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Vote to Raise Debt Ceiling; Soldier Found With Bomb-Making Materials; Inside Former Top-Secret U.S. Navy Program

Aired July 28, 2011 - 14:00   ET

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

RANDI KAYE, CNN ANCHOR: We are awaiting a vote in Congress to raise the U.S. debt ceiling and cut future spending, something both houses, both parties, the president have all been trying to do for weeks now.

These are live pictures of Congress there as we wait for this vote.

So is this the end of the story? Well, maybe.

In just about four hours, give or take, the House will vote on a largely unpopular plan from the Republican Speaker to let the Treasury borrow $900 billion right away, while cutting $915 billion in future spending. Contrast that with a much bigger Senate plan from Majority Leader Reid aimed at keeping the debt issue at bay until 2013.

Assuming the Boehner plan squeaks through the House here over the objections of many of his fellow Republicans, the Senate will take it up and promptly vote it down. Whether and when senators will take up the Reid plan still isn't exactly clear.

This part though is clear. We're now just five days away from a potential government default, when the Treasury says it will run out of borrowed money and won't be able to cover all of America's bills and obligations.

And that brings me to my colleague Kate Bolduan on Capitol Hill. And CNN's Sandra Endo also with us. She's in Pasadena, California. She's at a senior center with a big stake in the debt and deficit standoff.

Kate, let me start with you.

Speaker Boehner spoke with reporters just moments ago. You heard it right here on CNN. So let's hear just a little bit more of what he said.

(BEGIN VIDEO CLIP)

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: Today the House will take action again on a solution to end this debt limit crisis. We'll take action again, just like we did on our budget, on solutions to the problems that are facing our nation. After today, the House, while it's sent to the Senate not one, but two different bills that will rein in spending, increase the debt ceiling and bring an end to this crisis.

(END VIDEO CLIP)

KAYE: So Kate, to you once again here. Does John Boehner have the votes for his own plan in his own caucus?

KATE BOLDUAN, CNN CONGRESSIONAL CORRESPONDENT: They didn't answer that question precisely today. I can tell you they have been working very hard over the past day -- well, past couple of days to get support for it.

While it looked like it could have been more in question I would say a day ago, it does seem that they are making progress in getting their caucus, their members in line to vote for this. We heard coming out of a meeting earlier this morning members saying, as we've started to hear, that the perfect shouldn't be the enemy of the good or the doable. So you're seeing more members saying that they are going to vote for House Speaker John Boehner's plan.

But, again, they are not saying that they are absolutely 100 percent confident that they will get the vote, which indicates that it could possibly be close. His margin of error from the beginning, if he can't get any Democratic votes, is pretty small at this point if he's going to get this through with only Republicans -- Randi.

KAYE: And as we continue to watch these live pictures there in Congress, I want to continue our conversation. What about all of Boehner's tough talk, Kate? Do you expect that that will have any payoff here today?

BOLDUAN: It seems that there's tough talk, at least -- probably at least in part. Members got the message, as he was telling them early in a meeting yesterday that they should get their you know whats, if you will, in line behind his bill.

He's speaking to conservatives who had come out kind of complaining about his package saying that it didn't go far enough. They wanted to see more dramatic cost-cutting and deficit reduction measures to be part of the plan. And basically what House Speaker John Boehner and other leaders are telling them is this the vehicle, this is the alternative, this is what we're moving forward with, so get on board and support it. And of course now we'll have to wait and see how the vote lands later this evening.

KAYE: But once again, even if it passes, it really doesn't solve anything, does it?

BOLDUAN: That's absolutely right. The reality is that, if this bill passes and it goes over to the Senate, we heard just this afternoon that Senate Majority Leader Harry Reid announce that he's going to take up the measure and they're going to vote on it this evening. But we're hearing that it's a motion to table.

It's legislative language for basically saying that they're going to set it aside, effectively killing that legislation in the Senate. As Senator Reid has already said, and we've seen a letter from Senate Democrats, they are unanimously opposed to the Boehner bill. So it cannot pass in the Senate.

And that's really what I asked Boehner today in the briefing, just a short time ago. I asked him, "Since your bill is not going to be the one that can pass Congress, can you get your members to support a compromise?" He very artfully avoided answering that directly, saying that there shouldn't be a reason for anyone to vote against this, and that it's a reasonable, responsible bill.

So we'll have to see really what happens after this vote and the vote in the Senate this evening. It's kind of a new ball game after that.

KAYE: It certainly is. And what a ball game it is. We'll see who comes out the winner here.

Kate Bolduan, thank you very much for your reporting.

Let me bring in Sandra Endo now. She is in Pasadena, California, at a senior center, where a whole lot of folks have a whole lot at stake, and they are all watching what's going on in Washington.

Sandra, the seniors that you've met, are they alarmed so far by what they have seen happening or really not happening in Washington?

SANDRA ENDO, CNN CORRESPONDENT: Oh, absolutely, Randi. A lot of opinions, strong emotions coming out.

The seniors we've spoken to, a lot of people are scared, they're worried, they're angry about what's going on in Washington. There's certainly a buzz here at this senior center, and a lot of people are just frightened because they rely on their Social Security and also Medicare and Medicaid, of course, for their livelihood.

And let's talk to Bobby right now.

You were talking to me earlier, saying what's going on in Washington is ridiculous. How angry are you?

BOBBIE BROOKS, CONCERNED ABOUT CUTS TO ENTITLEMENTS: Very, very angry. It's because I would not be able to live the lifestyle I live if I did not have my Social Security, even though I work part time, 36 hours a week. But I can't live on either one of them.

ENDO: So you would be out on the street?

BROOKS: Probably worse than that, because I don't think -- the way I see some people on the street, I don't think I could live that kind of life, you know? Because I would just -- I wouldn't be able to function. So I hate that that day is staring us in the face.

ENDO: A big concern here.

Anastasia, also, you've been watching this political fight play out in Washington. What do you think of all the back-and-forth bickering? ANASTASIA STEWART, CONCERNED ABOUT CUTS TO ENTITLEMENTS: I think I would like to see all of them have to trade places with us, and let them try and live on what we don't have and what they are trying to even cut more of. Social Security has not even contributed to the deficit, and yet they are more than happy to take it and use it wherever they like.

ENDO: And all the back and forth, the fighting?

STEWART: The political games that they play, it's a bad role model for our kids, I must say. Truth has become obsolete, and that's very sad. And yet we claim to be a country that tells the truth and that's democratic, and yet we're not doing a real good job of that ourselves.

ENDO: All right. Thank you so much for sharing your opinions.

Obviously, a very tough emotional time for seniors as they wait, as the whole country waits, Randi, really, for some kind of deal, some kind of compromise, something, answers to come out of Washington -- Randi.

KAYE: So it sounds like folks there are certainly worried about the long term and any changes that might happen for entitlements -- Social Security, Medicare, Medicaid.

ENDO: Oh, absolutely. They are relying on these checks to come. And even President Obama, when he spoke, he was saying that these Social Security checks are in limbo.

If the country is broke, they won't have enough money to send out these checks. So certainly they are watching, they're waiting, all the seniors here.

It's abuzz here at this center. People grabbing me, wanting to say what they think about what's going on in Washington because they are angry. They feel like they are the ones being held hostage by all these political games.

KAYE: Sandra Endo at the senior center there in Pasadena.

Interesting to hear some fresh voices there, folks who really have a fight under way here.

Thank you, Sandra.

We have some breaking news to tell you about right now. An AWOL soldier has been arrested near Fort Hood, Texas. The FBI says they found bomb-making materials in his hotel room.

Pentagon Correspondent Barbara Starr joining us now with the very latest.

Barbara, tell us a little bit about who this guy is and how this arrest came down. BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Randi, this is Private First Class Nasser Abdo. And as you reported in the last hour, it was a gun shop owner in Killeen, Texas, that brought him to the attention of law enforcement authorities yesterday.

He went into that gun shop. The owners and workers felt he had behaved suspiciously, asking about certain items, weapons items in the gun shop that he didn't seem to have very much familiarity with. After he left they called law enforcement.

Private First Class Abdo was arrested at a traffic stop in Killeen, Texas. When they searched his hotel room, they found what officials tell us what enough material to make two bombs.

Let me just tick through some of the items they tell us they found. It included gunpowder, shotgun shells, a pressure cooker, 18 pounds of sugar they believe would have been used to enhance an explosion, and Christmas lights that possibly could have been used as a timer for an explosion.

Abdo apparently also went to a surplus store, ordered an Army uniform, and asked for Fort Hood patches, Fort Hood insignias to be sewn on to that uniform. All indications are that he had something in mind to attack Fort Hood. In fact, he apparently told law enforcement officials he wanted to stage some sort of attack.

He is actually in the Army at Fort Campbell, Kentucky. He had been AWOL, Absent Without Leave, and had been facing a court martial over accusations and charges that he had child pornography on his military computer. Oddly enough, he had also been granted conscientious objector status at his request some months ago so that he didn't have to deploy to the war zone.

And he went AWOL after that, turning up in Texas, turning up next to Fort Hood. Of course, always very sensitive, because in 2009, they had a mass shooting on that base, as you'll recall, in which 12 personnel died, 30 were wounded -- Randi.

KAYE: And Barbara, do you think one of the things that investigators might be looking at would be a possible connection to the man who was the focus of that rampage back in 2009?

STARR: Well, they may look for some sort of connection. We are told that they found a backpack in his possession that had so-called jihadi literature inside of it. We haven't seen that. We don't see the direct evidence. That is how it's described to us.

So there will be -- investigators certainly will want to know at a minimum who he's spoken to, what influences he may have felt that led him to this, looking at what Web sites he logged onto, that sort of thing. They will be looking for anything that may tell them what led him to these actions -- Randi.

KAYE: And as far as you know, nothing like this in his history at all? STARR: What we are told by U.S. military officials, his history basically is he, in 2010, last summer, tried to and did win conscientious objector status. He felt as a Muslim he did not want to go to the war zone and face the possibility of killing other Muslims, so they gave him that conscientious objector status, but really, right around that very time, is when it began to surface at Fort Campbell that he had child pornography, it is alleged, on his computer. He was charged with that and recommended by the military to face a court- martial over those charges, and he went AWOL after that -- Randi.

KAYE: Barbara Starr, great new details, fascinating details on this case of Private First Class Nasser Abdo. Barbara, thank you very much.

STARR: Sure.

KAYE: And for many more details on this soldier, what was found, what's expected to happen next, you can go to our "Security Clearance" blog at CNN.com/security.

A developing story that we're following this hour. New Jersey Governor Chris Christie checked into the hospital this morning after he experienced some difficulty breathing. His press secretary issued a statement that said, "Out of an abundance of caution, the governor went to the hospital and was given routine tests to check his asthma."

The governor is being treated at Somerset Medical Center in New Jersey. We'll bring you some updates as soon as we get them.

Polygamist leader Warren Jeffs fires all his attorneys and will be making his own case, it turns out. The very latest on that coming up.

(COMMERCIAL BREAK)

KAYE: Welcome back. Glad you're with us.

Checking some other top stories that we're following.

Polygamous sect leader Warren Jeffs fired all his attorneys today. He told a Texas judge he wants to represent himself in his sexual assault trial. He said if he is not allowed to be his own attorney, "true justice cannot be served." Jeffs did ask for legal counsel and for more time to prepare his defense. He faces charges of sexual assault and bigamy.

Some relief may be on the way for some of the most drought- plagued areas of the U.S. The current path of Tropical Storm Don has it headed towards some of those regions. The storm is currently working through the Gulf of Mexico, heading to Corpus Christie, Texas. Rainfall in some parts of the Lone Star State, more than 15 inches below average.

The woman who says the former head of the International Monetary Fund sexually assaulted her made a public appearance today at a church in Brooklyn. Nafi Diallo thanked organizations and community leaders for their support. She met with prosecutors for several hours yesterday. Strauss-Kahn has pleaded not guilty, and prosecutors have questioned the hotel maid's credibility.

Here's a question for you. What do dolphins, sea lions and sailors have in common when it comes to catching terrorists? In about two minutes we take you inside what was once a top secret U.S. Navy program. You do not want to miss this story.

(COMMERCIAL BREAK)

KAYE: They are surprising secret weapons in the hunt for terrorists, dolphins and sea lions used to hunt and capture possible terrorists and detect underwater bombs. It's an amazing and unique partnership between man and animal that the Navy is unleashing to keep us safe.

CNN's Kaj Larsen gets unprecedented access to what was once a top-secret U.S. Navy program and takes us into the water to see firsthand these water warriors.

(BEGIN VIDEOTAPE)

KAJ LARSEN, CNN CORRESPONDENT (voice-over): Playing the role of a terrorist in San Diego Bay, I'm trying to evade a dolphin trained to find hostile swimmers.

CHRIS HARRIS, U.S. NAVY MARINE MAMMAL PROGRAM: He's not going to make it. She's going to get him.

LARSEN: Out of nowhere --

HARRIS: There, she's got him.

LARSEN (on camera): I got about, say, 50 meters from the ship behind me, and then, boom! It came and hit me right here.

(voice-over): The dolphin hits me with a marker that alerts armed security to my presence.

(on camera): There was a brief second where I thought I was going to make it through. The next thing you know, I was staring a porpoise right in the face.

Oh, it just got me again! Oh.

(voice-over): In a minute, she's back on her boat and getting some TLC.

(on camera): I guess my combat ship attack, foiled again.

(voice-over): Undaunted, I try under water with my scuba gear on. Here's what the camera on the dolphin saw. Under water or on the surface, the dolphin finds me every time.

(on camera): So how does she compare to, say, suppose you had a side scanned sonar on the bottom of this boat. What's the difference? HARRIS: She's able to pick out details about an object that we would only dream to have on side scan sonar. And she can do it at great ranges with 100 percent reliability.

LARSEN (voice-over): The dolphin is looking for a swimmer like me.

(on camera): So she's going to hit this ball right here?

HARRIS: Yes. Once she's sure that that's a swimmer, there she goes. So she just touched that ball right there. Now at this point, Kaj, we're going to have to get out of the way of the handler.

He's going to go back in there and let her know, hey, good girl. Thanks for keeping your eye out for us. He's going to let her know she did a good job.

And he's giving her the marker. And there goes the marker. So now she's on her way. It's like a shot, as you know. You know it's a pretty good little bump.

LARSEN: Yes. Yes.

HARRIS: Let's watch and see --

LARSEN: That's one way to put it.

(END VIDEOTAPE)

KAYE: And Kaj Larsen joins us now live from Los Angeles.

Kaj, that was an amazing story. Tell me, how many attacks have they actually foiled?

LARSEN: Well, Randi, we know for sure that they have foiled one attack, and that was mine on the ship in San Diego Bay. But the Navy is understandably pretty close-hauled (ph) about the number of actual missions it conducts.

These marine mammals can be deployed anywhere in the world in 72 hours. So while they haven't told us how many actual attacks they have intercepted, we do know that it has a strong deterrent effect. And to date, in all of my research, I couldn't find an example of a successful combat swimmer attack against a U.S. ship. So it seems to be pretty effective.

KAYE: And sea lions, from what I understand, they're getting in on all this action, too. Is their role different from the dolphins?

LARSEN: Both the sea lions and dolphins can be used to perform what the Navy calls swimmer interdiction. That's intercepting a combat swimmer, as you saw in the video. They do have slightly divergent roles and they use slightly different techniques, but the principle is the same.

KAYE: And how many sea lions and dolphins are we talking about here? And how long does it take to train them?

LARSEN: As you can imagine, it takes a long time. I mean, we saw one sea lion that was 10 months old. He was a baby, essentially, and he was just starting his training, which will end up being several years to become fully operational. Right now the program incorporates about 75 dolphins and about 35 sea lions in total.

KAYE: And is there something particular about sea lions and about dolphins that they were chosen?

LARSEN: Yes. Well, they have these incredible natural capabilities that can be harnessed for this mission.

For dolphins, they have top-of-the-line sonar, far outpacing any technology that we could use to try and replicate it. And for the sea lions, they actually have a very keen sense of hearing and eyesight that works under water to either find swimmers, or there's a secondary mission where they recover objects under water as well.

KAYE: It really is a fascinating program. How long has it been going on?

LARSEN: It's, believe it or not, been going on since the '60s. Originally, they wanted to study marine mammals to see if they could improve the efficiency of torpedoes by looking at the hydrodynamics of these animals. But very quickly they realized, wow, we can put these mammals to use for a more interesting purpose.

KAYE: Well, even though you were foiled, I'm sure you were very impressed.

Kaj Larsen, great story, really. Thanks for bringing it to us.

And the entire "CNN Presents" documentary airs Sunday, 8:00 p.m. Eastern and Pacific Time.

And speaking of time, it's about 24 minutes past the hour. Let's check in on the top stories that we're following right now.

In Norway, police are preparing to interview the suspect in last week's terrorist attacks for a second time tomorrow. Anders Breivik is being held in solitary confinement and was last interviewed on Saturday. Police say they have new information, and Breivik is likely to face more interrogations in the coming weeks.

Attorney General Eric Holder has agreed to meet with some family members of 9/11 victims. That meeting is scheduled to take place August 24th. Holder is expected to talk about the next steps in investigating claims that journalists working for Rupert Murdoch's News Corp. tried to hack their phones.

A bit of good news for the job market today. The number of first-time applicants for unemployment benefits fell below 400,000. It is the first time that's happened, in case you're keeping track, since early April.

The August 2nd deadline looms, but is a default as bad as it really sounds? Find out next in this week's "Q&A."

(COMMERCIAL BREAK)

KAYE: So we all know defaulting on a personal loan is widely seen as negative, but does the same logic hold true for our country?

Our resident business experts Ali Velshi and Richard Quest tackle that in today's "Q&A."

(BEGIN VIDEOTAPE)

ALI VELSHI, CNN ANCHOR: "QUEST MEANS BUSINESS" and so do I.

We are here together in the CNN NEWSROOM around the world.

Hello, Richard.

RICHARD QUEST, HOST, "QUEST MEANS BUSINESS": Good day to you, Ali.

We are talking business, travel, innovation. Nothing is off limits truly today, because we're talking about governments defaulting on loans.

VELSHI: Nothing is off limits, including debt limits, Richard. It's been the talk of Washington for weeks, but it's not just an issue here in the United States. It's an issue around the world.

So here is our question: Does it ever make sense for a country to default on its debt?

Richard, I'll let you go first. You've got 60 seconds.

(BELL RINGING)

QUEST: Unfortunately, the answer is, most definitely yes. Sometimes defaulting on debt, it's the only way out for countries.

Over the past 200 years there have been dozens of defaults. Among the most recent, Russia in 1998, Argentina in 2001. Both had massive defaults. Mexico, in '82, narrowly avoided the same defeat in 1994, because behind default, bad economic policies.

Default is evidence of an economy in crisis, stretched to the breaking point, when no one will lend money, bills can't be paid. It is default that forces a change in policies, default that ultimately allows countries to recover.

So factor it into the United States, and ask yourself: Is the United States running economic policies which are no longer sustainable? Is there a plan to get out of the mess? The U.S. may be a handful of countries that have never defaulted, but such a situation has reached so messy moment that maybe default is the only answer.

(BELL RINGING) VELSHI: Wow, wow. All right, Richard. My turn. I got a minute now.

It's about responsibility. If you have borrowed money, Richard, you have to pay it back. That is as true for you as me and it is for companies and countries. Occasionally, as you have mentioned, there is no other choice but default, just like individuals sometimes have to declare personal bankruptcy. Sometimes countries simply can't pay what they owe.

Let me take one example that you cited. In 2001, Argentina defaulted on $100 billion in debt. Oh, if we only had $100 billion to worry about. The immediate pain was severe. Argentina's economy recovered, grown more than 8 percent a year since 2003. But, Richard, circumstances matter. And default, as you say, is an absolute last resort.

Now thanks to the fact that it's part of the Eurozone, Greece isn't out of options yet-at least not yet-and now here in the United States, wow, it's just irresponsible that the default you speak of is even a possibility. The United States can afford to pay its debt. It can increase its borrowing. The fight here is over whether we want to.

(BELL RINGING)

And with the full faith and credit of the U.S. government on the line, Richard, it is not and should not be an option.

QUEST: Oh. All right.

VELSHI: Well, at least we disagree.

QUEST: Now let's hear The Voice to actually put us to a real test of mettle for default.

THE VOICE: Good day, gentlemen. Let's hop right into it. We'll start with an easy one, OK?

According to the Treasury Department, which individual country holds the most U.S. Debt? Is it A,, China; B., United Kingdom-

(BELL CHIMES)

THE VOICE: Ali?

VELSHI: China.

THE VOICE: That is correct. China holds 7.5 percent-

QUEST: We both knew that. We both knew that,

THE VOICE: -of the U.S. debt.

THE VOICE: Well, next time you'll ding in quicker. How about that? Question number two. Which of the central banks of these G20 countries has the highest interest rate, is it A., Brazil; B., Russia; C., Indonesia; or, D., Argentina?

(DESK BELL CHIMES)

(BELL CHIMES)

Richard?

QUEST: I'm going with Brazil.

THE VOICE: That is correct. Brazil is at the top of the list with between 12.25 percent and 12.5 percent.

On to question three: According to the Women's Tennis Association, which player owns the record for the most double faults in one match? Is it A., Maria Sharapova; B., Venus Williams; C., Anna Kournikova; or D., Billie Jean King?

(LAUGHTER)

VELSHI: Oh, boy. Richard, you go first.

QUEST: All right. I'm going to go first with C.

(BELL DINGS)

THE VOICE: That is correct.

VELSHI: That's what I was going to say. I just didn't want to be wrong.

THE VOICE: She had 31 in one match in 1999 and still won. Congratulations, Richard.

VELSHI: You are the luckiest guy I've ever met in life.

QUEST: I've got -- what can I say? What can I say?

That does it for this week. Remember, we are here each week Thursday on QUEST MEANS BUSINESS 1800 GMT.

VELSHI: And in the CNN NEWSROOM, 2 pm. Eastern. And keep the comments coming on our blogs, CNN.com/QMB and CNN.com/Ali. Tell us each week what you want the two of us to talk about.

See you next week, Richard.

QUEST: Victory is sweet.

(END VIDEOTAPE)

KAYE: Imagine a world of advertising where women actually appeared as they are? Well, up next, we tell you about a country headed in that direction.

(COMMERCIAL BREAK)

KAYE: It is 37 minutes past the hour. Time for the news that you might have missed.

Last hour Speaker John Boehner spoke about his revised debt plan that's up for a House vote later today. Boehner says it's not perfect, but it's doable. Boehner's proposal, which calls for an immediate $900 billion increase in the debt ceiling, now meets his pledge to match any debt ceiling hike with dollar-for-dollar spending cuts. Even if the bill passes the House, it still has to face the Senate. And Senate Democrats say the Republican plan has no chance of passing the Senate.

An AWOL Muslim soldier, seen in this file video, has been arrested near Fort Hood, Texas, the scene of a deadly shooting rampage two years ago. Officials say In the latest incident the soldier told them he wanted to attack troops outside Fort Hood. FBI agents say they found bomb-making materials in his hotel room and jihadi literature in his backpack.

I just spoke to a gun store employee who tipped off police to this suspect. And I'll have some of that interview for you just a little bit later on. Also, we want to let you know there will be a live press conference coming up on CNN from Fort Hood. We're going to be hearing from the Killeen police, the Killeen, Texas police on the latest on the investigation there and probably a little more new information on this suspect.

Meanwhile, New Jersey Governor Chris Christie checked into a hospital this morning. His press secretary said he was having difficulty breathing, but he's now doing fine. The governor underwent some tests and is feeling great and looking forward to getting back to work tomorrow, according to his team. The governor says he's extremely grateful for the quality of care that he's receiving.

British advertising authorities have banned a Lancome ad featuring Julia Roberts for being, get this, overly air brushed. Here you see the air brushed Julia and here you can see the more natural Julia. You can tell the difference there, I'm sure. "The Huffington Post" reports a female member of the British parliament first raised concerns about the ad. She says air brushing is contributing to young women's problems with body image and confidence.

Can't look too good, I guess.

"Jeopardy" game show host Alex Trebek tore his Achilles tendon chasing down a burglar. He explained what happened when he showed up at a geography competition on crutches.

(BEGIN VIDEO CLIP)

ALEX TREBEK, HOST, JEOPARDY GAME SHOW: Yesterday morning, chasing a burglar down the hall at my San Francisco hotel, until my Achilles tendon ruptured, and I fell in an ignominious heap.

(END VIDEO CLIP)

KAYE: Trebek says he will have surgery tomorrow. Police arrested and charged a 56-year-old woman for possession of stolen property.

Why did it take China's top leader five days to visit the site of a deadly train collision? His stunning answer coming up next in "Globe Trekking."

(COMMERCIAL BREAK)

KAYE: With Chinese outraged over a deadly high-speed train collision, a rare admission from China's top leader. Five days after the accident that killed 39 people, Premier Wen Jiabao visited the crash site today. Why did it take so long? Because he was in the hospital. He didn't say just what was wrong, but it is extremely rare for Chinese leaders to talk in public about their health.

Chinese citizens have swamped social media accusing officials of a cover-up of the cause of the accident. The accident happened when a bullet train rammed into a stalled train. Wen today, pledged a full investigation and punishment for anyone found to be at fault. China's state-run news agency says design flaws and signal equipment led to that collision.

At least 49 people are dead after historic rains in South Korea. Take a look at all that water in the capital Seoul. Flooded streets looked like rivers. Rain fell at the rate of two inches per hour in some parts of the city. Officials say damage to Seoul and surrounding areas could top $100 millions.

And we want to let you know that at 3:00 o'clock this afternoon we will be hearing from Killeen, Texas police about the arrest of an AWOL Muslim-American soldier. He's been on the run since 2010, arrested today with allegedly plans to possibly set off two bombs near Fort Hood in Killeen, Texas. We'll bring you that press conference live right here on CNN coming up. We'll take a break here and be right back.

(COMMERCIAL BREAK)

KAYE: More now on the arrest of an AWOL soldier officials say was planning to attack troops at Fort Hood, Texas before his arrest. Private first class Naser Abdo allegedly bought ammunition in a gun shop near Fort Hood. Workers at the shop tipped off police who then arrested him.

Earlier, I spoke to a man who works at that gun shop, and I asked if he and his co-workers were on alert in the aftermath of the deadly shooting at Fort Hood two years ago. Here's part of what he told us.

(BEGIN VIDEO CLIP)

GREG EBERT, GUN STORE WORKER: I don't know if it was cause for us to be more concerned. We, as a rule of thumb, like to think that the safety of the community is important enough that if someone does something, or exhibits behavior that would be out of the norm, that we have an obligation to notify the police and allow them to pursue it from that point.

(END VIDEO CLIP)

KAYE: Abdo is a Muslim-American who went AWOL from Fort Campbell, Kentucky after being charged with possessing child pornography. Officials say they found in his hotel room enough material to make two bombs. Killeen police are expected to hold a news conference on the arrest of this soldier.

We are expecting that news conference at the top of the hour, around 3:00 p.m. here on the East Coast, and we'll bring it to you live when it happens.

Airlines are pocketing $25 million a day from passengers' pockets after an unplanned tax holiday. That's money that was going to airport construction projects. Unfair way to make a buck, or is this just business? We debate it next in "Stream Team."

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KAYE: Today's "Stream Team" directly impacts anyone who flies. Last Friday, Congress failed to approve the extension of a bill to keep the Federal Aviation Administration running meaning, that as of Saturday airlines no longer needed to pay the federal government $25 million a day in tax revenue. That's a 15 percent tax break on airline tickets, or about $50 for international travel, and as much as $30 on a typical domestic ticket. But did airlines pass on the savings to us? No.

Nearly all the major domestic carriers, including American Airlines, JetBlue, Airways and Southwest raised their airfares. Airlines such as Southwest defended the move saying consumers won't be paying more, even as Southwest hiked fares by $4 each leg, according to Spokeswoman Wendy Eikenger (ph). Only Spirit Airlines and Alaska Air so far have decided to keep their fares the same.

Joining me now to talk about this is Mary Schiavo, former inspector general of the U.S. Department of Transportation, who now works for a law firm and sues airlines. Also with us today, Rick Seaney, the CEO of Farecompare.com and Seth Kaplan, managing partner "Airline Weekly."

Rick, I want to start with you. Is it unfair, do you think, for airlines to pocket this money?

RICK SEANEY, CEO, FARECOMPARE.COM: I don't necessarily think it's unfair. I don't think it's very reasonable from a consumer perspective. This is absolutely a windfall. It's not going in the government's pocket. It's not going into the consumers' pocket. It's going into the airlines pocket. If the airlines had to sort of split the difference with consumers, I think consumers would have given the airlines a bunch of credit. This is after the last three years of being nickel and dimed with a variety of fees.

KAYE: Mary, what do you think about it?

MARY SCHIAVO, FMR. INSPECTOR GEN., U.S. DOT: Well, it is unfair because these ticket taxes don't go into the general United States revenue. They go into a trust fund, which funds the construction of airports, runways, air traffic control systems. We desperately need this air traffic control system. And by the airlines pocketing the money instead of giving it back to the consumers, or they could fund some of this construction that they need at the airports, they are being unfair to literally our nation, and the traveling public and it's -- it's just plain bad PR, bad practice.

Seth, what do you say to consumers who say, hey, the airlines should give us this money, give us a break? They shouldn't pocket it.

SETH KAPLAN, MANAGING PARTNER, "AIRLINE WEEKLY": Certainly what Mary was just saying is very well intentioned, but the problem is that the very most basic law of economics, that's supply and demand, still applies here. Basically nothing has changed between last week and this week in terms of how much consumers are willing to pay for a ticket. And in the end, airlines and all businesses don't really set prices, consumers do. And it's the business' job to charge people what they are going to pay. That's true of corn flakes and of airline tickets.

People are willing to pay what they were last week. If airlines suddenly lowered ticket prices by an average of $60, which is what it would be, guess what? Almost every seat for the next six weeks would sell out very quickly, and people who travel wouldn't even be able to do that.

So, what I would say though, is if we take this slightly misguided but well-intentioned crusade that everyone is on and turn it into something positive.

You know, although airlines don't really control prices, what they do control supply. The number of seats that are in the market, and if airlines knew that for an extended period of time this major cost to them would be reduced, guess what? They would put more seats in the market. And that, in fact, would lower fares, just as if oil prices suddenly fell, yeah.

And so that -- so, you know, hey, I know we're not in the mode right now of looking of ways to spend more federal money certainly.

KAYE: Right.

KAPLAN: But plenty of other people are going to get to keep their subsidies, farmers and everybody else. Congress might want to think about saying no taxes through the end of 2012 and watch what happens.

KAYE: Let me just jump in on it. Rick, what is your take on it? Because how long might this go on? We're talking $25 million a day here, will this go on as long as a shutdown lasts?

SEANEY: It's $25 million a day and Congress is fighting over a $14 million issue. This is all surrounding 13 airports that are being subsidized by the government to the tune of $14 million, half a day's worth of this crisis could be done. They should get it fixed, A. And I disagree. In Texas, right before kids go back to school, we have a sales tax holiday. It spurs on a bunch of business. People go and they shop. If all the businesses in Texas that are related to schools actually lifted all their prices for that one or two days for that holiday, I think consumers would be upset, and that's why consumers are upset right now.

KAYE: Mary, I'll give you the final word here.

SCHIAVO: Well, this is not a tax break, or this is not a subsidy for the airlines. The airline gets billions of dollars of subsidy a year. This is taking advantage of a loophole because Congress is dithering. The blame belongs squarely on Congress. It is, by the way, over-subsidizing some passengers to the tune of about $1,000 a flight, which is one of the things.

So this is Congress to blame, and the airlines are taking advantage of this. This is not an unintended subsidy. And by the way, to correct something. They do control the number of seats, the slots, the prices, that all came in 1978 with the airline deregulation bill.

KAYE: OK, all of you, a very healthy discussion there. Thank you very much for your time. Have a great day.

Is the president losing the support of independents? Mark Preston will break down some new polling numbers for us right after this break.

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KAYE: Time now for a CNN "Political Update." CNN's Senior Political Editor Mark Preston joining me from the Political Desk in Washington.

Hi there, Mark. You have troubling new polling, I understand, for the president?

MARK PRESTON, CNN SENIOR POLITICAL EDITOR: I do, Randi. Pew Research Center poll has just come out in the last couple of hours, it spells troubling news for the president's re-election prospects.

Let's take a look at this overall number right now. It shows that the president has lost 7 points from May until July on this poll right here. At the same time the generic Republican, that's a Republican that they don't actually have a name, has actually increased by 3 points. What that shows right now is that it would be a -- a tied up race between President Obama and the Republican that the GOP finally chooses as their nominee. Not good news for the president.

What's even more troubling is let's look at these next numbers right now. Where is he losing the support? He is losing it from the all-important independents right there. It shows he has lost 11 points right now, Randi, from May until July, and the Republicans have picked up 4. So, if you look at those numbers right now, as we're talking about politics, and what's going on in the debt ceiling, and where Republicans and Democrats are trying to gain with the voters, it looks like the president right there is starting to lose some support, Randi.

KAYE: Yeah, it certainly looks that way. Got to figure out the debt ceiling along with Congress and he has got to figure out how to bring up those poll numbers.

PRESTON: No doubt.

KAYE: All right, Mark Preston in Washington. Thank you, Mark.

Your next update from the best political team on television is just an hour away.

And that will do it for me this afternoon. CNN NEWSROOM continues right now, with Brooke Baldwin.

Hi, Brooke.