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Air France Crash Report; Warren Jeffs' Silent Defense; We Are Almost Out Of Time; Boehner Still Seeks 217; What Default Looks Like; Tropical Storm Don Closes In On Texas; Memorial For Norway Terror Victims

Aired July 29, 2011 - 12:59   ET

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

RANDI KAYE, CNN ANCHOR: We can't say nothing's changed in the deadlock over debt limits.

This time yesterday, the House was due to vote on a short-term debt hike that stood no chance of ending the crisis. Today, the House is due to vote on a short-term debt hike that stands even less chance of ending the crisis.

And today, we are one day closer to D-day. Default, we're told. The government's inability to cover all its bills and obligations could be just four days away. That's unless Congress passes and the president signs an increase in the Treasury's authority to take on debt by selling bonds.

House Speaker Boehner still trying to sell his fellow Republicans on a plan to hike the debt limit by $2.5 trillion in two installments this year and next. He'd also cut spending by $917 billion over 10 years.

Senate Majority Leader Reid says there is no time to wait for the House, so he'll try to pass his own plan to cut spending by at least $2.2 trillion while raising the debt limit by $2.7 trillion all at once.

For his part, President Obama says, and I'm quoting here, "The power to solve this is in our hands."

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Keep in mind, this is not a situation where the two parties are miles apart. We're in rough agreement about how much spending can be cut responsibly as a first step toward reducing our deficit.

We agree on a process where the next step is a debate in the coming months on tax reform and entitlement reform, and I'm ready and willing to have that debate. And if we need to put in place some kind of enforcement mechanism to hold us all accountable for making these reforms, I'll support that too if it's done in a smart and balanced way.

So there are plenty of ways out of this mess, but we are almost out of time. (END VIDEO CLIP)

KAYE: Now, I want to bring in CNN's Joe Johns to tell us where things stand at this very moment.

How is Speaker Boehner trying to reach his magic number of 217?

JOE JOHNS, CNN SENIOR CORRESPONDENT: You know, Randi, when I was listening to you at the very top, it sounded like you were describing theater of the absurd, and that's pretty much what we have going on here right now. House Republicans are inching closer to fixing their problem in the House of Representatives.

I think we have pictures now of the House Rules Committee, I want to show you that, and they are meeting I am told. And whenever the House Rules Committee meets, essentially what they're trying to do is pave the way for a bill -- a revised bill, any bill to make its way to the floor of the House of Representatives. That's Congressman David Drier there, he is one of the key players in all of this.

Now, the Republicans are looking to try to change their latest proposal and get the approval of the rules committee by essentially adding on a balanced budget provision and a requirement that both Houses of Congress pass the balance budget amendment before they will allow what is called this two-step process of raising the debt limit.

Now, Democrats have said, again and again, they don't want a two- step process, and what's fascinating here is that the Republicans change their proposal would require the passage of the amendment. Harry Reid, the Senate Democratic leader, heard about this, went to the cameras, and check out his reaction.

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D-NV), MAJORITY LEADER: I am not standing in line to see how many times they can amend the constitution, but you know, if people wanted to vote on that, fine. But as Senator Schumer pointed out, to show the extremism of these people, the extremism of these people, they are not satisfied with the vote on it, they want a guarantee that it is passed -- it passed before they will allow an extension of the debt limit. I mean, how bizarre can anybody be?

(END VIDEO CLIP)

JOHNS: Well, bizarre or not, the fact of the matter is that John Boehner, the speaker of the House, is doing everything he can to pass something out of there, and in order to do that you have to make deals, you know, 10, 15 years ago they would have thrown money at the problem, billions of dollars, perhaps, to get votes.

Now, they are not throwing money at the problem, but they got to give people something in order to get their votes, and this is what they are trying to do -- Randi.

KAYE: So, Joe, it seems like there's a lot of conversations going on, but is there any real negotiation going on? JOHNS: Well, basically, what the people at the Senate are doing is waiting for the House to figure out if they are sending a bill over or not, that's the first thing.

But Senator Reid did say he wanted to sit down with the Republican leader, Mitch McConnell, in the Senate, and talk about a bill that would pass, and that's key. Because if Mitch McConnell had good ideas, I mean he at least knows what the Tea Party Republicans over in the House are thinking. If he has some good ideas, he might be able to figure out something to thread the needle, you know.

One of the scenarios here is there is two dozen or so hard-nosed over in the House and they may have to marginalize them and try and go around them but who knows if that is possible?

KAYE: Who knows? We'll keep watching it along with you. Joe Johns, thank you very much.

Well, you heard the scenarios for post August 2nd, depending on the politics, some very smart people believe failure to pass a debt agreement will lead to dooms day, near disaster or pretty much business as usual. The Bipartisan Center has looked at actual numbers, though, on both sides of the ledger, and I want to show you the highlights, well maybe we should call them the lowlights.

But I want you to take a look here, we put some dates together, some key dates. On August 3rd, the treasury is due to bring in $12 billion in tax revenues and face $32 billion in payments, I am talking Social Security and defense contract, federal salaries, Medicare and Medicaid, jobless benefits, and, of course, a whole lot more. Assuming no borrowed money to make ends meet, the gap for that one day alone, August 3rd, will be $20 billion, you see it right there, not pretty.

All right, let's go to the next day, August 4th, another $4 billion comes in, but another $10 billion is supposed to go out. Combined deficit, $26 billion. Now, let's fast-forward to August 31st, OK? We will have taken in $172 billion against $306 billion in obligations. We've done the math here, you can look at it for yourself, we'll be $134 billion short. No one knows, yet, whom the treasury will pay and who will have to wait.

All right, checking some other "Top Stories" for you now. Strange behavior when the Muslim army soldier arrested with bomb- making material appeared in federal court today. Private Master Obdo was charged with one possession of an illegal firearm, Obdo was taken into custody yesterday near Fort Worth, Texas.

Killeen police say he told them he wanted to kill soldiers at the military post. He refused to stand up today when the judge entered the court room, he was yanked up by U.S. marshals. As he was leaving, he shouted out the name of a Muslim soldier charged with killing 13 soldiers at Fort Hood two years ago.

It is batten down the hatches for south Texas. Tropical storm, Don, tracking sustained winds of 50 miles an hour, expected to make landfall along the Texas coast late tonight or early tomorrow. This storm is about 190 miles southeast of Corpus Christi and about 165 east of Brownsville. There is a silver lining here, though, Don will dump much needed rain on the bone-dry state. Texas farmers are suffering the third worst drought in recorded history.

Norway paused today for a somber memorial service of the victims of the twin terror attacks.

Norwegian leaders joined relatives for a service in Oslo by the youth wing of the labor party, the target of last week's shooting spree. Norway's prime minister called the victims heroes, and said Norway's response would have more democracy. Suspect Andres Breivik has admitted carrying out the bombing and shootings which killed a total of 76 people, many of them teenagers and young adults. Police plan to question Breivik today for the second time since his arrest.

The Libyan woman that claimed she was gang raped by forces loyal to Moammar Gadhafi has arrived here in the U.S. Iman al-Obeidi flew into New York two nights ago and got a flight to Denver where she plans to stay, at least for the time being. She gained international attention and concern in March when she rushed into a Tripoli hotel full of international journalists and described in detail her alleged rape. In May, she escaped to Tunisia and was granted asylum by the U.S. Before coming here, she spent 54 days at a U.N. refugee center in Romania.

Fixing the debt ceiling crisis. Could it be as simple as balancing a city budget? One mayor is on a mission to help Congress and the president get it done. We'll talk to him next.

(COMMERCIAL BREAK)

KAYE: Welcome back.

The pressure to solve the debt ceiling issue is being felt in Washington, of course, but even officials across the country are anxious for Congress and the White House to get this deal done. One mayor went as far to write President Obama and the leaders a letter this week, offering some ground-level insight into the crisis.

Here is an excerpt from the letter, it says, "I write to offer some outside the beltway perspective and to strongly affirm the need for an immediate bipartisan practical solution that balances reduced federal spending with a comparatively mild increase in revenues. "

The author of the letter joins me now, Phoenix Mayor Phil Gordon.

First, Mayor, thank you for coming on the show. I want to ask you though, why did you decide to send the president and Congressional leaders this letter? Did you think it would help them?

MAYOR PHIL GORDON, PHOENIX, ARIZONA: Well, I was -- I am hoping it is going to help, because I want to point out, respectfully, the crisis is already here. We have had contracts now that have been affected particularly at the airport, where people aren't being able to go to work, which means people are out of work. And Phoenix has bit hit as hard or harder than any other city in the United States. And while the numbers are less, it's still pro rate the same if not worse. We had a 25 percent budget reduction over the last two years, laid off over 2,000 employees, and yet still have a AAA bond rating, the highest in the country of any major city, we have the lowest crime rate in 40 years, and we're investing in the future.

So, we did not do it with the bickering and the partisanship that I just watched a few minutes going on. It can't be done in the press. It's got to be done and done quickly.

KAYE: How were you, though, able to solve it? Not all the details of course, but just briefly, what do you think you did right that maybe you could pass on to Washington and let them know how to get it done?

GORDON: Well, again, I offer it respectfully, but it is affecting our city. Number one, we brought all the parties together that were the people that were really involved in the negotiations, and didn't leave the room. Literally, we didn't leave the room. And we didn't debate it in the press, which I know that's important.

But it's -- I think it's more important to work out something, let the tempers be left at the door, and we stayed in the room and we made the hard choices, and some of us took the political risk for the good of the future, and I think that's what it's been about, is statesmanship.

And you know, the public has supported us, 90 percent of now the city is supporting what we took, which was a small increase in food taxes, but at the same time a major decrease in services and personnel.

KAYE: What's the most important tip you think you can offer Congress and the president today?

GORDON: To, I guess, continue to sit down but not leave the room. Put a handshake on and say we're going to do this for the country now, we've got to. The crisis -- I think acknowledge that the crisis is already there. I mean, people are out of work right now because of this debate, and if the goal is to put people to work, both sides claim victory, let's go forward, and have a balanced budget, and then, you know what? The electors in November, with the presidential election, can decide on a referendum.

KAYE: And do you think that we'll have an agreement before August 2nd? What's your gut?

GORDON: I do. You know, the pressure now with mayors like myself and real working people speaking up, people being put out of work, not that they're out of work trying to get a job, but now people losing their jobs, you know, this pressure has got to be building on these individuals.

And with respect to those that have taken a pledge not to do this or to only do this, you know, that's really -- what is causing the problem is, if we are not flexible, if we cannot adjust and if we think one size fits all, we will end up in default, and look like countries like Greece.

This is the United States, this is the world leader. And we look like children now fighting our partisanship. And the public now isn't distinguishing between political parties, they are really saying shame on all of you, get the balanced budget and go forward. That's why we elected you.

KAYE: Mayor Gordon of Phoenix, thank you for your time and advice as well, appreciate it.

GORDON: Thank you.

KAYE: Air France Flight 447, a plane that literally fell out of the sky two years ago, killing 228 people. The final report on how it happened and solutions, next.

(COMMERCIAL BREAK)

KAYE: Almost two years after Air France Flight 447 tragically plunged into the southern Atlantic Ocean killing all 228 people aboard, investigators have released their final report on what they believe caused the trash. Until recently, details surrounding the flight have largely remained a mystery. Richard Quest, anchor of "QUEST MEANS BUSINESS" on CNN International, joins me now from London with much more on this.

Richard, I know you've been following this. But now with this final report, what did investigators conclude?

RICHARD QUEST, HOST, CNN INTERNATIONAL'S "QUEST MEANS BUSINESS": Well, it's basically the findings as a result of the cockpit voice and the flight data. And we now know what took place. This is the crucial bit. We know that probably those petro tubes at the front of the plane, the speed sensors, clocked up, or at least one of them did, with ice. And that that gave false readings for the indicated air speed, the IAS. That is, if you like, mechanical part of what took place.

But this crash is really all about what happened in the cockpit. How the pilots dealt with that incident. The relationship between the two copilots where one was the relief captain. The captain, who was on his rest break. What they did over a period of less than 10 minutes that finally doomed the plane.

And I think, Randi, what you're seeing here, in fact, I don't think, I'm pretty certain what you're seeing here is an aircraft that was perfectly flyable, that had a serious but not catastrophic malfunction, and it's the way the pilots handled it. I am desperately avoiding the phrase pilot error, and instead I would go with the phrase, with is what aviation experts are telling me, pilot skills. It was the skilling of the pilot that actually comes into question here.

KAYE: Do we know what they might have done wrong? And what do you think we've learned from this, if anything?

QUEST: Well, I think what we've learned is that -- and the recommendations that we got is, pilots are trained to fly the plane. And when it's in the cruise, that's a fly level 35,000, just cruising the way across the Atlantic, all the automatic pilots are on the auto thrust (ph). Everything is being monitored. But what the pilots are not trained to do is fly the plane and those sort of altitudes. Yes, they may have been trained to do it once, but it's not part of their regular training, to go to what's known as -- to go alternate (ph) law (ph) in the cruise and actually have to fly the plane, the AirBus -- or indeed the Boeing 777 or whatever it might be.

And what I think is going to -- is this particular incident, and the coglin (ph) incident up in Boston, and a variety of other incidents, what they are doing is raising the question about pilot skills and whether more training needs to be handed and given to actually reminding pilots, fly the plane first.

KAYE: Such a horrible, horrible crash there.

All right, Richard Quest, thank you for the new details. Appreciate it.

He fired his attorneys again, but now polygamist sect leader Warren Jeffs is keeping pretty quiet about his defense. And I mean that quite literally. Coming up, we take you live to Texas for the bizarre developments in his sexual assault trial.

(COMMERCIAL BREAK)

KAYE: An audiotape of the polygamist sect Warren Jeffs allegedly raping a 12 year old girl. DNA evidence allegedly proving the self- proclaimed 55 year old prophet fathered a baby girl with a 14 year old. These are the key piece of evidence Texas prosecutors laid out for jurors. Evidence, they say, will prove Jeffs sexually assaulted two underage girls.

Jeffs' trial kicked off with opening remarks yesterday after he successfully fired his high-powered attorneys. But the trial is taking an unusual, albeit it silent turn, despite prosecutors making damning opening statements and calling several witnesses to the stand, Jeffs is practically giving the court the silent treatment. The trial went on without Jeffs saying much of anything, never mind making his opening arguments issuing pleas or questioning witnesses even.

So let's get straight to our good friend and CNN national correspondent Gary Tuchman, who is in San Angelo, Texas.

Gary, this sounds like a wild ride. I know you were inside the courtroom watching this all play out. Warren Jeffs stayed silent mostly throughout the trial until now. So what happened in court today?

GARY TUCHMAN, CNN NATIONAL CORRESPONDENT: Well, Randi, he was the most silent attorney I've ever seen in my career covering court cases. Not only did he not say anything, no objections and nothing at all, he just stared straight ahead. He didn't look at the jury. He didn't look at the judge. He didn't take any notes.

But then, just about an hour ago, Randi, a dramatic and crazy and wild and nutty turn. There was some evidence being presented of documents showing the names of his wives. His various wives. This man is accused of sexual assault and married to these 75 different women. And he stood up and he said he objected. And the jury looked shocked and surprised. They're wondering why he'd never talked this whole trial. And the judge says, on what grounds? He says on religious grounds. And then he prepared to give the longest objection that I've ever seen in my career. He talked for 60 minutes, not just about why he objected about this evidence, he gave a diatribe about Mormonism, about polygamy, about why he feels his rights are being violated.

He said that, "we believe in plural marriage," this is a quote, "heavenly originated, heavenly authorized through a heavenly power. Not to be interfered with by government powers."

And then he said, this is a wicket world. And the irony is, is that if he's guilty of what he's charged with, he's helped make it a wicked word. He's accused of raping a 12-year-old girl and a 14-year- old girl. But he says he's a completely innocent person, Randi. And the judge had to suspended the morning's proceedings because he kept interrupting the prosecutor afterwards. So Lord knows what's going to happen when we come back into court.

KAYE: So I know everybody has a right to a fair trial, but, boy, this sounds like a waste of time. I mean does Jeffs even plan to cross examine witnesses? What do you think?

TUCHMAN: Well, he hasn't cross examined anyone yet, and there's been nine witnesses who have taken the stand. But because he believes -- you know, he says he gets revelation from God. He says he's a profit on earth. And he told the jury during this hour diatribe that he was a prophet. That Joseph Smith was the first Mormon profit. That the Mormon theology teaches. That's -- he was giving a Mormon theology lesson is what he was doing.

But we don't know what he'll do next. And that's -- he was like a petulant child, actually, just now, when he kept interrupting the prosecutor. And the judge said, please stop interrupting the prosecutor. And he was like a child throwing food off his high chair. So we really don't know what's going to happen next, but he is still representing himself in this trial, which could put him in prison for life if he's found guilty.

KAYE: So on the one hand the fact that he isn't cross examining anyone could speed it along. But if he's going off on these diatribes, it could slow it down. So, what do you think?

TUCHMAN: Well, that's the interesting thing. Before he went on this diatribe, the prosecution announced this trial is expected to last a month. It just began yesterday. The prosecutor said, we know think it will go to the jury this Tuesday, in just a few days.

Well, now that he's talked, you just don't know. I mean if he talks for an hour, if he starts cross examining witnesses and talks slowly and talks for a long time, this trail could take into the year 2040. I just don't know. There's no way to predict it at this time.

KAYE: Gary Tuchman, watching it all unfold there in the courtroom in San Angelo, Texas.

Gary, thank you very much.

She stormed a hotel risking everything just to tell her story of alleged gang rape. Up next, we will tell you where this Libyan woman is living now and how she got there.

(COMMERCIAL BREAK)

KAYE: It's about 30 minutes past the hour. Here are some of the stories that you may have missed.

President Obama back in front of the cameras today urging Congress to work together to agree to reach a compromise on the debt ceiling. He encouraged Americans to keep the pressure on Washington by contacting their representatives.

Meanwhile, GOP leaders are working to bring House Speaker Boehner's debt bill to a vote by the end of the day after some tweaking. Senate Democrats are threatening to vote the Boehner plan down if it passes the House.

And be sure to catch our special report on the debt crisis with Wolf Blitzer and Don Lemon right here on CNN this Sunday at 9:00 p.m. Eastern.

Strange behavior when the Muslim Army soldier arrested with bomb- making material appeared in federal court today. Private Naser Abdo He was charged with one count of possession of a destructive device. Abdo was taken into custody yesterday near Fort Hood, Texas. Killeen police say he told them he wanted to killed soldiers at the military post.

Abdo refused to stand up today in court when the judge entered the court, so he was yanked up by the U.S. marshals. As he was leaving, he shouted out the name of a Muslim solider charged with killing 13 soldiers at Fort Hood two years ago.

The woman who caught the world's attention when she publicly accused members of Moammar Gadhafi forces of gang raping her is now living in the United States. Iman al-Obeidi arrived in New York Wednesday before boarding a flight to Denver, Colorado. She has been living in a U.N. refugee city in Romania since June.

Al-Obeidi told CNN she is happy to be in the U.S. and offered thanks to the U.S. and Secretary of State Hilary Clinton. She doesn't want to speak publicly, but in the next hour, I'm going to talk with the CNN producer she has been talking with since she arrived in the U.S.

The cameras captured it all when a British man through a shaving cream pie at media mogul Rupert Murdoch. According to British reports, the 26-year-old man has been convicted of assault and causing harassment. Jonathan May-Bowles admitted to throwing the pie as Murdoch testified before British lawmakers about the tabloid phone hacking scandal.

Tiger Woods is returning to the links. He made the announcement today on his website, his Twitter account. Woods says he will take part in the World Golf Championships, a Bridgestone invitational in Akron, Ohio next week -- mark your calendar. This will be Woods' first tournament since he withdrew from the Player's Championship in May due to an injured left knee and strained Achilles tendon.

How do some of Mexico's most notorious drug traffickers live? You can check out a day in the life of a drug dealer on the big screen. We'll have all the details for you next.

(COMMERCIAL BREAK)

KAYE: The reality of the bloody drug war is heading to the big screen in Mexico. They call them narco movies, and for some it's just a little bit too realistic.

Senior Latin American Affairs Editor Rafael Romo takes a closer look.

(BEGIN VIDEOTAPE)

RAFAEL ROMO, CNN SENIOR LATIN AMERICAN AFFAIRS EDITOR (voice- over): It's a scene that Mexicans have become accustomed to. Drug lords, hit men and organized crime bosses paraded in front of the camera for all the world to see. It's a reality that plays itself in front of the eyes of the Mexican public. The ongoing armed conflict among rival cartels and the Mexican government has left has many as 40,000 dead in the last four years.

This shocking reality has made its way on the big screen with a new genre called "narco movies."

(VIDEO CLIP, "HIGH-POWERED PEOPLE," JC FILMS")

ROMO: In this movie called "High-Powered People," a drug lord and one of his associates discuss alliances with a rival cartel. Filmmakers say their screenplays are based on current events, but the violence in their movies pales in comparison to reality.

JUAN MANUEL ROMERO, FILMMAKER (through translator): We are not even close to reflecting reality. You can actually call our movies soft because we don't show as much blood and killings. We just try to give people what they want.

ROMO: The English translation of the movie titles are very revealing. "The Big Bazooka Shot," "The Sinaloa Jackals ," "Land of Blood" and "Narcos and Dogs" are among the most popular.

The filmmakers say they make sure their screenplays don't rub any of the cartels the wrong way, and it's a kinds of self censorship that keeps them safe. ROMERO (through translator): We deal with these issues in the best way possible. We're not afraid that they're going to come after us because we behave. We do things the best we can and so far we have not been threatened by anybody.

(END VIDEOTAPE)

KAYE: Rafael Romo joins me now in studio.

So is anybody concerned about the glorification of what the cartels are all about?

ROMO: There is great concern, but there's two points.

One, the movies are not yet mainstream in Mexico, it's only in about four states where most of the violence is concentrated.

And number two, there's a governor in one states, the state of Sinaloa, that already banned folk songs that glorify drug trafficking and drug lords. His next move may be banning the movies, but he's not there yet and there is also the question of freedom of expression in Mexico.

KAYE: Are these being custom made for someone? Are they targeting someone, do you think?

ROMO: There is a possibility that the drug lords themselves may be behind some of these movies. We have no idea whether any of the movies we had in our report had anything to do with this. But there is at least one drug lord who under interrogation admitted that he paid $200,000 to have a movie about his life made.

KAYE: It does kind of sort of takes me back to the 1980s, the movie "Scarface," I am sure you are familiar with that one. That was loosely based on reality. How realistic do you think these are?

ROMO: Well, look, what the filmmakers say is it is based on reality, but they pale in comparison to what Mexico is going through right now. And as you saw, the quality and the production quality of the movie is not the greatest. And the screenplays, they are basically all the same, follow the same formula, but they are there because that's part of the reality that Mexico is living.

KAYE: You know, we talked even just last week about that 14- year-old boy who was convicted for working as a killer for the cartels, and you think about how now you put these guys on the big screen and kids are going to think they are heroes, then what?

ROMO: A story that keeps on telling. I mean, it's getting very shocking.

KAYE: Certainly is. AL right, Rafael, thank you very much. Great reporting.

Hugs, tears and music. The people of Norway pause to remember the victims of the twin terror attacks. And police are interrogating the alleged shooter again today as we dig deeper into the man police say he cited many times in his manifesto. Who is this so-called reform terrorist? That story is next.

(COMMERCIAL BREAK)

KAYE It has been exactly one week since the bombing and shooting rampage in Norway. The nation came together as one today to remember the 76 victims; the first funerals were also held. Emotions of deep sorrow were combined with words of hope and determination. Norway's prime minister called the victims heroes and said the country's response would come with more democracy.

Suspect Anders Breivik has admitted carrying out the bombing and shootings that killed 76 people, many of them teenagers and young adults. Police are questioning Breivik today for a second time since his arrest.

Now the man accused of killing dozens of Norwegians last Friday was an admirer of someone that CNN recently investigated. In his 1,500-page manifesto, Anders Breivik quotes a man named Walid Shoebat multiples times. Shoebat describes himself as a former terrorist that now spends his life warning about the dangers of Islam.

CNN's Drew Griffin joins us now with much more on this.

So we talked about part one of your series, and that's when you found out his story didn't really add up, Walid Shoebat's story didn't really add up. But now there are questions surrounding his business practices.

DREW GRIFFIN, CNN SPECIAL INVESTIGATIONS UNIT CORRESPONDENT: Absolutely right. He said he is a former terrorist, through a bomb at a bank in Israel, was a former member of the PLO. We went, take a look, all the names he gave us, we could find no evidence that any of that is true. And yet, this man really has been making a tidy sum of money going around preaching and teaching of about what many say is a hate speech against Islam.

Well, it turns out, Randi, his finances are as vague as his background.

KAYE: We'll take a look.

(BEGIN VIDEOTAPE)

GRIFFIN (voice-over): It's clear Walid Shoebat does not like tough questions.

WALID SHOEBAT, TERRORISM SPEAKER: It's a stupid question.

GRIFFIN: He became even more defensive when we began asking about his foundations, his tax-exempt status and all the money he is making. He has turned what some might call hate speech into a career, trading on his past to advise law enforcement officials and religious groups about the threat of Islamic radicals.

He says he was a Palestinian terrorist jailed by the Israelis, but it is a life story based on very little evidence. But it sure pays well. Tax records filed by his business partner reveal his speaking engagements earned more than $560,000 in 2009.

SHOEBAT: So why the skepticism? if somebody collects half a million dollars, you think it goes to my pocket? It's absolutely untrue.

GRIFFIN: Like his answers, his tax return is vague on specifics. And his various businesses and foundations, well, that's vague, too.

(on camera): How much do you get paid for these speaking engagements?

SHOEBAT: Not that much. If you look at my salary, I make what a gas station makes or garage makes. I mean, everybody thinks I am raking in the dough, which is absolutely incorrect.

GRIFFIN: Yes. The Walid Shoebat Foundation, is that a charity?

SHOEBAT: Walid Shoebat Foundation is part of the FFMU.

GRIFFIN: And what does FFMU do?

SHOEBAT: Basically, we're in information and we do speaking, and we do also helping Christians that are being persecuted in countries like Pakistan, and we help Christians who are suffering all throughout the Middle East.

GRIFFIN: And how do you do that?

SHOEBAT: None of your business.

GRIFFIN: Isn't it anyone's business who donates to you?

SHOEBAT: Of course. But, you see, a lot of the times, if you disclose information who you are helping, it ends up biting them because they have in Pakistan (INAUDIBLE) law.

GRIFFIN (voice-over): The business, in fact, Shoebat leaves up to his manager, Keith Davies, who was down the hall selling Shoebat's anti-Islam books. When CNN had specific questions about the business, like perhaps the names of the high ranking generals and experts he said are on his board of advisers, well, Shoebat said, get the number from Davies.

(on camera): Walid said that you would be able to tell us about your advisory board. You guys said you have generals and other high- ranking officials.

KEITH DAVIES, BUSINESS MANAGER: Correct.

GRIFFIN: Can you tell us who they are? DAVIES: Off the top of my head, yes. Let me see. I'm trying to think. The names have gone blank. They will come back to me in a second.

Major General -- no, I can't remember, a four-star -- there's a three-star general of the Air Force, Irish name, Thomas -- I usually know these off by heart.

GRIFFIN (voice-over): Davies did come up with one name, a pilot, but no contact details, despite repeated requests from CNN. We made calls to the individual anyway, but he never called us back.

The group's public tax forms lists only Davies and a real estate developer as board members, both with the same address. Shoebat and Davies run several foundations and three Web sites that are all linked, a confusing model, considering the group's tax returns for the past four years contain very little information.

In fact, while Shoebat has a foundation bearing his name, no tax forms could be found on public sites. Davies said they are merged together.

(on camera): The other question Walid said I should ask you is about the money.

DAVIES: You won't -- well, you don't ask anybody else here about the money.

GRIFFIN: Well, you have all these foundations. And I'm trying to find out where this money goes in terms of charity, what is the foundation.

DAVIES: Well, most of the money is used to help persecuted Christians in the Middle East that the media doesn't want to talk about.

GRIFFIN: I will talk about it if you can give me any information about that.

DAVIES: Yes, we have a Web site that you can have all the information about what we do on our Web site. It's RescueChristians.org.

GRIFFIN: I read that. It's very unspecific as to what exactly is going on, where the money is going.

Keith, I got to ask you, because I do a lot of this type of reporting on charities, organizations that collect money for various funds. Everything is not very transparent. Is this -- are you running a scam here?

DAVIES: Oh, absolutely, a big scam. I'm not answering. You're trying to -- just trying to scam us all the time. We are a very legitimate organization. We have been around for eight years or we -- six or seven years. (INAUDIBLE) files with the IRS, and you can have a look at the forms. I can even send you a copy of the tax returns if you want.

GRIFFIN (voice-over): He never did, but we found some on other Web sites. The money is coming from universities and churches and from your tax dollars. Some of his appearances are paid out of Homeland Security grants. The DHS in South Dakota told us Shoebat was paid $5,000, plus expenses, to speak at this event. And he was given security.

But Shoebat told us:

SHOEBAT: No, there's no expenses they paid. The hotel, I paid myself. The hotel, I paid today myself.

GRIFFIN (on camera): The bigger question may be why Walid Shoebat is in South Dakota teaching a bunch of cops about Islamic terrorists, a state that has so few Muslims, the local newspaper here in Rapid City says only a couple of dozen live here year-round.

(voice-over): Jim Carpenter is South Dakota's homeland security director.

(on camera): What was the point of bringing him here?

JIM CARPENTER, SOUTH DAKOTA HOMELAND SECURITY DIRECTOR: I think he brings a point of view that certainly is not necessarily mainstream. It's not a South Dakota-based point of view. He brings in commentary about living and being raised as a Muslim and then converting over to Christianity.

(END VIDEOTAPE)

KAYE: Wow, that is really an amazing story. To think that all of his background he shares with the people isn't true. You would also think, right, that the Department of Homeland Security might have checked this guys out. What did they say about him --

GRIFFIN: Or somebody would check him out.

We did contact DHS, Department of Homeland Security. They said, look, it's up to the states to vet these guys. But they did say if training programs do not meet standards, corrective action will be taken. One of the standards they will not tolerate or rely on racial or ethnic profiling. That is exactly what Walid Shoebat is teaching these cops in South Dakota. I sat through three sessions; there's no doubt about it!

KAYE: And as far as you know, he is still out there?

GRIFFIN: Still out there. We have not seen him do many speaking engagements listed since we aired this report, but he is on many right-wing, very conservative radio outlets, basically attacking CNN.

KAYE: Leave it to you, Drew, to cramp his business just a little bit.

GRIFFIN: Thanks, Randi. KAYE: Thank you.

Just in to the CNN NEWSROOM now. CNN's Congressional correspondent, Kate Bolduan, has learned there could be a vote on final passage of the Boehner bill could be between 7:00 and 8:00 p.m. tonight. This coming from a House Republican source. The source does CNN that time, of course, could slip, but right now a word of a vote on the Boehner bill could come between 7:00 and 8:00 tonight. We will continue to follow that for you.

And coming up, you know all that tough talk from members of Congress, the ones who say they are not budging in the fight against raising the debt ceiling? Well, it looks like some of those hard liners actually have some debt problems of their own. We checked the record, next.

(COMMERCIAL BREAK)

KAYE: Some hard-charging members of Congress have changed the debate in Washington over the size of the federal government and how much it should be spending. But records show some of the hard liners have debt problems of their own. Here's CNN's Brian Todd.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: It would have saved our country.

BRIAN TODD, CNN CORRESPONDENT (voice-over): They're the fire brand class, deficit hawks in Congress taking a hard line on the debt ceiling talks. Some are Tea Party favorites who rail at Congress for past spending like Republican Senator Mike Lee of Utah.

SEN. MIKE LEE (R), UTAH: Congress debt for decades has been burying our children and our grandchildren both born and unborn under a mountain of debt.

TODD: But according to recent disclosure forms, Senator Lee's racked up significant personal debt of his own, at least $65,000 worth from a credit card and a line of credit. The forms released last month show there are a few Republicans who are demanding a hard line on cutting the nation's debt but have plenty of debt on their own. Nonpartisan spending watch dog Taxpayers for Common Sense --

RYAN ALEXANDER, TAXPAYER FOR COMMON SENSE: I think this raises the questions about are you walking the walk while you're talk the talk about getting the debt down.

TODD: Senator Lee's argument, you have to put this in context.

(on camera): An aide to Senator Lee said the senator couldn't do an interview with us on this, but the aide did push back hard saying the scrutiny is quote, "crackpot". The aide says the Senator has his finances in order, is managing his debt responsibly and that if he's doing that, who are the critics to question his role in the budget debate?

(voice-over): Tea Party supported Republican Congressman Joe Walsh has played a prominent role in that debate.

REP. JOE WALSH (R), ILLINOIS: Thank God Congressmen like me were here. Imagine, step back and imagine if the Republicans hadn't taken over Congress. This city would have raised the debt limit who knows how much.

TODD: But Walsh's ex-wife says he needs to pay up on a big debt, more than $117,000 in child support according to a lawsuit. We couldn't reach Walsh's attorney for comment. But he told the "Chicago Sun Times" Walsh doesn't owe that amount. Walsh says the attacks against him in this case are false, but also says this.

WALSH: I'm the most openly-vetted candidate in the world. I have had financial troubles and I talked about them throughout the campaign. This is where real America is.

TODD: And there's no evidence that there's any financial impropriety. What's wrong with him incurring debt that millions of others do?

RYAN ALEXANDER, TAXPAYERS FOR COMMON SENSE: They are allowed to incur debt just like millions of Americans do, but we're also allowed to push back and ask questions. If you choose to incur personal debt, if that's how you choose to manage your finances, how can you tell the country we can't manage our own debt?

TODD: The documents say two other Republican congressmen, Tim Griffin of Arkansas, who recently said that America's got a spending addiction, and Kevin Yoder of Kansas, who said that Washington needs to cut up the credit cards, each had credit card debt of at least $15,000 as of late last year.

We contacted the offices of both congressmen. They didn't respond.

Brian Todd, CNN, Washington.

(END VIDEOTAPE)

KAYE: The debt ceiling debate is dragging down the public's opinion of leadership in Washington. Paul Steinhauser will break down new CNN polling right after this break.

(COMMERCIAL BREAK)

KAYE: The debt ceiling debate keeps dragging on, and the public is starting to get fed up with Washington leadership. Well, CNN deputy political director, Paul Steinhauser joining me now from the political desk in Washington.

Hi, Paul. Happy Friday. What's it costing politicians in terms of the poll numbers?

PAUL STEINHAUSER, CNN DEPUTY POLITICAL DIRECTOR: It's definitely not helping them, Randi. No doubt about that. Americans getting frustrated. It's pretty obvious. Check this out, here's an example. New poll from Gallup, national survey. Look at this: only 4 in 10 approve how President Obama is handling the debt ceiling crisis. And look at that, numbers keep going down and down. Only three in 10 give a thumbs up to House speaker John Boehner, and less than a quarter of the people polled approve of how Harry Reid, the Senate majority leader, is handling this crisis.

Randi, I guess it's no surprise whatsoever. Americans want compromise between the parties. They want this deal to get done, and it just hasn't happened so far. They are frustrated; they're taking it out on the politicians -- Randi.

KAYE: And the politicians, Paul, from what I understand, they are using the debate as a political weapon in their ads. What can you tell us about that?

STEINHAUSER: Oh, yes, no doubt about it. Coming soon or already at a television near you, ads on national cable, ads in local TV stations across the country. In fact, today a progressive group, a bunch of progressive groups and unions, came out with ads that go out after Republican lawmakers over the debt crisis.

And I just learned a few of minutes ago a conservative group is going out with ads attacking the president. We've seen this from a bunch of groups on both sides. You can't escape it. These ads are everywhere and are going to continue over the next couple of days. As the politicians try to make deals here, these groups with putting ads up across the country on cable and broadcast -- Randi.

KAYE: Paul Steinhauser in Washington. Paul, thank you.

Your next update from "The Best Political Team on Television" is just an hour away.