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Madeleine McCann May Be Alive; Scandal Costs Nine Secret Service Jobs; Aide: Edwards Called Hunter "A Crazy Slut"; Gingrich Getting Out Of Presidential Race; Christie Defends Troopers Suspension; Obama Slow Jams The News; Romney's Focus On Faith; Global Economy Slowing; Murdoch Denies Political Influence; FBI Police Investigate Saints GM; Baby Boomers Use Pilates to Stay Fit

Aired April 25, 2012 - 10:00   ET

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


CAROL COSTELLO, CNN ANCHOR: But we begin this morning with startling new developments in a missing child case that's riveted much of the world nearly five years after Madeleine McCann vanished during a family vacation to Portugal.

British police believed she may still be alive. They've released a new image. You're looking at it right there that shows how she might look like now.

She'll be 9 years old in mid-May. She was three when she disappeared. I'm sure you remember this. Investigators have faced blistering criticism for the way they handled the case.

CNN's Max Foster is in London. He is following the latest developments from there. Fill us in.

MAX FOSTER, CNN CORRESPONDENT: Yes, Carol. The British police aren't the lead investigators on this. The Portuguese police are, but the British police got involved after being asked by the prime minister.

And they basically got together all of the evidence from the Portuguese investigation, from the British investigation, but also all of the evidence from private investigators and they're pouring over it.

Thirty seven police officers working full time on that for nearly a year. They got a quarter of the way through. Now, what they want to do is present this. These findings to the Portuguese police and see what they can do with it. This is where we stand at the moment.

The British police are calling for Portugal to reopen the case. They have close to 200 leads they say, so far. They consider that's a quarter of the way through the evidence. There are 40,000 pieces of information to get through and approximately 100,000 pages of evidence.

So huge, huge project for the British police, but certainly which has grabbed the world's attention, Carol and that's partly why there's so much pressure on them. COSTELLO: Interesting. The McCann's -- any reaction from the parents?

FOSTER: No reaction so far today, but we do know that they were very involved in forming this portrait that you have just shown. The idea really is to show Madeleine as she would probably appear now to the best of their estimations, really.

It's deliberately made to look like a school photograph. So the sort of picture the people could well have or parents could well have on their mantelpiece.

Hopefully jogging some memories if they have seen the girl looking like this or they can remember being in Portugal at the time when she went missing.

There are gaps in the story here the police are saying and there are opportunities for something to have happened, which they are not aware of. They are going to try to get this reopened, but it's up to the Portuguese.

COSTELLO: I know you will follow this story. Max Foster live in London for us.

Also this morning, new developments to tell you about and new casualties in the Colombian prostitution scandal. A total of nine members of the Secret Service are now losing their jobs.

But that is not satisfying the political blood loss. Right now, the powerful Senate Judiciary Committee is opening the first public hearing on the scandal.

And Homeland Security Chief Janet Napolitano will be front and center as you see she is right now. She is the first member of the Obama administration to face public questions. Here is what she had to say moments ago.

(BEGIN VIDEO CLIP)

JANET NAPOLITANO, SECRETARY OF HOMELAND SECURITY: The director took immediate action to remove the agents involved. And a full and thorough investigation is under way to determine exactly what transpired and actions we need to take to ensure this kind of conduct doesn't happen again.

Director Sullivan has the president's and my full confidence as this investigation proceeds. Investigation will be complete and thorough and we will leave no stone unturned.

(END VIDEO CLIP)

COSTELLO: Senior congressional correspondent, Dana Bash is on Capitol Hill. So, Dana, that was her opening statement. Has the questioning began?

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: It has. You know, what is fascinating has been so far. It's just the beginning. Both Democrats and Republicans are extremely forceful about one of the main concerns, which is, of course, the safety of the president and everybody else who is protected by the Secret Service. Listen to what the Democratic chairman said about that.

(BEGIN VIDEO CLIP)

SENATOR PATRICK LEAHY (D), CHAIRMAN, JUDICIARY COMMITTEE: Nobody wants to see the president's security compromised. Nobody wants to see America embarrassed. I can't think of anything that would -- aside from the personal tragedy, anything that would look worse than the rest of the world if something happened either to President Obama or Governor Romney, especially during a presidential election.

(END VIDEO CLIP)

BASH: Now, Carol, the first question that Senator Leahy asked Janet Napolitano was whether the president was in danger. She said that was the first question she asked Secret Service Director Mark Sullivan, and his answer was no.

And she later said that according to what they know so far, there was no impinging on the president's safety and no access to secure information by the people involved -- Carol.

COSTELLO: What did the secretary say about the possibility of other incidence, anything yet?

BASH: She did. She was also asked that question by Senator Leahy and I believe actually if you can look at the live picture, she's being asked similar questions by the Republican Lindsey Graham.

But she was very careful in her answer. It was very interesting, Carol. The way she answered was that in the two and a half years that she has been there, the office of public responsibility, which is where anybody would call to report a tip of bad behavior, they have not received complaints.

She made a point saying that during that time, there had been 900 trips internationally and 1,300 trips domestically. Nothing on the record to suggest that anything happened like that again, very carefully answering that question that they don't have anything on the record. That doesn't answer the question about whether it happened.

COSTELLO: OK, you're going to back into that hearing. We'll check back with you later. Dana Bash reporting live from Capitol Hill.

In Chicago, trial resumes next hour for the man accused of murdering Jennifer Hudson's family. Her former brother-in-law is charged with the killings of the singer's mother, brother and nephew. Hudson left the courtroom yesterday before grizzly police photos of the crime scene were shown.

A former aide to John Edwards back on the stand today and he may be cross-examined. Andrew Young has been spilling intimate details about his former boss' secret love life during testimony.

Edwards is accused of using a large amount of campaign contributions to hide his alleged affair. Here is CNN's Joe Johns.

(BEGIN VIDEOTAPE)

JOE JOHNS, CNN SENIOR CORRESPONDENT (voice-over): With Andrew Young on the stand, he's the former right hand man, errand boy and fixer to former Senator John Edwards.

The prosecution laid out a simply amazing story of sex, lies, politics and money. Young spoke of the day when Edwards' mistress, Rielle Hunter, made so many repeated frantic calls to him.

That when he finally got her on the phone, he said somebody better either be pregnant or dying. Rielle Hunter, Young says, responded, nobody is dying.

When Edwards found out he was pregnant, he responded gruffly. Young quoting Edwards, he said, she's a crazy slut and there's a one in three chance it was his child.

Also stunning was the response of Bunny Mellon, the big money donor from Northern Virginia who agreed to help because she thought Edwards could rescue America.

Andrew Young said he secured her agreement to give hundreds of thousands of dollars for the benefit of the campaign, no questions asked Young claimed.

Checks in ever increasing sums funnelled through Mrs. Mellon's decorator and endorsed by Andrew Young's wife according to Young. With this money in the family account Young said, he moved Rielle Hunter to North Carolina to keep her away from the media.

She was threatening to go public he said. He gave her a $5,000 a month allowance. A couple times it went up to $12,000. He rented a house for her in his name. Got her a BMW. By this time, she was using an alias Young said going by the name of Jaya James.

Young said Rielle also lived in his house with him and his wife and kids for about three weeks, which he called very difficult. He said Rielle could be very demanding. More than once he said Rielle said, if she didn't talk to Edwards, she was going public.

How did his wife feel about all of this? Young says she was scared to death. We were scared to death. Edwards was a viable presidential candidate and this was a truckload of money. They asked the trial lawyer, Edwards, if it was OK to do this.

Young says, Edwards told them it was completely legal. Young said he communicated in code with Edwards because there was concerned that knowledge of these matters could implicate Edwards if he were to become attorney general.

(END VIDEOTAPE)

JOHNS: So far it's all been about Andrew Young's version of events. But as early as today, he's expected to get challenged as the Edwards defense team gets its first opportunity to cross examine him -- Carol.

COSTELLO: Joe Johns reporting live for us.

This just in to CNN. We have confirmed that Newt Gingrich will indeed drop out of the presidential race next week. Shannon Travis, he's in North Carolina. That's our reporter where Gingrich had a campaign event today.

Shannon will join us a little later to talk more about this decision that a lot of people didn't think would come because as you know, Newt Gingrich said he would go all the way to the convention.

But apparently, he has changed his mind due to his showing in North Carolina because those big five primaries were held yesterday. He will announce that he will drop from the presidential race on Tuesday. Again, we'll get more information later on NEWSROOM.

New Jersey's governor is defending the decision to suspend two state troopers over this video. Here it is. It shows police officers escorting a caravan of exotic luxury cars down the Garden State Parkway. The problem is they were traveling fast. Speeds reportedly topped 100 miles per hour.

(BEGIN VIDEO CLIP)

GOVERNOR CHRIS CHRISTIE (R), NEW JERSEY: It's a completely ridiculous story. It shouldn't have happened. Dumb thing to do. But let me assure you that it's not the last dumb thing that we will see happen.

(END VIDEO CLIP)

COSTELLO: The caravan included dozens of elite sports cars like Ferraris and Lamborghinis. Yes, they were traveling at break-neck speeds. One witness dubbed it death race 2012.

President Obama is on the campaign trail again today stumping for low interest rates on subsidized student loans. It's a pitch that targeting young voters. He found the perfect stage on late night television. Listen as the president joins Jimmy Fallon to slow jams the news.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES OF AMERICA: Now is not the time to make school more expensive for our young people.

(END VIDEO CLIP)

COSTELLO: Maybe the president did make his audience swoon, but he's playing a familiar tune throughout the presidential race. Polls have shown Mr. Obama is more likable especially to young people than his presumptive Republican challenger, Mitt Romney. For some members of a Mormon Church in Massachusetts, politics isn't the first thing that comes to mind when they hear the name Mitt Romney. Coming up, a look at the man they know as Bishop Romney.

(COMMERCIAL BREAK)

COSTELLO: In politics this morning, make it another win or five for Mitt Romney, the former Massachusetts governor making a clean sweep of last night's Republican primaries. In a speech, Romney put a bruising battle for the nomination behind him and took the bid for president directly to the voters.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: For every single mom who feels heart broken when she has to explain to her kids that she needs to take a second job and won't be home as often.

For grandparents who can't afford gas to visit grandchildren anymore. For the mom and dad who never thought they would be on food stamps. To all of you, I have a simple message. Hold on longer. A better America begins tonight.

(END VIDEO CLIP)

COSTELLO: Mitt Romney's convincing wins have his rivals rethinking their chances. Sources telling CNN that Newt Gingrich will indeed end his bid for the White House and throw his support to Mitt Romney. That probably will happen on Tuesday.

Before Romney turned his attention to politics, he focused on faith serving as a bishop in the Mormon Church in Massachusetts. Mary Snow spoke with some of Romney's former church members to get their thoughts on the man who used to lead their congregation and now wants to lead the nation.

(BEGIN VIDEOTAPE)

UNIDENTIFIED FEMALE: They might ask that, too, that he labored with his own hands that he might serve the people.

MARY SNOW, CNN CORRESPONDENT (voice-over): Reading the Book of Mormon together is now a routine for former Catholics Sandy and Ron Catalano. But the couple's clash over Mormonism almost destroyed their marriage.

Ron was skeptical when his wife converted in the late 1970s. With nowhere to go, Sandy turned to her then bishop, Mitt Romney.

SANDY CATALANO, MEMBER OF ROMNEY'S CHURCH: So when I went to Mitt, I said it's just so hard, I don't know what to do. I broke down and said I can't do this anymore. Do I love the Lord more than I love my husband?

SNOW (on camera): And what happened?

CATALANO: He said to me, you can love both. I'll show you how to do it.

SNOW (voice-over): Mitt Romney they say came up with odd jobs for Ron, an out of work maintenance man struggling to provide for his wife and three sons.

RON CATALANO, MEMBER OF ROMNEY'S CHURCH: What he was doing he was fellowshipping me and bringing me closer not to the religion, but just bringing me closer to him and his family and my family, which is important.

SANDY CATALANO: He really helped change our lives for the better.

ROMNEY: We have work to do.

SNOW: Romney, on occasion talks about his time as a church leader in the Boston area working his way up the ladder at Bain Capital. Romney was a volunteer bishop similar to a pastor at the church of Jesus Christ of Latter Day Saints.

Friends at this church say he worked up to 20 hours a week doing everything from counseling members to balancing budgets.

ROMNEY: And in that capacity, I had a chance to work with people who lost their jobs in some cases or facing other financial distress, losing their homes. I found that those kinds of circumstances were not just about money or numbers. They were about lives and about emotions.

SNOW: So why doesn't Romney talk more about his roles in the church.

UNIDENTIFIED MALE: Mitt really is a great listener.

SNOW: Grant Bennett, a former LDS bishop who served with Romney says there's a cultural component of humbleness among Mormons and he says there are political risks.

GRANT BENNETT, FORMER BISHOP, LDS CHURCH: There are many, many misperceptions about the Mormon church. I think, to dwell on his involvement in the church no matter how effective he might do it, inevitably would lead to side discussions that may not be productive.

SNOW: Not everyone in Bishop Romney's church was a fan with the some of the harshest criticism coming from Mormon women.

UNIDENTIFIED FEMALE: This is an issue from the winter of 1986.

SNOW: Judy Dushku was the editor of the feminist Mormon magazine who says she first clashed with Romney when the publication couldn't be distributed at church.

JUDY DUSHKU, MORMON FEMINIST: His attitude is always I know what's best. I'm the interpreter of Mormonism for all Mormons. You have no right to comment on it. If you do comment on it, you are wrong.

SNOW: Dushku also recalls the story of a friend, a mother of four who published a letter in the magazine saying her bishop pressured her not to have an abortion.

This, despite a blood clot that put her health and that of the baby's at risk. The woman who wrote it confirmed to CNN that bishop was Mitt Romney. The Romney campaign declined comment.

UNIDENTIFIED FEMALE: I wanted him to look and hear what the women had to say.

SNOW: Helen Claire Seivers remembers Romney a leader who did try to address concerns of women in a church largely run by men. She credits Romney with meeting with about 250 women to discuss issues and make some policy changes.

HELEN CLAIRE SEIVERS, FORMER CHURCH ACTIVITY DIRECTOR: I thought he was pretty open and caring to say yes, we'll do this because I don't think many church leaders would have done that.

SNOW: But note, Seiver's admiration is in the past tense.

(on camera): What is your reaction when you see him on the campaign trail now?

SEIVERS: I have no idea who that man is. What it looks to me like is he's figuring outlet what he needs to do to win the Republican nomination and he's doing it.

SNOW: As for the Catalanos, they say they know the real Mitt Romney and hope their former bishop does become president.

SANDY CATALONO: He just knows how to connect with people like us.

SNOW: Mary Snow, CNN, Belmont, Massachusetts.

(END VIDEOTAPE)

COSTELLO: Breaking news on the political front. CNN has now confirmed Newt Gingrich will indeed drop out of the presidential race. He may do that on Tuesday.

Shannon Travis on the phone in Cramerton, North Carolina. Gingrich had a campaign event there today, Shannon, what did he say?

SHANNON TRAVIS, CNN CORRESPONDENT (via telephone): That's right, Carol. You just reported it. I mean, Newt Gingrich is going to be ending his bid for the White House next week sometime.

That's according to CNN political director Mark Preston, citing two sources. Mark also reports that is he will throw support behind Romney once he formally concedes from the race.

Apparently, the details are still being worked out. But, Gingrich is likely going to hold the final campaign on Tuesday. He's surrounded by friends and family.

You just mentioned, I am here at Newt Gingrich's last campaign event here in Cramerton. He's got a few more today. He's vowing to do all 23 that he's slated for North Carolina.

But at this event at a diner, he pretty much all but said that he was dropping out. He talked about details of his transition coming soon -- in the strongest terms yet, embracing Romney as a likely Republican nominee.

This is very strong hints that he would do it. Obviously, again, we confirmed he will do it next week.

COSTELLO: He seems so, I don't know, he adamantly said he will carry his campaign through the convention. What finally changed his mind, do you think?

TRAVIS: That's right. Well, only Gingrich knows, but I can tell you this much. He's been using that language, verbiage going on to Tampa. It's quite possible that a lot of us we assumed going on to Tampa as a candidate.

But last night, he started -- he continued to talk about going on to Tampa, but he sharpened his goal saying that he will carry the conservative banner on to Tampa. He'll make sure that the party platform has conservative ideals in it.

They'll make sure that Romney campaigns on the conservative message. Going on to Tampa for awhile could have meant going on to Tampa, but not necessarily as a candidate just to carry the conservative banner -- Carol.

COSTELLO: Shannon Travis reporting live for us from North Carolina. Again, Newt Gingrich getting out of the presidential race. He'll probably make the official announcement on Tuesday.

It's been awhile since we heard the name Salahi. You remember the Salahi's, the infamous White House party crashers. You knew they could not stay out of the spotlight for long. One of them reportedly wants to run for governor. We'll digest that new information, that's coming up.

(COMMERCIAL BREAK)

COSTELLO: It's 24 minutes past the hour. Warning signs for the global economy. A new report says Britain is now in a recession. We know China and Europe are not doing so great, either.

Alison Kosik is at the New York Stock Exchange to tell us what it might mean for the United States.

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: You know what, Carol? We are already seeing the signs of other country's slowing economies hitting the U.S., especially with hiring. In fact, there's a report from Ohio State out today that shows that most medium sized companies say, you know what, we are not going to hire.

We are not confident enough to hire. They would rather save money than spend it. That's exactly what companies do when they're not sure where the economy is going. We kind of saw that behavior during the great recession.

We're seeing a little of that pop up again. Also this week, it is corporate earnings season. We are seeing this sort of global economic slowdown hit those corporate earnings.

Cereal maker, Kelloggs, cuts its earnings forecast because of challenges in Europe. McDonald's said its sales in Europe were down as well. That's usually one of the strong spots for McDonald's.

Now I don't want to sound alarm bell here. One country probably won't trigger a worldwide slump. But if several countries are slowing, it could become a problem. It's what's happening now.

Because today as you said, the U.K. is now officially in a recession. Growth in China is slowing. Europe is probably in a recession.

Yes, U.S. companies are feeling this. Guess what, on Friday, we are going to get a report here on the entire U.S. economy. It's a GDP report. Expect it to show a slowdown in the first three months of this year -- Carol.

COSTELLO: Alison Kosik reporting live from the New York Stock Exchange. We have a pressing question for our "Political Buzz" panel this morning. Is it presidential to slow jam the news?

Barack Obama did it with Jimmy Fallon last night. We slow jammed the message. More on that, next.

(COMMERCIAL BREAK)

COSTELLO: Checking our top stories now, a 4-year-old girl who disappeared while on vacation in 2007 may still be alive. British police released a new image showing what Madeleine McCann may look like now. They've been reviewing the case for nearly a year. McCann was at a resort in Portugal with her family when she vanished.

Happening live right now on Capitol Hill is the House Oversight Committee on the Secret Service prostitution scandal. Homeland Security Secretary Janet Napolitano is being hit with questions on the scandal that has embarrassed the Secret Service.

(BEGIN VIDEO CLIP)

JANET NAPOLITANO, HOMELAND SECURITY SECRETARY: Took immediate action to remove the agents involved. A full and thorough investigation is under way to determine the actions we need to take to ensure this kind of conduct doesn't happen again. Director Sullivan has the president's and my full confidence as this investigation proceeds. The investigation will be complete and thorough and we will leave no stone unturned.

(END VIDEO CLIP)

COSTELLO: It is the first public hearing on the scandal. We'll follow developments and we'll bring them to you as they happen.

John Edwards' former aide, Andre Young back on the witness stand today. He testified yesterday. He helped the former presidential candidate cover up his affair with the campaign videographer. Edwards is accused of using campaign contributions to hide his affair.

"Political Buzz" is your rapid-fire look at the best political topics of the day. Three questions, 30 seconds on the clock. Playing with us today is CNN contributor, Maria Cardona on the left; Georgetown professor, Chris Metzler on the right; and Daniel Stone is in the middle, he's a senior reporter with "News Week" and "The Daily Beast". Welcome to all of you.

MARIA CARDONA, CNN CONTRIBUTOR: Thanks Carol.

CHRIS METZLER, PROFESSOR, GEORGETOWN UNIVERSITY: Hello.

DANIEL STONE, SENIOR REPORTER, "NEWS WEEK" & "THE DAILY BEAST: It's good to be with you.

COSTELLO: Hello, nice you're here.

Ok, first question, let's talk about the carnal sins in Colombia, nine people have lost their Secret Service jobs now. Here's what comedian Lizz Winstead said about that on her Facebook page. "Three more Secret Service guys gone. Pretty soon, the President is going to be left with Kevin Costner."

Last hour I talked to a lawmaker who is calling for director Mark Sullivan's job.

(BEGIN VIDEO CLIP)

REP. RANDY FORBES (R), VIRGINIA: Think about the culture that would assign this many knuckleheads to such a premier mission. Think about a culture that wouldn't detect this through all the years of training. And even when all of this was happening down there, it wasn't the Secret Service that determine it and report it and stop it. The only reason we know about it and are talking about it today is because one prostitute didn't get paid for services.

(END VIDEO CLIP)

COSTELLO: So, guys, should the Secret Service director be fired? Maria?

CARDONA: Look I think we need to take a step back and take stock Carol of the amazing things the Secret Service does to protect the President every single day from tracking down a stupid comment that a teenager might put on Facebook to the putrid rants of a has-been rocker like Ted Nugent. I think that it's something to take -- to take into consideration.

Look if this investigation does lead to the director, then yes, he should go. But I personally think that common sense, good behavior, personal responsibility and knowing when to keep it in your pants is something that each person needs to take personal responsibility for.

COSTELLO: Chris?

METZLER: Wow. Well, I think there is a larger issue here, relative to the culture of government agencies in Washington. This is an example of boys gone wild, obviously. But if we look at the larger culture in these agencies, we've got the Secret Service scandal, we've got the GSA scandal and we have the Secretary of Defense Panetta, on this $800,000 trip which he's not repaid the taxpayers.

So there is that issue. He is supposed to do that as part of his military aircraft ride back home. What I think is important, is we do need to figure out if it does lead to the head of the Secret Service, he does need to go.

COSTELLO: Daniel?

STONE: Well what we -- the key factor here for any scandal involving the government is how much it spreads. We heard there were about 11 individuals involved in this at the beginning. Some of those have been relieved of their duties. And we heard from Secretary Napolitano and even the President that they have full confidence in the director of the service. At this time I don't think we're going to see his resignation and I don't think the President wants him to resign at all at this point.

COSTELLO: Ok on to question number two, President Obama and Jimmy Fallon slow jam the news.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: What we said is simple, now is not the time to make the school more expensive for our young people.

UNIDENTIFIED MALE: Stop affordable Sanford loan work on the student turn. The Pell grant is a beautiful thing. But with college getting more expensive is it enough by itself to satisfy all your collegiate needs? A Pell no. If Congress doesn't act, it's the students who will play the riding should join on this like Kevin Kanye.

(END VIDEO CLIP)

COSTELLO: Ok. So Fallon was funny. Obama was serious. Fox News says this was nutso and lowers the status of the presidential office. So was slow jamming -- so was slow jamming the message an effective way to get it across -- Daniel?

STONE: Well, look, we know that being president now means you can't just rely on one platform, on one media. People get their political news and take their message from a lot of different sources.

He was speaking to an auditorium full of young people and college students and people who watch Jimmy Fallon's show across the nation that's a very unique constituency. He had to take the message to them.

And look it was effective. We are talking about it the day after. That video is going to be played million of times online as well.

COSTELLO: Chris?

METZLER: Well I -- I -- I do think that -- I am not sure how much lower the office of the presidency can go than the late night talk circuit, but I do think, that in fact, this is part of the message. This is part of being able to reach that particular audience.

And, you know, it's free publicity. We are talking about it. Everyone else is talking about it. So this is the kind of money now that the campaign doesn't have to use from its coffers. So as a result of that free publicity, I'll take it.

COSTELLO: Maria?

CARDONA: Wait Carol. You said that Fox News was criticizing this President? Are you sure your researchers got that right? Because I can't believe that for a second.

COSTELLO: I'm going to double check that.

CARDONA: Look, of course, it's a great medium. To Daniel's point millions of young people watch this. And that's exactly the kind of voters that President Obama was trying to reach.

He was serious, but he was also funny in the give and take. He and Jimmy actually had a little thing going. The whole thing is hilarious. It gets students to talk about it. Forget whether we're talking about it. That's not what the President cares about. The President cares that his message got through to the students. And it did.

COSTELLO: Ok time for your "Buzzer Beater" now. 20 seconds each. Tareq Salahi you remember him. He wants to run for Governor of Virginia. It's a natural next step for the man who crashed the White House party without an invitation and infamously lost his wife to the lead guitarist of Journey.

So guys, why should Virginians vote for him for Governor? Chris? Chris.

METZLER: They should not. Look, if what they want to do is to vote for a publicity hound on a horse then they can certainly do that. This guy is a complete moron. And so he's running for Governor of Virginia? Why -- so at least he won't be able to or he won't have to crash the governor's party if he gets elected. Not going to happen.

COSTELLO: Daniel?

STONE: Look this -- this couple and specifically Tareq Salahi has been a distraction since the beginning, since we heard about them at the White House. I don't think his candidacy is going to be taken very seriously here in Washington and among certainly among the voters of Virginia. I think his 15 minutes have long been over but they'll soon be very much completely over.

COSTELLO: Maria?

CARDONA: Well I think it was either Quinnipiac, Gallup or Mad Magazine just has a poll saying that what Virginia voters want most are more winery tours, more polo matches and a governor who knows how to crash parties. So that's why they should vote for him.

COSTELLO: Hey, he doesn't have anything else to do. His wife left him.

CARDONA: You know, exactly.

METZLER: Hey Carol, you're looking -- you're looking fabulous in green today.

COSTELLO: Oh, thank you so much. I appreciate it. I just got this blouse. Why are we talking about this? Ok I'm embarrassed now. Chris --

(CROSSTALK)

CARDONA: You look great, Carol.

COSTELLO: Thank you.

METZLER: Take care.

STONE: Thanks.

COSTELLO: Chris, Daniel and Maria thanks so much.

CARDONA: Thanks Carol.

COSTELLO: Still ahead on NEWSROOM, eavesdropping allegations against the Saints GM are not just a concern for the NFL, now the FBI and the police are getting involved.

Plus, more Americans are looking for that mind body connection as they reach their golden years. We'll tell you what they are doing in our series "Age against the Machine".

(COMMERCIAL BREAK)

COSTELLO: 40 minutes past the hour. Time to check our top stories.

Right now, the U.S. Supreme court is hearing Arizona's appeal over its controversial immigration law. Key issue -- can states enforce their own immigration laws or is that the federal government's job? Arizona will argue illegal immigration creates financial and safety concerns.

A military judge has denied Bradley Manning's request to have all the charges against him dismissed. Manning is suspected of leaking hundreds of thousands of classified military and state department documents while in Iraq. The trial will happen in the fall.

A major Asian retailer of U.S. beef has stopped selling it after a case of mad cow disease was confirmed in California. It was found in a dairy cow during random testing. U.S. health officials say the risk to the public is extremely low. Mad cow is thought to cause fatal brain disease in humans.

Media mogul, Rupert Murdoch spent hours denying that he cozied up to British politicians for his own profit. This was at a hearing looking at the journalistic standards in Britain. Murdoch was grilled about his relationships with politicians like the former prime minister, Tony Blair.

(BEGIN VIDEO CLIP)

RUPERT MURDOCH, CEO, NEWS CORPORATION: I, in ten years of his file there, never asked Mr. Blair nor indeed did I receive any favors. If you want to check that, I think you should call him.

Dan Rivers is in London. He's on the phone with us right now. Dan, you have been listening to the testimony. Murdoch was questioned about his relationships with prime ministers going all the way back to Margaret Thatcher, right?

DAN RIVERS, CNN CORRESPONDENT: That's right, yes. Basically, what they were trying to sketch out and put to Rupert Murdoch was that down the years for more than 30 years various prime ministers have sought to cozy up to him knowing that they would possibly get the favorable press coverage.

And in return to that, he expected to get favorable treatment on various business deals he was trying to do. That was something he consistently denied. But it formed the majority of today's session. At times, Rupert Murdoch appeared to be trying to -- quite irritated by some of the questions. At times he paused sometimes, you know, ten seconds or more to think about his answers.

He certainly appeared to be pretty exhausted by the end of it. She's 81 and certainly was showing his years I think by the end. But she'll be back tomorrow. I think tomorrow, possibly will be the most interesting day when he'll be questioned about what he knew about the phone hacking scandal, was he aware that this extended to not just one rogue reporter as this company insisted in the beginning. It was much more widespread at the "News of the World".

Dan London reporting live for us from London.

Coming up on NEWSROOM, the FBI and state police are now investigating the New Orleans Saints GM over allegations he eavesdropped on opposing coaches. We'll hear from the same interim head coach next.

Plus, this woman she was going to need surgery on her shoulder but then she started doing Pilates. And that saves her a whole lot of money and paying. Find out more in our age against the machine.

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COSTELLO: Ok, let's talk sports and the New Orleans Saints because the scandal just got worse. Carlos Diaz from HLN is here to fill us in about the details that the FBI and police now want to get involved.

CARLOS DIAZ, HLN HOST: You know, when you say the word "eavesdropping", you think of like a housewife -- listening to the housewives' conversation on the phone. But when you say the world "wiretapping", it gets a whole lot more important and that's what's really going on here.

The Feds and the local authorities now in New Orleans are looking into whether or not Saints GM Mickey Loomis actually had a device in his suite which allowed him to listen to other team's coaches during games from 2002 to 2004.

Now there are several things that are very important to consider here. The fact that this is considered wiretapping so the feds and the local authorities looking into this. But, the statute of limitations is five to six years on this. Five years in the federal level; six years on the local level. So, those limitations have already run out.

But, they are still going to investigate this because local investigators are saying let's investigate it and we'll let the attorneys figure out about the statute of limitations. We want to find out if a crime has been committed.

COSTELLO: Wow.

DIAZ: Yes.

COSTELLO: So what is the NFL doing about this?

DIAZ: And that's the thing that people -- people think that the NFL was looking -- NFL was like, they didn't know about it until the ESPN report that came out earlier this week. We didn't know anything about this which much different than Downey-gate which the NFL was all over.

So basically, the NFL is saying we are going to let the authorities look into this. And then we will punish the parties ifs the authorities find out this is, in fact, true. Yesterday, New Orleans Saints head coach, interim head coach Joe Vitt came out and said he is very ticked off and does not agree and says these allegations are completely false. Listen.

JOEW VITT, INTERIM HEAD COACH: It's ludicrous. It's absolutely ludicrous. It's impossible. It's impossible. I have never heard of it before. That's from Star Wars.

When I first heard something about being a wiretap, I thought they were talking Samuel Bulgravano or something. I didn't even know what they were talking about. What are you talking about/ That is ludicrous. And then to associate Mickey with that, it's irresponsible; it's a shame.

DIAZ: I want to applaud him by getting the Star Wars reference and the Mafia reference in the same sound byte. But no. It's one of those things where, how can you prove that something it happened as long as 2002, that long ago. But it happened apparently -- allegedly from 2002 to 2004. And that's the big thing.

Is it a wiretapping case and the feds and local police are involved to see if it is or not?

COOPER: Well, I don't know. I don't think ESPN would report it if they didn't have credible sources because that could be dangerous for them. Because they could get sued, right. There's something there somewhere -- seemingly anyway.

Let's switch gears and talk about Meta World Peace. Because Meta World Peace got slapped with seven games.

DIAZ: Yes. After this vicious elbow to James Harden right there from Oklahoma City Thunder, he's been suspended seven games. One game of the regular season which is tomorrow, it's the last game the Lakers and the first six games of their playoff series -- whoever they go to play in the flesh.

So that right there is the blow. Now initially, Meta World Peace said that it was a blow that he was celebrating. He just -- James Harden happened to get this way. He has now apologized to the Oklahoma City Thunder. But keep in mind the seven-game suspension is not just for that blow. It's for the fact that he's been suspended over a dozen times; 13 times in his career for transgressions on the court. So obviously, he has a past.

COSTELLO: Yes. He does have the fact. And not a pretty one. He's trying to rehabilitate himself. But I guess that didn't really matter.

(CROSSTALK)

DIAZ: I don't think that World Peace -- changing of the name to World Peace did a lot for him this year.

COSTELLO: Thanks, Carlos.

A new study shows just how early discrimination starts. Kids as young as six-years old, so they would rather play with their slimmer classmate as opposed to their overweight one. More in your daily dose.

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COSTELLO: 53 minutes past; checking our top stories now.

A 4-year-old girl who disappeared while on vacation in 2007 might still be alive. British Police released this image of what Madeleine McCann may look like now. They've been reviewing the case for nearly a year. The little girl was at a resort in Portugal with her family when she vanished.

John Edwards former aide Andrew Young back on the witness stand today. He testified he helped the former presidential candidate cover up his affair with the campaign videographer. Edwards is accused of using campaign contributions to hide his affair.

In today's "Daily Dose" a study casts a new light on discrimination among kids. Researchers interviews 1100 first graders from 2900 different schools. They showed each of them a photo of their classmates and asked them how much they like playing with them on a scale of one to three.

The kids who are overweight were far less liked with most kids preferring to play with slimmer classmates. The CDC says one in three children under the age of 5 is obese or overweight.

Millions of baby boomers about to retire are learning an important lesson. They found a way to keep medical costs down. Their answer: Ahead in our Age against the Machine?

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COSTELLO: When you think about retirement, you think about the good life, right? You don't think about surgery or medical bills. But for millions of baby boomers about to retire, they've actually found a key to keeping those costs down. Sandra Endo shows us what it is in "Age against the Machine".

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SANDRA ENDO, CNN CORRESPONDENT: Flipping through a file of bills, Marian Haggerty says she's paying a lot for her health now that she's in her 50s.

A lot of medical bills here.

MARIAN HAGGERTY, BABY BOOMER: Correct. Physical therapy, surgery, a whole variety of different assessments, x-rays.

ENDO: After surgeries to her knee and foot, she decided to work on preventive measures to get stronger.

HAGGERTY: I want to stay working and productive and have fun while I'm doing it. ENDO: Three years ago, she turned to Pilates, a fitness band which is low impact but strengthens muscles using resistance. And like Haggerty many baby boomers are focusing on ways to stay healthy and agile. To promote longevity.

HAGGERTY: I have saved at least a shoulder rotator cuff operation because of the specific Pilates exercises that we do. I don't have the neck problems that I might have based on my job. I was able to prevent the other foot from becoming a claw toe foot.

UNIDENTIFIED FEMALE: Arms just a little bit in front of you.

ENDO: Her instructor says the Pilate class especially for aging clients are the most popular because of the benefits clients see in their everyday life.

TIMEA PRESLEY, PILATES INSTRUCTOR: Often mobility becomes an issue. Because I you don't use your body it becomes a little stiffer and you don't use your body, it becomes stiffer and that, again, leads to injuries and that is being prevented here.

ENDO: Health and fitness experts say these days there are a number of fitness classes like cross fit, yoga and boot camp that all work the body's base.

VANESSA HAILES, CERTIFIED FITNESS TRAINER: Working your core allows you to keep your spine in alignment, better posture for the duration of your workout and prevent injury.

ENDO: Haggerty says her mind and body has improved because she's proactively working to stay strong.

HAGGERTY: I hope when people think about baby boomers they think about health, vibrancy, productivity, being engaged and we're taking care of ourselves.

ENDO: Because Haggerty says, as a baby boomer, she wants to stretch the years ahead of her to the fullest. Sandra Endo, CNN Washington.

(END VIDEOTAPE)

COSTELLO: I'm Carol Costello, thank you for Joining us this morning. CNN NEWSROOM continues right now with Kyra Phillips.