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Police Shootings in Oakland; AIG Underestimated Bonus Payments
Aired March 21, 2009 - 22:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
DON LEMON, CNN ANCHOR: Good evening, everyone. I'm Don Lemon. We start with breaking news tonight out of Oakland, California. And we warn you, the pictures are disturbing. Four Oakland police officers are in critical condition tonight, shot and wounded in two separate incidents. That's blood you see there at the bottom of your screen along the sidewalk at the scene of those shootings right there near the police officers.
Reporter Dave Stevenson of KTVU is standing by for us. He's at the hospital with the very latest. David, what do you have for us?
DAVE STEVENSON, KTVU CORRESPONDENT: Don, I'm standing outside Highland Hospital, where the four hospitals were brought this afternoon. They are said to be at this moment in critical condition. This all began with the traffic stop in East Oakland, just after 1:00 Pacific Time this afternoon. That's when two officers were shot by a suspect who then fled his automobile on foot. Now that led to an enormous manhunt here in Oakland involving the Oakland Police Department and the California Highway Patrol. Oakland police say a tip led them to an apartment complex where the suspect had allegedly holed up. The police say that the suspect then shot two officers responding to that scene before he was himself shot by officers.
At this time, police say that all four officers are in critical condition. That was the word we received as of about 4:30 Pacific Time this afternoon. We are waiting to hear more a little later on this evening. Dozens of the fellow officers came to the hospital along with friends and colleagues in shock, in concern about the condition of those officers.
Again, we're waiting to hear more from the Oakland police a little later on this evening, don.
LEMON: Reporter Dave Stevenson from our affiliate KTVU. Thank you. If you get anything new, we will bring you back. Thank you, Dave.
We turn now to another developing story that is sure to make any of you angry tonight. There are new claims that AIG has underreported its bonus payouts. The Connecticut attorney general tells CNN he has documents that show the company paid out $53 million more in bonuses that's first thought. A total of $218 million instead of the $165 million we've heard about all this week. Connecticut is one of at least 20 states, the ones in blue that you see, which have announced official investigations into AIG bonuses. Connecticut Attorney General Richard Blumenthal has asked AIG to clarify the size and timing of its bonuses. When I spoke to him by phone, Blumenthal told me he plans to pursue the bonus money because nothing justifies such large payouts.
(BEGIN AUDIO CLIP)
RICHARD BLUMENTHAL, CONNECTICUT ATTORNEY GENERAL: We've heard a few explanations, but quite honestly, none of the apparent justifications hold water with me because whether the payments were made in December or March, I want to know how much they were because we deserve back every dollar of those $218 million apparently now that they acknowledge -- the company acknowledges were paid in bonuses.
(END AUDIO CLIP)
LEMON: Well, the back and forth continues. CNN has received a new statement from AIG tonight. Spokesman Mark Herr says, quote, "Attorney General Blumenthal's claim that he has discovered additional AIG retention payments is incorrect. The payments he appears to be referring to were made months ago, have been widely reported on and were specifically disclosed to the Treasury."
About 20 people took a bus ride today to the homes of two AIG executives in Connecticut to vent in person about huge bonuses to the, quote, "rich and shameless". CNN national correspondent Susan Candiotti rode along with them.
(BEGIN VIDEOTAPE)
SUSAN CANDIOTTI, CNN CORRESPONDENT (voice-over): Seventy three year- old widow Willy Huguley is a first-time activist who said she's close to losing her home to foreclosure.
WILLY HUGULEY, PROTESTER: Why me? Why me?
UNIDENTIFIED FEMALE: When do we want it?
CROWD: Now.
CANDIOTTI: She joined about 40 protesters outside AIG offices in Wilton, Connecticut, holding homemade signs reading, "lifestyles of the rich and shameless", blasting the insurance giants for paying executives $165 million in bonuses after getting federal bailout money.
UNIDENTIFIED MALE: It's really justifiable outrage at this growing gap between people who in fact, you know, remain insulated from the meltdown in the economy and those who, you know, are the ones struggling to save their home and avoid foreclosure.
CANDIOTTI: Connecticut's Working Families Party staged a bus tour past some swanky AIG executive homes who got those bonuses.
(on camera): First stop, the home of Doug Polling (ph). Right over here, security guards are in the driveway. This is the man who gave back the single biggest bonus check, according to a spokesperson for AIG. He did it because it was, quote, the correct thing to do.
(voice-over): Polling, if at home, was nowhere in sight. Private security guards kept protesters at the driveway's edge.
UNIDENTIFIED FEMALE: He went to college with your sister. We want to thank him for doing what he did.
CANDIOTTI: Unable to thank a letter, it was read out loud.
UNIDENTIFIED MALE: We applaud this step. Most of us will never know what it feels like to turn down millions of dollars.
CANDIOTTI: Mark Zwiebeck likely won't. A laid-off steel worker and father of five, youngest is 14, he's hoping for better days and putting his faith in President Obama.
MARK ZWIEBECK, LAID OFF STEELWORKER: Eight years ago, this would have been a 20-second clip. And that would have been the end of it and nobody would have gave the money back. Nobody gave the money back eight years ago.
CANDIOTTI: At the next waterfront estate, another symbolic letter read outside the home of former AIG executive James Hunt (ph), nicknamed Jackpot Jimmy by one New York paper. He also gave back his bonus. It's almost too much to think about for the likes of Willy Huguley, who can think of better things to do without all of that corporate cash.
HUGULEY: People who don't have food in their homes and who can do nothing themselves.
CANDIOTTI: By going on tour to follow the money, these working class families want taxpayer-backed corporations to know from now on, they'll be watching every penny. Susan Candiotti, CNN, Wilton, Connecticut.
(END VIDEOTAPE)
LEMON: Make sure you stay with us. Our conversation on AIG and all of the outrage over Wall Street bonuses continues. Our outspoken players sound off ahead.
And later, Ali Velshi and the CNN money team search for truth inside the AIG scandal. See what they found in "AIG: Facts & Fury". Tonight at 11:00 p.m. Eastern. Again tomorrow at 8:00 p.m. But tonight following this broadcast.
President Barack Obama is trying to move beyond the anger of AIG and return to his top priorities. But his proposed budget is already taking hits on Capitol Hill. The Congressional Budget Office says the president's plan will cause $9.3 trillion in deficits over the next decade. In today's weekly address, the president defended his spending plans.
(BEGIN VIDEO CLIP)
BARACK OBAMA, U.S. PRESIDENT: This budget must reduce that deficit even further. With the fiscal mess we have inherited and the cost of this financial crisis, I have proposed a budget that cuts our deficit in half by the end of my first term. That's why we're scouring every corner of the budget in a proposed $2 trillion in deficit reductions over the next decade. In total, our budget would bring discretionary spending for domestic programs as a share of the economy to its lowest level in nearly half a century.
(END VIDEO CLIP)
LEMON: Republicans see political gain in the potential red ink. They used their weekly response to pounce on the president's budget.
(BEGIN VIDEO CLIP)
GOV. HALEY BARBOUR, (R) MS: President Obama's budget spends too much, taxes too much and borrows too much. It's breathtaking. The new administration's budget for next year alone calls for a $1.2 trillion deficit. Nearly triple any past federal deficit. While families are cutting back, President Obama's proposed a massive government spending spree.
(END VIDEO CLIP)
LEMON: President Obama says he realizes critics accuse him of taking on too many issues at once, but he says, quote, "the challenges we face are too large to ignore."
Iran's Supreme Leader is dismissing President Obama's call for a fresh start in relations. Mr. Obama this week reached out to Iran in a videotaped message but Iran's Supreme Leader says Iran will change its policies over if the U.S. changes its policies. President Obama's video marks a dramatic shift in tone for the U.S. Former President Bush once labeled Iran part of an axis of evil.
In Eastern Pennsylvania tonight, 5,000 people were evacuated after a tanker truck overturned with a load of toxic acid. It happened overnight near Wind Gap, when the driver apparently swerved to avoid a deer. The accident blocked the highway in both directions. The evacuated residents are back home tonight.
CNN's Jacqui Jeras following developments on record flooding in the Midwest. She joins us with that from the CNN Severe Weather Center. Hi, Jacqui.
(WEATHER REPORT)
LEMON: All right. Jacqui, thank you very much.
And high above the Earth this afternoon, two astronauts did weekend chores outside the International Space Station. They did routine maintenance to prepare for a future mission. They also attached a GPS antenna and infrared camera. Alarms sounded towards the end of the space walk but mission control called the problem nothing to worry about. Another space walk is planned for Monday.
The growing outrage over AIG bonuses, how did Congress miss them? And are lawmakers actually hurting the economy by lashing out at AIG? We're digging deeper with radio host Neal Boortz, David Sirota, also Roy Seikof of the Huffington Post and Rick Newman of "U.S. News & World Report." These guys won't hold back. You will want to see that.
Also, fight for control of Mexico's drug trade. We will tell you about that. It's a deadly business with four major cartels battling it out. We're getting inside the story here.
Plus, we want you to be on our show tonight. We want you to be part of our community. Twitter, Facebook, MySpace, ireport.com is how you do it.
(COMMERCIAL BREAK)
LEMON: All right. Here's what some of you are saying tonight about the stories we're reporting, mostly about AIG.
Here is what chillWith says. "Several failed corporations are trying to disguise bonuses as retention payments. If the execs failed them, why retain them?" Rahblah says, "Big pictures is almost too big to imagine fathom. Bonuses matter because they are indicative of a larger problem. It is symbolic."
GMcClain20 says, "How about be bringing Dodd up on charges for the AIG fiasco? While we're at it, let's get Geithner, too."
Join us in our show tonight. Be a part of it. Twitter, Facebook, MySpace or ireport.com. We will get your responses on the air and we love to hear from you.
With AIG hijacking the headlines, there's been no shortage of opinions about who is to blame here. Earlier tonight we spoke with four of the most outspoken voices in America from across the political spectrum, conservative talk radio host Neal Boortz, author, journalist and columnist David Sirota, chief business correspondent with "U.S. News & World Report" Rick Newman and Huffington Post editor Roy Sekoff. Listen.
(BEGIN VIDEOTAPE)
LEMON: Millions of dollars in bonuses after a bailout from all of you as taxpayers, I don't need to tell you, it really rubs it in here. That is obvious. Joining me tonight, conservative talk radio host Neal Boortz, thank you Neal for joining us. Author and journalist and columnist David Sirota, thank you sir. Rick Newman as well, chief business correspondent "U.S. News & World Report" and Roy Sekoff, editor of Huffington Post.
Again, thanks to all of you for joining us. Neal, are you buying it that he didn't know what the language was and no one stuck this in? Do you think this was put in there on purpose?
NEAL BOORTZ, HOST, "THE NEAL BOORTZ SHOW": He's a politician. They lie. I'm so -- I am so uninterested in the role Chris Dodd played. What bothers me here -- and I have never been more afraid for our country than from this idiotic little brouhaha we have going on.
LEMON: Why do you say it's an idiotic little brouhaha?
BOORTZ: This is .09 of one percent of the bonus money. Of the bailout money. Nine one hundredths of one percent.
LEMON: I see David shaking his head. He's in the monitor next to you. David, you don't hear believe that, everyone saying, we need to stop focusing on this. It's only a drop in the bucket. But doesn't every drip fill the bucket?
DAVID SIROTA, COLUMNIST: Exactly, and there's two things here, first of all, since when does $200 million become no big deal?
BOORTZ: Hold on. When Chuck Schumer a couple of weeks ago said we don't need to be quibbling about $200 -- when government -- when government spends it on some pork, Chuck Schumer says, we don't need to be quibbling over $200 million. But then when somebody earns that money legally by a legal ...
SIROTA: Earned it? Earned it? They earned the money?
BOORTZ: I know to you ...
SIROTA: That sector of AIG drove this economy into the ground. They did not earn that money. They did not earn that money.
LEMON: David and Neal, hold on.
BOORTZ: I know leftists hate the word earn. They like the word given.
SIROTA: These people did not earn taxpayer money. They did not earn my taxpayer money.
LEMON: Rick, as a chief business correspondent for "U.S. News & World Report." You hear them talking about earning the money. This is all part of contracts. Whether or not they could have sued and all of this. Was it earned? Is it legal for them to do this?
RICK NEWMAN, "U.S. NEWS & WORLD REPORT": We could have a distracting conversation about how you define earned. I'm done. I'm actually not angry about these bonuses. I'm angry they happened but I think this is turning into a fairly cleansing, something like a cleansing process. I think we're learning a lot about the mechanisms for how these bonuses get determined in the first place. I think that's very important. Obviously there's some chicanery involving that.
I think this is obviously kind of a venting moment for the nation. And what I hope happens is we sort of digest all of this and we get on which really a much bigger question is, what are we going to do about AIG?
LEMON: Not only AIG, but others. Go ahead, Roy.
Hang on.
ROY SEKOFF, HUFFINGTON POST: Since when does capitalism let us say we reward extreme failure? That's what we are looking at. And Neal, we can deal with this on more than one level. This thing stinks on many levels. Yeah, you're right, it's a drop in the bucket. Let's talk about the bigger picture about the whole bailout and what we really did. We had an insurance company that turned into a casino, right, and made these horrible debts and they now want us, the taxpayers to pay off these bets, to pay off Goldman Sachs, to pay off Deutsche Bank.
BOORTZ: Roy, just a question. Tell me how the heavy equipment in aircraft leasing portion of AIG was a casino? Since you know all about what AIG does, tell me ...
SEKOFF: We're not talking about the -- we're talking about the credit derivatives. You know who brought us here.
LEMON: Hang on. We have to speak one at a time here. Roy, what were you saying?
SEKOFF: You know what we're talking about. We're talking about the credit swap derivatives, we're talking about the financial arm of AIG, where they put the hedge fund on top of the insurance company, and that's what brought this down. Not the heavy machinery.
BOORTZ: Let me tell you what has happened here. We have the Congress of the United States that has now voted to punish some people whether it's for good reason or bad reason, to punish some people that they do not like by seizing from them property that they legally obtained.
SIROTA: It's our taxpayer money.
BOORTZ: What the congress has done ...
SIROTA: They intervened and said it's our taxpayer money. It is our taxpayer money.
LEMON: Rick, there is something to say about it that it is retroactive and it feels like somebody is coming back and taking something from you that was already in your pocket or already earned.
NEWMAN: Yeah, well, it happens.
SIROTA: But, Don, the key issue here ...
LEMON: Let him finish. David, let him finish. Hang on. Go ahead.
NEWMAN: I think Roy was actually hitting upon something and he's talking about something that involves a lot more money than $165 million in bonuses. It is actually way more important, which is why is Goldman Sachs basically getting bought out at 100 cents on the dollar when they took risks going with that? This is an enormous, we are talking about $50 billion or $70 billion.
SIROTA: That's a real question.
LEMON: We will get back to this.
(END VIDEOTAPE)
LEMON: That was one explosive conversation in topics we discussed ever here before.
Up next, President Obama's role in the AIG blame game. And what exactly he is taking responsibility for. You know our players had a lot to say about that. That's moments away.
Also, a shocking number about who's getting sick and dying in Washington, DC.
(COMMERCIAL BREAK)
(BEGIN VIDEOTAPE)
LEMON: Our guests are back. Neal Boortz, David Sirota, Rick Newman and Roy Sekoff. OK, Neal, start with you, what is the Obama administration's role in this? What are Republicans saying or conservatives saying, how much for the eight years before that, the Bush administration responsible for the economy? President Barack Obama in office less than 100 days but what is his role in all of this, the administration?
BOORTZ: Actually, I think his role is absolutely minimal in all of this. The initial -- the initial bailout of AIG was under President George Bush and if somebody wanted to do something about bonus payments then, they could have asked for and sought a modification. It would take both parties to this court to get this modification.
LEMON: So why all of the criticism about which venue he's going to, should Geithner resign? All of this -- why is this when less than 100 days in office?
BOORTZ: Because -- because the public has been whipped into an absolute frenzy over these bonuses and one has to wonder if this is being done in order to stop them from really thinking about the original bailout plan, the stimulus plan and then this pork-filled budget that they passed a couple of weeks ago.
LEMON: It looks like all of you are agreeing on this. But hang on, before you guys start talking, I want to play this. I will get to you, promise. I want to play this because maybe your minds will change about responsibility in all of this.
(BEGIN VIDEO CLIP)
REP. JOSEPH CROWLEY, (D) NY: A multibillion dollar bill for American taxpayers of $56 million in bonuses and are slated to pay an additional $162 million in bonuses to 292 participants in the coming weeks.
TIMOTHY GEITHNER, TREASURY SECRETARY: It is very important that we make sure that we're providing exceptional assistance to these firms, that that assistance is going, again, to achieve the objectives of these programs, not to reward the kind of executive that's got us in this mess. (END VIDEO CLIP)
LEMON: That was March 3rd. And Representative Joseph Crowley questioning him about it, talking about specifically about the payments in December, the ones to come in March. This was Thursday with our Ali Velshi. Take a listen.
(BEGIN VIDEO CLIP)
GEITHNER: I was informed by my staff of the full scale of these specific things on Tuesday, March 10th.
(END VIDEO CLIP)
LEMON: Roy, so do you still agree that there's really very minimal responsibility here? The question is, when do they know it?
SEKOFF: Not at all. Not at all. Geithner is coming out of this looking very bad. You asked in the piece, who dropped the ball? Well, Geithner's dropped more balls than a drunk juggler on this one. He's been in it from the beginning. As they said in the piece, he was there back when he was part of the New York Fed, part of the original bailout. And then there was a battle in the Obama administration about the people like Geithner, who didn't want any limits on executive compensations or bonuses. And he won that fight against people like David Axelrod and we are seeing now what happens. For him to act like he didn't know like he's shocked is very disingenuous.
LEMON: Rick wants to get into this. Go ahead, Rick.
NEWMAN: It is disingenuous. But I think back to last September. What they thought they were looking back then was the collapse of this huge financial firm, possibly this sort of industrial strength run on all the banks. And they thought the whole global economy was at stake. It's plausible that it never even occurred to anybody that these companies that were basically insolvent and would otherwise be bankrupt would be paying bonus money to executives and not just to any executives, but to the very people who caused the problem.
LEMON: David, why are you shaking your head?
SIROTA: First of all, we know there's been a Fed branch that has said the crisis was overstated at the time that they passed all of these bailouts. The second that's important to know is Timothy Geithner's chief of staff at the Treasury Department is a Goldman Sachs lobbyist, who was given a waiver to go into the administration, who had been previously lobbying for Goldman Sachs against executive compensation limits.
And now we find out the same Treasury Department staff is the one that made Senator Dodd water down this executive compensation situation to create this crisis. So I think what we are seeing here is an Obama administration where the president is saying one thing and his administration aides are doing another thing.
LEMON: Are you saying they watered it down to create the situation on purpose?
SIROTA: No, no. What I'm saying is that the president has said one thing about being tough on executive compensation. And the people he's put around himself are Washington insiders and Wall Street insiders who are doing exactly the opposite of what he said he wants done.
LEMON: And David, what I was about to set up, as I was setting up the Geithner sound bites here, it seems like you were in disagreement about whether or not Geithner, what he knew and when he knew it? What was that about?
SIROTA: I think that Tim Geithner knew about this. One of two things is going on, either Tim Geithner's lying or he's incompetent. There was a January 23rd Bloomberg news piece -- excuse me, January 27th Bloomberg news piece that said these bonuses were going to be paid out. So for the treasury secretary to come before the people and say he's not reading business news is absolutely absurd. He's lying or he's incompetent.
LEMON: I have to move on. Quickly, I want to get Neal, I want to get all of you, do you think he didn't know or he's not telling the truth?
BOORTZ: One quick point. This is opinion. Timothy Geithner is a willful, conscious tax cheat. Why would anybody be surprised that he would lie?
SEKOFF: The biggest problem, Don, is he's opened the door for conservatives who are against all caps on executive pay to suddenly become born-again populists. They are storming the barricades. They're so upset. And that's the height of hypocrisy. That is what Geithner has allowed to happen. They are taking pot shots at Obama saying it happened on his watch.
LEMON: Rick?
NEWMAN: I think the Bush administration and the Clinton administration have been coddling Wall Street at the same time trying to act tough. There's this think like we can't let the Wall Street talent slip away because they are the guys who now how to fix a problem. Let the Wall Street talent slip away. I have a feeling they will find some other talent.
LEMON: David, we know your opinion. Either he's lying or extremely incompetent.
(END VIDEOTAPE)
LEMON: All right. Very interesting conversation. Not the end of it. Some people say AIG and the bonuses just the tip of the iceberg. Who's the next AIG? We talk about that with our national voices on that in just a little bit.
Here's what some of you are saying.
RedRedMeat says, "The thing that scares me most is the trampling of the Constitution just to get retribution."
Tariss says, "AIG was fined for cooking the books by Eliot Spitzer three years ago. Where was the SEC?"
MSPoint (ph) says, "How much of the legislature's outrage over AIG bonuses is authentic and how much is posturing? CYA, posturing CYA."
And bpitter2007 says, "Was AIG paying people to tank the American economy? Was that the product and the bonuses were the rewards?"
Make sure you join our show. Logon to twitter, facebook, myspace or ireport.com. We want to hear from you. Have you become part of the conversation here.
The fight for control of Mexico's drug trade, it's a deadly business with four major cartels all battling it out. It's deadly. We're going to get inside the story. Plus this ...
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: I'm a school bus driver. When I come back around 5:15, my second job starts. Prepare the meals. Pack them up. It's like the family project seven days a week.
(END VIDEO CLIP)
LEMON: We will introduce you to the angel of queens. Taking care of the hungry in his neighborhood every single day. His story will inspire you.
(COMMERCIAL BREAK)
LEMON: A quick update on our breaking news we told you about at the top of the show, it's out of Oakland, California. And we warn you the pictures here are disturbing. Four Oakland police officers are in critical condition, shot and wounded today in two separate incidents. Blood you see there on the sidewalk right where the police officers are, right at the scene of those shootings, two of the officers were shot during a routine traffic stop. Two more were wounded just a short time later when the suspect was cornered following a massive manhunt. The suspect was shot and killed. Dozens of people, including family members and fellow officers have gathered at the hospital. No word on what sparked the first shooting.
It is not just AIG handing out huge bonuses, the fat paychecks are a way of life in the executive ranks of corporate America. I want you to listen to what our highly opinionated guests had to say about it just a little bit earlier tonight.
(BEGIN VIDEOTAPE)
SIROTA: I don't think we can trust anything coming from AIG. I mean, they're trying to clean up their image. Look, this is an issue of what is the government prepared to do to stop this moving forward? Frankly, if there is one point that Neal and the right has made, and again, I think Neal and the right complaining about executive bonuses is as credible as Bill Clinton saying he didn't have sex with that woman Monica Lewinsky. But one thing i think there's been credibility on here is that -- is that these are unacceptable bonuses and that the entire bailout culture, the whole bailout culture, has created this.
LEMON: Let's talk about the whole culture, whole Wall Street culture. We are saying who's going to be the next AIG? Who is the next AIG? Because a lot of these companies, many of these companies are paying out bonuses and they are just not reporting it and we haven't heard about it. Who is the next AIG?
NEWMAN: We know the answer to that question with regard to bonuses, it's Merrill Lynch. We know that Merrill Lynch's bonus pool was $3.6 billion. That's 20 times the amount we're talking about with regard to AIG. And Cuomo, the New York attorney general, has the list of ...
SIROTA: Wells Fargo, JPMorgan and others.
SEKOFF: And that's the problem with the bill the house just passed. It only starts in January. Don't forget, Merrill Lynch rushed through $2.5 billion in December. So if we let that go down the way it's going to go down, John Thain will be rewarded for the trickery of giving the bonuses before January.
SIROTA: The broader point is that we need -- going forward, we can't keep dumping money on corporations like AIG and like other banks. We need actual structural form. If we're going to nationalize the banks, which I support, let's nationalize it. Let's stop throwing taxpayer money at them.
LEMON: I'm sitting here just reading Neal's face because I can see him in the monitor.
BOORTZ: Are you listening to this language?
LEMON: I'm listening to it.
BOORTZ: Listen to this language that when a company pays a bonus pursuant to a contract, it's trickery. I can't wait to see that little blog on the Huffington Post.
SEKOFF: Neal, they were supposed to be paid in January. They were supposed to be paid in January. But when they knew they were going to merge with B of A, he rushed them out. That was the trickery was.
LEMON: I see the point on both sides. This is setting a bad precedent. We're going to talk about that later.
BOORTZ: You said something about Rick -- I think it was Rick that said, and I want to approve -- I want to support his stance. I think from now on -- and we've learned this through practice in this country, everything that the private sector says is a lie. Everything that government tells us, it's the truth. Let's just go on that policy from now on.
SEKOFF: No one is saying that, Neal.
BOORTZ: Yeah.
SEKOFF: And we saw Chris Dodd just proved that wasn't true and we saw that Tim Geithner said that wasn't true. Nobody's sitting here saying that everything the government says is true and all business is bad.
BOORTZ: Let me ask you a question ...
LEMON: Guys, hang on. Hang on. You have to ask him a little more -- quickly, how much time do we have, Emily? We have 30 seconds. I wanted to get some of the responses in here. One which I thought was really important. Why are AIG bonuses causing such outrage? We loosened this shadow banking credit default, swap, fin system on the world. Than why such controversy, David?
SIROTA: That's the whole point, is that we created a culture that says it's completely OK to turn the financial industry into a big casino that pays out huge bonuses, paid for by taxpayers, to the people who caused the problem. And Neal's laughing. You want to talk about these contracts.
BOORTZ: I'm laughing because you're asinine, David. That's why I'm laughing.
SIROTA: These contracts were fraudulent. These contracts were fraudulent.
We are expected to believe the government can't invalidate these contracts but can go into GM and Chrysler and invalidate contracts for union workers. What a joke?
LEMON: David, Neal. You can disagree with his argument. I don't know if you can call the man asinine or call him names.
BOORTZ: I can. You can disagree with me.
(END VIDEOTAPE)
LEMON: Make sure you stick around. Ali Velshi and the CNN "Money" team search for truth inside the AIG, inside that scandal, see what they found out in "AIG: Facts and Fury" coming up in about 20 minutes right at the top of the hour here on CNN.
A shocking number about who is getting sick and dying in Washington, DC. We're going beyond the numbers here. But, first, it is a battle raging out of control just south of the border, and spilling over here in the United States as well. Mexican drug cartels fighting over the drug trade. We're going inside this story as well.
(COMMERCIAL BREAK)
LEMON: Mexico says it scored two major busts against drug traffickers this week. Among those arrested was a man who the government alleges was behind the attack on a U.S. consulate, an attack on a Mexican TV station and the killing of Mexican soldiers. Well, earlier Mexico announced the arrest of the son of one of the top leaders of a drug cartel. But Mexico's aggressive tactics against the cartels are just part of the picture here. Right at the heart of the drug war are rival cartels battling each other for control of the drug trade. Look at this.
(BEGIN VIDEOTAPE)
LEMON (voice-over): Drugs, guns, money. It is a volatile cocktail that has killed about 7,000 people during the past two years in a ruthless war waging just south of the U.S. border. At the heart of the bloodshed are three major drug cartels battling for control of tons of marijuana, cocaine, heroin and other drugs funneling north into the U.S.
The Tijuana cartel in green controls the Baja Peninsula, the east coast in yellow is the Gulf cartel. In between, the vast orange territory, controlled by the Sinaloa cartel. Areas in red are where they are battling each other for control.
CHIEF DAVID AGUILAR, U.S. BORDER PATROL: That results in some of the in-fighting, some of the border violence that we're seeing. They are fighting for territory that they no longer operate with impunity.
LEMON: Mexican President Felipe Calderon blames the U.S. for the violence in his country. He said America's appetite for illegal drugs is one half the problem. The other half ...
FELIPE CALDERON, MEXICAN PRESIDENT: We need to stop the flow of guns and weapons towards Mexico. Let me express to you that we seized in these two years more than 25,000 weapons and guns and more than 90 percent of them came from the United States.
(END VIDEOTAPE)
LEMON: I want to bring in now Richard Marosi. He's been covering the escalating violence for the "Los Angeles Times". He joins us now to explain why the killing has been skyrocketing. So I will ask you first off, why has it been skyrocketing?
RICHARD MAROSI, "LOS ANGELES TIMES": With the government offensive against the cartel, it destabilized the operation. It's not business as usual anymore. So they are scrambling, fighting each other, fighting the government and trying to keep these trafficking routes open in the U.S. so they can keep making their drug profits and buying the weapons and enriching themselves.
LEMON: Here's what I think is interesting about all of this. We have a map here that shows the green is Tijuana, the orange is Sinaloa. But basically I think there are four major drug cartels here. But, really, for years there have been cartels that are infiltrating Border States but now all of a sudden escalating. Tell us about that.
MAROSI: Well, the reason everyone's taking note right now is because this offensive against the cartels is creating a battle for control. It is creating a lot of bloodshed. On this side of the border, the de ha DEA has cracked a few investigation that's has exposed the tentacles of the Sinaloa cartel into the United States, which reaches across the country. So it's been a combination of factors. That said, these cartels have been long established in the United States with distribution centers all over the country. But now it's just a little bit -- more in the news now because the Mexican government is -- appears to be committed in weakening them.
LEMON: Then put the spill over then into perspective for us, characterize it. What does it mean? Is it as bad as we think it is? Can it escalate -- we think it is going to escalate, we have been reporting into the U.S. even more, if something isn't done about it.
MAROSI: To a certain extent, I think it's been a little mischaracterized. Most of the spillover is not violent spillover, it's mainly the drugs that have always been spilling over the border. The violent spillover is gang on gang generally warfare. In-fighting mainly in the Arizona area in Phoenix. What you have here in the San Diego area sometimes is ransom kidnapping rings that will on occasion kidnap someone living close to the border.
LEMON: Isn't it crime begets crime? Of course, if that's happening in the neighborhood. Quickly, I only have 15 seconds left here, where the U.S. isn't innocent in all of this, guns and our appetite for drugs, right?
MAROSI: No. That's at the root of the problem. Looks like the Obama administration is going to devote more resources towards prevention and treatment, which everyone says would greatly help if we can reduce the demand on drugs on this side.
LEMON: All right. Richard Marosi, thank you very much, from "The Los Angeles Times," reporting on what's happening in Mexico and the border towns. I really appreciate it. We will get back on, sir.
Meanwhile, we want to talk about a frightening number of people getting sick in Washington, DC. We're digging much deeper into that, next.
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LEMON: All right. You guys are really weighing in on -- getting under your skin, this whole bonus thing going on. Here's what WLPerry (ph) says, "Our government has to do something to keep these drug cartels from spreading farther into the U.S. and soon."
And survianop says, "If they don't get the gun from the U.S., they will get from them somewhere else." Get them from somewhere else.
Talking about the Mexican drug cartel and the border towns there.
YogiFish says this, "This is ransom money being paid for the American economy that's held hostage. Wall Street is full of sophisticated criminals."
Bpitter says, "I thought bonuses were paid from company profits. When did we start paying bonuses on company losses? I didn't get that memo." That is a very good response. Thank you for that, bpitter. Logon to Twitter, Facebook, MySpace or ireport.com. That's how you can be part of our show. We'll get you on the air.
You know what, there's a killer on the loose in our nation's capital and it's killing scores of people. We're going to investigate that.
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LEMON: Here's something we need to talk about and you need to pay attention to. The rate of HIV/AIDS in the nation's capital is higher than any other city in America. And as bad or worse than some parts of Africa.
Take a look at the numbers released by the CDC's -- or DC's HIV/AIDS Institute. There's been a 22 percent increase in cases since 2006 and this is the worst-ever HIV rate in Washington, DC, three percent. Three percent of DC's residents are infected with HIV or AIDS. That is no joke. That is somewhere around 18,000 people all living in one city, and guess what? Probably higher than that because some people don't get tested. Out of these cases men having sex with men, make up 30 percent. Contraction through heterosexual contact, 28 percent and drug use, 18 percent.
I want to bring in someone who really wants to get the issue out at this and champing at the bit to talk about it. There she is right there. Myisha Patterson-Gatson, she is the director of mobilization for the Black Aids Institute. Myisha, thank you for joining us.
MYISHA PATTERSON-GATSON, BLACK AIDS INSTITUTE: Thank you for having me.
LEMON: There's mixed messages about the HIV/AIDS rate in Washington, DC and how high it really is. I want to get to the bottom of this and get the correct numbers on all of this.
PATTERSON-GATSON: Sure.
LEMON: Why is the HIV rate so high in Washington, DC?
PATTERSON-GATSON: Why is it so bad? When you look at the demographics of Washington, DC, African Americans are the majority of the population in DC. And when you look at HIV/AIDS in the District, African Americans comprise 76 percent of those infected with HIV and AIDS.
LEMON: Hang on right there. If you're watching, no matter black or white or whatever, listen to what this young lady just said. Because African Americans make up -- what does that say about African Americans? Not getting the message in some way about HIV/AIDS? And how to protect yourself?
PATTERSON-GATSON: I think there are a lot of different issues that really play into the increasing rate of HIV and AIDS in the black community. One is definitely information. Stigma is driving this. The fact in black communities we saw the disease HIV and AIDS didn't affect us initially. Even though it has ...
LEMON: It's a gay disease, it doesn't affect -- yeah.
PATTERSON-GATSON: It always has affected black people disproportionately but media was showing that it was the disease of gay white men. So black people didn't feel like -- this is one of the only diseases we weren't disproportionately affected by.
LEMON: Give me the solution real quick, please, Myisha.
PATTERSON-GATSON: Solution, we are calling for a few things to happen. One, we really think the administration and the government should use some of the money from the stimulus package to promote testing and prevention right now. We're talking about shovel-ready projects that can get people new jobs and save lives.
LEMON: And one is to change your opinion about it, educate yourself and I'm sure get tested.
PATTERSON-GATSON: Yep.
LEMON: Myisha, we really appreciate you joining us.
PATTERSON-GATSON: Thank you for having me.
LEMON: Myisha is from the AIDS Institute in Washington, DC. We really -- the Black AIDS Institute. Myisha Patterson-Gatson, appreciate it. Have a great evening.
PATTERSON-GATSON: You, too.
LEMON: Thank you so much. Come back any time.
We want you to meet the angel of Queens working full time during the day, feeding the hungry in his neighborhood every single night.
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LEMON: This week's CNN Hero is feeding scores of needy people every single day.
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ANNOUNCER: This is CNN Heroes.
UNIDENTIFIED MALE: There's no money to eat.
UNIDENTIFIED MALE: It's hard to find a job.
UNIDENTIFIED MALE: I live on the street.
JORGE MUNOZ, COMMUNITY CRUSADER: : When you're hungry, you're hungry, that's. Four years ago, I'd seen those guys standing out, they're desperate. They need to eat. My name is Jorge Munoz. And every night I bring food to the hungry in Queens, New York. I'm born in Colombia. But I'm a citizen right now. I'm a school bus driver. When I come back at 4:15, my second job starts. Prepare the meals, pack them up. It's like the family project seven days a week. I go to the same corners every night around 9:30. They're waiting for me. The economy is real bad right now. Day by day their number increases. Two months ago it was 100. Now jumped to 140.
UNIDENTIFIED FEMALE: So he's awesome. They call him the Angel of Queens.
UNIDENTIFIED MALE: It's through him that many of us are fed.
MUNOZ: In the beginning, it was just Hispanics. But now I see different nationalities. I'll help everyone who needs to eat. Just line up.
The best part is when you see this man, I want them to eat every night. It's easy. Compared with them, I'm rich.
ANNOUNCER: Tell us about your hero at cnn.com/heroes.
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LEMON: I'm Don Lemon. "AIG: Facts and Fury" right now.
