNIDENTIFIED MALE: I'm surprised it hasn't happened sooner.
(END VIDEO CLIP)
VELSHI: The woman spent a night in jail. She's facing felony sex abuse charges.
Casey Anthony is a free woman, whereabouts unknown, though. She was released from an Orlando jail early Sunday morning, and here's a snapshot of the life she walked out to about two weeks after she was acquitted of killing her daughter, Caylee. She's broke. She's facing several pending lawsuits. She's not communicating with her family, and her lawyers say she's been getting death threats. The big question, where does she go from here? Your guesses are good as mine.
Fewer college students are signing up for credit cards. Last year, college credit cards issued by colleges and alumni associations dropped 17 percent. That's according to a survey released by the Federal Reserve. Consumer advocates say that's thanks to a 2009 law that limits marketing cards to college kids.
Time now to go around the world with Monita Rajpal. She's live in London. Monita, this News Corporation scandal led to a high-profile resignation over the weekend and a high-profile arrest. Where do we stand now?
RAJPAL: Well, what we know right now is that the head of Britain's largest police force, Ali, has resigned. Sir Paul Stephenson, commissioner of the Metropolitan Police, stepped down as questions surrounding his relationship with the editors of the now defunct "News of the World" newspaper.
Also, while Stephenson maintains he had no knowledge of the extent of the activities at the paper, he said he was resigning to quote "As commissioner, I carry ultimate responsibility for the position we find ourselves in." His resignation comes as News International's former chief executive, Rebekah Brooks was arrested Sunday, and she underwent 12 hours of questioning by police.
Brookes is set to appear before parliamentary inquiry on Tuesday alongside James Murdoch and Rupert Murdoch, but there are questions now as to which she would actually be able to testify on Tuesday, Ali.
VELSHI: All right. We'll keep an eye on that. I know you'll follow that closely. What about Hillary Clinton's trip to India? The bombing happened last week. This trip is still on. She's hoping to get a lot done.
RAJPAL: Yes, this is a key trip for Secretary Clinton, Ali, and it comes, as you're saying, less than a week after series of explosions in Mumbai that left 19 people dead and about 100 people injured. She says it's quote, "more important than ever that we stand with India." At this point, no one has claimed responsibility for those blasts, and we don't even know if the Indian (INAUDIBLE) has more intelligent into -- as to who may be responsible, but we understand that counterterrorism measure is set to be high on Clinton's agenda during this three-day trip.
She is likely going to press for better ties between Indian-Pakistan, which is right next door. The relationship, as you know, has been shaky for some time now, but Clinton will also focus on business and economic ties. India has a $1.6 trillion economy, Ali.
VELSHI: Monita, stick around for this. Scientists of uncovered underwater volcanoes, the size of Mt. Fuji off the coast of Antarctica. Now, this is image ring when they show you from the British Antarctic survey. There are about a dozen peaks, some up to 10,000 feet tall. It's an important find because undersea volcanoes can collapse and trigger tsunamis. Something definitely worth watching. Monita, good to see you. We'll check in with you a little later on.
Let's go to Rob Marciano live from Atlanta. Tropical storm Bret is causing some flight delays. Tell me what this is all about.
ROB MARCIANO, AMS METEOROLOGIST: Second tropical storm of the season, Ali, and it's formed about, I don't know, 150 miles or so east of, say, West Palm Beach Florida just over the Bahamas there. Fifty-mile- an-hour winds right now. It's kind of been drifting down to the south. Now, it's moving east at a three miles an hour, but there you see the forecast track for the National Hurricane Center as of 5:00 a.m. We think this thing will go out to sea and probably stay below hurricane status.
Bad news is that Florida desperately needs the rain. So, that's a bit of an issue for them as they can certainly stand to see moisture. Thunderstorms in the New York City area this afternoon. We'll call for some delays as they will in Chicago, Detroit, Cleveland. Meanwhile, the rest of the central part of the U.S. will continue to bake. There's the front that's trying to push out and having a hard time doing it. Hazy, humid and hot conditions persist.
There are 11 states that have excessive heat warnings out. That's dangerous levels of heat from Minneapolis back through, say, St. Louis. One way to cool off. Check out this report from an iReporter out of California. There was a boat show out there. And this is what's called the jet-lev. It is a levitation device, a jet pack that uses water, Ali, as its propulsion system. Costs about $100,000. I know you'll be out there shortly, but it's kind of, I don't know, George Jetson meets Jacques Cousteau.
VELSHI: A $100,000?
MARCIANO: That's small potatoes for you, come on, reach into the pocket.
VELSHI: I was really into this. I was waiting for you to tell me how much it costs because I might pick one up. A $100,000, I think I'll wait for everybody else to get one.
MARCIANO: I'm sure you'll get at least one. VELSHI: That's very cool, though.
MARCIANO: Yes.
VELSHI: That's a very, very cool idea. Rob, good to see you, my friend. I'll catch up with you on "American Morning" in about 10 minutes.
VELSHI: Sounds good.
All right. Before we go, today's word of the day. You have to know, schadenfreude. It means, well, I'll tell you what it means and why you need to know it right after the short break. it is 54 minutes after the hour.
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VELSHI: Fifty-seven minutes after the hour. Now, back to our word of the day. Schadenfreude. According to Merriam Webster, it means, enjoyment obtained from the troubles of others. Let me use it in a sentence for you. This is from the "Wall Street Journal," quote, "The schadenfreude is so thick you can't cut it with a chainsaw." The "Wall Street Journal" is one of Rupert Murdoch's publications.
They used the word in an article fighting back against claims that "The News of the World" scandal tarnished the journalists of other Rupert Murdoch publications including the "Wall Street Journal.
OK. It's 57 minutes after the hour. Here are three things to put on your radar today.
With an August 2nd deadline quickly approaching, President Obama and Congressional leaders are still trying to work out a possible deficit reduction deal.
Around 9:00 eastern this morning, the shuttle "Atlantis" crew will bid farewell to the space station crew before closing the hatch and preparing to return home.
And around 1:00 p.m. eastern, President Obama will nominate Richard Cordray to head the new Consumer Financial Protection Bureau. It's scheduled to formally open for business on Thursday. The bureau is intended to make basic financial practices such as taking out a mortgage or a loan clearer and more transparent.
All right. Now to see how the world's money is doing this morning. The Nikkei closes up. Hang Seng closes down. The Dax and FTSE-100 are both down at this hour. Let's go to Kristie Lu Stout from Hong Kong. Kristie, give us the latest on markets this morning.
KRISTIE LU STOUT, CNN INTERNATIONAL CORRESPONDENT: Well, the markets close moderately lower across the Asia Pacific. Now, in Europe, stock markets are down this first trading day. Phillips Electronics, there's news out that the group plans to cut an additional $700 million in costs after reporting its biggest loss in nearly 10 years. Now, I'm also keeping an eye on Australia's main index. It was flat today, but shares of News Corp fell nearly four percent as the company battles out phone hacking scandal -- Ali.
VELSHI: That continues around the world. Now, in the U.S., despite the issues that investors are worried about with respect to European debt and the U.S. debt crisis, a big week because of earnings.
STOUT: That's right, and here's a checklist. Some of America's most influential companies are out with Q2 earnings this week. So, today, you want to keep an eye out for Halliburton, Wynn Resorts, IBM, and also Hasbro, and this is a crucial time for the markets given the concerns about this economy, but perspective check. We should keep in mind that Q2 earnings are usually the weakest of the year -- Ali.
VELSHI: Kristie, good to see you as always. And, we'll catch up with you in Hong Kong. Kristie Lu Stout in Hong Kong.
By the way, talking about earnings. Let's talk about moneymakers at the box office. We knew "Harry Potter" was going to do well, and can you guess how well? The "Harry Potter" finale scoring the biggest opening weekend ever, $168.6 million here in the United States and $476 million worldwide.
The "Transformers: Dark Side of the Moon" fell 55 percent from its debut, but still came in with $21.3 million, and the comedy "Horrible Bosses" came in third with a pretty respectable $17.6 million. That's it for me in WAKE-UP CALL.
AMERICAN MORNING starts right now.
