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Schwarzenegger's Sons Born Days Apart; IMF Chief Resigns, Accuser Testifies; Jobless Claims Drop to 409,000; Obama to Lay Out U.S. Role in MidEast; Message from Osama Bin Laden; CIA Chief Warns Against Leaks; No Sign Senior Pakistan Leaders Knew; Ex-IMF Chief Denies Assault Charges

Aired May 19, 2011 - 10:00   ET

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

CAROL COSTELLO, CNN ANCHOR: Let's take a quick look at the top stories right now.

(BEGIN VIDEO CLIP)

COSTELLO: Shocking details key emerging from the Schwarzenegger scandal. The latest detail to come out, his son with wife, Maria and his secret son with his housekeep born just days apart.

The woman who has accused the head of the International Monetary Fund of sexually attacking her is testifying before a grand jury in New York. Dominique Strauss-Kahn has resigned as IMF chief. He says he'll devote himself to proving he's innocent.

And a number of people filing for first time unemployment claims is down again. That is the second straight week of sharp drops.

(END VIDEO CLIP)

COSTELLO: President Obama will lay out his vision for America's role in the Middle East in just over an hour. He's expected to talk about Syria, the protests and a new round of sanctions against its repressive regime.

And he just may lay out an Obama doctrine for the Middle East. Nothing is set in stone, but that may include a long controversial idea the creation of a Palestinian state. We'll talk about that later this hour.

Also the president is said to talk about Egypt, the Arab spring and the ways the United States can help democracies flourish. Flashback to 2009 when President Obama spoke in Cairo.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES OF AMERICA: So long as our relationship is defined by our differences, we will empower those who sow hatred rather than peace, those who promote conflict rather than the cooperation that can help all of our people achieve justice and prosperity. And this cycle of suspicion and discord must end. (END VIDEO CLIP)

COSTELLO: Let's go to the White House and Ed Henry. So the president said that two years ago, what do you think will be - what do you think he'll say this time around?

ED HENRY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, one thing that he will say that will tie it right back to what he said two years ago June in Cairo is when he was talking about purveyors of hate and trying to offer alternative as you've heard him suggesting that - an alternative to al Qaeda so that young Muslims would not turn to the terror group.

He was referring of course to Osama Bin Laden in part there and other parts of the speech. And now that Osama Bin Laden has been killed, just in the last few weeks, that's one of the main reasons White House aides say that the president has decided to choose this moment to deliver this speech to try and show the world, look, we've talked for so long about how there's an alternative for young Muslims.

Turn away from terror. Here is a dramatic example with the death of Osama Bin Laden. But I think what you mentioned about the economy is very important, as well. Part of the reason why we saw the Arab spring pop up in the first place, not just young people, people of all ages in the Arab world thirsting for human rights, they're also thirsting for a job, basic economic rights.

And frustrated with the economic inequities of oil rich nations not really sharing the money with their people and so the bottom line is you'll see the president layout about $2 billion in help from the U.S. loan guarantee, some debt forgiveness, Egypt, Tunisia, try to use it as a model for other countries struggling to become democracies, as well, Carol.

COSTELLO: You know, the other thing, interesting thing that President Obama said in his speech in Cairo two years ago was that Guantanamo Bay was going to be closed down and it's not going to be. Will he mention something like that this time around?

HENRY: Well, if he does, it's unlikely, but if he does, he'll have to talk about how this has been a thorny issue that turned out as he said before to be a lot tougher to close than the White House ever dreamed.

And the bottom line is he still wants to close Guantanamo Bay because he believes it's sort of something that just gets more -- uses a recruiting tool, if you will for al Qaeda and other terror groups.

So it's something certainly he's still thinking about, but if you go back to that speech and think about some of the things he did not mention like he didn't mention Syria two years ago. He didn't mention Libya, some of the big issues now front and center in the Mideast and who can blame him for not mentioning some of those countries.

The bottom line is two months ago, a lot of people were not expecting this much change let alone two years ago, Carol.

COSTELLO: Yes, he's not clairvoyant. Ed Henry live at the White House, thank you.

We want to get some global perspective on this from international anchor Hala Gorani. Hala, the president is expected to pledge some money to places like Egypt and Tunisia, but let's listen to Egyptian activist and what she said on John King, "JK USA" last night.

(BEGIN VIDEO CLIP)

GIGI IBRAHIM, EGYPTIAN BLOGGER, ACTIVIST: At this point whatever President Obama will address will really be irrelevant to what the situation is right now because we're building democracy from the bottom up by the people from within the people.

And it's for the first time in the Arab world that the United States or any foreign power doesn't have on do anything with bringing change to this -- and democracy to this part of the world.

(END VIDEO CLIP)

COSTELLO: OK, so you listen to her and she doesn't seem to really care what President Obama says today. So will his speech even have an impact in that part of the world?

HALA GORANI, CNN INTERNATIONAL ANCHOR: It's a good question. I mean, in 2009 compared to today, many things have happened. Just in the last six months, many things have happened. There have been revolutions. There have been uprisings. There have been wars. There have defiant demonstrations.

And I think what Arabs now are saying is look, when change came to our country, we provoked that change. We didn't wait for to come from the outside. We did it internally. And I think that's a huge difference when it come it is to how the Arab world is now going to view an Obama speech. Perhaps there's less of an expectation with regard to what the United States can and will do.

COSTELLO: But at the same time, some Egyptians say we need help in keeping our democracy flourishing, we need jobs. United States maybe you can give us money, maybe like as in $2 billion.

GORANI: Great and that would be a continuation of the policy of the last several decades. It's not new that the United States will provide these billions. But when it was providing billions before, it was coming so to a regime that Egyptians considered oppressive and it would be a continuation of the same policy.

Because now that the revolution is over, and I hesitate to say the revolution is over, now that we're in a post-revolutionary period in Egypt, so many challenges lie ahead. And I think with the United States now, the realization has really hit home that the economy and that jobs are what are going to make this region flourish and democracy take hold, and less political rhetoric and more economic assistance.

COSTELLO: We'll see what the president says and how the Middle East reacts. Hala Gorani, many thanks.

At the bottom of the hour, CNN's Wolf Blitzer will join us live with a preview on some perspective on President Obama's Middle East speech. That's set for 11:40 Eastern this morning. Wolf will join us in about 20 minutes.

More fallout surrounding Osama Bin Laden. Al Qaeda has released a new audio message said to be recorded by bin laden shortly before U.S. commandos killed him. In it, the speaker praises the recent uprisings in the Middle East. The 12-minute tape was posted on radical Islamic web sites. They called Bin Laden, the martyr of Islam.

(BEGIN VIDEO CLIP)

COSTELLO (voice-over): Back here at home, CIA Director Leon Panetta sent a letter to CIA employees saying there have been unprecedented leaks on the raid. He warned employees to protect classified information concerning Osama Bin Laden in that raid in Pakistan saying the leaks could compromise future missions and put lives at risk.

In the meantime, Defense Secretary Robert Gates insists there is no evidence top Pakistani leadership knew about Bin Laden's compound in Abbottabad.

ROBERT GATES, SECRETARY OF DEFENSE: I've seen no evidence at all that the senior leadership knew. In fact, I've seen some evidence to the contrary. But -- and we have no evidence yet with respect to anybody else. My supposition is somebody knew.

(END VIDEO CLIP)

COSTELLO: Pentagon officials acknowledge relations between the United States and Pakistan are strained, but say it's crucial for both countries to work things out.

From a shabby jail cell on Riker's Island, one of the world's elite economists has just quit his job. Dominique Strauss- Kahn formally resigned as head of the International Monetary Fund days after his arrest on sex related crimes.

In the meantime his lawyers are taking another shot at bail. They have a hearing at New York State Supreme Court today. Susan Candiotti is there and what are they suggesting as terms, you know, for the court to grant bail?

SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT: Carol, first of all, even though that hearing is hours away from now, there are reporters and photographers all over the place outside here waiting for that hearing to start. Here is what the defense attorneys for Dominique Strauss- Kahn are suggesting to the court, that they are prepared to do if he is granted bail. They're suggesting that he would put up $1 million bail, that's the same amount that he suggested on Monday, but it was a different judge then.

New judge will be at this hearing. He's also offering to stay at home, to be confined to a home 24 hours a day, seven days a week. Where would that be? Here somewhere in Manhattan, possibly living with his daughter. She has a place here on the Upper West Side.

He would also submit to electronic monitoring. That is likely to include an ankle place let, for example. He probably would have to call in at least once a day to the court to assure them he's at home.

He's already turned in his passport and he's also putting up the deed to his $4 million home in Georgetown, that's a suburb, of course, of Washington, D.C. He's also saying that he would waive extradition.

If for some reason he escaped, he left the United States, he would waive extradition to come back to the United States whether it be France or any other jurisdiction that does not have a treaty can the under so all those things are in play.

We don't know whether the district attorney will go along with this offer because they refuse to comment at this time. Now, for the alleged victim in this case, the thought of her alleged attacker possibly getting bail to say the least according to her attorney is very unnerving. He says that she is fully cooperating with the police and she is testifying before a grand jury for the second day in a row.

(BEGIN VIDEO CLIP)

JEFFREY SHAPIRO, LAWYER FOR ALLEGED VICTIM: Reliving it in your mind is hard enough. Having to recount it even to a therapist is difficult, much less having to talk about it on the record in front of a grand jury. I mean, it's extraordinarily difficult and nonetheless she's making it through this.

(END VIDEO CLIP)

CANDIOTTI: Now that Strauss-Kahn has resigned from the IMF, it is very likely he will participate fully in his defense and certainly he has a long road ahead of him, Carol.

COSTELLO: He sure does. Susan Candiotti reporting live from New York City and you'll get back to us if anything happens in the short term. Thank you, Susan.

The so-called Doomsday Movement says this weekend will bring a biblical rapture to mankind. Some people like our own Jeanne Moos have some questions about that.

(BEGIN VIDEO CLIP)

JEANNE MOOS, CNN CORRESPONDENT: What happens if on Sunday we're all here and there is no earthquake?

UNIDENTIFIED MALE: Well, there will be an earthquake.

(END VIDEO CLIP)

COSTELLO: Yes, not everyone agrees with that prediction though. We're going to talk about it in 10 minutes.

And new details are emerging in the Arnold Schwarzenegger scandal like his two sons, born days apart with different moms. We're live in California with the latest.

(COMMERCIAL BREAK)

COSTELLO: Finding out your husband cheated and got her pregnant that's a punch in the gut. Finding out it was right around the time he got you pregnant?

That's what Maria Shriver is dealing with. The latest twist in the Schwarzenegger scandal, he's got two sons born just days apart in 1997. Thelma Gutierrez is following story and Thelma, you have more on them, Arnold Schwarzenegger's one time mistress.

THELMA GUTIERREZ, CNN CORRESPONDENT: Yes, Carol. In fact, Mildred is 50 years old, also a native of Guatemala, lives here in this upscale neighbourhood in Bakersfield, California. It's about 100 miles away from the Brentwood Mansion where she worked for the Schwarzeneggers for 20 years.

Now she told neighbors out here that she was retiring. She talked openly about working for the Schwarzeneggers. And the fact that she wanted to come to retire to a quiet place with her 14-year- old son, people who met the teenager say they speak very highly of him and say he was a very, very well behaved teenager.

(BEGIN VIDEO CLIP)

ROGER STEELMAN, NEIGHBOR: I feel for the young boy more than anything because he's very, very nice, polite young man.

MARY STEELMAN, NEIGHBOR: This young man is just at the top end of being polite and very cordial. Just somebody you want to be around. I mean, he's really a very highly intelligent young man.

(END VIDEO CLIP)

GUTIERREZ: Now, the teenager and his mother have not been seen in the area since Sunday. We can say that CNN obtained a copy of the boy's birth certificate and it shows that boy was born just days after Maria Shriver gave birth to her youngest son, Christopher.

It also lists the father on the birth certificate as being the man that Mildred Baena was married to at the time. Now we also obtained copies of the divorce papers and it shows that the couple separated less than three weeks after this child was born.

And as you can see, Carol, many people out here saying that their hearts go out to this young boy.

COSTELLO: Such an ugly story. I know "People" magazine is reporting that Maria Shriver has hired a divorce attorney. What do we know about that, Thelma?

GUTIERREZ: What we know, Carol, is that "People" has said that that attorney that's been retained is Laura Waser. She's a very prominent attorney in Hollywood. She's represented many prominent women, high profile women like Angelina Jolie and Britney Spears and she's definitely a force to be reckoned with from what we understand.

COSTELLO: Thelma Gutierrez reporting live from California. Many thanks.

Now let's see how Hollywood is reacting to the Schwarzenegger revelation. What about major projects that were just announced for the actor, Arnold Schwarzenegger? "SHOWBIZ TONIGHT" A.J. Hammer joins us with that and more. So, A.J., any chance this scandal might derail Schwarzenegger's Hollywood comeback?

A.J. HAMMER, HOST, "SHOWBIZ TONIGHT": Well, Carol. It might happen. It hasn't happened yet. All reports at this point seem to indicate that things will it continue as planned for the "Governator" even the upcoming animated series, "The Governator," which features the Schwarzenegger's super hero with a secret life. That is still to go.

And here's what's kind of crazy to me about this project. You have to listen to the wording of the press release that came out almost two months ago announcing this project. It says that Schwarzenegger's character's secret is so secret that even his wife and kids are unaware, a super hero leading a double life who is also a devoted family man.

Are imitating life, anyone? Now one of the executives behind the show told the Hollywood reporter that the fictional series stands on its own. It's going to continue as planned. As for his live action roles, he's upcoming role in the film "Cry Macho" and his efforts to reboot "The Terminator" series, they don't appear to be hurt by these revelations at least at this point.

In fact, they may even be helped. The producer of "Cry Macho" that's the film where Schwarzenegger is going to be playing an aging horse trainer. He publicly speculated they could actually get a bump in ticket sales from all the attentions.

So, Carol, pretty amazing to consider this may not hurt him at all, but again it's a bit early to tell what the fall out is going to be in his Hollywood career.

COSTELLO: Man, I used to so love those "Terminator" movies, but I will look at them with the whole different eye now. The thing that surprises me is how this secret was kept secret for so long.

HAMMER: Yes, it's amazing. And I was talking to somebody last night on HLN about the idea that when he ran for governor, the vetting process that the other candidates put these guys through is so much harsher than what the press and the paparazzi does.

As far as Hollywood, it's generally forgiving. You know, they forgive a sex scandal after a while even one as spectacular as this one. The newest revelation about all this comes from TMZ. They say that Arnold paid for a party that all five of his children attended.

That the four he had with Maria Shriver and the son he's apparently had with his housekeeper Mildred Baena. TMZ says that Schwarzenegger paid for a party with Baena's niece and the whole family. The whole family was there, Carol.

So pretty stunning to see how this all going to continue to unfold and I think we're at the tip of the iceberg with all these new information that's coming up by the hour.

COSTELLO: I certainly hope this helps Maria Shriver's endeavors. Whatever she decides to do and something tells me I'm sure it will and should. A.J. Hammer, many thanks.

Want information on everything breaking in the entertainment world? A. J. has got it tonight on "SHOWBIZ TONIGHT" at 11:00 p.m. on HLN.

So have you been putting off that spring yard work? Maybe you should put it off for just one more week because the Dooms Day Movement says that this weekend expect the rapture.

Coming up next, I'll ask John Avlon, why we even listen to this kind of stuff. But first, Oprah Winfrey is knocked out of the number one spot on Forbes Celebrity Power list. She's now number two. Teen idol, Justin Bieber is number three. Find out who tops the list after the break.

(COMMERCIAL BREAK)

COSTELLO: Before the break, we showed you number two and number three on this year's Forbes Celebrity Power list. Do we have a drum roll? Yes, you might have guessed it, Lady Gaga, she is number one followed by Oprah Winfrey and Justin Bieber.

The ranking's measure earnings in addition to social media followers. Oprah made way more than Gaga last year, but Gaga has 10 million Twitter followers.

Some say the world will end in fire. Some say in ice, but one group believes it will be another natural disaster and it will happen on Saturday.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: The largest earthquake the world has ever seen. Buildings will collapse. It will be quite awful.

UNIDENTIFIED MALE: Ninety seven percent of the people God will destroy. UNIDENTIFIED MALE: I don't believe in such --

(END VIDEO CLIP)

COSTELLO: Ouch. There will be a big giant earthquake. As you can see, the so-called Dooms Day Movement has been getting a fair amount of skepticism for their prediction. John Avlon is an author of "Wing Nuts, How the Lunatic Fringes." A political book. We just wanted to talk about this because it's so weird, John.

JOHN AVLON, SENIOR POLITICAL COLUMNIST, NEWSWEEK AND THE DAILY BEAST: Yes, it is really weird. And there's this radio station/church/ -- well, it's a cult. It's been perpetrating this idea to a lot of folks in the New York City subways and elsewhere.

And you have to feel sorry for these folks. They've been duped. You know, Dooms Day cults have been around for all human history and they have a pretty bad track record and no reason to believe it will improve on Saturday.

COSTELLO: I got to say though, you know, often I travel around the country doing stories and I've asked just random people, talking about other topic matters, and they bring up dooms day. So it's not just crazy cult did-like people who believe. Some pretty sane people actually believe this, too.

AVLON: Well, you know, it's interesting. We have seen an uptick in millennial talk and end times talk and some of our politics and some political and media figures talking about it on the radio and television shows, stoking that fire.

I have a theory about this. I think it's the baby boomers are aging. They're facing their own mortality. And they somehow some of them think that when the world -- when they end, the world must, as well. I think it's an extension of baby boomer narcissism. And guess what, folks, just not true.

COSTELLO: No offense baby boomer audience. I get it. It's OK. I was just going to say that this dooms day thing is being used this many useful things, as well. For example, the CDC is using a light hearted end of the world campaign to inform people about disaster awareness.

Some suggestions from the DCC, preparedness 101, zombie apocalypse, they say about if zombies attack or about if there's hurricanes or pandemic, have an emergency kit handy with water, food and all of that stuff.

It also says zombies are after your brains, so before -- this is the CDC and this is real. They say plan your evacuation route which is also helpful to have of course before bad stores or other disasters. I didn't know the CDC had a sense of humor like that.

AVLON: Apparently they do and they're being rewarded for it. Their web site's been crashed because of the popularity of this. Humor is good. Humor is our friend. Humor is a societal corrective. The sad thing is there's going to be somebody out there who says, see, the CDC is warning us about zombies. So keep a sense of humor. Everything will be just fine.

COSTELLO: Let me ask you this bottom line question. If it really does happen, are you going to be one of those people who go straight to heaven or are you going to be one of those people who stay and die a horrible death on earth?

AVLON: I wouldn't presume to answer that question, Carol, but I'm with the second guy in that interview. I think you need to confront the folks selling the theory and just call it fear mongering that's pre-occupying some really insecure people and it's kind of sad.

COSTELLO: Yes, that is a sad part. OK, I tried to end it on a light note, but, no. John Avlon, many thanks. We appreciate it.

A pitcher picks off two runners in a row from first base, first time that's been done in the majors in eight years. And you will see it in sports.

And you know the names. Ensign, Edwards and now Schwarzenegger and the list goes on. Politicians behaving badly. What does it say about the men who run for office? We'll try to answer that question on our "Political Buzz."

(COMMERCIAL BREAK)

COSTELLO: We're about an hour from President Obama's major speech on the Middle East. He is expected somewhere in that speech to address the conflict between the Israelis and the Palestinians. Yes. Bring peace to the Middle East. Maybe. Kind of. Never?

Wolf Blitzer live in D.C. Nobody knows the struggle better than you, Wolf. That's why we wanted to talk to you this morning. Is there anything the president can say that will rejuvenate peace talks between Israel and the Palestinians?

WOLF BLITZER, CNN HOST, "THE SITUATION ROOM": It's not looking very promising right now on the Israeli-Palestinian front. The Israelis are very nervous about not only what's happening in the region but even more worried about what's happening right now within the Palestinian community, the relationship between the Hamas and Fatah, the two branches. Fatah, which recognizes Israel. Hamas, which does not. So, the Israelis are worried about that.

They're worried about what's happening in Egypt, the largest of all of the Arab countries, their major neighbor. They're looking at what's happening in Syria. So, this is a moment when the prime minister of Israel, Benjamin Netanyahu, is coming to Washington tomorrow to meet with President Obama. There doesn't seem to be a whole lot got on. There's a lot of nervousness in Israel, within the Israeli government, Netanyahu, about - about President Obama and his administration.

And there's a lot of nervousness in the Arab world about President Obama and his administration right now. They would like the U.S. on come forward and put down a formal President Obama peace plan, outlining a settlement between the Israelis and Palestinians. And everything I'm hearing, Carol, is the president is going to be speaking in much broader terms. He's not going to get into the specifics. That will be a source of disappointment for the Palestinians --

COSTELLO: Well, it may be a source of disappointment, but over the years, over the decades, you know, any kind of road map to peace so to speak has not really been effective.

I was just wondering about the relationship between the United States and Israel. Is it better or worse now that President Obama has been in office for a few years?

BLITZER: It's probably better than it was a year, a year-and-a- half ago, two years ago, between Netanyahu and President Obama. It's not where it has been in the past. Certainly there's mistrust on both sides, mistrust here in Washington as far as Netanyahu is concerned. There's mistrust in Jerusalem within his government as far as President Obama is concerned.

It's interesting that George Mitchell, who was the special envoy for the Middle East from almost day one of the Obama administration -- he's there at the State Department, Carol, right now. He's come to listen to the president's speech. He wrote a very terse resignation letter. It wasn't effusive in praise. It wasn't very upbeat. Raised a lot of questions of why he decided on the eve of this major speech by the president, on the eve of Prime Minister Netanyahu's visit to Washington, King Abdullah of Jordan's visit to Washington this week, he decided his time was up.

But he's there at the State Department today. And I wonder what, if anything, that means.

COSTELLO: And just a final question for you. It seems events are happening in the Middle East you know - you know -- that have nothing to do with the United States. That the United States had no part of. So, I guess the question I'd like to ask you is does it really matter what President Obama says today as far as events that may or will happen in the Middle East?

BLITZER: I think it does matter. Not so much necessarily because I don't think he's going to get into specifics on the Israeli- Palestinian front.

But as far as what's happening, as far as this Arab Spring, the democracy movement in Tunisia and Egypt, now in Syria, in Yemen and Bahrain and in other countries throughout North Africa and the Middle East, they will be listening very closely to see what the president says, how consistent he is. He's been very tough on Mubarak in Egypt, saying he must go. Been very tough on Libya, Gadhafi, he must go.

Less consistent on Syria. Sanctions, yes. I don't know how effective those sanctions will be, given the lack of any U.S.-Syrian economic relationship. But he stopped short of recalling the U.S. ambassador, for example, from Damascus. Stopped short of saying Bashar al Assad, the leader in Syria must step down, must go.

So, there will be -- people in the region will be watching and listening very carefully to hear what the president has to say.

COSTELLO: Wolf Blitzer, I know you're going to join Suzanne Malveaux at 11 a.m. Eastern to kind of dissect the president's speech and we look forward to that. And thank you for joining us. We appreciate it.

BLITZER: Thanks, Carol.

COSTELLO: Some other headlines making news just into the CNN NEWSROOM.

Authorities want to take DNA samples from unabomber Ted Kaczynski in connection with their investigation into the 1982 incident in which seven people died after taking -- after taking Tylenol laced with some kind of poison. That's according to the FBI office in Chicago. This news just coming into us. We're following it for you.

New revelations in the Arnold Schwarzenegger scandal. We've learned his son with wife Maria and his secret child with his housekeeper were born just days apart.

And another health set back for Zsa Zsa Gabor. Her husband says the 94-year-old actress fell into a coma after being rushed to the hospital. He said she had problems with a feeding tube and suffers from a stomach infection.

It is time for "Political Buzz," a lightning-fast conversation hitting the hot political topics of the day. Each of our brilliant political observers get 20 seconds to answer three probing questions. Will Cain is a political analyst and CNN contributor. He leans right. Cornell Belcher leans left. And John Avlong is an ardent centrist.

Welcome to all of you. As Wolf just told you a moment ago, the president will make a speech at the State Department. It will center around U.S. policies in the Middle East. So, our first question, what does President Obama gain by talking about the Middle East today? Will.

WILL CAIN, CNN CONTRIBUTOR: I think he gains less than he stands to lose. The last time we heard from the president on one of these issues in the Middle East and Arab Spring was we were told we had to intervene militarily in Libya for a humanitarian crisis. But now the humanitarian crisis is essentially expanded to Syria, Israel, Jordan. And I don't know where we stand. I don't know that anyone knows where we stand. So, I don't know how he's going to be able to explain that.

COSTELLO: Cornell?

CORNELL BELCHER, DEMOCRATIC POLLSTER FOR 2008 OBAMA CAMPAIGN: I think the important part here is broader than that. Frankly, it's a time for America to reposition itself with those young Arabs out there who are marching and protesting and trying to change their world. It's an opportunity for us to get in front of them and be a part of that process and so that the extremists are -- it's a way to us to reposition America in their eyes.

COSTELLO: John.

AVLON: This is about one of the defining issues of our time. President exerting leadership and a vision that America can help effect this change and make sure evolution occurs, not further revolution. And it's not hijacked by the extremes in their societies. This is an overdue speech but a very important speech. And it will take on Syria as well and have debt forgiveness for Egypt.

COSTELLO: Question number two. Right now, the country is fascinated by the stream of revelations about the former California governor. This isn't the first time we've heard of such a thing. You know, Ensign, Edwards, now Arnold Schwarzenegger. The list goes on. Politicians behaving badly. What does this say about men who run for office? Cornell?

BELCHER: It says they really like sex.

(LAUGHTER)

BELCHER: No. Truth of the matter is, I'm going to be countered on this one. I think if you look at the thousands upon thousands of men who serve in public office, for the most part, most of them are committed to their families. But it's just these high profile cases. I don't know the sat for this, but I'm willing to bet you that the divorce rate for those - for elected public official males aren't that much different from America overall. So, I'm going to go sort of counterintuitive on this.

(BUZZER SOUNDS)

COSTELLO: John.

AVLON: Yes. Look, clearly there's some kind of a problem. I think there's an arrogance that sometimes comes with high office and insulation and a sense of entitlement. This is the least original sin, but it is really pathetic, and I'd like to see more people in elected office trying to hold themselves to a higher standard rather than playing to their worst instincts and then getting busted for it and looking like idiots and making our whole gender look stupid.

COSTELLO: I love asking this question of men. Will.

CAIN: I think John's answer is interesting and partially true. but I don't know how that explains every other man in society. And I'm kind of with Cornell. I don't know that there's anything that unique here. The difference is when these guys get caught, you hear about it. I'm not excusing their behavior, I'm just saying half of society is living in a glass house and holding a rock in their hand.

COSTELLO: I like Cornell's answer the best. He was short and right to the point.

Third question. The president's 2012 campaign is mocking the birther movement and raising some funds at the same time. You can get anti-birther swag for just 15 bucks. So, our final question, our Buzzer Beater. So, you only ten seconds, I'm sorry.

The Obama campaign is selling anti-birther cups and T-shirts to raise campaign funds. Crass or smart? John.

AVLON: Smart, funny. Confront the extremes by pointing out their absurdity. Good.

CAIN: Let's move on.

COSTELLO: Will.

CAIN: Smart because if you paint your opponent by a wacko, marginalized position, that's good for you. Crass though, also, because it's not true and you're putting it on chotckies. Not very presidential.

COSTELLO: Ha! Cornell.

BELCHER: Very smart, and they're really nice mugs. And they're made in America. You should go online and buy some.

(LAUGHTER)

COSTELLO: Love it! I want a T-shirt!

Thanks to all of you. Will, Cornell, John. "Political Buzz" will return tomorrow.

The historic flooding of the Mississippi River and beyond literally hits home for one Southern governor. We'll have that story just ahead.

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COSTELLO: Doctors plan a news briefing this morning to discuss the next step in treating Congresswoman Gabrielle Giffords. Officials at a Houston hospital say Giffords is recovering well following yesterday's operation on her skull. Surgeons implanted a piece of synthetic bone made specifically for the congresswoman. Giffords' husband, Mark Kelly, currently commanding the space shuttle Endeavour, spoke from space about the surgery.

(BEGIN VIDEO CLIP)

MARK KELLY, ENDEAVOUR COMMANDER: I had a chance at the end of the day to call her mom and her chief of staff and my brother periodically through the -- as the surgery was going on, and she's doing really well. Everything went as planned. Her neurosurgeons are very happy. She's recuperating, and she's actually getting back to therapy today. So it went really, really well.

(END VIDEO CLIP)

COSTELLO: As you know, Giffords watched her husband and his crew blast on from the Kennedy Space Center on Monday. Checking stories Cross Country now. Officials at Pima Community College in Tucson, Arizona say they will not appeal a judge's decision to release a few hundred e-mails relating to the mass shooting -- relating to mass shooting suspect Jared Lee Loughner. The school has been under increasing pressure to do so in the days after the January shooting that left eight people dead, 13 wounded, including, of course, Congresswoman Gabrielle Giffords.

National Weather Service is confirming that a tornado with an EF- 1 rating touched down near Hagerstown, Maryland. It uprooted a few trees and tossed a few mobile homes. Luckily no one was hurt.

Floodwaters slap at the lake home of the Mississippi governor Haley Barbour. Sandbagging was not enough to protect the home from the swollen Wolf Lake and nearby Yazoo River.

It's a whole new world for Dominique Strauss-Kahn. Sex crime charges have cost him his IMF job and all the VIP perks that came with it. We'll have more on that in a few minutes.

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COSTELLO: Let's check a couple of baseball highlights because they're good ones. We start with a rare sight on the dive in ninth inning. Texas against Kansas City. First, though, the Rangers' reliever picks the pitch runner Jared Dyson, off of first base. The very next batter walks. Mike Sevilas goes into a run for him. And you'll see it here. And he gets picked off, too! It's been eight years since back-to-back pickoffs. Texas won the game in 11 innings, 5-4

How can fielders see anything in a foggy Fenway Park? The conditions make this play by the Tigers' Scott Sizemore -- isn't he amazing? It was spectacular! The second baseman makes the sliding catch with his back to the plate, robbing David Arteise. But the Red Sox beat the Tigers 1-0.

CNN has learned that Dominique Strauss-Kahn has arrived at Manhattan criminal court well ahead of his 2:15 p.m. Eastern bail hearing. As you know, he resigned as head of the International Monetary Fund. Comes days after his arrest for allegedly sexually assaulting a hotel employee. By stepping down, he's losing some pretty nice perks.

Here's CNN's Brian Todd.

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT (voice-over): His political enemies recently made hay out of this: a picture of Dominique Strauss-Kahn, a socialist, stepping into a Porsche worth at least 90 grand. The car is not even his, but the head of the IMF does seem to live well enough to afford the ride. Take his salary, more than $440,000 a year. That's more than President Obama makes. And Strauss-Kahn pays no taxes on it. This at a time when one IMF critic says the institution imposes stark conditions on the governments it lends money to. PETER CHOWLA, BRETTON WOODS PROJECT: Not only are taxpayers in borrowing countries paying for that salary, but then they're actually having to pay the cost in the second way which is that they have to undertake the policies the IMF demands, which often hurts particularly ordinary working class people.

TODD: An IMF spokesman responds pay increases for IMF officials are below the rate of inflation, but Dominique Strauss-Kahn's perks don't stop at his straight paycheck.

(on camera) One of Strauss-Kahn's best perks: an annual allowance of more than $79,000 tax-free to spend as he likes. According to his contract, to maintain a scale of living appropriate to his position. Plus he gets reimbursed separately for entertainment expenses.

An IMF spokesman says the institution does not pay for the $4 million house in Washington or for other properties reportedly owned by Strauss-Kahn and his wife in Paris and in Marrakesh, Morocco.

(voice-over) IMF staff assigned outside the U.S. do get housing allowances. Analysts say the people like Strauss-Kahn who aren't American and work at the Washington headquarters get other benefits.

JOHN SEWELL, NEW RULES FOR GLOBAL FINANCE COALITION: They get allowances for keeping their kids in school. They get health care. They get generous vacations.

TODD: It's also in Strauss-Kahn's contract that he and anyone in his family fly first class whenever he's on official business. I asked John Sewell, who's monitored global banks for 40-plus years, about Strauss-Kahn's take home.

(on camera) You don't have a problem with the salary?

SEWELL: I don't have a problem with the salary. I think this is one of the world's most important jobs. It's reflected by the fact that Dominique Strauss-Kahn played an absolutely essential role in dealing with the global financial crisis that we hopefully are moving out of.

TODD: Sewell also credits Strauss-Kahn with drastically likely reforming the IMF and making it relevant again after a period when few countries wanted to borrow money from it.

Brian Todd, CNN, Washington.

(END VIDEOTAPE)

COSTELLO: Coming up next, we'll return to the Schwarzenegger scandal. One writer thinks the media is not being fair to the housekeeper. Why go after her with just gusto when she didn't do anything criminal, right? We'll talk to Howard Kurtz next.

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COSTELLO: The Schwarzenegger scandal hit the Internet with a vengeance. Tawdry details, some true, some not. But they're all over the place. And so is the name of Arnold's housekeeper mistress, the mother of his teenage son.

Howard Kurtz has some problems with that or at least some questions. He's written a piece for "The Daily Beast" called "Exposing Arnold's Housekeeper."

And Howie, before we start, I'd like to read a snippet from your article.

HOWARD KURTZ, CNN HOST, "RELIABLE SOURCES": Please.

COSTELO: "The housekeeper did not ask to be the center of a white-hot political scandal. What gives the media the right to obliterate her privacy?"

Well, Howard, some might say she did have an affair with a married man and then tried to pass off the baby as her husband's at the time. So, she deserves what she gets.

KURTZ: OK. So, why don't we then focus on all the thousands of women who have had affairs with married men, some of whom have had babies?

I mean, look. I feel some sympathy for this woman. She's not a public figure. She didn't file a lawsuit, she didn't go to the tabloids. She didn't do the kinds of things that might make me say, OK, she's thrust herself into the news. And yet, you know, it started with a little gossip site online, Radar Online. And then I see her picture in "The New York Times" and I see it on Fox News. I don't believe CNN has run it. And I'm just questioning why that is.

COSTELLO: Well, you know, the other thing that I don't think people realize -- we have run the picture, by the way, Howard. Just as an update to you, we have. Because it's out there. It is out there.

The other thing I think people forget was Arnold Schwarzenegger was her employer. And no one has ever really investigated that angle of the story.

KURTZ: I agree that that angle of the story has not gotten sufficient attention. I think the former governor deserves all the scrutiny that we can bring to bear on what could be real abusive power. She wasn't on his California state payroll. She was on his personal household payroll.

But it just seems to me not just to drag her in. But here's the other problem I have, Carol. There is a boy, probably about 13 or 14 years old. I don't think any of us want to identify him. His face has been blurred in the pictures. But once you identify the mother, obviously people will know who the kid is --

COSTELLO: Oh, that kid's face is all over the Internet, Howard. All over the Internet. KURTZ: And you know, this whole "it's out there. Let's do it because it's out there" means that we have no standards anymore. That every news organization is going to throw up his hands and say, "Well, we'd kind of like to follow our own rule, but everybody else is doing it, so why don't we do it?" And that is a very slippery slope.

COSTELLO: The Strauss-Kahn case. I'd just like to center on that for a bit because there is an alleged rape victim in this case. There are some media people camped outside this woman's Bronx apartment, trying to get a shot of her.

I guess nothing is sacred anymore because usually all media would stay away from an alleged rape victim.

KURTZ: Although some French media outlets have identified this woman, and there is a tradition in the U.S. of not identifying women who charge sexual assault. Doesn't mean it's true. But she's an alleged victim. So, there I think the media are doing the right thing. But the stakeout outside the apartment in the Bronx. Again, this is why people hate the press because we descend like piranhas on people. I mean, this woman, if her story is true was cleaning the room, got jumped by this guy who happened to be an important French politician, the head of the IMF. She didn't ask for this kind of scrutiny and this kind of attention.

COSTELLO: Howard Kurtz, thanks for joining us. If you want to read Howie's article, it's on TheDailyBeast.com.

We're just about 45 minutes from President Obama's major speech on U.S. policy in the Middle East. He'll give that speech at the State Department and you can see it right here on CNN. Our live coverage begins at 11:30 Eastern.

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COSTELLO: A quick look ahead at stories making news later today.

At 12:30 Eastern, officials unveil their findings on the deadly collapse that kill 29 coal miners last April in West Virginia.

At 11:30 Eastern, the National Oceanic and Atmospheric Administration releases its outlook on the coming Atlantic hurricane season, which officially begins June 1.

And we're less than an hour away from President Obama's scheduled address. He is expected to lay out his proposed vision for the Middle East.

And with that, I turn it over to Suzanne Malveaux.

You'll have extensive coverage. I won't be here for "Talk Back" today, but I'll be back tomorrow.

SUZANNE MALVEAUX, CNN ANCHOR: OK. Looking forward to that, Carol. Yes, but, obviously, the speech, a very big, important speech that we're going to be covering for the next two hours. COSTELLO: I'll be listening.

MALVEAUX: All right. Thank you, Carol.