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Veterans Groups Called to White House; Psychology of the Debt Debate; Representative Wu Resigning; U.S. Military Funds Intercepted; Men Hardest Hit by Job Losses; The Help Desk; Talk Back Question; Battling Online Theft

Aired July 26, 2011 - 12:00   ET

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

SUZANNE MALVEAUX, CNN ANCHOR: Top of the hour. I'm Suzanne Malveaux. Want to get you up to speed.

Just one week and counting until the deadline to raise the country's debt limit. There's no deal and no deal means higher interest rates on mortgages and car loans. Not even to mention the damage to the country's financial standing.

Last night, President Obama and House Speaker John Boehner took to the air in dueling speeches. The president acknowledged what so many people are feeling, that is frustration.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: But do you know what people are fed up with most of all? They're fed up with a town where compromise has become a dirty word.

REP. JOHN BOEHNER (R), HOUSE SPEAKER: The sad truth is that the president wanted a blank check six months ago and he wants a blank check today. This is just not going to happen.

(END OF VIDEO CLIP)

MALVEAUX: Since Friday, Norwegians have been paying tribute to 76 people killed in two related terror attacks. Only today are they learning who these victims are. Police are releasing the names of those whose family members have been notified.

Anders Breivik, the man suspected of the massacre, is talking to his lawyer. The lawyer says that Breivik considers himself to be in a war and he questions his client's sanity. So does Breivik's father, who wants to remain anonymous.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE (Through Translator): No, I'll never have more contact with him. In my darkest moments, I think that rather than killing all those people, he should have taken his own life.

UNIDENTIFIED REPORTER: These are strong words from a father.

UNIDENTIFIED MALE (Through Translator): They are, but thinking about what has happened, I get so upset and I still don't understand that something like this could happen. No normal human being would do something like that.

(END OF VIDEO CLIP)

MALVEAUX: Five time Grammy Award-winning singer Amy Winehouse was buried today. Her funeral was for close family and friends only. She was found dead in her London apartment over the weekend and an autopsy provided no answers on how she died. The coroner hopes to know more when lab test results come back in two to four weeks.

One of four teens mauled by a grizzly bear during an outdoor survival trip in Alaska says he was forced to use those survival skills. Victor Martin from California took off running and then fell. The bear bit him on the feet and the ankles. He kicked the bear square in the face. And that's when it backed off.

Martin describes how huge the bear was.

(BEGIN VIDEO CLIP)

VICTOR MARTIN, BEAR ATTACK VICTIM: Easy, eight to nine feet, about 900 pounds.

UNIDENTIFIED REPORTER: Did it stand up?

MARTIN: Once. It was terrifying, but prayer helps.

(END OF VIDEO CLIP)

MALVEAUX: Postmaster general says we're soon going to see a smaller, leaner, more competitive Postal Service. He released a list of almost 3700 post offices that are now slated to close. Most of them bring in less than $50 a day and employees work only about two hours a day.

Kids love them. Especially for the toys inside. But now McDonald's is hoping parents are going to think better about the Happy Meals. The fast food chain plans to cut back on those French fries, add a little fruit or vegetable instead.

Veterans advocacy groups have been called to the White House this afternoon for a special briefing.

Barbara Starr, she's live at the Pentagon.

Barbara, I think we can assume that this is about potentially an impact on their benefits in the next week or so if the country defaults on its bills?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Absolutely, Suzanne.

Veterans groups tell us they started getting phone calls from the White House late last night asking them to come to a 4:30 briefing at the White House this afternoon to talk about what will happen to veterans benefits if the debt ceiling is not raised and also, the broader implication of the potential budget cutting, the deficit reduction talks that will go along most likely with any debt ceiling agreement.

Veterans groups tell us they are very concerned because they say for them, this is unprecedented. If the debt ceiling is not raised, there is no promise at this point that their disability checks, their benefit checks and benefits to some veterans' families will remain intact.

They simply don't know what will happen to them. They say that is the major concern. One veterans advocate saying he is getting e- mails all the time now from veterans around the country who are very concerned about what will happen to them.

One of the veterans groups, the Disabled Veterans of America, the DAV.org, excuse me. That's an important Web site, DAV.org. They are going to hold an online virtual protest tomorrow.

If you want more information, go to DAV.org. They are going to be protesting all day long online with veterans around the country about the budget and deficit impasse in Washington. They are going to post messages and other information they say will make it clear to Washington just how concerned millions of veterans are around the country -- Suzanne.

MALVEAUX: Barbara, is the Pentagon giving any advice to veterans who are so afraid and worried for themselves and their families? Or are they saying essentially you've got to find means -- other ways to survive?

STARR: Well, you know, what's so interesting is just -- you know a couple of months ago in that whole crisis about the government shut- down, both the Department of Veterans Affairs and the Pentagon had a lot of information about what would happen to veterans from the Veterans Affairs Department, active duty military from here at the Pentagon.

Right now, everybody is really being pretty quiet. There's a lot of sort of background chatter that somehow both active duty military pay and veterans benefits would be shielded from any crisis, but nobody's making any promises.

Nothing has been put in writing, if you will, from the political side of the House, Capitol Hill, the White House, the Treasury Department, and it's that uncertainty that is causing so much concern right now amongst the veterans community about their benefits -- Suzanne.

MALVEAUX: I'm sure. OK. Barbara, thank you very much for the developing story.

Here's your chance to "Talk Back" on one of the big stories of the day. And today's question, very much related to what we've been discussing before.

What would you tell Congress to do about the debt limit? Carol Costello in Washington. Hey, Carol.

CAROL COSTELLO, CNN CORRESPONDENT: A lot of people sounding off on this one, Suzanne.

What's happening in Washington is political gamesmanship at its worse. It's ugly and more than a little bit scary. The United States has never gone into default because past administrations and lawmakers have actually compromised.

CNN contributor John Avlon says lawmakers have raised the debt ceiling 77 times since JFK, including 18 times under Ronald Reagan and seven times under George W. Bush. But back in the day, politicians weren't quite so macho. Many now insist on standing on principle even though most Americans stand on the side of good old-fashioned compromise.

According to a CNN/ORC poll, two-thirds of Americans want the president and Republicans to compromise rather than stand up for their beliefs to get things done. Wow. A break from partisanship. At least among what politicians like to call ordinary Americans.

Perhaps the happiest outcome of the president's speech last night was when he urged you to contact your congressman and you did. Lawmakers' Web sites were crashing all over D.C. The phone lines on Capitol Hill all tied up today, and here is your chance to sound of again on Facebook and on CNN.

And yes, lawmakers do swatch CNN. You bet they do. So "Talk Back" today. What would you tell Congress to do about the debt limit? Facebook.com/carolCNN. Facebook.com/carolCNN. I'll read some of your comments later this hour.

MALVEAUX: Yes. And Carol, you said to keep it clean, right?

COSTELLO: Keep it -- try to keep it clean.

MALVEAUX: Keep it clean. All right.

COSTELLO: We've had a few, but I understand. People are angry.

MALVEAUX: People are frustrated. They're frustrated. All right. Thanks, Carol.

COSTELLO: More than that.

MALVEAUX: Here's a rundown some of the stories ahead. First, counseling for the players and the debt ceiling debacle. We're going to break down the psychology behind the blame games.

And part of a $2.6 billion U.S. contract falls into the hands of the Afghan underworld. We are following the money trail live in Afghanistan.

Then one in five men, unemployed. We're going to take a closer look at what is being called the mancession. Plus more depression sufferers in rich countries than in less wealthy ones. Can money truly not buy happiness? We've got a medical report on that.

And on Home Shopping Network, Mariah Carey in charge.

(COMMERCIAL BREAK)

MALVEAUX: Deadlock over raising the debt limit. Not a laughing matter for most Americans but for late-night comedians, you know, there's a lot to work with.

(BEGIN VIDEO CLIP)

JON STEWART, "THE DAILY SHOW WITH JOHN STEWART": We've raised the debt ceiling 17 times under Reagan, five times under H.W. Bush, four times under President Bill Clinton, seven times under G.W. Bush. So apparently for past Congresses, accomplishing a debt ceiling raise is as effortless as this.

JAY LENO, "THE TONIGHT SHOW": Nancy Pelosi, John Boehner, OK. Go over there. There's Harry Reid, there's Mitch -- freeze it right there. Freeze it right there. OK? Harry Reid, Mitch McConnell can't agree on a budget? They obviously agree on everything else. Look at them. Look. Same hair, same glasses, same sport coat, same shirt. Why can't you agree on this?

(END OF VIDEO CLIP)

MALVEAUX: They all dress like that in Washington. You know the jokes are funny but the situation, really not so funny in D.C. People, very frustrated. And here's what some of you are saying about this deadlock.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Too much spending, really. I don't know whose fault that is, but you know, Congress and the president should work together to get that fixed.

UNIDENTIFIED FEMALE: We have adults who have been elected to office and yet they play worse than 3-year-olds.

UNIDENTIFIED MALE: I'd fire them all.

UNIDENTIFIED MALE: I really don't know nothing about it.

UNIDENTIFIED MALE: I think everyone in Congress knows that they can't default or it's going to be -- it's going to cause, you know, economic calamity.

(END OF VIDEO CLIP)

MALVEAUX: Standoff in D.C., a lot of people comparing it to, like, you know, a couple headed for divorce and you know why can't they just get along, get something done? We brought in clinical psychologist Jeffrey Gardere for a little counseling session. I think they are in need of one, don't you think, Jeff? You know the psychology of the debt talks, how are you going to bring these two sides together?

JEFF GARDERE, CLINICAL PSYCHOLOGIST: Well, Suzanne, yes, absolutely right. I have been talking to people everywhere, my patients, friends and so on, and they see president Obama and House Speaker Boehner as two adults, two parents who are involved in couples counseling and they are just not behaving and the American public, just like the children, are just getting really upset about it and they see them acting just like children.

So there are a lot of things that they can do as I would do with them in couples counseling.

MALVEAUX: What would you suggest? What would you advise? Would you have them in the same room? Would you say you got to talk to each other, a time-out? What do you think?

GARDERE: Right on, Suzanne. Because now that they've talked to the American public by giving their speeches yesterday, we need to get them back into the same room, into the same therapy room, if you will, to talk to one another and reestablish the intimacy that they had, the respect that they once had for one another.

They weren't very nice to one another in giving their separate speeches so they have to reestablish that trust, first and foremost. Secondly, they have to stop the blame game. You talked about this earlier. Stop pointing fingers and take responsibility for your own behavior.

And as part of that, stop carrying that emotional and in this case political baggage, if you will, because it's not counseling with two people. It's not negotiations with two people. It's two people and a whole bunch of other ghosts that are in the room and it keeps things from happening in a positive way.

And finally, compromise. There has to be compromise. Yes, one parent in this couples counseling may have compromised earlier on, but both of them really do need to compromise now, and if they don't compromise, the kids who are the American public, are going to step up and say enough, this screaming and yelling.

MALVEAUX: Yes.

GARDERE: You talked about the Web sites that went down, they're going to tell them behave and compromise, for heaven's sake.

(LAUGHTER)

MALVEAUX: I think, you know, that's a good point there, because I mean, you've got these two and they might cringe when they -- we call them this couple here, but if you're at a complete impasse, no one is going to give, do you bring in the third party, the mediator, the counselor, the person -- there needs to be another person who steps into the process?

GARDERE: Yes, there may have to be another person to jump in. In this case, it might be Uncle Harry Reid with his proposal. This way if both of these folks decide to work on the Reid proposal, go with that one, then neither one of them lose face.

But the important thing here is, Suzanne, that they have to put the needs of the American public, the needs of the children in couples counseling, before their own needs or this just will not get done. We'll have a divorce and we'll have a debt ceiling that won't be raised and a big problem.

MALVEAUX: All right. Jeff, thank you very much. Appreciate it. We hope that it all works out.

We are getting some breaking news here. We understand that Congressman Wu of Oregon is resigning. This was an ongoing -- this was actually an ongoing scandal that was occurring because he was accused of perhaps sexual misconduct with the daughter of a donor, and we are just getting some information here.

The highlights being that initially he decided he was not going to seek reelection. That is what he was telling folks. But now this has changed. He is now resigning after a woman accused the congressman of making sexual advances.

This has been an ongoing investigation. There have been some problems. I'm just going to read really quickly what we've got on the latest wire here. That initially, he was considering all options on the table, including not seeking reelection, whether or not he was going to serve out the rest of his term. That's according to his communications director, but he was facing mounting calls for his resignation.

And I'm getting a statement from his office. I'm just going to go to my e-mail, see if I can't check this out. Yes, here we go. This is a statement from the office of Congressman David Wu. I'll just read it to you very briefly. He says -- it says, Congressman David Wu issued the following statement of resignation to the United States House of Representatives.

This is in quotes, "It has been the greatest privilege of my life to be a United States congressman. Rare is the nation in which an immigrant child can be a national political figure. I thank God and my parents for the privilege of being an American. Now, however, the time has come to hand on the privilege of high office. I cannot care for my family the way I wish while serving in Congress and fighting these very serious allegations.

"The wellbeing of my children must come before anything else. With great sadness, I therefore intend to resign effective upon the resolution of the debt ceiling crisis. This is the right decision for my family, the institution of the house and my colleagues. It is also the only correct decision to avoid any distraction from the important work at hand in Washington. I intend to go forward with new resolve and love of my family, the state of Oregon and our nation." This is the official statement coming from Congressman David Wu, that he is now going to resign from Congress after allegations that there was sexual misconduct.

Moving on, U.S. military funds fall into the hands of the Taliban. We are following the money from the Defense Department into a murky underworld of Afghan subcontractors and criminals.

(COMMERCIAL BREAK)

MALVEAUX: Here's a look at today's "Choose the News" stories. You can vote for the story you'd like to see.

First, a lot of your personal information floating out there in cyberspace, leaving you vulnerable to the underground world of computer hacking. One man is tracking down the bad guys to keep your information safe.

Second, a grandma armed with a baseball bat chases off an intruder. When the 70-year-old woke up to find a naked man in her home, she knew she had to protect her sleeping grandson upstairs.

And third, a U.S. soldier stationed in Afghanistan marries the woman of his dreams, over the phone. When they couldn't marry in person, they found a way to make it happen thousands of miles apart.

You can vote by texting 22360. Text 1 for "Hacker Tracker," 2 for "Granny Chases Intruder" or 3 for "Phone Wedding." The winning story is going to air later this hour.

The U.S. taxpayers have spent billions in the war on Afghanistan but a new report now says that some of that money is falling into the wrong hands. Funds from a U.S. Defense contract were allegedly funneled into the accounts of criminals and Taliban insurgents.

David Ariosto is in Kabul, Afghanistan.

David, thanks for joining us. Tell us, first of all, what was this money for? What was it supposed to do and where did it go?

DAVID ARIOSTO, CNN INTERNATIONAL CORRESPONDENT: Suzanne, this represents the bulk of transportation costs here in Afghanistan. Effectively we are talking about eight companies, four of which have been classified high risk. But these eight trucking companies were meant to deliver supplies, food, weapons, to soldiers and civilians here across this country.

Now what has taken place, at least according to this internal document that CNN was able to speak with a source who provided details of that report, effectively what has transpired here is among these contractors, we've had a series of subcontractors. Now keeping track of contracts and subcontracts even in Washington is difficult. In Afghanistan, it's even more so.

So what we have here is a series of trucking contracts that have been subcontracted out to even smaller firms. Those firms might even look for even smaller entities.

MALVEAUX: So what happens, David?

ARIOSTO: Trucking here in Afghanistan is dangerous.

MALVEAUX: Could you tell us what happened?

ARIOSTO: So what they will do or at least according to this report -- sure. Sure. Effectively what has happened is subcontractors have provided funds to security and some of these tribal groups in which they have direct links to Taliban insurgents. So effectively what we're seeing here, at least according to this report, is U.S. taxpayer dollars at least in part have filled and lined the pockets of the Taliban.

MALVEAUX: And who does the report blame for this?

ARIOSTO: Well, as is everything with Afghanistan, it's difficult to assign blame. Clearly, there is some transparency issues in terms of where this money went. The companies, officials are pointing to in terms of their nefarious conduct, the overseers are being questioned in terms of their responsibility.

But officials that we've spoken to have said they've radically revamped their program in an addition -- in an effort to basically stamp out some of these bad practices -- Suzanne.

MALVEAUX: All right. David, thank you very much. David out of Kabul, Afghanistan. Appreciate it.

One in five men in the United States don't have a job. We're going to look at why women are taking less of a hit.

(COMMERCIAL BREAK)

MALVEAUX: Here's a rundown some of the stories we're working on. Up next, a word coined during this current economic trouble and it applies specifically to guys. We're explaining what the mancession means to you.

Then software to protect your smartphone. Our Silicon Valley correspondent plugs us in from a company that specializes in stopping hackers.

In about a half hour, Mariah Carey dishing on her long pregnancy on the Home Shopping Network.

Well, men have been especially hard hit by the struggling economy. Some are calling it a mancession. And the longer they're out of work, the harder it is to get back into the game.

Our CNN Money's Poppy Harlow is in New York with the latest numbers.

And Poppy, give us a sense of what we're talking about here if you compare men and women when it comes to losing their jobs. POPPY HARLOW, CNNMONEY.COM: Yes, there's no doubt about it, Suzanne. When you look over the most recent recession, men lost millions more jobs than Americans. And this interesting McKenzie study just came out showing us that 20 percent of American men today are not working. That is up from 7 percent in 1970.

Not just because of a lack of jobs but also because of disability, incarceration, relying on their spouse's income. But look at the numbers on your screen. I will pull them back up for you there. 5.4 million American men lost their job in the recession, 2.1 million American women.

Why is that? Right? We still have over 14 million unemployed people. The reason is because so many men were employed in manufacturing and construction that took such a hit during the recession, but what is going on now in this so-called recovery?

We asked the CEO of Manpower. It's a big employment firm that works with companies al around the world on jobs. And here's his take on where the picture stands right now. Take a listen.

(BEGIN VIDEO CLIP)

JEFF JOERRES, PRESIDENT AND CEO, MANPOWERGROUP: Well, we have an issue. There is no doubt about it. And the longer we have this long- term unemployed, even for what would be considered the entry-level skill position, the shop floor is not going to be the same shop floor for that person left two and a half years ago.

New technology is put in place, how you have to read a CAD drawing or 3D dimensional drawing. So we are still going to have this kind of skills mismatch of what companies are looking at to get the highest skills and what is really out in the marketplace. And the U.S. is not alone in that. It's just exacerbated because of the low demand that we're seeing in the U.S.

(END OF VIDEO CLIP)

MALVEAUX: So, Poppy, you've got these big companies, some big companies at least who are out there hiring. How does it compare men and women getting the jobs in this recovery?

HARLOW: That's a great question, right? You heard what he said. It's all about skills right now. The fact this a lot of those in the U.S. without a job don't have the skills they need.

I want to show you men versus women here. When you look at this recovery, you look at specific sectors, manufacturing, retail and finance, men have gained 253,000 jobs since the recession. Women have lost, Suzanne, in those sectors 433,000 jobs. Even in sectors where women have gained jobs, men have actually gained more jobs. And we'll show you that in a minute. You look at business, education, health services, women gained 690,000 jobs. Men have gained over 800,000 jobs.

So, it was called the mancession. Men lost so many more jobs during the recession, but if you look at this recovery, men are actually getting jobs more quickly than women. So, something interesting to look at as we see this jobs crisis continue and see if women start sort of picking up steam.

MALVEAUX: Sure. Poppy, it's all very interesting. Thank you very much. Appreciate it.

The recession has also widened the gap between who's rich and who's poor. Allen Chernoff is at the New York Stock Exchange. And Allan, you have been looking at a new study comparing various households. Break it down for us.

ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: Well, the bottom line is that black and Hispanic households have certainly taken a real hit. This according to an analysis of government data by the Pew Research Center.

Let's have a look at our graphic. The Pew Center measured net worth, which is the value of your assets, your house, car, investments, minus your debts. Hispanics saw their net worth tumble 66 percent between 2005 and 2009. Black families were close behind, they dropped more than 50 percent. At the same time white American households saw their net worth fall a relatively modest 16 percent.

How come? Well, we can blame it on the housing market. A large number of Hispanics live in California, Florida, Nevada and Arizona, states that were at the epicenter of the housing crisis. Suzanne?

MALVEUAX: So now that some see the recession as being over, there is some sort of recovery here, do we see any narrowing of that gap at all?

CHERNOFF: The authors of the study say yes, the gap may have narrowed a little bit since home prices in some areas have been stabilizing a bit, but the gap is still very big.

Have a look at this. White Households have net worth upwards of $100,000 while black and Hispanic households have net worth of just $5,000 to $6,000. The National Urban League gave us this response to the study. Quote, "It's clearer than ever that the nation needs a targeted job creation policy, and that drastic program cuts in response to a manufactured debt ceiling crisis would be reckless and irresponsible." Suzanne?

MALVEUAX: Those are some huge differences there. Allan, with all the talk of the debt, lot of people worried about their investments, their 401(k)s, their investments. How are the stocks doing right now?

CHERNOFF: Well, stocks are taking a little bit of a hit today, but not all that much. They're still under pressure. Essentially analysts are saying look, we think -- we think that this is going to be resolved, this debt ceiling crisis will be resolved. But of course, you know, as we go on, certainly we may not resolve everything.

But for now, the markets are just sitting tight as if they have seen this high wire act before, and they know what happens at the end. But let's wait and see what happens.

MALVUEAX: Let's wait and see. We hope it's better news than what we've been getting. Thank you, Allan. Appreciate it.

So where do the happiest people in the world live? It ain't here.

(MUSIC PLAYING)

(COMMERCIAL BREAK)

MALVEUAX: Still time for you to vote on the story you would like to see. You can text your vote to Choose 22360. Text 1 for "Hacker Tracker." Finding the hackers who want to steal everything from your bank account, passwords to personal e-mails. Text 2 for "Granny chases intruder." After finding a man in her home, Grandma grabs her baseball bat, takes matters into her own hands. Or text 3 for "Phone Wedding." A U.S. soldier stationed in Afghanistan couldn't marry his sweetheart in person, so he decided to tie the knot from thousands of miles away. The winning story airs later this hour.

So, you might think more money you make, right, the happier you'll be? Well, a new study on depression is debunking that. Joining us is CNN senior medical correspondent Elizabeth Cohen.

Elizabeth - you know - why? What is this saying?

ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: You can't buy happiness.

MALVEUAX: It's true. The cliche is true!

COHEN: The cliche is true. Because these researchers looked to people all around the world and they find in the wealthiest countries that they had some of the highest rates of depression. For example, in the U.S., 19 percent of the people who were surveyed had experienced depression. But then take Mexico, it was only 8 percent, 19 percent versus 8 percent. So, they really found this sort of consistently that the folks in wealthier countries had higher rates of depression.

MALVEAUX: Why? It almost seems counterintuitive. You think if you have more resources, you are going to be a happier person.

COHEN: Even if you're not happy, you could go to a doctor who might get you happy, right? Because you might think that.

There are a couple theories out there. One is that in countries like the U.S., you were just talking about this on your show, actually, there is this wide range. There's a big disparity. So, you're walking around and you're seeing people driving Mercedes and wearing diamonds and you think "Golly, I don't have that," and it's depressing to see people who have things you don't have. So, that's one theory.

Another theory is that in wealthier countries, people are bopping all over the place. You move here for a job, here for a job, and you lose your family, you lose your community. And so that the more money there is, the fewer people you have around you who can support you and form that sort of community. We all know how important community is to people, and being isolated can be very difficult.

MALVEAUX: What can we learn from this study?

COHEN: We talked to experts, and there are a couple things you might be able to take away from this. First off all, if you are in that situation where you're going up the ladder which is a good thing, right? But it's taking you away from your community, make a community where you go. You don't want to become isolated. So, that's another important thing.

Something else which is easy to say but hard to do, don't covet thy neighbor's anything. You know, it's very easy to sort live your life and say I don't have a car that nice, I don't have jewelry that nice. And that will make you depressed.

MALVEUAX: Don't keep up with the Joneses.

COHEN: Right Don't keep up with the Joneses. Just make yourself be happy with what you have.

MALVEAUX: All right. Good. Good advice. Love it. Thanks, Elizabeth.

Well, arming your phone against hackers. You can't protect yourself if you don't know what to look for. So, we are take you inside one company building a reputation as a cyber crime fighter.

(COMMERCIAL BREAK)

MALVEAUX: "CNN In Depth." Malicious spyware programmed specifically to damage or disrupt your smartphone. All your personal information could be exposed. So, how do you stop this?

Well, our CNN Silicon Valley correspondent Dan Simon went to a company that's emerging as a leader in protecting phones.

(BEGIN VIDEOTAPE)

DAN SIMON, CNN SILICON VALLEY CORRESPONDENT: We're talking about the hacking of cell phones. And we are at LookOut Mobile Security, which has emerged as an industry leader when it comes to protecting your phone.

We're here with Kevin Mahaffey, co-founder of the company, who really understands this stuff. Before we talk some about this bad malware that's getting on our phones, I want to ask about the voice mail hacking scandal in the UK.

Your number one tip for people to prevent their voice mails from being compromised?

KEVIN MAHAFFEY, COFOUNDER, LOOKOUT: The easiest thing you can do to protect yourself from getting your voice mail hacked is to set a pin code. And make sure it's a hard to guess pincode, not 1234 and nothing somebody can guess simply by visiting your Facebook profile.

SIMON: It's one thing to get into voice mails; it's another thing for hackers to get control of your phone. You are seeing evidence of that.

MAHAFFEY: We have seen more malware on Android in the last month than in all of 2010 combined.

SIMON: So, Android is really the platform where hackers have turned their attention. In terms of what is actually happening, explain this text messaging feature that they can have access to and really rack up charges on your cell phone bill.

MAHAFFEY: Let's imagine you download an application from the market or you see an advertisement for an application. If you download that and put it on your phone, there is malware in the wild right now that can actually intercept your text messages and send text messages without your knowledge. Which may not seem bad, but what it can do is actually charge money to your phone bill, say $10 every month, without your knowledge.

SIMON: And that's really been in terms of frequency, that's really what you have been seeing in the last quarter.

MAHAFFEY: That's been one of the main attacks. There have also been attacks where people can take control of your phone, turn it into a bot and remotely control actions on your phone and do whatever they want with it.

SIMON: Kevin Mahaffey, thanks very much.

So what we've seen is, over the past, I don't know, few years, people have talked about this notion that hackers could get into your phone, take control of it, get your personal information. That was more theory-based. But we're now seeing the actual evidence of that. And that's where it's really scary. Products like Lookout, which has an app for the Android platform, can prevent that kind of thing from happening. But the bottom line is, people really need to treat their cell phone like it's a personal computer, because, after all, it now has some of your most personal information.

Dan Simon, CNN, San Francisco.

(END VIDEOTAPE)

MALVEAUX: Today's "Talk Back" question, what would you tell Congress to do about the debt limit?

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: You got one side that doesn't want to raise revenue. The other side that doesn't want to take any cuts.

UNIDENTIFIED FEMALE: I am continually flummoxed by the fact that we're just two parties so divided and can't come together on something as critical.

(END VIDEO CLIP)

MALVEAUX: More of your responses straight ahead. But first, here's some free money advice from the CNN "Help Desk."

(BEGIN VIDEOTAPE)

POPPY HARLOW, CNNMONEY.COM: Time now for "The Help Desk," where we get answers to your financial questions. Joining me this hour, Jack Otter, the executive editor at cbsmoneywatch.com, and Ryan Mack, the president of Optimum Capital Management.

Thanks for being here, guys.

JACK OTTER, EXECUTIVE EDITOR, CBSMONEYWATCH.COM: Good to see you.

RYAN MACK, PRESIDENT, OPTIMUM CAPITAL MANAGEMENT: Thank you.

HARLOW: First question comes from Eric in California. Eric writes, "I have a cash rewards credit card which I use to pay for everything. I always pay it off within a week or so and never leave a balance when my statement comes around. Can this hurt my credit score?"

What do you think, Jack?

OTTER: No. Eric, you rock. If we all followed Eric's example, this country would be in much better shape. Keep on doing it. Get -- you know he is -- the credit card companies don't like him. They are giving him cash and he's not --

HARLOW: They're not making any money off him.

OTTER: And he's not giving them any interest rate, you know, love. So, absolutely. Just stick with it. Keep on paying it off. I mean at some point could you have sort of a blank credit score because you've never borrowed any money, yes. But that problem is so small compared to the dangers of carrying too much debt, don't worry about it at all.

HARLOW: Good. Good to have an example for all of us.

OTTER: Do exactly what you're doing. Yes.

HARLOW: Ryan, your question comes from Julia in Atlanta. And Julia writes, "I'm newly married. My taxable income is $50,000 and my husband's is $275,000. Can I contribute to a Roth IRA under my name if we file taxes jointly? What if we file separately?"

MACK: Well, filing jointly, obviously the question is -- the answer is no. $166,000 or less for jointly filing, you're eligible from $166,000 to I believe it's $179,000. It phases out at $179,000 plus. You are not eligible for contribution. If -- for individuals, if she's filing by herself, $107,000 below she's eligible. $107,000 to $122,000. It phases out at $122,000 or higher. You know, she's not eligible.

The bigger question here is making sure they sit down and talk with each other about their finances. That's a big, huge discrepancy of income. How much is he going to contribute to the bills as opposed to what she's going to contribute. They're newly married. A lot of conversations that need to be had right at this point. So it's great that they're having this conversation.

HARLOW: Or before you walk down the aisle, right?

MACK: Exactly.

HARLOW: That's pretty important.

Thank you, guys, very much.

And if you have a question you want answered by our experts, just send us an e-mail any time to cnnhelpdesk@cnn.com.

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MALVEAUX: The president asked people to pressure Congress to act on the debt limit. Well, what happened? Websites crashed left and right. Now even phone lines in Washington are busy ringing, which brings us to today's "Talk Back" question and Carol with your responses.

Hey, Carol.

CAROL COSTELLO, CNN CORRESPONDENT: Suzanne, the "Talk Back" question today, what would you tell Congress to do about the debt limit? And before I jump into our responses, let me just say we were -- we've been overwhelmed with responses. So if a lawmaker out there is listening, please listen to these people because they're not only frustrated and angry, they're sad. Sad about how the rest of the world thinks about America during this bizarre debt ceiling debate. They want something done and most of the people who wrote on my FaceBook page, they want compromise.

Let's start with Andy. He says, " many friends have tried to get through to our congressman and his phone lines are down and server is busy. He's Republican. It's time the American people stage an old time protest in D.C. When we default, it will cause the shot heard round the world in the financial markets."

This from Elizabeth. "Take a moment and remember that you are here to serve us, not your own ego and career. Please compromise and find a solution."

This from George. "Reasonably cut spending and reasonably increase tax revenues. We didn't get into this mess overnight, nor will we escape it overnight."

This from Zach. "Republicans need to learn how to compromise and take a deal when it gives them what they've been asking for. No one cares what pledges you've signed. We all understand the difference between what you stand for and what needs to be signed to keep this country running. Divided government is supposed to lead to compromise, not civil war."

This from Diane. "I'd love to call, but the lines are busy or off the hook. Facebook restricts posts unless you like the page and there is nothing about these people that I like. Sending an e-mail requires entering my personal data, as if. So please tell the idiots in Washington they're fired."

This from Tony. "I worry that we not need worry about outside countries like China, North Korea, Russia, destroying this great nation, but the destruction may come from within our own walls by petty, egotistical, spoiled politicians."

Again, frustration, anger, but most of all, Suzanne, sadness coming through that the rest of the world is sitting back and watching what America is going through right now on Capitol Hill.

MALVEAUX: Is there anybody who was hopeful that they will come up with a solution, or are people, are at this point, we're like, look, we're so close to a deadline, this is just so discouraging?

COSTELLO: Well, that's really where much of the sadness came from. No, they don't have any -- like they don't have any confidence that our leaders will, you know, go down a path to compromise. They think they're going to just sit there and bicker and watch the country fall into default and see what happens.

MALVEAUX: All right. Well, you know what, let's go live to the White House, because I know the spokesperson, Jay Carney, is taking some questions about what the president is willing or not willing to do.

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: And the president, you know, spoke in detail about why compromise is essential and why there is an admirable and long history of Republicans and Democrats with strong disagreements and differences of opinion and ideological differences in the past, coming together and finding compromise on tough issues.

President Reagan did it with Democratic Speaker Tip O'Neill. President Clinton did it with Republican Speaker Newt Gingrich. This president did it with Republican leaders in December. It can be done again, and it must be.

I would note that the speaker of the House, in his address last night that followed the president's, never mentioned the word compromise, and yet that is the only alternative. We have a divided government. We have a two-party system. No party controls every branch of government. Compromise is the only option. And we'll -- and we will hopefully get there.

UNIDENTIFIED MALE: No chance it passing the Senate? No chance?

CARNEY: Well, look, I've -- that's our -- we do not believe it will pass the Senate. Senator Reid I believe said today -- MALVEAUX: All right, we've been listening to the White House briefing. Obviously trying to find some sort of compromise in play when it comes to the debt ceiling. We're going to have more after the break.

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MALVEAUX: You voted, we listened. Here's your "Choose The News" winner.

(BEGIN VIDEOTAPE)

SUSAN CANDIOTTI, CNN NATIONAL CORRESPONDENT (voice-over): Computers can hold all kinds of personal and professional secrets, from bank account passwords to sensitive business e-mails. But every minute of every day, those secrets can be targets of so-called cyber generals who can link computers to act like soldiers. An illegal network called a botnet.

CANDIOTTI (on camera): What is a botnet?

KARIM HIJAZI, CEO, UNVEILLANCE: Just think of it as an actual computer network that has been sort of ad-hocked, put together by a group of criminals or someone with mal intent.

CANDIOTTI: And who are the people doing this?

HIJAZI: You know, it ranges from everything from kids just playing around to really professional cyber criminals.

CANDIOTTI (voice-over): Karim Hijazi's company Unveillance tracks those illegal botnet networks. Companies hire him to see whether their computers are being tapped. You might call him a hacker tracker.

CANDIOTTI (on camera): Karim, how does an attack start?

HIJAZI: The hacker typically infects a bunch of computers out in corporate environments with a piece of malware or software viruses that ultimately feed information back to the command control server.

CANDIOTTI: So once that attack starts, the information is going back to the control center?

HIJAZI: That's right.

CANDIOTTI: And the next map shows how widespread this is.

HIJAZI: Right. This is an hour-long snapshot and sort of the afternoon of Unveillance, where we see botnets actually beaconing information out to the command control servers.

CANDIOTTI: Look at all those dots.

HIJAZI: Millions of them.

CANDIOTTI: How many are we talking about at any given time? HIJAZI: Tens of millions, if not hundreds of millions.

CANDIOTTI (voice-over): Hijazi's success exposing botnets drew the attention of one hacker group that wanted to steal his work.

HIJAZI: They were trying to extort us for botnet intelligence.

CANDIOTTI: The alleged extortionists are LulzSec, an offshoot of the hacker group Anonymous, that grabbed headlines recently after the FBI arrested 14 members.

CANDIOTTI (on camera): What did they say they would do if you didn't comply with their demands?

HIJAZI: They claimed they had information on us. They had gotten a hold of some of our e-mails and they were going to release them if we didn't comply.

CANDIOTTI: What was that like?

HIJAZI: You're sort of in a ransom situation.

CANDIOTTI (voice-over): Incredibly, the demands were documented in e-mails. In excerpts, the hackers say, quote, "your company isn't important to us, but it's clearly very important to you. If you take over a big botnet, we want insider info on it." Hijazi called the language "juvenile."

HIJAZI: It did indicate the age group that we were dealing with.

CANDIOTTI (on camera): But that doesn't necessarily mean they can't do damage.

HIJAZI: Doesn't mean they're harmless. Absolutely. It's like a baby with a gun.

CANDIOTTI (voice-over): Karim Hijazi immediately called the FBI. Eventually the hackers backed off after publicizing some of his e- mails. So far, no one's been caught and the hacker tracker is back to exposing botnets.

Susan Candiotti, CNN, New York.

(END VIDEOTAPE)

MALVEAUX: If your choice didn't win or you just want to check out the runners up, I'm going to have links to them on my page at facebook.com/suzannecnn.

CNN NEWSROOM continues right now with Randi Kaye. Hey, Randi.

RANDI KAYE, CNN ANCHOR: Hi, there, Suzanne. Have a great day. Thank you very much.