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American Morning

Time Ticking on Debt Ceiling Deal; Closing Arguments in the Casey Anthony Trial; Six People Missing After Boat Sank in Mexico

Aired July 04, 2011 - 07:00   ET

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


ALI VELSHI, CNN ANCHOR: Case may be going to the jury on Fourth of July. Closing arguments in the Casey Anthony murder trial. The prosecution painting a picture of a serial liar. The young mom who they say sacrificed her child for freedom on this AMERICAN MORNING.

CHRISTINE ROMANS, CNN ANCHOR: Welcome to AMERICAN MORNING. It is Monday, the fourth of July. Wow! Happy Holidays for everyone out there.

Kiran is off enjoying it.

VELSHI: Breaking news right now. Six people are missing after a small boat carrying mostly Americans sank off of Mexico's Baja, California, peninsula. Officials say 44 people were on the boat when it left the port of San Felipe. We're told the boat hit rough weather and sank almost immediately.

Right now 37 of the passengers are safe and back on dry land. There are reports of at least one person having died. The U.S. Navy is sending a helicopter to help with the rescue effort. We'll continue to monitor the story and bring you the latest developments throughout the morning.

ROMANS: Meantime the Casey Anthony case could go to the jury today after heated, emotional and powerful closing arguments in this murder trial. Prosecution describing the clash between the life they say Casey wanted and the life she had.

VELSHI: The defense using the jury -- or urging the jury to base their verdict on evidence rather than emotion. CNN's David Mattingly joins us live outside the courthouse in Orlando, Florida. They're not under way yet, David, but what's the order of business today?

DAVID MATTINGLY, CNN CORRESPONDENT: What we're going to see today, the prosecution will have a chance to finish up with its closing arguments, then the jury will go through a lengthy instructional period from the judge, and then they're going to start deliberating.

But as you were talking about just a second ago, this case now coming down to the nitty-gritty here, and the emotions are very high. Even while the defense was cautioning the jury to stay away from emotion and look at the facts, things got emotional between the attorneys. When defense attorney Jose Baez was making a point about, perhaps, Casey Anthony's father having access to the duct tape in this case, he looked over and saw prosecutor Jeff Ashton smiling and here's what happened.

(BEGIN VIDEO CLIP)

JOSE BAEZ, ATTORNEY FOR CASEY ANTHONY: We're not talking about fantasy forensics anymore. We're talking about cold hard evidence, evidence that points to one person, one person only. He could get up here and lie all he wants and dance around the truth, but the truth is the truth, and depending on who's asking the questions, whether it's this laughing guy right here or whether it's myself --

UNIDENTIFIED MALE: Objection.

UNIDENTIFIED MALE: Sustained. Approach the bench.

(END VIDEO CLIP)

MATTINGLY: Did you hear that? He called him "laughing guy." Immediately the judge called them both up to the bench and then had some very strong words to warn them. He doesn't want to see either side doing anything like that again, and said if it does happen again, whoever does it, is going to get thrown out of the courtroom and won't be able to participate in the rest of this trial. Very strong words to keep this thing on track here at the end as we're now preparing for this case to go to the jury.

VELSHI: All right, David, thanks very much. We'll stay on top of this with you through the course of the day. It is expected this could go to the jury today.

ROMANS: That's right. So let's bring in Sunny Hostin, former federal prosecutor and legal contributor for "In Session" on TruTV. She's been following this case all along. You saw the "laughing guy" reference, the prosecutor laughing behind his hand. Was that stagecraft for the jury, appropriate, inappropriate, a minor blip in the whole thing?

SUNNY HOSTIN, LEGAL CONTRIBUTOR, "IN SESSION": It was really inappropriate. I've been watching Jeff Ashton. He's a passionate prosecutor. And you know I was a prosecutor. There are moments when you're really in the moment but you can never as an officer of the court forget that the jury is there and the jury is watching you.

And he has been sort of making these expressions throughout. He did it in the opening statements. He's done it now in closing arguments and I think that these are just two gladiators at war with each other and it's gotten a bit personal. But I think Jeff Ashton really crossed the line.

Jose Baez, what we didn't show is, he asked the court not to sanction and not to hold the prosecution in contempt. He said they've been there for three years and he didn't want that to happen. He really rose to the occasion.

VELSHI: That happens, then it creates other opportunities for saying that trial didn't go as expected. We've been asking this as our question of the day, whether people think the prosecution proved its case.

HOSTIN: I saw.

VELSHI: I'm a bit surprised. There are a number of people who say no.

HOSTIN: Yes. Yes.

VELSHI: Whether -- they haven't proved it beyond a reasonable doubt.

HOSTIN: This is a circumstantial case, lots of circumstantial evidence, no direct evidence linking Casey Anthony to this crime. And I think that's why people are uncomfortable with it. It's a capital case. They feel you need more to put someone to death.

I think it's a pretty strong circumstantial case, and the closing argument was very, very compelling and very effective by Jeff Ashton. So they do get the last word because the burden of proof is on the prosecution. We're going to hear one more time from the prosecution in rebuttal, and I would imagine we're going to see more fireworks.

ROMANS: How is Casey Anthony's responses? How are they playing, do you think, to the jury? She was angry, crying, sobbing, grimacing, what was that about?

HOSTIN: A lot of it I feel is theater, because as you've mentioned I've been watching it from the very beginning so I get to watch when the jury isn't in the courtroom. When the jury isn't in the courtroom we're not seeing these theatrics. But we are seeing them when the jury there is.

And so I think part of it is drama and theater for her. The jury is certainly, we know from studies, watching everything that she does, so it's too soon to say how they're going to react to it. But they're watching and noticing.

VELSHI: If you're this jury, been in this a long time, over all the details and they get the charge and they go in to start deliberating. Is it a long deliberation, is it quick?

HOSTIN: Well, I remember being a prosecutor and this is the most difficult time for a prosecutor. Quick viewers are usually inure the benefit of the prosecution. Long verdicts, long deliberations usually are a defense oriented verdicts.

ROMANS: Because they're struggling in there. They're trying to work through this doubt.

HOSTIN: Experience, and they're in the heat of battle. So I would remember "12 Angry Men," that thing going on. So I would imagine if we see a short verdict, it's going to be a prosecution verdict. If it starts dragging out day to day, then I think it's a defense verdict.

ROMANS: All right, we'll be talking to you again, Sunny Hostin, it's fascinating. We're all working today.

HOSTIN: Pins and needles. Thanks. VELSHI: Former Bosnian Serb commander Ratko Mladic kicked out of court this morning, the judge removing Mladic from the chambers after multiple disruptions. Mladic refused to enter a plea and claimed the judge wasn't allowing him to breathe. Those are his quotes.

The court entered a not guilty plea on his behalf. He's suspected of war crimes, including genocide. Mladic is accused of ordering the shelling in Sarajevo and the massacre of 8,000 Muslim men and boys in Srebrenica in the 90s.

ROMANS: New this morning, a police officer and father of two shot to death at a hotel in Memphis last night. Police say Officer Warren was responding to a report of shots fired at the hotel. Responders had already found the body of one victim when shots started flying again. Warren was fatally hit and pronounced dead at the hospital. That shooting suspect is in custody.

VELSHI: Two people including a toddler killed shot execution at a Pennsylvania summer home. Three others shot in the head are in serious condition this morning. The survivors haven't been able to speak so police don't have a description of the shooter. What we know right now is the home is owned by a New York City couple who were among the wounded. Police still don't have any clear motive in the story.

ROMANS: Flames lighting up the night sky in Egypt after an attack on a pipeline that supplies gas to Israel. The Egyptian army says the explosion appears to be an act of sabotage. And right now the flow of gas to Israel and Jordan has been shut off. This is the third time Egyptian gas pipelines have been attacked since that uprising this spring that toppled Hosni Mubarak's government.

VELSHI: New video of Venezuelan president Hugo Chavez in Cuba. He's there undergoing cancer treatment. Venezuela's vice president says Chavez could stay in Cuba as long as 180 days, much long than originally expected. Chavez admitted last week to having a cancerous tumor removed in Cuba.

ROMANS: And a bold new step for Thailand. For the first time a woman's in charge. Yingluck Shinawatra is set to become the country's new prime minister. Her party won the majority of Thailand's 500 member parliament. Her brother was kicked out of office during a coup five years ago.

VELSHI: Novak Djokovic the top tennis player when the rankings are announced today. The Serbian beat Rafael Nadal yesterday in four sets to win his first Wimbledon title. It's the first time since February of 2004 that a man other than Roger Federer or Rafael Nadal has been number one.

ROMANS: That's amazing.

All right, you may not know him, but 7.4 million baseball fans do.

VELSHI: Everybody in Toronto does. ROMANS: The Toronto Blue Jays outfielder Jose Batista received the most votes in all-star game history, beating Ken Griffey junior's record of six million. Batista had 54 home runs last year and leads the majors this season. The New York Yankees led the way with six all-star selections.

VELSHI: Up next on "American Morning," the battle over the debt ceiling. Talks have been going nowhere. With time running out and Congress back at work tomorrow, can we expect some kind of compromise?

ROMANS: And fists fly in the Philippines.

VELSHI: Watch what happens.

ROMANS: This is actually a mayor, oh, laying the smack down on a police officer. We're going to tell you what this is all about coming up next.

(COMMERCIAL BREAK)

ROMANS: Welcome back to "American Morning." Just about four weeks to go until the nation's borrowing limit reaches its debt line. As the pressure mounts and Republicans and Democrats, they are in their bunkers, they are digging in their heels, they are at their positions.

VELSHI: They're not even close because they have completely different approaches to this. Brianna Keilar live at the White House. Brianna, what's the deal here, because we're less than a month away? The president has told everybody get down to work but nobody has said OK, let's.

ROMANS: Is the bottom line that you have entitlement reform on one hand and tax increases on the other hand and they're both kind of like hunkered around those things?

BRIANNA KEILAR, CNN WHITE HOUSE CORRESPONDENT: Right now, I think saying that they're really sort of in their bunkers is a really good way to put it, guys. Right now the impasse is over tax increases.

Of course, happy Fourth of July to you, of course. A great day to celebrate but what it means is we're getting close to the August 2nd deadline the Treasury Department has set for the legal limit the U.S. can borrow. You have House Republicans being exactly and Democrats, being exactly where we saw them about a week and a half ago, Republicans saying there cannot be tax increases and Democrats really now, their tactic is to target what they call tax loopholes, tax breaks that hedge fund operators enjoy, corporate jet owners enjoy, oil and gas companies are getting.

Not quite as vociferously, there's also some advocating to limiting deductions that wealthier Americans, those making $250,000 or more per year take on their taxes. This is what the president is calling right now a balanced approach. He's saying if you're going to be, you know, cutting programs for seniors and for poor Americans you need to be looking at tax increases for corporations and wealthy Americans. But we are still in the same place, Republicans insisting that any kind of tax increases can hurt the economy and we'll see where things go this week. Both the House and the Senate are in session and president Obama is in town.

VELSHI: Tell me this then. There are a lot of things where you can say we can compromise on this and that. These two sides don't see its right way. What could be the big breakthrough here? Republicans are saying under no circumstances do we increase taxes on virtually anything, and Democrats say it can't just be all cuts.

KEILAR: That's right. And at a certain point one side is going to have to blink. What you've seen is Democrats start to narrow down. Instead of insisting on sort of widespread tax increases or talking about increasing taxes for certain brackets, they're talking about specific tax increases. And they feel this is very important because they're saying if you're going to cut programs, you need to be looking at some sort of tax increases. It seems like they've kind of narrowed what they want.

And you did hear yesterday, some Republicans saying, you know, we do need to be looking at the way -- we do need to be looking at the tax code. And so there's some language there, but it's certainly kind of amorphous, I guess you could say.

VELSHI: Yes.

KEILAR: And it's still early to see if they can come to kind of agreement.

VELSHI: It is amorphous and it needs to get amorphous (ph) very quickly. Brianna --

KEILAR: Yes.

VELSHI: -- good to see you. Thanks very much, Brianna Keilar.

ROMANS: Of course, Ali, this is so important that Congress gave up its July 4th holiday recess to get back to work tomorrow on the nation's budget crisis. If the debt ceiling isn't raised by August 2nd, the U.S. Treasury won't be able to pay off its bills. We're running out of time. We've seen it before, but never so close to default.

I want to show you what our debt ceiling looks like. This is Congress from 1917 to the present. Ali, they've raised it 78 times since 1960. And since the nation's debt reached the $1 trillion mark back in the 1980s, government borrowing has been climbing and climbing at an exponential rate.

I mean, my beef quite frankly, Ali, is all along here -- you had plenty of time not to get right to the edge like we are right now. Right now, the debt ceiling is $14.2 trillion. That's about 95 -- there you go, about 95 percent of the size of the whole economy. We're fast approaching rates not seen since the Great Depression. So, this is the size of our debt, our national debt, Ali, when in relationship to the entire size of the economy. So, look at this -- World War II, Great Depression, you saw our debt really balloon here as the size of the economy. This is almost approaching 120 percent, 140 percent. And then, look, here we are right now, 2009, getting up there.

This is what economists call a debt crisis quite frankly, when you have your debt bigger than the size of your entire economy.

The bottom line: America has been a borrowing nation. Right now, for every dollar the United States spends, every dollar your government spends, it has to borrow 38 cents of that, Ali. And if the debt ceiling is not raised, the U.S. could actually eventually have to default on some of its payments.

That's the last thing we need when recovering from a recession. That's how important it is. This part of your government, by August 2nd, can't borrow.

VELSHI: I'm going to say what others say to us.

ROMANS: Sure.

VELSHI: That this is not the Armageddon that Treasury Secretary Timothy Geithner and, in fact, some Democrats say it is, that the danger of defaulting is not as serious as not fixing the debt crisis over the longer term.

ROMANS: They're both very serious crises. And you're asking politicians to try to do the nuance of both of them and that's where people get very worried. They don't think these guys have the political wherewithal to be able to get it done. It's unpredictable.

The president I think last week said that results would be catastrophic. But it's also unpredictable what the world would think if we can't borrow this money. Obviously, the United States government is spending more than it takes in by an amount that's unsustainable, everyone agrees about that.

Fixing it in the short -- there's some talk, Ali, about floating maybe mini fix in the near term. Something that's not popular really with anyone, could it just punt it down the road. But, you know, we'll have to see where they go.

VELSHI: After the last three years, I'm not really looking forward a whole lot more unpredictable in financial markets.

ROMANS: Right.

VELSHI: All right, Christine, thanks a million for that.

Call it a mayoral beat down. You got to check out this video. The mayor of a city in the Philippines started throwing fists at that city's sheriff. It was all caught on camera. Watch this. The mayor is the one in the blue. Look at that. Smack down.

She was angry because the sheriff wouldn't hold off on knocking down a slum area. The mayor is taking a five-day leave of absence while the government investigates that beat down.

And coming up on AMERICAN MORNING: Prince William and wife Catherine continuing their tour of Canada. But in Montreal, a group of protesters gave them the royal snub. We'll explain that to you.

Nineteen minutes after the hour.

(COMMERCIAL BREAK)

VELSHI: Twenty-two minutes after the hour. Minding your business this morning.

U.S. stock markets are closed for the holiday today. The Dow, NASDAQ and S&P 500 closed higher Friday. That boosted -- it was boosted by manufacturing numbers and an easing of those concerns in Greece. Looking to a big jobs number on Friday to give us a sense of how things are going back here at home.

E.U.'s leaders have approved a $17 billion emergency funding for Greece over the weekend. Protests turned violent last week after parliament added new austerity measures, including new pay cuts for public workers to secure the funds from the E.U.

A new study says people are adding more to their retirement nest eggs. Those savings rose to about $18 trillion the last quarter. That's according to the Investment Company Institute. That's up 10 percent from the same time last year and just below the record high in 2007.

The hacker group Anonymous claiming it stole two dozen usernames and passwords of Apple employees after hacking the company's Web site. Anonymous tweeted about the attack Sunday night and posted the hacked info online. No customer information was stolen. CNN's calls to Apple have not been returned.

The latest "Transformers" movie is winning big at the box office. The third installment of the sci-fi series raked in $95 million in U.S. sales. That is a new record for the holiday weekend. "Cars 2" placed second.

Don't forget. For the very latest news about your money, check out the all-new CNNMoney.com.

AMERICAN MORNING back right after the break.

(COMMERCIAL BREAK)

VELSHI: A veritable of who's who of European royal royalty. Monaco's ruler, Prince Albert, tied the knot.

ROMANS: They did.

VELSHI: It happened. The 53-year-old married Charlene Wittstock, a swimmer from South Africa. Albert's sisters, both princesses, and French President Nicholas Sarkozy were among the 3,500 guests in attendance. Afterward, Albert and his bride toured the country in a custom Lexus. Of course, the country is two square miles.

ROMANS: True. True. But beautiful -- beautiful place up there on the hill to get married. Lovely.

The royal couple continues their tour of Canada this morning, the other royal couple. Prince William and his wife Catherine arrived at Prince Edward Island late last night.

But earlier, a group of protesters gathered in Montreal. They were chanting and carrying signs to oppose the newlywed's tour and the British monarchy.

Max Foster joins us live from Prince Edward Island -- Max.

MAX FOSTER, CNN CORRESPONDENT: Ali, yes. The couple toured Quebec over the weekend and it is an anti-monarchy stronghold if you like. But, actually, they were a great success. They were in Montreal, a couple public visits and some protests there, but I would say more fans of William and Catherine there.

But then they made the pretty bold move going to Quebec City, a strong anti-monarchy movement. They inspected a -- there was a ceremonial event there, which William spoke at, purely in French. So, that really won rounds the audience of Quebec as it were. They went on a public walkabout. That was a success.

And then, as you say, they arrived here in Prince Edward Island last night. I had a chance to meet both William and Catherine last time. And the impression I got is they're very pleased with the visit and looking forward to the rest of it, and heading to L.A. later on.

Lots of TV moments today to expect as well. So, the tour continues.

ROMANS: All right. Max Foster, thanks so much.

James Taylor I think playing in the background -- another fine Canadian soul.

VELSHI: That's right.

ROMANS: All right. Thanks, Max.

VELSHI: Top stories:

A search resuming this morning after a tour boat with 27 Americans aboard sank of the coast of Baja Peninsula, in the Sea of Cortez. There were 44 people onboard when it capsized. Six are still missing and reports one person has died.

U.S. Coast Guard is sending a helicopter to help with the search once the sun comes out. We're told the boat hit some rough weather yesterday and sank almost immediately. ROMANS: Exxon Mobil is mopping up in Montana after a burst pipeline spewed 1,000 barrels of oil into the Yellowstone River. Recent flooding has made cleanup difficult but officials say swift currents and high water could actually help break up the oil. Officials say some of the oil has washed ashore, but they see no sign of harm to wildlife, at least yet.

VELSHI: Well, we could learn this week whether prosecutors will drop charges against Dominique Strauss-Kahn. The former International Monetary Fund chief was released on his own recognizance on Friday after the prosecution said there are credibility problems with the accuser. In the meantime, leading French socialists are calling on their party to give Strauss-Kahn a chance to cheat in next year's elections.

ROMANS: Well, the stunning turnaround on that case is just unbelievable.

VELSHI: Unbelievable, yes.

ROMANS: The credibility of the witness why the prosecution moved so quickly and then -- or the government moved so quickly and then, now, you know, he's released on his own recognizance.

VELSHI: But remember that no one is saying something didn't happen. They're saying they don't have a credible witness on which -- upon which to base a trial.

ROMANS: And what happened. The DNA evidence is interesting in that case.

OK. We'll continue to follow that for you.

And deliberations expected to begin today after powerful closing arguments in the Casey Anthony murder trial. The prosecution alleging Casey sacrificed her child for a life of freedom.

The defense says the prosecution's case is based on fantasy forensics. The state still gets a chance to rebut the defense's arguments today.

VELSHI: Well, that brings us to our question of the day. Do you think the prosecution has proved its case against Casey Anthony?

Here's some of your responses. From Facebook, Denny says, "The law says, quote, "proven beyond a reasonable doubt end," quote. The prosecution's case is purely circumstantial and leaves some of those doubts. She's not innocent but will be found not guilty of murder one -- will not be -- will be found not guilty of murder one, I'm sorry, but maybe guilty of a lesser charge."

ROMANS: Got a lot (inaudible) who's been following this and know all the lingo. Larry Ragans on the blogs said, "The prosecution has not proven Casey Anthony's guilt beyond a reasonable doubt. Sure Casey Anthony lied many times but lying isn't murder."

VELSHI: Christian says on Facebook, "I don't think that they have. No one has proven how this child died. No one knows beyond a reasonable doubt. You can't convict someone based on a theory."

ROMANS: Benny Barboza on Facebook says, "I believe they have. The defense did enough to prevent the death penalty, but not enough for Casey Anthony to walk."

VELSHI: Well, it's quite possible that they will get the case today. The jury will get the case to deliberate today. And as Sunny Hostin said, quick return by the jury often favors the prosecution and a longer one tends to favor the defense.

ROMANS: Right.

VELSHI: Well, this July 4th as we celebrate those who fought for our independence, we also want to remember the U.S. soldiers who are fighting overseas right now.

You may remember the year-long series "A Soldier's Story" reported last year by Jason Carroll. He's now back in Afghanistan with one of those soldiers, Sergeant Randy Shorter.

ROMANS: Sergeant Shorter was part of the surge who arrived last August. His one-year mission is nearly complete. Jason is live now from Shirrana in the south eastern part of Afghanistan. Happy Fourth of July to you, Jason. Nice to see you.

JASON CARROLL, CNN CORRESPONDENT: And happy Fourth of July to you. I'm going to bring in Randy Shorter right now. I have to tell you, we now have to refer to him as First Sergeant Randy Shorter because he's since been promoted since the last time the two of us were together.

So let me bring you in here now. Tell us about, what was it September, August, the last time I was with you guys? Tell me what the past several months have been like?

The Taliban has been exerting its influence here in the area. How has it been for you and your men?

FIRST SGT. RANDY SHORTER, U.S. ARMY: For me and my men it's been quite busy. Getting out there, getting after it. We've been steadily, you know, helping the Afghan people here. We've been promoting a lot of projects, a lot of schools, getting out there every day.

CARROLL: Also, congratulations on that promotion.

SHORTER: Thank you.

CARROLL: Also, much has been said about the draw down. You and some of your men will be leaving in just a few weeks. How do you feel about that?

Because there's been, you know, politically there's been discussions on both sides, some saying it's time for the drawdown, others saying not the time for it.

SHORTER: You know it's very exciting for us. It's about time about time we start looking at a draw plan and getting back to our families. We've been at it about 10 years now.

CARROLL: Long time.

SHORTER: Long time. And, you know, it's about time the Afghan people start taking responsibility of their country.

CARROLL: Also it is the Fourth of July, I know you guys, you're able to have some of the Fourth of July barbecue lunch today.

SHORTER: Yes.

CARROLL: But after that, not much rest, right? You guys will have to get for security reasons you can't talk a lot about the mission coming up, but tell us how you guys mark the Fourth of July?

SHORTER: Well, today's the birthday of the United States. You know, July 4th, 1776. We went ahead and had a little barbecue for lunch. But you know, unfortunately --

CARROLL: It was good, you guys. It's very good.

SHORTER: Unfortunately, duty calls. We still got a mission. We still have things to do here. We just did our mission brief, precombat to make sure -- duty calls.

CARROLL: We'll be out there with you on that combat mission later on. But also, this is an opportunity for you and later some of the other men here to give a shout out to your family.

Your wife, Cheryl, I know she's sitting at home watching. This is an opportunity for you to say something to Cheryl and your two lovely daughters.

SHORTER: Well, Cheryl, Milaney, Arianna, how are you? I love you so much, few more weeks, be in your arms shortly. Happy Fourth of July. Have a good one.

CARROLL: They're awfully quiet now, but you should see what they're like when the camera is not on. They're quite wild.

They're a great group of guys and we'll be checking in with them throughout the day here on AMERICAN MORNING" on some of the other shows marking this Fourth of July.

But also, it's just a reminder even though it's a holiday, the war still goes on and these guys will be heading out on another combat mission in several hours from now. Christine, Ali.

VELSHI: Jason, good. Thank you very much. Must be great for First Sergeant Shorter's family to hear and --

ROMANS: Wait until he comes home and sees the honey-do list she has.

VELSHI: You know, supplies are short in Afghanistan so Jason couldn't get a full-sized shirt. He had to wear a kid's t-shirt.

ROMANS: I think he has nice arms.

VELSHI: He's got big arms.

ROMANS: There you go. All right, still ahead, get ready for a spectacular Fourth of July show tonight.

Up next, we're talking to Keith Lockhart, who's conducting America's orchestra, the Boston Pops and their star-studded event tonight.

VELSHI: That is great. If you like monkeys, you can relax. The court has ruled in your favor. Minnesota government shut down over a budget impasse continues, but the state zoo is getting a pass. We'll tell you about that at 35 minutes after the hour.

(COMMERCIAL BREAK)

VELSHI: Washington, D.C.

ROMANS: The nation's capital, mostly cloudy right now, 74 and thunderstorms later, 92.

VELSHI: Hopefully will cool it off, but it's a busy day on the mall in D.C.

ROMANS: Certainly is.

VELSHI: Congress is off today. They will be back at work tomorrow so lawmakers can focus on raising the debt ceiling. The White House has said that on August 2nd four weeks away, the government will run out of money to pay all of the nation's bills in full and on time.

They will be able to pay some stuff. Over the weekend, former President Clinton urged President Obama to stand firm against Republican opposition to increasing tax revenue.

And just in case you don't really believe that August 2nd date, Treasury came out again late last week and said we're not kidding, it really is August 2nd.

ROMANS: The fact of the matter, the message it sends to the world when we're deciding whether to pay our mortgage or our car note, like the White House likes to say, pay our Chinese investors interest, but maybe not Social Security payments, you get an IOU from the government for you paychecks.

VELSHI: It's a bad place for the government to be.

ROMANS: It's not a good position to be in.

All right, just in time for the holiday, the Minnesota Zoo back open this morning despite the state government's shutdown. A judge ruled the zoo could use money from other sources like memberships and parking to keep running.

This is a busy weekend for the zoo there. Minnesota's government has been shut down since Friday because Democrats and Republicans can't reach an agreement on a new budget. Sounds familiar, doesn't it?

VELSHI: Yes, the zoo has some fixed costs because they have the monkeys to feed.

ROMANS: They do. They also have revenue that they can count on, people coming in and paying to walk in the front door.

VELSHI: It should be helpful to a lot of people in Minnesota who can do that today because a lot of the other government services are shut down.

All right, the end of an amazing era in human history. NASA is going to launch its very last space shuttle on Friday. Space shuttle "Atlantis" is blasting off for a 12-day mission to the international space station, the final flight for NASA's shuttle program.

The space agency says it now has new goals to touch an asteroid and send humans to Mars.

ROMANS: All right, don't miss the history-making liftoff. Stay with CNN for live coverage, this Friday, July 8th at 11:26 a.m.

VELSHI: I love that graphic.

ROMANS: I know. Ali Velshi is going to be there as the space shuttle "Atlantis" takes off for the very last time.

VELSHI: Can we just keep doing that? Can we do that again, Michele?

ROMANS: Can you make it come out of his ear?

VELSHI: Look at that. Watch this.

ROMANS: You're like powers, ask for it, like that.

VELSHI: That's fun. That's never happened to me before on the show. All right, what would the Fourth of July be without fireworks? Nothing.

Every year more than 500,000 people pack Boston's Charles River, the esplanade out there to watch one of the most amazing fireworks displays. It's the Boston Pops fireworks spectacular and concert.

ROMANS: Here to give us a preview of what we can expect is Keith Lockhart, conductor of the Boston Pops Orchestra. Happy Fourth of July, welcome to the program this morning.

KEITH LOCKHART, CONDUCTOR, BOSTON POPS ORCHESTRA: Thank you. Good morning. Happy Fourth of July.

ROMANS: So what's the preparation like, the sleepless nights as you head into the big day? What are you guys all up preparing for this morning?

LOCKHART: Well it's so funny, in many ways we start planning for the program for next year's program on July 5th. Somehow always comes down to a huge last-minute scramble and this year was no different. We finished meeting about things about 1:00 yesterday morning and people are putting those things into motion even as we speak.

VELSHI: All right. This is the 38th year. It's really quite - I mean, there are some fantastic July 4th celebrations across the country, but this one is quite remarkable. How did it get started?

LOCKHART: Well, it got started with my predecessor at the Boston Pops, Arthur Fiedler, the amazing iconic American musician who was there 50 years. He got together with a Boston businessman named David Newguard who still involved with the program.

And they took what was already a free series of concerts on the Charles River Esplanade where we perform today and said we should do a proper Fourth of July concert and practically we should do a big loud piece that blows things up.

So the idea of doing a specific Fourth of July concert was born and the concert has swollen until we have as many as 700,000 or 800,000 people attending live as well as going nationally on TV.

ROMANS: And the big loud piece that blows things up is the Tchaikovsky 1812 overture, something that now across the country everyone tries to use. That was Arthur Fiedler's brainchild.

LOCKHART: Contribution, yes, a piece written by a Russian to celebrate a Russian victory over the French has become an indispensable patriotic item.

VELSHI: All right, what can people who are getting ready to see this or maybe deciding they're making their way to the Charles River Esplanade, what can they expect to see this year? What are some of the highlights?

LOCKHART: Well, a two-hour concert followed by one of the most spectacular fireworks displays you'll ever see. Martina McBride is our headliner soloist.

We're also joined by Michael Chiklis in the capacity as master of ceremonies and singing with the band. The U.S. Army Soldiers Chorus and Field Band, great patriotic music and a lot of fun, a great party.

VELSHI: All right. It's going to be a great time. By the way, if anybody wants to watch it, it's on locally in the Boston area WBZ TV from 8:00 to 10:00 p.m.

ROMANS: You were going to have Lionel Richie, but he had a vocal problem. You switch around at the last minute showing that you could start planning July 5th, but you never know how things are going to work out in the days before.

LOCKHART: That's exactly -- you start planning on July 5th and on July 3rd, the next year, everything changes. Yes, Mr. Ritchie withdrew about less than 72 hours ago. And we've been -- we scrambled quickly and Martina was incredibly gracious, but she had no orchestral arrangements. All of that has been created since we heard from Lionel Ritchie's people.

VELSHI: It's going to go off flawlessly nonetheless. You guys, congratulations. Keith Lockhart, we're going to enjoy watching it. In fact, watch it across the country from 10:00 to 11:00 p.m. on TV tonight. Have a great, great time.

LOCKHART: Thanks. I will try. Take care.

VELSHI: All right.

ROMANS: Morning headlines are next. Listen up parents, if your little one is a motor mouth or is slow to start talking, what does that mean growing up and what your kid's language skills today say about --

VELSHI: People always worry when their kids are late to start speaking.

ROMANS: Were you a late speaker, Ali? You haven't stopped since you started.

VELSHI: I was early and constant, but the news is good. For those of you who are late talkers - I mean, most of you subsequently realize that anyway, but the news is good for you. So we'll tell you about that.

Plus, your belly button, it seems it should be designated a bacterial nature reserve. We'll explain what yuckiness scientists found in there. Even the scientists I have to tell you were shocked. When they say they found a new ecosystem, your belly button is like that. It's 45 minutes after the hour.

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ROMANS: It's 47 minutes after the hour. Here are your morning headlines.

Breaking news, six people are missing after a small boat carrying mostly Americans sank off Mexico's Baja California Peninsula yesterday.

We're told 37 passengers are safe and there are reports at least one person has died. The U.S. Navy is sending a leapt to help with the rescue effort this morning.

Exxon Mobil mopping up in Montana after a burst pipeline spewed 1,000 barrels of oil into the Yellowstone River. Officials say some of that oil has washed ashore, but current river conditions could make cleanup easier helping to break up and disperse that oil.

Twelve thousand people allowed to return home just in time for the Fourth of July as firefighters begin to get a hold of a huge forest fire in New Mexico. That fire near the Los Alamos Nuclear Research Lab has now burned more than 120,000 acres.

U.S. stock markets are closed for the holiday today. The Dow, Nasdaq and S&P 500 all closed higher Friday boosted by some strong manufacturing numbers and easing concerns in Greece. Investors looking to the big jobs report for June, that comes out this Friday.

The Senate gets back to work tomorrow instead of taking its holiday recess, now it's focusing on raising the debt ceiling. The Obama administration has said if a deal is not reached by August 2nd the government will run out of money to pay the nation's bills in full and on time.

Former International Monetary Fund leader Dominique Strauss-Kahn could learn as early as this week whether he'll be free of charges that he allegedly sexually assaulted a hotel maid. Authority says they are -- there are now concerns about the accuser's credibility.

Deliberations in the Casey Anthony murder trial expected to begin today in about an hour from now. During closing arguments the prosecution alleged Casey sacrificed her child so she could live a freer life. The defense says that the case is based on forensic fantasy.

You're caught up on the day's headlines. AMERICAN MORNING back right after this break.

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VELSHI: Happy Fourth of July, Atlanta. This is a typical summer Atlanta day, 74 degrees.

ROMANS: Hot, hot and hot.

VELSHI: You wake up at 74, you think it's fantastic, partly cloudy. It will be thunderstorms and 94 later on today, but then it gets nice right after the storms.

ROMANS: OK, here is something else that is hot and moist.

VELSHI: Right, but not Atlanta.

ROMANS: Home to more bacteria that has never been seen before by humans. It's all in your belly button. Hot, moist and full of bacteria.

VELSHI: Scientists at North Carolina - now we think the belly dancers probably have a cleaner belly buttons because they probably do belly button maintenance, unlike the rest of us.

But the scientists in North Carolina swabbed the navels of volunteers. I love to see how they were recruited.

ROMANS: Listen to what this project is called.

VELSHI: The belly button biodiversity project, 1,400 distinct bacterial strains were found. Here's funny part, nearly half of them have never been seen before anywhere. Scientists wanted to study the belly button because it's hard to clean. The study was meant to ease the public's fear of disease. ROMANS: Probably there's a lot of skin because there's no other contact in there.

VELSHI: Right. It's on its own. I mean, I don't want to start like a belly button phobia, navel phobia out there.

ROMANS: I thought you were going to say belly button fetish.

VELSHI: I'm at ease with my belly button. You see things to clean your ears and your eyes. You don't see a lot of stuff dedicated to cleaning the belly button.

ROMANS: All right, but I love this belly button biodiversity project.

If your child isn't speaking too much by 2 years old, don't panic. A new pediatric study says late bloomers should be fine by the time they start kindergarten.

VELSHI: Senior medical correspondent, Elizabeth Cohen joins us with all the details and really what it's finding is that if your kid doesn't talk much, just tell them to start digging out their belly button.

ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: Right, it's probably all that odd bacteria they have down there. That must be it.

VELSHI: So what is the story?

COHEN: Well, what they found is, you know, a lot of parents kind of panic if their child shall at 2, isn't talking or isn't saying very many words and parents get all worried.

So these Australian researchers said, you know what, we're going to follow these kids and we're going to see how they do later on in childhood. What they found is that 80 percent of the kids they studied who were having problems at age 2, they were up to speed by kindergarten.

They were perfectly fine and that other 20 percent most of those were perfectly fine later on in childhood. So the bottom line here is that for most kids, really, parents, don't worry. They will be OK.

ROMANS: Well, you know, parents worry about hitting those milestones, things that parents look for by the age of 2 because it's also how -- these are how doctors find these early signs that you need intervention, if your child may be on the autism spectrum. It's those milestones to the parents is so worried about because our doctors tell us to. What should we be looking for?

COHEN: Right, I think the word here is that you want to be vigilant and you want to watch for these milestones, but you don't want to freak out if your child isn't meeting them.

So let's talk about what some of those milestones are. For example, you should take a look and see, by age 2, your child should be able to walk alone. They should be able to recognize names for themselves and other people in their lives.

They should also be able to imitate others. If you take a look at cnn.com/thechart, my colleague Val Wellingham (ph) has a wonderful blog with a link for all the milestones that your child is supposed to reach at various ages.

VELSHI: All right, what should you be concerned about and then get in touch with your pediatrician when it comes to your child and speaking abilities?

COHEN: Right, OK. So let's take a look again at these children at age 2, what they should be able to do and what you should be worried about or concerned about or at least talk to your pediatrician about if they're not able to do it.

So for example, a child, if they don't imitate action or words or can't follow simple instructions, those are issues that they lose skills. If they're able to do something and then they can't.

You definitely want to talk to your pediatrician. But again, it's important that parents not be overly worried. Talk to your pediatrician. Get their guidance and tell them how concerned you are and see if this is something that really needs further follow-up.

ROMANS: So many milestones you don't even think about. You know some of them were like making eye contact, running on their tiptoes, using their fingers, starting to try to use other things.

I mean, there are so many milestones to hit, it's almost overwhelming as a parent. But we'll go to that blog and check them all out. Thanks so much, Elizabeth Cohen.

COHEN: Thanks.

VELSHI: All right, top stories right after the break. It's 54 minutes after the hour.

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ROMANS: Breaking news this morning, lost at sea. A small boat, carrying mostly Americans, sinks of the Mexico's Baja Peninsula. I'm Christine Romans. The U.S. Coast Guard about to send a helicopter to help find those still missing. New details just ahead.

VELSHI: Apple hacked. I'm Ali Velshi. A group claims stolen passwords and user names from a server. Find out if your user information could be compromised on this AMERICAN MORNING.

ROMANS: Good morning. It's Monday. Monday, July 4th. Kiran Chetry has the morning off. Ali and I are here this morning.

VELSHI: And we got a lot of news for Fourth of July. We're following breaking news. Six people are missing after a small boat carrying mostly Americans sank off Mexico's Baja California Peninsula.

Officials say, 44 people were on the boat when it left the port of San Felipe. We're told that the boat hit some rough weather and sank almost immediately.

ROMANS: Thirty seven people were rescued. We're told some of them were actually able to swim to shore -

VELSHI: It was very close to shore, right.

ROMANS: The reports at least one person has died. Joining us now Petty Officer Pamela Boehland from the U.S. Coast Guard. You were with us earlier. You told us 37 people have been rescued.

What can you tell us is the latest now? You're probably still waiting for the sun to rise so that you can see the situation and get more rescue out there?

PETTY OFFICER PAMELA BOEHLAND, U.S. COAST GUARD (via telephone): That's correct, yes. Right now, the numbers remain the same. We're still waiting to launch our helicopter to assist in the rescue of six missing people.

ROMANS: So six are still missing?

BOEHLAND: That's correct. We are still planning to launch a helicopter from San Diego to aid in the rescue of the six missing people and we have 37 people alive and one report of a fatality.

VELSHI: Petty Officer Boehland, tell us who is conducting the search? I believe you're assisting, but it's the Mexicans who are conducting the search. What's the area like? What's the terrain, the water condition?

BOEHLAND: That's correct, it's actually the Mexican navy that's running this search and the coast guard was asked to provide a helicopter to provide some areal support for this search.

It will be a waterside rescue, which is certainly nothing new for the coast guard. We conduct waterside rescues all the time. We received a report that the wind is pushing about 20 knots and it's relatively good visibility.

ROMANS: Can you tell us what kind of tour this was? You called it a fishing boat. Was it a fishing tour, sightseeing cruise? Are we any closer to knowing why it capsized? I know it happened pretty quickly, didn't it?

BOEHLAND: Yes, ma'am. As I understand, the boat hit a rough touch of weather and sank almost immediately. It was a charter fishing vessel, which means it was hired to do a fishing trip not for commercial use, but for fun, for pleasure.

VELSHI: All right, you're probably an hour, still, from getting some sunlight -- or is it starting to come out there?

BOEHLAND: We're about half an hour from launch time for the helicopter.

VELSHI: OK. All right. We'll keep posted on this story with you. Petty Officer Pamela Boehland, thanks very much for joining us.