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CNN Live Today

Abolish FEMA?; Gas Gauge; Investigating Katrina Fraud

Aired April 27, 2006 - 10:00   ET

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

DARYN KAGAN, CNN ANCHOR: We're talking about FEMA, homeland, defense. It is a disaster agency that many say it's a disaster. Today, a call to do away with FEMA, just get rid of it altogether. The recommendation comes from a Senate committee's report. It will be released this hour.
It says that Hurricane Katrina revealed flaws in FEMA that are beyond repair. The report calls for replacing FEMA with a new emergency management agency. Even so, that new agency would remain within the Department of Homeland Security. The head of the agency would have a direct line of communication with the president during disasters.

This morning's report is the first to call for FEMA to be dismantled. Let's bring in our Homeland Security Correspondent Jeanne Meserve with more on that.

Jeanne, more on that idea in a moment. First, what about the timing? Talk about disbanding FEMA about a month before hurricane season begins.

JEANNE MESERVE, CNN CORRESPONDENT: Well, this wouldn't have any impact on that because if these changes were to be made, it would have to be approved by Congress, signed by the president and then, of course, implemented. So it would not affect the upcoming hurricane season. Don't worry about that.

But why now? This Senate committee, the Homeland Securities and Government Affairs Committee, has held 22 hearings on this subject. They have reviewed more than 800,000 documents. They've talked to scores of witnesses. And this was the time when they finally could push this out. This is the last of the big reports. You'll recall we already heard from the House, from the White House, even the Department of Homeland Security inspector general's already weighed in. This is the last big one and it is bipartisan.

KAGAN: So there's two parts of it. One says dismantle FEMA. The other says, when you build this new agency, keep it within the Department of Homeland Security. A big criticism of FEMA was that it was doing fine when it was outside DHS. Why would this new one stay inside of it?

MESERVE: Well, I think they're trying to play King Solomon here. There are those who want it outside, notably James Lee Witt, the former FEMA director, who says it worked fine the old way. Much more effective outside the agency. But Senator Lieberman was amongst those who pushed the idea of the Department of Homeland Security with FEMA inside it. So he's in a bit of an awkward quandary there.

What they hope to do with this is create this workaround, where it would be bigger within the Department of Homeland Security. It would resume some of its old roles like preparedness that had been stripped from it. It will get more money. The budget can't be played with significantly unless Congress has some say so.

But, most importantly, a lot of people say, it would have this workaround where during a catastrophe the director would not have to go through the Department of Homeland Security necessarily, he would have a direct line to the president. Would be able to communicate with him about what he wanted. That's something, you'll remember, that Michael Brown did and was criticized roundly for it, but he said it was the only way to get things done.

KAGAN: All right, Jeanne, we'll have you sticking around and listening in to this news conference with the two senators in just a moment. Thank you for that.

Let's talk about the idea of ditching FEMA. Can it work? Will it even happen? Is it a good idea. Joining me from Washington, our Security Analyst Richard Falkenrath.

Richard, good morning.

RICHARD FALKENRATH, CNN SECURITY ANALYST: Good morning, Daryn.

KAGAN: Let's split (ph) this down. First of all, should FEMA be abolished?

FALKENRATH: Well, I don't think it should be abolished. And as I read the report, and I just got a draft of it, it looks to me like they're recommending more like a renaming of FEMA and a reinvigoration of the FEMA functions within the department. So I think we're making a lot of the abolition idea here, but when you get into the report, it looks to me more like a renaming.

KAGAN: So just change the alphabet soup by which you refer to it.

FALKENRATH: And give it more resources and greater status within the department and the federal government.

KAGAN: Well, then there's aspect of keeping it within the Department of Homeland Security. What do you think about that?

FALKENRATH: I think it really is the right idea to keep it where it is. It doesn't make a lot of sense to have it outside, independent, to have a separate response system for natural disasters and another one for terrorist attacks. You do need to get them in there and I give the senators credit for sticking to that idea even though it is a little unpopular these days.

KAGAN: Well, we heard one of the criticisms from Michael Brown when he was testifying, a former FEMA director, saying that natural disasters in the current structure get treated like the stepchild. That they don't get the same status as a terrorist attack.

FALKENRATH: Yes, we've heard that from him. We've heard similar things from James Lee Witt. And I really don't think it would stand scrutiny.

The senators and their staff looked at that question very carefully. Their analysis of what went wrong in Katrina looks to me like about the best that we've seen. They're very critical of Michael Brown personally.

They're also very realistic about the different responsibilities at state and local levels. And they offer a lot of criticism at those levels as well, saying this is a national problem, not just a federal problem.

KAGAN: Richard Falkenrath, stick with us.

Let's go ahead and listen in to the two senators. Here is Susan Collins of Maine, a Republican. And Democrat Joe Lieberman is there to talk about this report.

SEN. SUSAN COLLINS, (R) MAINE: And reviewed more than 838,000 pages of documents during our eight-month investigation. Our findings are reflected in the very name of the report, "A Nation Still Unprepared."

Why is this? There are several fundamental reasons. We found clear evidence of failures in planning, failures in decision making, a failure to create an effective, coordinated national response system and most of all, a failure of leadership at all levels of government. Throughout the course of the investigation, there were several findings that I found particularly troubling.

The first is the blatant insubordination of then FEMA Director Michael Brown. It was clear that he was disengaged from the onset of Katrina. He failed to communicate absolutely vital information about the condition of the levees in New Orleans. Most of all, he allowed his personal feelings, his distaste for being in the Department of Homeland Security, to override his clear obligation to provide effective leadership at a time when lives were at stake.

The second troubling moment for me during the hearings was hearing about the failure to evacuate the nursing homes in Louisiana. This undoubtedly led to the loss of dozens of lives and is absolutely inexcusable.

Third, the outright confusion over who was responsible for the integrity of the levees. That is astonishing given what was at stake, how absolutely vital the levees were to the protection of the city of New Orleans. We have listened to eight months of blame, yet no one has taken clear responsibility for insuring that the levees were as strong and as safe as they should have been. In fact, at our hearing, federal, state and local officials pointed to each other as the responsible party.

Fourth, an astonishing lack of situational awareness among DHS, DOD and White House officials slowed the response during a critical time. Officials in Washington failed to grasp the extent of the crisis due to inexcusably poor communications.

The 86 recommendations that Senator Lieberman and I are proposing will help to ensure that government at all levels responds more effectively. Our first and most important recommendation is to abolish FEMA. FEMA is discredited, demoralized and dysfunctional. It is beyond repair.

Just tweaking the organizational chart will not solve the problem. FEMA has become a symbol of a bumbling bureaucracy in which the American people have completely lost faith. There are many good people who work at FEMA, but they have lacked the leaders, the tools, the systems and the budget to be effective.

We propose instead the creation of a new national preparedness and response authority, which will be led by a director who will report directly to the president in times of catastrophes. We would put preparedness and response back together. There are, after all, two sides of the same coin. We would give the new authority strong, new power and responsibilities for protecting critical assets and distributing billions of dollars of grants to states and local governments to help them prepare and respond to disasters, whether natural or man-made.

The new authority would be like the Coast Guard, an independent agency within the Department of Homeland Security. This is important because this status shields the new agency from internal reorganizations that could rob the authority of its assets or powers. It would, instead, take an act of Congress to make changes to the new national preparedness and response authority. This is a protection that FEMA never had.

The second major recommendation that we propose is to create regional strike teams. I was struck during our hearings by how many FEMA and other governmental officials were deployed from region one, our region in New England, down to the Gulf region. Now, while we believe that New Englanders are superior people who can handle any crisis . . .

UNIDENTIFIED MALE: We agree.

COLLINS: The fact is, that they had absolutely no knowledge of the geography, the culture, the officials that were involved in the Gulf region and that does not make sense. The last time that officials should be exchanging business cards is in the midst of a crisis.

We are proposing instead that we have strong, regional offices where strike teams that would have representatives of all the federal agencies that are involved in responding to disasters and they would train and prepare and plan with their state and local counterparts, with non-profit organizations and with the private sector. We think that would result in a firm, more cohesive and effective emergency response team. Katrina has taught us all the bitter lessons of the cost of failing to build and maintain a true national emergency planning and response system. The first obligation of government is to protect our people. In Katrina, we failed at all levels of government to meet that fundamental obligation. We must learn from the lessons of Katrina so that next time disaster strikes, whether it's a storm that was imminent and predicted for a long time, or a terrorist attack that catches us by surprise, government responds far more effectively.

Senator Lieberman.

SEN JOE LIEBERMAN, (D) CONNECTICUT: Thanks very much, Senator Collins.

Madam Chairman, I'm very proud to be standing with you today to announce that we have agreed . . .

KAGAN: All right. We're listening in to Senator Joe Lieberman, also Senator Susan Collins, the leaders of the committee in the Senate that has looked at Katrina and the disaster and what they say can be done better. Atop of the list, they want to disband FEMA. They want it to go away, start a new agency but still keep that agency within the Department of Homeland Security.

We were talking about these ideas with Richard Falkenrath, our CNN security analyst.

A couple more things we heard from Senator Collins there that I wanted to run by you, Richard. Calling FEMA a symbol of bumbling bureaucracy. You were saying this sounds more like a renaming of the agency. Branding problems it sounds like the senators are recognizing.

FALKENRATH: They are. And they're making a pretty bold organizational proposal here. But when you think about how you'd actually implement it, I mean, what would you do. You couldn't fire all the people and rehire them. There are several thousand people working at FEMA. You couldn't tear down the building. It would be the same building, the same people at least for quite a long transitional period before it becomes something new and bigger as they propose.

So I think it is sort of symbolic when they say abolish FEMA. They want to eliminate the acronym and replace it with another acronym and invigorate it within the department.

KAGAN: What about these ideas of a regional strike teams? She was pointing out that so many of the -- so much of the help came from New England, but if you already had people planted and stationed in different areas of the country, along with representatives of the different agencies that should respond to a natural disaster, that people would be more ready to go and more familiar with how the local customs and things work in that area.

FALKENRATH: Well, they're absolutely right. Those are needed. Everyone recognized that after FEMA. It was in the White House report as well. So I think the senators are essentially confirming a recommendation the administration has already adopted.

KAGAN: And what about Michael Brown? He's out there as a consultant now, but not exactly getting a ringing endorsement from this commit.

FALKENRATH: Well, he has a right to earn a living, but clearly his performance in office during Katrina has been criticized and I think rightly so. Susan Collins had some very strong words for him and his insubordination, which I think were deserved.

KAGAN: That is one of the suggestions in the report, that the leadership of whatever this agency would be called should be skilled in crisis management. This is another thing that Katrina exposed, that a lot of these people were political appointees and didn't have the skills to lead such a situation.

FALKENRATH: Well, I think they're exactly right. These should be professionals in these top jobs. But they also have to be people appointed by the president. So he's going tend to appoint people who he knows and have been supportive.

This is a real problem, though, to figure out who is actually going to take these jobs given all the public attention on FEMA. You know, they had a real hard time finding a new director for FEMA.

KAGAN: Yes.

FALKENRATH: And, you know, I wonder if we're not making these jobs almost too hard. So hard that no one in their right mind would want to take them.

KAGAN: And they are important, very important indeed, especially as we get closer to hurricane season.

Richard Falkenrath, thank you for your expertise this morning.

FALKENRATH: Thank you, Daryn.

KAGAN: We're going to look at business news ahead. The nation's largest oil company announces it is swimming in profits. And, get this, Wall Street says it's disappointed with those numbers.

Also, sticker shock turns into the blame game. Gas prices go up. Who is responsible? The oil companies? Is it overseas threats? Or is it you and me? Tom Foreman investigates when LIVE TODAY continues.

(COMMERCIAL BREAK)

KAGAN: The numbers are in. Gasoline prices are eating up more of your take-home pay, but ExxonMobil Corporation reports a first- quarter profit of $8.4 billion, yeah, that's a b. Sounds like a lot of money, but the oil company didn't make as much as Wall Street expected. Analysts had predicted profits of more than $9.25 billion. And remember, these numbers reflect just the first three month of the year. They just don't cover the most recent run-up at the pumps. Politicians are watching nervously as the pump prices climb. With many of you planning to go to the polls this November, you better believe Congress is paying attention. Some lawmakers want to look at tax records from oil companies. There's also talk of a windfall profits tax. And if that's not enough, Senate Republicans are pushing a plan to give taxpayers $100 gas rebate. One Democrat even wants to give us all a 60-day gasoline tax holiday. We'll keep you posted on the proposals.

Up, up and away. Gas prices are high. You're ready for the low road. You want somebody to blame. CNN's Tom Foreman investigates. His report was done for "Anderson Cooper 360."

(BEGIN VIDEOTAPE)

TOM FOREMAN, CNN CORRESPONDENT, (voice over): Who is to blame for the price of gas at a record high and apparently getting higher?

UNIDENTIFIED MALE: Too high.

FOREMAN: Who is to blame for $50, $60, $100 bills at the pump?

UNIDENTIFIED MALE: I'm wondering when it's going to stop.

UNIDENTIFIED MALE: It's getting very ridiculous.

UNIDENTIFIED MALE: Somebody else is getting richer. It's not us.

FOREMAN: Not us either say American oil companies which sell the gas they make from crude oil. For the first quarter of the year, the top three companies are expected to report $16 billion in earnings. But industry spokes folks say blame high pump prices on international companies jacking up the price for that crude they draw from the ground. Those companies can do that because people who invest in oil, who buy that crude, are worried about future supplies and they're willing to pay.

RAYOLA DOUGHER, AMERICAN PETROLEUM INSTITUTE: Fundamentally we're seeing the forces of supply and demand internationally pushing those prices up and a lot of political instability in some oil-rich areas that are tipping it right over the top and pushing it ever higher. And it's translating to higher prices.

FOREMAN: Blame it on China and India, economists and political experts say. Their exploding economies are sucking up oil.

DAVID SANDLOW, BROOKINGS INSTITUTION: Oil is a global market. And so when other countries start using oil, and certainly approaching the levels we will, it's going to have a big impact on prices.

FOREMAN: Blame it on lack of innovation environmental groups say. For 30 years we've talked about alternative fuel vehicles but industry and government have generally been slow to support them and consumers too. NATHANIEL GREENE, NATURAL RESOURCES DEFENSE COUNCIL: I think the most important thing they can do is not get caught up in the blame game and really look for some long-term solutions.

FOREMAN: Right now, for many, the short-term solution is avoiding blame or even contact with this volatile issue. ExxonMobil sent this memo to gas stations saying, if news crews want pictures of customers buying golden gas, tell them "for safety reasons, ExxonMobil does not allow filming on our stations properties." I tried to call the woman who wrote that memo.

UNIDENTIFIED FEMALE: Hello, you've reached the office of Coreen (ph) . . .

FOREMAN: No luck. Well, the oil industry has its own ideas about whom to blame.

DOUGHER: Half the blame goes to consumers.

FOREMAN: That's the demand part of supply and demand, they say. And as long as driver's will pay $3 a gallon for gas, that's what it will cost.

Tom Foreman, CNN, Washington.

(END VIDEOTAPE)

KAGAN: Anderson is keeping his eye on the gas price watch. You can join "A.C. 360" weeknights at 10:00 p.m. Eastern.

So as we look at these oil profits and pumped up gas prices, consumers are watching both sides of these eye-popping numbers. A gallon of regular now averages almost $2.93. A Texas judge thinks a nationwide gasoline boycott might cut the oil companies down to size. A report now from Angela Vierville of our affiliate KSAT.

(BEGIN VIDEOTAPE)

JUDGE JIMMY MARTINEZ, BEE COUNTY, TEXAS: Well, it's time to stop. It's time to stop and get some good, clear answers to the American people, and particularly to my county.

ANGELA VIERVILLE, CNN CORRESPONDENT, (voice over): Bee County Judge Jimmy Martinez is passionate about a new resolution just passed by county commissioners asking for a boycott of ExxonMobil to begin on May 1st and last until a gallon of gasoline costs $1.30 or less.

MARTINEZ: I want to know, you know, why people are getting in the millions for salaries and bonuses. I've got people in my county that can't even travel to Corpus Christi to get health services.

VIERVILLE: Martinez is referring to a $400 million retirement package given to an Exxon executive and record-breaking oil company profits.

UNIDENTIFIED FEMALE: The summer's coming up and you can't, you know, go on vacation because it's so outrageous.

VIERVILLE: But the three Beeville convenience stores carrying Exxon gasoline are locally owned. Owner Leticia Munoz (ph) says such a boycott won't bring down the cost of gasoline, but only hurt their small business.

LETICIA MUNOZ: We are independent. We are not affiliated with ExxonMobil. Therefore it's not going to -- they won't probably even know that this is going on down here.

(END VIDEOTAPE)

KAGAN: Well, in the next hour of LIVE TODAY, we're going to talk to a member of the American Petroleum Institute. You're going to find out why oil companies insist their profits are not obscene and they say they're not to blame.

Gerri Willis is never to blame, unless you're looking for some great "Top Five Tips."

Gerri.

GERRI WILLIS, CNN CORRESPONDENT: Hey, Daryn, good to see you.

We've got a different topic today. We're going to tell you how you can reduce allergens inside your home and what you need to know about your childhood teddy bear. It could be making you sick. "Five Tips" is next.

(COMMERCIAL BREAK)

KAGAN: The markets have been open close to an hour. They are not doing a lot. The Dow is down 10 points. The Nasdaq, well, it's up a little bit. It is up about three points.

Different kind of numbers game for you now. You have millions and millions of them floating around your house. We're talking about spores, dust mites, pollen. Lovely, right, for you breakfast eaters out there. All these kind of icky allergens. So who you going to call? Our own allergy buster Gerri Willis here with her "Top Five Tips" to help you breath a little easier.

WILLIS: That's what we're looking for here, Daryn.

I don't know if you have allergies. Do you have allergies?

KAGAN: Very little. We weren't allowed, growing up, to have them. My mother had no time for us to have allergies.

WILLIS: Wow, that's tough love.

KAGAN: Yes.

WILLIS: Well, if you do have allergies, and I do, they're horrible, your bedroom is the hot zone for allergies. If you're trying to get rid of indoor allergy, start in the bedroom. There can be up to 2 million dust mites just in your bed. These dust mites are invisible and they feast on dead skin. They're the number one allergen and their population peaks in July and August. So to get rid of the pests, wash your linens once a week, like your mom said, in the hot cycle and invest in allergen-proof pillow and bed covers. Now these are going to cost you anywhere from $10 to $100 at your local home improvement store.

KAGAN: Now this next tease, this is when we say, if you have small children, ask them to leave the room and not listen to this tease, because it can be very traumatic what you're suggesting, Gerri.

WILLIS: Could be. It could be. Well, OK. You want to freeze the mites off your stuffed animals. Listen to this. Your child's stuffed animal, and if you have one yourself, it's a breeding ground for mites. Just think, you can go 10 to 20 years without washing these things. If you can, put it in the washer. If it's an heirloom from your childhood that's too delicate for the washer, put it in a plastic bag, put it in the freezer for 24 hours, it kills the mites. Look, this is making people sick, you want to take care of it.

KAGAN: Teddy in a plastic bag in the freezer. This is like "CSI."

WILLIS: I know. It's sort of cool, though, isn't it?

KAGAN: I don't know. I think it's a little traumatic to think about that.

Another idea is that you have to look at your own pets.

WILLIS: Cats have the most dander. Ten million people are allergic to cat dander. Both dogs and cats have allergens and you can find those allergens in almost every home, whether you have pets or not. The type of pet you choose, obviously, makes a difference. Cats have more allergens than dogs. And light-haired female cats generally cause fewer allergy symptoms than dark haired male cats.

KAGAN: Hey, I did not know that.

WILLIS: Very interesting, huh?

KAGAN: Did not know that.

WILLIS: If you want to control that dander, make sure fido or fluffy stay off the furniture. There's a reason behind that.

KAGAN: Yes.

WILLIS: And wash your pet at least once a week.

KAGAN: I'm not putting Tripod in the freezer, if that's where you're going.

WILLIS: I saw your dog yesterday. Really cute! KAGAN: Oh, that's Darla. The cat is Tripod. Anyhow, different segment. None of them are going in the freezer. They're all doing great. Let's talk about not my pets, but mold.

WILLIS: Yes, this is a real -- this is serious stuff. Mold is very serious. Some of your homes have mold hot spots out there. You want to watch for the basement, the bathroom, your closet, even your house plants, Daryn. I didn't ever think of this, but this is an obvious thing. Water collects there. You get mold in your house plants.

If you see mold growing on a hard surface like a wall, use a mixture of bleach and water and scrub it with a stiff brush. Make sure you wear those rubber gloves. Now, to keep the mold from coming back, cut the humidity to 40 percent or below by using a humidifier. Obviously, you can also just turn on the air conditioner because that cuts humidity, as well.

KAGAN: Then there's pollen. We've just passed the time of year here in the South where you can literally see the pollen. It turns everything yellow.

WILLIS: Oh, that is so scary. Listen, if you are allergic -- if you have allergies, serious allergies, this is the one that can get you in almost any season, from tree pollen in the spring to ragweed in the fall. If you're sensitive, don't leave the house or keep the windows closed from 5:00 a.m. to 10:00 a.m. That's when plants make the most pollen. And since it's airborne, it attaches itself to the shoes, your clothes, your hair.

So make sure you take off your shoes before you come inside the house and take your showers at nights to get it out of your hair because then it's in your pillow. Finally, think twice about hanging your laundry out to dry. Clothes can be big pollen collectors.

KAGAN: Great tips today. What's coming up on your show this weekend?

WILLIS: Well, we've talked about pet dander today, but you could also be allergic to your partner. We'll tell you what you need to know about that this weekend on "OPEN HOUSE." We've also got some...

KAGAN: Your partner like your husband?

WILLIS: Yes. Human dander. We're going to tell you all about it. We will also talk about gas price myths, avoiding foreclosures. Daryn, foreclosures are through the roof. We've got a great show coming Saturday morning, 9:30 a.m. Eastern on CNN. "OPEN HOUSE." Join us for that.

KAGAN: There was a Brady Bunch episode where I think Jan thought she was allergic to Cindy or Marcia or something like that. You might want to look at that for your show.

WILLIS: And we're in two boxes like this, you know?

KAGAN: That's my -- yes, exactly. There you go. Gerri, thank you.

WILLIS: Thank you.

KAGAN: Coming up, it is magic times two.

(BEGIN VIDEO CLIP)

MAGIC JOHNSON, FMR. PRO BASKETBALL PLAYER: Sometimes God blesses us with a special person who can handle big jobs, and we have that special person right here.

(END VIDEO CLIP)

KAGAN: You have two special guys. The former Lakers great Magic Johnson and J-Mac team up. We're going to tell you what their game plan is just ahead.

(COMMERCIAL BREAK)

KAGAN: You remember this magic moment. Jason McElwain brought fans to their feet, even made grown men cry. Now moviemakers are hoping for the same with an assist from a legend.

Reporter Berkeley Brean from our affiliate WHEC has the story.

(BEGIN VIDEOTAPE)

BERKELEY BREAN, WHEC REPORTER (voice-over): Jason McElwain and Magic Johnson walked into the gymnasium at Greece Athena High School on the very same floor where J-Mac's magical story began.

MAGIC JOHNSON, J-MAC MOVIE EXEC. PRODUCER: I think it will give a lot of young people hope and not young people just living with autism, but all young people.

BREAN: Magic says he saw Jason's performance on television, thought about his own battle with HIV, felt inspired, and knew he had to have a part in the story.

JOHNSON: To have the presence of mind to, like, say, you know what? I'm ready and I'm going hit every shot, and that's basically what he did. And then to feel the crowd and the crowd react -- every shot, they were hugging and jumping and high-fiving and low-fiving. And sometimes God blesses us with a special person who can handle big jobs, and we have that special person right here.

BREAN: Ever since he was carried off the court by his teammates, J-Mac has met the president, an NBA team and Oprah. But today may have been his biggest thrill.

JASON MCELWAIN, "J-MAC": He was living with HIV his whole life -- like, half his life, and he proved to everyone that he could play with the disease. So he is a great dream for me to meet.

BREAN: The J-Mac movie still needs a writer and a cast. J-Mac seems to know who's playing him, but ultimately kept it a secret. MCELWAIN: If I would release a name -- want me to release it? No. I don't care who plays me, as long as it's good.

(END VIDEOTAPE)

(BUSINESS HEADLINES)

KAGAN: Raise a mug and perk up. There may be a new reason to have a cup of coffee every morning, and another, and another after that. Heart healthy findings, ahead on CNN LIVE TODAY.

(COMMERCIAL BREAK)

KAGAN: Here's a morning eye-opener for you. Coffee can actually be good for your heart. Some studies say the opposite, but Harvard researchers say that is just java jive. They studied the coffee- drinking habits of 120,000 people for about 20 years. They say people who have had four or five cups a day ran the same risk of heart disease as those who pretty much skipped the morning brew.

In fact, women who drank six or more cups a day cut their heart risk by 28 percent. But the Harvard study found that heavy coffee drinkers also tend to smoke, and that may be the reason that some coffee drinkers appear to have heart ailments. The coffee biz is not just beans. Worldwide, the drink -- we drink actually $70 billion worth of coffee every year. That is a lot of Starbucks.

Mama bears are known for watching out for their cubs, but when mama bear and babies are in trouble, well, what then?

Sean Hennessey of our affiliate WHDH has details on a treetop rescue.

(BEGIN VIDEOTAPE)

SEAN HENNESSEY, WHDH REPORTER (voice-over): A baby bear nuzzling next to its mother. Nature captured on camera after a harrowing adventure for a black bear and her three cubs.

UNIDENTIFIED MALE: This one worked out exceptionally well.

HENNESSEY: The berry bears began attracting attention Tuesday when they set up shop in Jennifer Isenberg's (ph) front lawn after finding her bird feeder.

UNIDENTIFIED FEMALE: I came out to see what my dog was barking at, and looked up, and there's this big bear looking at me. I was shocked.

HENNESSEY: Seeking safe haven from traffic and onlookers, the family was still in the tree Wednesday morning. That's when authorities took out this tranquilizer gun, needing two darts to get the job done.

UNIDENTIFIED MALE: The animal was going down, but not as quickly as we'd like it. HENNESSEY: With the clock ticking because the drugs were beginning to wear off, the mother was rushed to a wild life preserve. Her cubs released next to her. One ran up a tree, but two others took off and didn't seem happy when they were retrieved.

LT. JOHN PAJAK, MASS. ENVIRONMENTAL POLICE: They're wild animals. They're not accustomed to being handled by humans.

UNIDENTIFIED MALE: Get up there. Go!

HENNESSEY: The cubs were reunited with their sibling, ensuring the family stays together.

Soon the grogginess began to wear off and the mom began to move. Now fitted with a GPS tracking antenna, she tried to stand up, but stumbled. However, authorities did not leave her alone until they were sure she could defend herself and her little ones. All in all, an ending that couldn't have been scripted better for this family and her former hostess.

UNIDENTIFIED MALE: I'm thrilled, that was the ultimate outcome for me. That's all I wanted to happen.

(END VIDEOTAPE)

HENNESSEY: You know we love the baby animals around here. That story was from Sean Hennessey of our CNN affiliate WHDH.

So how about more animal cuties for you? On to baby lemurs. The star attractions at a zoo in southern Japan. They're called rust lemurs. They were born earlier this month. They're special, because they're endangered, they're rare, and you know, come on, they're just plain cute. Only a few thousand still live in the wild. We like the babies there.

Coming up, it is greed over need.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: We have people from prison who applied for FEMA benefits.

(END VIDEO CLIP)

KAGAN: Yes, can you believe it? Katrina fraud. It happens. We're going to take a look on LIVE TODAY.

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KAGAN: So the competition beats you, then your own company does. Or so says a California woman. She says her superior spanked her and did it in front of her colleagues, and now she wants the company to feel the pain. A jury is deliberating Janet Orlando's case today. She's suing her former employer, Alarm One -- that's a security company -- for more than a million dollars for spanking her with a rival company's yard sign. The company says the spankings were voluntary and were only a team-building exercise.

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KAGAN: Never underestimate the criminal mind. Case in point, how about Hurricane Katrina relief? Fraud artists hatched some wild plans, and police are starting to uncover them.

CNN's Sean Callebs tracks some of the worst offenses. His report was prepared for "ANDERSON COOPER 360."

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SEAN CALLEBS, CNN CORRESPONDENT (voice-over): Cops going after drugs, a killer, a dangerous fugitive? Not in this case. Instead, someone in Florida accused of lying to get thousands of dollars in FEMA benefits.

(on camera): And you didn't --- you never lived in New Orleans, did you?

UNIDENTIFIED MALE: No.

CALLEBS (voice-over): Money meant for Katrina victims. On September 8th, just a week after Katrina flooded New Orleans, the U.S. attorney's office created a task force to root out fraud, and it's been busy.

ALICE FISHER, ASST. U.S. ATTORNEY GENERAL: What's staggering is that we've charged people in over 24 districts across the nation. So this is fraud that is going from Florida all the way to California.

CALLEBS Some had moxie.

FISHER: Well, we had people from prison who applied for FEMA benefits.

CALLEBS: That's right. Two inmates at Louisiana Avoyelles Women's Correctional Institution said their housing was disrupted by Katrina and wanted FEMA relief funds mailed to them in prison. They were, but authorities eventually got their hands on the checks.

The motive in all these cases, greed. A brother and sister team in Dallas are accused of stealing 100 Red Cross debit cards worth more than $4,000 each. They told authorities they used the money for jewelry, cars, shoes, and cash.

In Bakersfield, California, more than a dozen workers at this Red Cross call center face fraud charges. They are accused of working the system so they, family and friends could allegedly steal money meant for hurricane victims. Hundreds of thousands of dollars is involved. 61 people are indicted. Government workers are being targeted, too.

FISHER: For example, we charged a case in Mississippi where there was a debris removal contract, and somebody was filing false load tickets in order -- in exchange for a kickback. CALLEBS: That was in Perry County, Mississippi, where a worker for the Army Corps of Engineers has already pleaded guilty to taking a bribe to lie about the amount of debris a contractor had collected. Both men will be sentenced June 8th.

In Galveston, Texas, a hotel owner said he provided rooms for his employees as part of their pay. According to the Department of Justice, he also filed with FEMA for more than $230,000 in disaster relief lodging, claiming his workers were evacuees, flooded out of their homes. He's facing 39 counts of fraud. So far, about 250 indictments, 50 people convicted, two million applications for assistance.

FISHER: And what I think is very important to this overall anti- fraud effort is not only the money that we recover from the people that committed fraud, but also the deterrent effect.

CALLEBS: Meaning some have returned ill-gotten gains before being charged. Authorities say there's no way around it. With billions of dollars in aid floating around, it's an attractive target for cheats and thieves.

Sean Callebs, CNN, New Orleans.

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KAGAN: You can get a fresh perspective on the day's top stories from Anderson Cooper. Join "A.C. 360" weeknights at 10:00 Eastern.

So just a few minutes ago, the head of the Federal Reserve Ben Bernanke talking to Congress, and he was talking about the effects of high oil prices and high fuel prices on the future U.S. economy. We understand he spoke in English, not legalese, so let's go ahead and listen in to what he had to say.

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BEN BERNANKE, FEDERAL RESERVE CHAIRMAN: ... higher oil prices do create problems for monetary policy. On the one hand, they directly affect the cost of living, inflation. On the other hand, by taking purchasing power away from consumers, they tend to slow economic activity. And so it does produce a difficult problem.

For the Federal Reserve, one issue we'll be looking at very carefully is whether the increases in energy prices that we've already seen and that we may see in the future, whether they pass through into core inflation; that is, whether they go beyond energy sector itself and begin to be seen in higher prices for other goods and services. If that were to happen and if expectations of inflation were thereby to rise, that would be very deleterious to the long-term growth of the economy.

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KAGAN: Well, not too many big words there. Again, that's Fed Reserve chairman Ben Bernanke, talking about high fuel prices as he addresses Congress.

A party in a Houston suburb ends in horror.

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UNIDENTIFIED MALE: He was severely beaten. It was just -- oh, my goodness. I couldn't believe it. His face was severely swollen, lips, everything. He just looked -- there was blood everywhere.

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KAGAN: A boy beaten and sexually assaulted clings to life. Police say it may have been a hate crime.

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