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American Morning

Boston Police Officer Uses Racist Description of Gates; Investigators Focus on Dr. Conrad Murray in Michael Jackson's death; Obama's Approval Rating Drops in July; Has the Recession Ended?; Health Care Reform Stalls Ahead of Recess; One-Way Ticket Out of Town

Aired July 30, 2009 - 07:00   ET


CAROL COSTELLO, CNN ANCHOR: And hello to you, again. I'm Carol Costello, in for Kiran Chetry this morning.

JOHN ROBERTS, CNN ANCHOR: Good morning. I'm John Roberts. It's a Thursday. It's the 30th of July. Thanks for joining us on the Most News in the Morning. Crossing the top of the hour now. And here are the stories that we'll be breaking down for you in the next 15 minutes.

A Boston cop suspended for calling Professor Henry Louis Gates Jr., quote, "a banana-eating jungle monkey." Yes, that's what he said. The officer made the remark in an e-mail to a newspaper reporter. We're in Boston with the very latest this morning.

CAROL COSTELLO, CNN ANCHOR: Investigators now say the only doctor they are looking at in the Michael Jackson case is Conrad Murray. And record show the doctor's finances are a mess. Randi Kaye has new details on his money troubles and what Jackson's chef witnessed. That's coming up.

ROBERTS: And President Obama poked fun at a national news magazine yesterday for claiming the recession is over on its cover. We'll show you what he said and how the audience reacted.

But first, can a couple of cold ones chill some hot tempers? Professor Henry Louis Gates Jr. and Cambridge police Sergeant James Crowley head to the White House in a few hours to throw back a couple with President Obama, the gesture by the president hoping to smooth over what's become a flash point for race relations across America.

And just when it looked like the controversy was beginning to cool down, a Boston police officer just reignited things all over again by hitting the "send" button.

The job is at risk over an e-mail in which he called Professor Gates, quote, "a banana-eating jungle monkey." This is the officer, 36-year-old Justin Barrett. He's also in the National Guard. And he sent the mass e-mail to some other members of the Guard and to "The Boston Globe" venting over a column on Professor Gates.

Barrett uses the phrase "jungle monkey" not once, not twice, not three, but four times. Three referring to Gates, and once calling the writings of President Abraham Lincoln, quote, "jungle monkey gibberish." Barrett says of Gates, if he had been the officer he verbally assaulted "like a banana-eating jungle monkey, I would have sprayed him with OC." OC, by the way, is pepper spray.

The Boston police are condemning Barrett's comments, calling them offensive and hurtful. But Officer Barrett and his attorney launched a defense of sorts.


OFFICER JUSTIN BARRETT, BOSTON POLICE DEPARTMENT: I am sorry I wrote that. I'm sorry that my family has to deal with the selfish motivation and feelings that I had.

I regret that I used such words as -- I have so many friends of -- every type of culture and race you can name. And I'm not a racist.

PETER MARANO, OFFICER JUSTIN BARRETT'S ATTORNEY: Justin Barrett didn't call Henry Gates a jungle monkey to malign him racially. He stated his behavior was like that of one, and it was a characterization of the actions of that man.

BARRETT: I am sorry for the content of the e-mail. I'm sorry for how people are reacting to it, especially my fellow police officers.

I am not a racist. I never have been, never will be. I treat people with dignity and respect every time.


ROBERTS: Maybe in some point during that whole run of sound, you did what we did this morning and you said...


ROBERTS: "What?" So, let's play again for you the explanation that attorney Peter Marano gives for what the officer wrote.


MARANO: Justin Barrett didn't call Henry Gates a jungle monkey to malign him racially. He stated his behavior was like that of one, and it was a characterization of the actions of that man.


ROBERTS: So he didn't call him a jungle monkey. He only said he acted like one.

COSTELLO: There's a fine line between the...


COSTELLO: I don't know. I mean, the police officer is trying to save his job, because, you know, at the height of this racial inferno, he sends this to "The Boston Globe"? It would be pretty hard for the Boston police department to say, well, we'll just suspend you. But we'll see what happens.

ROBERTS: Some people should think long and hard before they hit the send button.

COSTELLO: They sent it to "The Boston Globe." And he didn't think the...

ROBERTS: At any rate, the woman who called police about a possible break-in at Gates house says that she feels vindicated now. The 911 tapes are out, and Lucia Whalen is talking to the press.

Our Elaine Quijano is tracking that side of the story for us this morning. She is live in Boston. Good morning, Elaine.


Well, I was at that news conference yesterday when Lucia Whalen spoke out. You know, she basically said she has been through the emotional ringer, and she wanted to set the record straight.


QUIJANO: Joined by her husband and her attorney, Lucia Whalen reluctantly came before the camera.

LUCIA WHALEN, GATES 911 CALLER: Cambridge is a wonderful place. And when I was called racist, and I was a target of scorn and ridicule because of the things I never said.

QUIJANO: What she never said in her 911 call to Cambridge police was that she saw two black men.

UNIDENTIFIED MALE: Are they white, black, or Hispanic?

WHALEN: Well, there were two larger men, one looks kind of Hispanic, but I'm not really sure. And the other one entered and I didn't see what he looked like at all.

QUIJANO: But in his police report, Sergeant James Crowley said he spoke to Whalen on the scene and she Whalen described seeing, quote, "What appeared to be two black males with backpacks." That's not what Whalen says she said.

WHALEN: As I said, the only words I exchanged were I was the 911 caller, and he pointed to me and said, "Stay right there."

QUESTION: Nothing more?

WHALEN: Nothing more than that.

QUIJANO: Asked about the discrepancy, a Cambridge police spokesman said that's an issue that could be reviewed in the future. In the meantime, for Lucia Whalen, vindication.

WHALEN: Now that the tapes are out, I hope people can see that I tried to be careful and honest with my words.

QUIJANO: And despite everything, Whalen said she'd do it all again.

WHALEN: You have to -- you know, if you are concerned, you're a concerned citizen, you should do the right thing. If you're seeing something that seems suspicious, I would do the same thing.


QUIJANO: Now, as for today's White House beer summit, Whalen's attorney suggested her client's forthright actions should have earned her an invitation too.

And John, that attorney, Wendy Murphy joked about it. At one point, she said, "I don't know, maybe it's a guy thing." She said that's OK, Whalen doesn't like beer anyway - John.

ROBERTS: Well, if she doesn't like beer, why would she want to be invited?

Elaine Quijano for us this morning. Elaine, thanks so much.

COSTELLO: More on the Michael Jackson saga now. Michael Jackson's father says he believes his son had a secret love-child. It's true. Joe Jackson claiming this young man sitting with the Jackson family at Michael's memorial service could be Michael's fourth child.

His name is Omer Bhatti. He's 25 years old. And here's how Michael Jackson's father broke it to news one.


UNIDENTIFIED MALE: Michael may have had another child. Omer is his name? And then everybody was like, oh, I was sitting there right next to Rebbie, and everyone was trying to connect some dots. Do you know that as Michael's other son?

JOE JACKSON, MICHAEL JACKSON'S FATHER: Yes, I knew he had another son. Yes, I did.

UNIDENTIFIED MALE: And he looks like a Jackson.

JOE JACKSON: Oh, yes, he looks like a Jackson, he acts like a Jackson, he can dance like a Jackson.


COSTELLO: That's proof.

CNN has not been able to confirm Joe Jackson's claim. We're reaching out to Bhatti for a response, but he has denied being Michael Jackson's son before.

There was only one doctor at Michael Jackson's side when he died, and that would be Dr. Conrad Murray. And investigators are now saying he's the only doctor in their sights. Randi Kaye has new details about his finances and what it was like inside Jackson's home on the morning he died.

RANDI KAYE, CNN CORRESPONDENT: John, Carol, a federal law enforcement official telling us now that, quote, "Dr. Murray is the only one they're looking at."

Now we know that other doctors' records have been subpoenaed, but clearly now, with three search warrants now served on Dr. Conrad Murray's property, he has become the central focus.

Remember, his lawyer told us that they were searching those properties looking for evidence in the offense of manslaughter.

Dr. Murray's lawyer's office told me they don't think an arrest is imminent because they haven't seen any proof or even a final autopsy report.

Also Murray's loan from the bank for his country club home in Las Vegas was $1.65 million. It turn out that he failed to make his payment of just over $15,000 last January and has been racking up debt every since.

I called his attorney about this. A spokeswoman confirmed he is facing the threat of foreclosure, and told me, quote, "He was to be paid $150,000 a month by Michael Jackson. He was not paid by AEG," that's the tour promoter, "or Jackson for the two months he worked for them. So he is low on money."

Meanwhile, if Dr. Murray fails to pay up by mid-August, he could lose his house.

We have insight to report about Jackson's final morning at his home. His personal chef is talking.

Kai Chase told CNN Dr. Murray usually came down to get Michael Jackson's breakfast around 10:00 a.m., to get him something to eat or drink. But on June 25th, the day Jackson died, the doctor did not come downstairs until noon.

Now, the chef says at that point, Dr. Murray came running halfway down the stairs that actually lead to the kitchen in the house, screaming, "Hurry, get prints, get security."

She said the house became chaotic. Security guards were rushing around, the housekeepers were screaming, and that Michael Jackson's daughter Paris was screaming, "Daddy, daddy."

The chef said everyone gathered in a circle, and they all prayed at that point.

And finally, we've learned that this Jackson case is actually not the first time Dr. Murray has had a brush with the law. He was charged in a domestic abuse case in Arizona back in 1994. Deputies apparently responded to a domestic abuse call. We've confirmed Dr. Murray was arrested for, quote, "domestic violence disorderly conduct."

We're told by Tucson police and the county attorney that his girlfriend had accused him of having an affair and apparently threw something at him, and then Dr. Murray allegedly pushed her down.

He was acquitted about five months later.

John, Carol, back to you from Los Angeles.

COSTELLO: It just keeps getting uglier, doesn't it?

ROBERTS: It's like this big onion, just keep peeling back the layers and something else pops up.

Well, President Obama, his approval ratings down ten points in just a month since the end of June. Is it just the typical six-month slide, or is something else at work? We'll put that question and other political to our panel coming up right after the break.

It's 11 minutes after the hour. Keep it right here.


ROBERTS: Welcome back to the Most News in the Morning.

New Gallup poll numbers put President Obama's approval ratings at a new low. The numbers how 53 percent of those asked approve of the president's job, the number who disapprove now up to 39 percent.

As for the president's health care reform, two key Senate Republicans now say there's no way they'll have a deal before Congress's August recess next week. Over in the House, a plan for conservative Democrats is upsetting liberals.

For more on all of this, let's bring in Tara Wall of "The Washington Times." She's also a former senior advisor for the Republican National Committee, and Karen Finney, who is the former communications director for the DNC.

Karen, let's start with you. Health care, a little bit of movement in the Senate, now saying they're not going to have a vote by next Friday. Meantime, blue dogs in the House say they have a deal. Liberals are all up in arms.

Where do we stand with health care? Is this everybody get down or is there just too much push-pull going on?

KAREN FINNEY, FORMER COMMUNICATIONS DIRECTOR, DNC: I think the pressure is really going to be on to get something done. I hope that what happens is as members of Congress go home over the recess, they are confronted with constituents who want to know, look, we voted for change. What's going on here? Unfortunately, I think part of what we're seeing, though, is the impact of sort of the negative advertising and the spin control that I think actually the Republicans have really put the Democrats on defense, unfortunately.

And unfortunately, I think we saw this movie back in the '90s. So I'm hoping -- I think we're all hoping that the Democrats can kind of get it together.

I think it's good news what we're seeing on the House side with the blue dogs. Obviously there's going be a little more work being done over there.

On the Senate side, look, I think there a number of senators who have drawn a line in the sand and made it clear we have to get a public option despite of what some of the so-called gang of six on the Finance Committee is trying to do.

So clearly a lot of issues to hash out, and, obviously, August, there is going to be a lot of activity both from the RNC and the DNC.

ROBERTS: Tara, what do you think is going to happen by the time the members get back after the August recess? Do you think that this really will go anywhere, or will it get kind of weighed down by its own lack of momentum now?

TARA WALL, FORMER SENIOR ADVISOR, RNC: Certainly, the longer it's out there, the worse it is for President Obama.

I do believe at some point, at the end of the day, there will be some type of health care reform, whatever form that may be in. I think it is still up in the air. I do think obviously it's going to be something that's going to be tackled as soon as the members get back in session.

I would say that it seems at this point, though, that the blue dogs, the president felt like the blue dogs were making him look bad, and he had to make some concessions.

He sold this as a cost-cutting plan where government is it going to come in and solve all of the problems, and had to really pivot off of that, realizing that the real unpopularity with the American people for what was being proposed.

And some might give him credit for that and give the blue dogs some credit for that as well.

Obviously, though, they used to say for President Bush, when both sides are mad at you, you know you are doing something right. The same might apply here as well.

ROBERTS: Yes, we get the same thing here at CNN.

Let's talk about the approval ratings. President Obama's approval rating in the latest Gallup poll is 53 percent. Karen, that's down from 58 percent just a couple of weeks ago, and down from 63 percent in late June.

What's going on? Is it typical of what happens after six months, or does he have some real problems pushing his poll numbers down?

FINNEY: I think it's a couple of things.

I mean, first of all, when you start somewhere in the 70s, you know that's probably not going to last forever. So sure, we're six months in. Things are tough. They're getting better. But definitely people are still feeling the pain, and there's still a lot of anxiety out there.

Again, I think some of this has to do with what we've seen, the attacks from the Republicans, from the right. And, again, I think the White House and the Democrats need to get back on often and talking about -- proactively about what was accomplished in the last six months.

But, you know, when you have Republican members out there talking about, well, you know, the stimulus plan is already a failure when we're really only six months in...

ROBERTS: Do you have that much of an impact, Tara?


I mean, are you guys that good?

WALL: Well, I think Republicans would like to take as much credit -- I think -- look, the public is tiring of this pointing the finger backwards and continuing to blame a past administration. At some point, you have to buck up, you've got to step up and take responsibility for your own actions and for your own proposals and plans.

Popularity aside, the president has been very popular. His policies, however, have not been popular. And that -- the likability factor has not kept up -- is not keeping up with the reality. And the reality is, this -- these policies are not popular with the American people.

ROBERTS: Go ahead and jump in Karen, and then I want to talk about happy hour after this.

FINNEY: OK, happy hour.

Obviously, I disagree. I think part of what's going on here, people trust the president, they do like him. And what's interesting is when you sort of dig in that next layer in a lot of these of polls and people are asked about some of the merits of these programs, they do like it, and they do understand.

So part of this is, you know, there's a little bit of a spin game going on on the surface. As people are able to kind of dig in and understand a little more, like health care policy, for example, they do like it. ROBERTS: OK, but...

WALL: He ran as a centrist. He's governing as a liberal, and that is what you're seeing.

FINNEY: Well, the left is angry at him and the right is angry at him. So I think he's pretty much in the center.

But I know John wants to talk about the beer.

ROBERTS: I know, we want to talk about happy hour here, because there's the question -- it will be a little private get together. The public won't be invited in. We won't know what's going on, we won't see the dialogue here.

So is this going to substance, or it just going to be suds? What really, Tara, needs to happen for this to be a teachable moment for America, and then Karen, we'll get you to ring in.

WALL: I first asked about the media, me included, to be a little more responsible in how we characterize this.

I mean, certainly we understand the appeal of the president and the appeal of wanting to sit down with him, but, at the same time, the issue is delving in to what the issues are going to be, not bantering about what kind of beer these guys will have.

The issue is whether the conversation will be moved forward. And I don't know that it will be. I don't know if it will be more than a photo-op at this point. I hope it would be more than that.

But is Gates going to apologize for overreacting? Is the president going to apologize for throwing the entire police department under the bus in front of a national audience?

How are we going to move the conversation forward about racial profiling? Is it going to build upon the federal ban on racial profiling that we already have?

So those are the kinds of things I think Americans would like to see coming out of this, not what kind of beer these guys are drinking.

FINNEY: I agree with Tara certainly that what kind of beer they're having is really not what this should be about.

But I think that we all have to take responsibility for the fact that what comes out of this meeting is really on all of us. What the president has done is to say, let's the three of us come together and sit down and have a conversation.

And I hope what comes out of it is not big pronouncements, but, you know what, just three guys sitting down talking to one another, because that is how we break down racial stereotypes and other prejudices. It's when you have the opportunity to talk to somebody or be exposed to somebody who's different than you are, that you say, you know, that person -- I have something in common with them. That's how we break that down.

The other thing is, you know, some people are criticizing this as a potential for a photo-op. We can't know what an impact of people seeing though images will be.

For younger people, they may see those pictures and think, wow, these two guys are going to sit down together. Maybe I should think about how I deal with that in my own life. So pictures can be very powerful.


ROBERTS: Sorry, we're out of time guys, but we'll see what happens. We'll see what happens. We hope to hear from the principles after this meeting and see what they have to say.

Tara Wall, Karen Finney, great to see you, as always, thanks.

COSTELLO: Interesting conversation.

Well, "Newsweek" had a really interesting cover. It said "The Recession is Over." Is it really over, though? Even the president took, well, he doesn't quite believe it either. We'll delve into this more.

It's 21minutes past the hour.


COSTELLO: Welcome back to the Most News in the Morning.

So, "Newsweek" magazine is having a little fun with the economy for their latest cover story featuring a big blue balloon that reads "The Recession is Over."

What a great fantasy that is. And the cover, it caught the president's eyes.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I don't know whether you've seen the latest cover of "Newsweek" magazine on the rack of the grocery store. But the cover says, "The Recession is Over."

Now, I imagine that you might have found the news a little startling.


I know I did.


COSTELLO: But, "Newsweek" is already responding to the president in an article online, and they're pointing out, the president seems to have missed the asterisk that adds -- "good luck surviving the recovery." It's was a joke.

CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: I know. That's the whole thing. Once the recovery begins, it's not going to feel any different for anybody.

ROBERTS: And you have that big pin there ready to pop the recovery, too, right?

ROMANS: Oh, yes.

Listen, everybody this week is talking about a recovery in home prices and home sales and home values. This is the biggest asset you will ever buy. You're going to borrow a ton of money to go out and buy a house.

Everyone wants to know if there is some relief here. Well, I've got the latest foreclosure numbers from realty track for the first half of the year, and I have to tell you that it's uneven. Everything that's happening in the housing market is very uneven, which is normal because this is very local.

I want to show you the top city for foreclosures. What's that phrase, "What happens in Vegas stays in foreclosure court," I guess, because look at Vegas. Incredible the number of foreclosures in Vegas. Ft. Myers, Florida, really tough there.

Some of these cities in California are still up 50 percent, 60 percent, 70 percent from last year the number of foreclosures.

So foreclosures heating up in other big cities like Seattle, Minneapolis, Phoenix up 58 percent versus a year ago, Phoenix foreclosures. And prices in Phoenix, by the way, have been more than cut in half now from the peak -- Miami, Tampa.

But there are a few places where the foreclosures are tapering off. St. Louis, Baltimore, New York, Houston, Boston. If you look at Denver -- Cleveland, actually which was the beginning of this whole thing, Cleveland's foreclosures have come down.

But some people are saying that's just because there have been so many foreclosures there aren't any more houses to foreclose on in some of these neighborhoods. But still, at least that's a sign of cooling off a little bit there.

So depending on where you live, these foreclosures are starting to cool off.

Meanwhile, 25 or 26 different loan servicing CEOs were summoned to the Treasury Department this week for maybe a little talking from Treasure officials about why five months into it haven't we been able to modify some of the loans and refinance some of the loans. So they still haven't gotten that part of the equation right yet.

COSTELLO: That's just wrong. That's just wrong.

ROMANS: I don't know how much of the home sales have been buying the foreclosed homes, investing, investments, and investors.

ROBERTS: You would probably suspect at least some of it is.

ROMANS: I'm pretty sure it's at least a quarter of it is that kind of activity.

COSTELLO: Who has any money? I mean, first-time home buyers, they probably do.

ROMANS: This is a good time for first-time home buyers. It really is. I can't say it enough. It's a good time for the first time home buyers if you have a job and you have money.

ROBERTS: Christine Romans, minding your business this morning. Christine, thanks so much.


ROBERTS: We've been talking a lot about health care, things starting to move in the House just a little bit. The blue dogs came up with a deal.

Well, what about the movement in the Senate? There is a bipartisan group of senators trying to put together a deal. We'll talk with one of those people. Senator Charles Grassley joins us coming right up.

It's 27 minutes after the hour.


ROBERTS: It's 30 minutes after the hour, and here are this morning's top stories.

The doctor at Michael Jackson's side when he died is now the sole focus of federal investigators, and there are new details about Dr. Murray's money problems and the chaos inside Michael Jackson's home on the morning he died.

COSTELLO: The man charged in last month's Holocaust Museum killing has been indicted by a federal grand jury in Washington -- 89- year-old James Von Brunn is facing seven separate charges. He could be looking at the death penalty.

ROBERTS: And a Boston police officer could lose his job over an e-mail in which he called Professor Henry Louis Gates Jr. quote, "a banana-eating jungle monkey." Officer Justin Barrett sent it to several people and "The Boston Globe" responding to an article over the Gates' controversy. Barrett has apologized and his attorney has said -- insists rather -- his client is not a racist.


PETER MARANO, OFFICER JUSTIN BARRETT'S ATTORNEY: Justin Barrett didn't call Henry Gates a jungle monkey to malign him racially. He stated his behavior was like that of one and it was a characterization of the actions of that man.



COSTELLO: What can you say after that? I don't know -- I can't believe they went on camera after the e-mail became public.

ROBERTS: They're obviously trying to clean up a very big mess.

COSTELLO: I don't think they're doing a good job.

On to health care now. After weeks of closed-door meetings, three Democrats and three Republicans on the Senate Finance Committee known as the "Gang of Six" are breaking off talks on health care reform. The reason -- two of the Republican senators say there's no way they can cut a deal before the summer break starts next Friday.

One of the two is Iowa Republican Senator Chuck Grassley. He joins us live from Capitol Hill. Good morning, senator.

SEN. CHUCK GRASSLEY (R), IOWA: Good morning. It would be better for me to say that instead of saying there's no way we can cut a deal, there's no way we can get all the compromising that needs to be done by an artificial deadline of Friday of this week. So we're going to continue to work together this week and next week. But we're getting close.

COSTELLO: What's the major sticking point?

GRASSLEY: Oh, there's several. If you looked at all of the things we have to deal with, it's a small subset of everything we have to do. But it's probably 50 percent of all of the controversy that's involved in it.

But the point is to answer your questions there's several things on the revenue that has to be raised yet. I think we have got most of that figured out. But there's a lot of detail within those issues that have to be compromised yet.

And then there's some places where we have policy yet that has to be figured out. I think we have got some of the big things that were contentious, compromised. There's not going to be any government-run insurance company set up.

And we're going to increase the competition for the present (INAUDIBLE) through cooperatives as we've known them for 150 years.

And then another very important one is whether or not to mandate that every employer has to have health insurance for his employees. We're not going to have an employer mandate. We're not going to have the big payroll taxes on employers that the House bill and the Kennedy bill does.

Those are some things that we really have compromised that has been very tough things and wide differences between Republicans and Democrats.

COSTELLO: You know what a lot of people are worried about like if this thing like -- the recess happens and then lawmakers bring their ideas of health care reform back to their constituents. And it's sort of like it's even more complicated.

And all of the compromises that you've reached so far might go by the wayside because individual lawmaker's constituencies might say we don't like that.

GRASSLEY: Well, Carol, isn't our country a Democratic government? Doesn't it rule -- or isn't it supposed to rule from the grassroots up? And if what we're trying to do here can't meet the test of public opinion, should we be doing it?

I mean, after all, this is a democracy and these are complicated issues. If they can't be understood by the public, you know that we're passing a law affecting every citizen. Do you know health is a life or death situation?

COSTELLO: Absolutely Senator. But I will there are ads on television now put out by both the DNC and the RNC that certainly complicate the issue and say things that aren't quite true for political purposes.

I think many people are confused by them.

GRASSLEY: Well, when they get a chance to talk to their Senators and Congressmen; that is right out grassroots democracy. And they have an opportunity to talk to us uninfluenced by outside sources and they can express our views to us and we ought to be able to explain this. If you can't explain something, it -- you know, you're in a bad situation in our country.

COSTELLO: That's true.

Ok, so if you were a betting man, when do you think health care reform will become a reality in America?

GRASSLEY: Just think how far we've come since February and March on this whole issue. There are two committees that reported their bill -- we're working on a bipartisan approach here in the Senate. It will probably be the only bipartisan approach before the Congress and probably it takes bipartisanship to get anything done.

And it ought to be bipartisan when you're restructuring 1/6 of the economy and also when you're affecting a life or death situation of every citizen in our country. So I expect this progress we've made is pretty good indication that we'll get a bill to the president this fall.

COSTELLO: Senator Grassley thanks for joining us this morning. We appreciate it.

GRASSLEY: Glad to be with you.

ROBERTS: Homelessness in America is a huge problem, right? So many people have wrestled over what to do about it.

One city -- actually more than one city -- got an interesting solution. But is it the right solution? Is it good to just ship the problem overseas?

Our Alina Cho is looking in to that. She's got the details on it coming right up.

It's 36 1/2 minutes after the hour.


ROBERTS: Welcome back to the most news in the morning.

Cities across the country are now giving out one-way tickets to get homeless people out of town. Is it a real solution though or an out of sight, out of mind quick fix?

Our Alina Cho is looking into that for us and she joins us live this morning. Good morning to you.

ALINA CHO, CNN CORRESPONDENT: Good morning. It kind of depends on who you ask. Some people think it's heartless. Some people call it a compassionate program. It really does depend on who you ask.

Good morning everybody.

There's no question though that homelessness is a huge problem in America. In a given year, 3.5 million Americans are without a home. People do want solutions.

Some cities, including the nation's largest, New York, are actually using the city dollars to ship the homeless out of tents.


CHO (voice-over): Free plane tickets to places like Paris, Puerto Rico, Casablanca; train rides and bus tickets too. The recipients -- the homeless and taxpayers are footing the bill.

MICHAEL STOOPS, EXEC. DIR., NATIONAL COALITION FOR THE HOMELESS: We used to call it in a negative way, Greyhound therapy. But if it's done right, it is a very good program.

CHO: The National Coalition for the Homeless says cities across the country are using taxpayer money to get rid of homeless people sending them to places where they can find a temporary home, mostly with relatives.

MAYOR MICHAEL BLOOMBERG, NEW YORK: Given the cost of providing shelter for a family, this saves the taxpayers of New York an enormous amount of money.

New York City's Department of Homeless Services says on average it costs $218 per person for a one-way ticket; the cost of housing a family of three in a shelter, $36,000 a year. Justin Little and Eugenia Martin owed back rents on their apartment in North Carolina. So with their 5-month-old daughter, they came to New York last week for a fresh start. With no money, they went to a shelter, then they got the help they needed from family members. So three days later, the city paid to send them back on a Greyhound bus.

EUGENIA MARTIN, GIVEN TICKETS TO LEAVE NEW YORK: They paid for our tickets. They gave us food on the bus because we had no money. They even called to make sure we made it here and everything. So I'm grateful.

LINDA CONTEZ, PICTURE THE HOMELESS: We felt pressured. We felt pressured that they wanted us to get out of the system, to get out of the state and to go somewhere else. It was right from jump.

CHO: Linda Contez and her husband moved to New York a year ago after their Florida home went into foreclosure. She says as soon as the couple applied for shelter, instead of offering a bed, the city wanted to pay for tickets back to Florida.

Contez, who now works as an advocate for homeless rights, says it took three months to convince social workers that returning was not an option.

CONTEZ: If they can go back to another city and they have housing, I mean by all means. But really in the long run, why were they here in the beginning? If they couldn't live where they were before, evidently they came here for a reason -- to get housing.


CHO: Critics of the program call it cosmetics saying by shipping the homeless out, you're just shipping the problem, really, from one city to another. You're moving them really from a shelter bed to a living room couch and they're still homeless.

Advocates say, as you heard in the piece, $218 for a ticket versus $36,000 a year to house a family in a shelter, you're looking at thousands of dollars in savings.

The interesting thing guys, is that you just heard from, Linda Contez, she and her husband live in a shelter. They both have fulltime jobs. She's an advocate for the homeless. He's a sanitation worker. But the truth is, even with full time jobs, they can't afford an apartment in New York.

ROBERTS: Which brings up the question that we had while we're watching your piece these folks are having trouble in other cities across America. Why do they move to New York where it's so much more expensive to live? Is it because they have better programs for the homeless?

CHO: I think that's one reason. They thought that they could find shelter here. And there is a -- you heard Mayor Bloomberg say there's a legal obligation to provide shelter. It's one of the only cities in the country that has something called a Shelter Law. You cannot tell the homeless we're too full. You have to provide shelter.

In cases where you cannot, this is what happens. A lot of people are asking, "We're in a recession. Is this the best way to be spending taxpayer dollars?"

The city argues, listen, $36,000 a year to have a family of three in a shelter for a year versus $218 per ticket, we're saving thousands of dollars. So, there's an argument either way for it.

It's a controversial program. But one thing is for sure, with this recession, there are more and more homeless people. The numbers are jumping and it's only going to get worse.

ROBERTS: Great story, interesting one too. Thanks very much Alina.

CHO: You bet.

COSTELLO: Here's a rundown on the AM Rundown. Here's what's on the A.M. Rundown on the next 15 minutes up next.

Folks in Brooklyn, New York are divided over plans for the new Coney Island. Will all the charm of the famous landmark be swallowed up by swanky hotels?

At 50 minutes past the hour, we're paging Dr. Gupta to get real answers to your questions about health care reform.

And at 7:55 Eastern, a big change in the relationship between Washington and Havana with one flip of the switch; we'll explain that one for you.

It's 43 minutes past the hour.


COSTELLO: It's kind of a cloudy day in New York. There were nasty thunderstorms last night. But today, there's just a chance of those storms coming back. The high of 88 degrees.


New York's Coney Island is getting a facelift, and no one is disputing the fact that it really needs one.

ROBERTS: But some people think that the city's upscale renovation plans will kill Coney Island's character.

Richard Roth joins us now live from one of America's most famous beach towns. A lot of controversy about this, Richard; what's it all about?

RICHARD ROTH, CNN CORRESPONDENT: That's right John. You know, my cameraman Frank, just told me his parents met under the board walk here at Coney Island many years ago. There may have been a lot of drama back then. But nothing to match what's been occurring now in the fight over the restoration of Coney Island.


ROTH: Coney Island, a New York City institution. The beach, the rides, yes, the freak shows.

UNIDENTIFIED MALE: Getting those hot dogs down. That's a true champion.

ROTH: Of course, the hot dogs. A long time ago, Brooklyn's Coney Island was the place to be, cooling off at a time when air conditioning didn't exist. On a summer afternoon at the famous Nathan's Hotdog Stand, Brooklyn-born Irv Millman came back to visit and reminisce.

IRV MILLMAN, NEW YORKER: It was just a wonderful time, kids, the beach, water, what else is there for a kid?

ROTH: More recently, historic Coney Island has been caught in a controversy about its future. New York City and developers want to revitalize much of Coney Island which became seedy and rundown as city people moved to the suburbs. New York approved on Wednesday a large redevelopment plan, filled with hotels, apartment, and stores.

BLOOMBERG: Let's be honest about this. The best days for Coney Island have passed unless we do something. And here we are doing something to try to give it a real future.

ROTH: Frustrated Coney Island activists watch the vote occur. They see corporate America destroying an iconic part of the fabric of New York.

DICK ZIGUN, MAYOR OF CONEY ISLAND: There's not enough acres left after you stick in all these hotels and stuff that doesn't belong in the amusement area for rides for the very amusements that attract and ...

ROTH: The city says the Cyclone and the Wonder Wheel will survive along with new amusement attractions. Jobs and housing are promised for local residents.

55-year-old Mark Page was at the board walk with his family. He's seen the ups and downs of Coney Island as a life-long resident.

MARK PAGE, CONEY ISLAND RESIDENT: I know it's modern. And we have to step up to the future in the 21st century. But don't get rid of the essence. That's what I think is important.

ADRIAN PAGE, CONEY ISLAND RESIDENT: I hope they retain the feeling of Brooklyn. Brooklyn is like the world.

(END VIDEOTAPE) ROTH: Still to come, New York City says it's going to buy back here the land here that a developer does own. So there's still a little bit more of a rollercoaster ride for Coney Island's future though the city is confident it's on the right track after what the mayor said was years of sinking here at the beach -- John and Carol.

ROBERTS: Is there a way, Richard, that they can renovate, they can upgrade it, and still maintain that sort of Brooklyn kitch (ph) that Coney Island has always had.

ROTH: That's still the big issue. There were several proponents as noted at the city council meeting who are quite vehement that they cannot achieve that. But the nostalgia, the historic charm will be lost.

But the city, the mayor says, "Look, it needs to be done desperately." When you look around here in the early morning, you think that a little -- it does need a lot of work here.

So I think -- look, the mayor said it's not going to be Disneyland. We saw what happened with Times Square. There was a change there. A lot of people think it was for the better but still some people say it's missing what was there originally.

ROBERTS: All right. Richard Roth for us on Coney Island this morning. Richard thanks so much.

Hey, listen, we've been talking about health care all morning, right? You can be forgiven if you don't quite grasp it because it is fairly complicated. After all the House bill is more than 1,000 pages.

But our Dr. Sanjay Gupta is coming up. He's been looking into all of this. He's your inside connection to getting your health care questions answered. He'll be right with us.

49 minutes now after the hour.


ROBERTS: The debates over health care reform. It's enough to give anybody a headache.

COSTELLO: Certainly is. We think it's time to simplify, that's where our chief medical correspondent, Dr. Sanjay Gupta comes in. Sanjay's taking your question.

Okay, lots of ground to cover with today's questions. Listen to Vanessa from El Paso.


VANESSA, EL PASO: Hi, Dr. Gupta. My name is Vanessa and I'm from El Paso, Texas. I am a mother, a working mother of two, happily married. I hate to admit, but I haven't had health insurance for about five years, my employer does offer the insurance, but the premiums are very high, and my family cannot afford. I'm hoping the new health reform bill passes soon.

My question is, if the president does sign this bill in October, how long would I have to wait before I can sign up for the new public plan? Thank you.


DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: Vanessa thanks for calling in. This actually brings up a couple of interesting points like Carol you mentioned. On of the things is this myth about how fast this is all going to take place.

If the bill is signed in October, there's been rumors circulating that within a couple of months it's all going to change. The fact is it's going to take a lot longer than that as you might expect, this is pretty complicated.

We've poured through the 1,000 pages trying to decipher this, trying to create a time line that might make sense for you.

Let's see if we can try and break this down a little bit. About 2011, a couple of years from now when the tax increases that people have been talking about are going to start taking effect to pay for this. 2013, several things will happen, this is a critical year for health care reform overall.

Second line first, everyone would be required to have health insurance. Again, 2013, preexisting conditions covered at that point. If you have an illness, you've had a hard time getting insurance, that's going to change in 2013 under this plan. And also the bottom line important, exchange opens up to businesses with under 10 employees only.

If you look at 2014, it's going to broaden a little bit more, that exchange is going to open up to businesses with under 20 employees. And the public option is going to be opened up to people who can't afford work premiums.

In 2015, it's going to be sort of interesting and it gets to one of the big debates around this, Carol and John, this idea that everybody will flood to the public option if it exists. Congress will vote on that point about whether to expand this public option even further and seeing if people who, you know, have health care insurance now but want a cheaper option might be able to buy into that. But that won't happen in 2015.

ROBERTS: Two points here, Sanjay. First of all, you mentioned the exchange a couple of times. Can you just explain what the exchange is and say that Vanessa works for a company with over 20 employees; she won't have that option to join that exchange for about seven more years or so? GUPTA: Second question first. That's right. This is the time line sort of indicated, it could be several years before someone would actually be able to join this public option or exchange.

This is a government subsidy that's going to help provide health care insurance for those who are having a hard time affording it now. That's basically what it is.

It gets a little bit more complicated than that, and our goal is to try and make this simple. So let me just add a couple of points.

One is that if you look at the numbers overall, if you have access to private insurance right now, most of what we've read in this 1,000-page bill is you're going to stay in that private plan unless that you're paying more than 11 percent of your overall income towards premiums.

You can do the math in your head, you can think about that, but if you're paying less than 11 percent, you're going to have a hard time qualifying for this sort of public option.

ROBERTS: Sanjay Gupta for us this morning, helping us to break it all down. Thanks so much, doc. We'll see you again soon.

GUPTA: Thank you.

COSTELLO: I just admire him for reading all 1,000 pages of this plan. That's amazing.

In Havana Cuba, the United States had this sign up. And the sign was like I guess it was proclaiming pro-American messages. There's been a decision to take that sign down.

Shasta Darlington will tell us why.

It's 54 minutes past the hour.



Signs of a thaw in U.S.-Cuban relations: the Obama administration quietly pulling the plug on an electronic billboard that broadcast anti-communist messages to Havana. But the Cuban people weren't getting the message anyway.

Shasta Darlington reports.


Both the U.S. and Cuba have made a series of cautious overtures since Barack Obama took office. But with this latest gesture, no news means good news for bilateral relations.

(BEGIN VIDEOTAPE) DARLINGTON: Cuba unplugged. The United States has turned a huge electronic ticker at its diplomatic headquarters in Havana sending a message that times are changing.

The sign board was unveiled in 2006. It displayed news and human rights slogans and ignited a war of words with then Cuban President Fidel Castro.

"This is a provocation of that nest of cockroaches as people call them and excuse me for offending the cockroaches," he said at the time.

One message read, "No man is good enough to govern another without that man's consent -- Abraham Lincoln." Another, "Read what you want, say what you think."

Cuba retaliated. Erecting a field of 138 black flags representing what it called the Cuban martyrs of U.S.-backed terrorism. The ticker was effectively blocked.

According to the state department, the sign was quietly unplugged in June.

UNIDENTIFIED MALE: We believe that the billboard was really not effective as a means to delivering information to the Cuban people. It was evident that the Cuban people weren't even able to read the billboard because of some obstruction that were put in front of it.

DARLINGTON: The shutdown went mostly unnoticed in Havana.


DARLINGTON: "That doesn't have anything to do with us," she says. "I only noticed because you told me."

Cuba has also done its part. When Barack Obama took office, aggressive billboards facing the diplomatic mission were taken down.

UNIDENTIFIED MALE: Dueling billboards, if you will, was not serving the interest of promoting a more productive relationship.

DARLINGTON: The massive marches that Fidel Castro once led past the building, also a thing of the past.


DARLINGTON: Both countries have ratcheted back the Cold War era rhetoric, but they have a long way to go before they restore diplomatic relations broken off almost 50 years ago -- John, Carol.

ROBERTS: Shasta Darlington reporting for us this morning. Thanks so much.