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American Morning
Debt Deal Stalemate; Inside the Bachmann Family Business; Summer Swelter; Parliament Wants Murdoch; More Debt Talks; Rodney King, DUI
Aired July 13, 2011 - 06:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KIRAN CHETRY, CNN ANCHOR: And good morning.
Many parts of the nation wilting from the heat.
I'm Kiran Chetry.
Millions of Americans under a heat advisory this morning. And hundreds of thousands are without power because of the weather. We'll tell you when we can see relief.
ALI VELSHI, CNN ANCHOR: I'm Ali Velshi.
New urgency this morning to the debt ceiling talks as President Obama warned that Social Security checks may not go out to millions of Americans if there is no deal by the default deadline.
(MUSIC)
CHETRY: And good morning. You're watching AMERICAN MORNING on this Wednesday, July 13th. Christine Romans is off this morning.
So, it's not just the Social Security checks, but also veterans benefits, other --
VELSHI: Right.
CHETRY: I mean, that's a pretty scary process.
VELSHI: It starts to get mathematical. We've got to actually figure out what gets paid and what doesn't get paid. We'll talk about that a lot.
But another big story right now, a massive and dangerous heat wave is gripping much of the nation. Here's how it looks and feels across the country. Take a look at the big red quarter.
Temperatures expected to reach 104 degrees in parts of Texas today. In the Southeast, temperatures are expected to reach the upper 90s. And it's more than just uncomfortable, it's dangerous.
Heat has already claimed the life of at least one person in Illinois and adding into that, the heat is causing drought conditions in the Deep South to intensify. Also this morning, hundreds of thousands still without power in the Chicago area after strong thunderstorms rolled through. Officials warn the power there might not be back on until Saturday.
Let's go live to Rob Marciano. He is outdoors this morning -- silly Rob -- in Atlanta's Piedmont Park.
Sun still not up, so it's still probably manageable there. But a lot of the South waking up this morning to 80 degrees overnight or higher.
ROB MARCIANO, AMS METEOROLOGIST: Yes. That's the thing. It really hasn't cooled down much overnight, Ali. So, even if you're out before the sun comes up, you're still feeling it.
And that's been the big deal with this heat wave. It hasn't been really so much the record-breaking high temperatures that we've seen, because we haven't seen a ton of them. It's the amount of moisture in the air.
It's the humidity, where any time of the day you go out, be it middle of the day or middle of the night, you go walk out and you're wearing it, you feel it. It's muggy, it's oppressive and that's what we're seeing now.
But in some cases, that's the heat as well. In many places, I mean the weather, it's cooking.
(BEGIN VIDEOTAPE)
MARCIANO (voice-over): Yes, it's hot enough to fry an egg.
UNIDENTIFIED MALE: That's Oklahoma heat for you.
MARCIANO: It's so hot it even buckled this road and caused this water main to burst through the sidewalk. And it's been hot for a while in Oklahoma City, where temperatures have broken 100 degrees 18 of the last 20 days.
UNIDENTIFIED FEMALE: It's hot outside. It's hotter in the house.
MARCIANO: A brief power outage in Wichita, Kansas, makes an escape from the heat whatever virtually impossible.
But it's the economic impact that is hitting these Texas farmers hard. The drought has dried up grass that cows eat.
UNIDENTIFIED MALE: We're seeing so many people selling their entire herd and that's like selling your factory.
MARCIANO: Cotton and other crops aren't faring well either. Even the ones plentiful Ogallala Aquifer may run dry in west Texas.
(on camera): The reality is, when the underground wells dry up, so does business. Grain elevators in this area stand empty and the economies in towns like Happy, Texas, are depressed. (voice-over): Originally named for its oasis-like source for water, main street now resembles a western ghost town. Lake Meredith is the other water source, feeding 11 cities including Amarillo and Lubbock. It's so hot and dry the lake is slowly disappearing.
UNIDENTIFIED MALE: The average loss of water from Lake Meredith is 100 inches.
MARCIANO (on camera): Just from evaporation?
UNIDENTIFIED MALE: Just from evaporation.
MARCIANO (voice-over): Now, hot and very humid and hazy air is building into the Northeast. Heat advisories are up for 11 states. And the hottest of the hot -- Mississippi and parts of Tennessee, where the heat index could soar to 116.
(END VIDEOTAPE)
MARCIANO: All right. So there you go. The Northeast is getting a little bit of a break. Not so much a cold front coming through yesterday, but more or less a drier front. So, with less humidity up there.
But the southern half of the U.S. continues to sizzle. We're going to see dangerous amounts of heat and humidity. As mentioned, the number of heat advisories and warnings that are up stretch across 11 states.
Here's the forecast high temperatures for these areas. As measured in the shade, not including humidity, Dallas, Texas, may very well get up and over 100 degrees today. Ninety-seven degrees in Jackson, 97 degrees expected in Atlanta, Georgia.
We'll see some relief to this, not so much today, definitely not so much tomorrow. But maybe as we head -- as we head towards the weekend. But with -- you couple the heat, the humidity, and the drought, guys, this has been just an awful, awful way to start the summer.
Back up to you.
VELSHI: How does that conversation go for you guys, Rob? You know, where it's going to be really, really hot in the South. Hey, Rob, why don't you go report outside in Piedmont Park, tomorrow? Like do you say, "Yes, that's a great idea," or do you say, "How about I don't and stay inside?"
MARCIANO: Yes. It's right up there with, hey, there's a cat 5 coming in to hit Miami, why don't you stand in it?
VELSHI: It's part of what you do. All right. I get it.
(CROSSTALK)
VELSHI: All right. Rob, good to see you. CHETRY: The other thing is you just can't -- you can't expect to be able to do the same exact thing that you normally do when it's this hot. You have to make changes, drink more water. We kept our daughter home from camp because they're outside all day.
VELSHI: They're going to be outside. That's going to -- yes. Well, we'll keep following that and tell you how that weather system is moving across the country.
CHETRY: All right. It's a nice time to live in the north -- Pacific Northwest. I'll tell you that.
Well, Rodney King booked on DUI charges in southern California. He was pulled over yesterday and arrested after police say they witnessed him commit several traffic violations.
King's admitted to a long-standing drinking problem. He made national headlines, of course, in 1991 when he was beaten by four police officers and it was caught on tape. The video of that incident and ensuing trial and the fact that they were then acquitted triggered the 1992 Los Angeles riots.
VELSHI: Tucson shooting suspect Jared Lee Loughner can refuse to take his anti-psychotic medications. That's the ruling of a federal appeals panel. They say because Loughner has not been convicted of a crime, he is entitled to deny treatment. Loughner is charged with killing six people and wounding 13 others including Arizona Congresswoman Gabrielle Giffords during a shooting rampage in January.
CHETRY: Just released new pictures of the California apartment where alleged crime boss James "Whitey" Bulger lived for the last 15 years. Well, these are pictures of weapons.
FBI agents say they found 30 weapons inside of that apartment, including handguns and automatic rifle, and even a hand grenade. Some of the weapons were discovered hidden behind the living room and bathroom walls.
VELSHI: Some home movies released showing how close police came to saving Jaycee Dugard before they actually did. She was kidnapped at the age of 11 and held captive by convicted sex offender Phillip Garrido for 18 year. She has two of his children.
CHETRY: The Eldorado district attorney's office has now released these tapes shows a parole officer going through the Garrido home. This is sometime between 2000 and 2007, and talking with him and his wife and missing Jaycee, who was being held prisoner, was 30 feet away in the backyard.
Here's a clip of the officer, what he finds behind a locked door and it was where Garrido's ailing mother was sleeping. Take a look.
(BEGIN VIDEO CLIP)
POLICE OFFICER: OK, and this room here?
PHILLIP GARRIDO: We've been sleeping in there.
POLICE OFFICER: Why is this door locked?
GARRIDO: Because --
(INAUDIBLE)
POLICE OFFICER: Can you move out that out and open the door?
GARRIDO: Because she's convalescing and so we use this bathroom.
POLICE OFFICER: All right. This door right here?
GARRIDO: That's where we sleep.
POLICE OFFICER: Turn the light on. All right.
(END VIDEO CLIP)
CHETRY: Imagine knowing what we now know that Jaycee Dugard was some 30 feet away in the backyard in tents, went undiscovered for years.
These are also shots over 20 years ago of Garrido videotaping children in public places. One shows Philip Garrido singing and playing the guitar while his wife films children around him. Jaycee Dugard was kidnapped in 1999. She was found 18 years later. This is her a few days ago on ABC News.
The Garridos were charged and convicted of kidnapping and rape. They're both in prison for life.
Jaycee is now out with a book about her life in captivity called "A Stolen Life."
VELSHI: New pressure this morning on media mogul Rupert Murdoch after a phone hacking scandal that forced him to shut down the most read Sunday tabloid in England. The U.K. parliament may force him to pull his $15 billion bid to take over British Sky Broadcasting, BSkyB, today. And they have the prime minister's support.
The deal would give Murdoch 40 percent ownership of all commercial TV in Great Britain.
Prime Minister David Cameron is expected to meet Milly Dowler's family today. She was the girl who was kidnapped and murdered back in 2002. Her parents are suing Murdoch's paper, "The News of the World," over allegations that her phone was hacked and her voice mails deleted, giving her parents the false hope she was deleting those voice mails, meaning that she was still alive.
But the scandal getting bigger by the minute -- Dan Rivers will join us live from London at 6:40 Eastern with the update.
CHETRY: And now to politics and the high stakes stalemate over increasing the nation's debt limit. The clock is ticking. We're now just 21 days from an August 2nd deadline to avoid a disastrous government default.
President Obama and congressional leaders from both parties will meet again this afternoon after nearly two-hour session at the White House yesterday. The president upping the ante in the debt showdown, saying that without a deal, millions of seniors and veterans might not receive their benefit checks.
Republicans call that a scare tactic.
Meantime, the Senate's top Republican floated a backup plan that would give the president unilateral power to raise the debt ceiling in order to prevent a default. Well, that plan crashed and burned within his own party.
We get reaction from both sides to the impasse and it suggests the divide remains deep.
(BEGIN VIDEO CLIPS)
REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: The president talks a good game, but when it comes time to actually putting these issues on the table, making decisions, he can't quite pull the trigger.
SEN. CHUCK SCHUMER (D), NEW YORK: Protect millionaires and cut Medicare benefits instead. This approach is not balanced. It's not fair. It's not moral. And it will not be accepted.
(END VIDEO CLIPS)
CHETRY: CNN's Dan Lothian has been following the partisan warfare over the debt crisis. He is live at the White House this morning.
So, it seems they're not any closer, even though there is a lot of talk yesterday, a lot of rhetoric, to getting a deal done.
DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: That's right. No closer at all. And this is the fourth day in a row that these congressional leaders will be meeting here at the White House after yesterday's nearly two-hour meeting. One Democratic source told us that the mood was, quote, "weary" as all of those in the room were getting tired of hearing each other's talking points.
Still, the sticking point remains, taxes on the wealthy and President Obama still pushing for that big deal, even as he's warning about the dire consequences they can't reach an agreement.
(BEGIN VIDEO CLIP)
SCOTT PELLEY, CBS NEWS ANCHOR: Can you tell the folks at home that no matter what happens, the Social Security checks are going to go out on August the 3rd? There are about $20 billion worth of Social Security checks that have to go out the day after the government is supposedly going to go into default.
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Well, this is not just a matter of Social Security checks. These are veterans' checks. These are folks on disability and their checks. There are about 70 million checks that go out each month.
PELLEY: Can you guarantee as president those checks will go out on August the 3rd?
OBAMA: I cannot guarantee those checks go out on August 3rd if we haven't resolved this issue, because there may simply not be in the coffers to do it.
(END VIDEO CLIP)
LOTHIAN: Now, some lawmakers are saying that they don't believe that a bipartisan agreement is possible, so you're hearing more talk now about this Senator McConnell, a backup plan that you were talking about, which essentially would give President Obama the power to raise that debt ceiling in three increments before the 2012 election.
Responding to that, in a statement, White House spokesman Jay Carney said, quote, "Senator McConnell's proposal reaffirmed that leaders of both parties have stated clearly that defaulting on America's past due bills is not an option. It is time for our leaders to find common ground and reduce our deficit in a way that will strengthen our economy."
At the same time, you're also hearing from business leaders, also large business organizations, trying to push lawmakers to find some kind of bipartisan agreement. Of course, that's looking very difficult now -- Kiran.
CHETRY: All right. Dan Lothian at the White House for us this morning, thanks so much.
VELSHI: And, of course, as Dan was mentioning President Obama telling Congress and the nation that Social Security checks could be in jeopardy if the government defaults on its debts, if that debt ceiling is not raised.
So, that brings us to our question of the day. What is the impact of Social Security checks not going out on August 3rd?
CHETRY: We want to know what you think. How will it affect you? What do you think will get blamed? Will it really happen?
Send us an e-mail, a tweet, or let us know on Facebook. And we'll be reading some of your comments a bit later in the show.
VELSHI: Coming up next, World Cup fever -- the U.S. women one game away from a trip to the finals.
CHETRY: Wow.
VELSHI: Our resident soccer expert Richard Roth will be joining us to talk about today's critical matchup with France.
CHETRY: Well, if you don't rent movies because you don't need to because you got Netflix -- well, you could be getting ready to pay more for your DVDs and your streaming rentals. We'll tell you how much more coming up.
VELSHI: And a controversial clinic in Minneapolis offering gay clients counseling to change their sexual orientation. Basically make them straight. It is owned by Republican presidential candidate Michele Bachmann and her husband. CNN investigates -- just ahead.
(COMMERCIAL BREAK)
VELSHI: OK. This is an interesting - you know, we've been talking about these pledges that Republican candidates are being called upon to sign. Mitt Romney is not signing a controversial marriage pledge, which is drawn up by a conservative group in Iowa. The Family Leadership Organization created the document in defense of, quote, "traditional marriage."
But Romney wouldn't endorse it because of controversial language that it originally contained and it sort of claimed that black children born into slavery had better family structures than black children today. It said black children back then had a better chance of growing up in a two-parent household.
CHETRY: A two-parent household than they do now.
VELSHI: Than they do now.
CHETRY: They removed that language because, I mean, it raised a firestorm.
VELSHI: Yes. And GOP candidates Michele Bachmann, Rick Santorum, have signed it, although they said they signed the pledge, they're not - they didn't feel they were signing the preamble, which is where this is contained.
CHETRY: Well, Michele Bachmann is number one in a new poll of likely voters in the Iowa caucus. And according to the American Research Group, 21 percent of the respondents are backing the Minnesota congresswoman. Romney is now in second place with 18 percent. Ron Paul and the undeclared Sarah Palin also registering in double digits.
So, you know, this is a huge -
VELSHI: Yes.
CHETRY: -- this is the first - this would be the first testing ground for the GOP presidential candidates -
VELSHI: It's a big deal.
CHETRY: -- and she's leading.
VELSHI: Yes. A lot of questions being raised right now about the Bachmann family business. Bachmann and Associates, it's called, offers therapy to gay men and women in the Minneapolis area.
CHETRY: And - and the lead counselor is Bachmann's husband.
Jim Acosta has been looking into this clinic and he joins us live from Washington this morning. Hi, Jim.
JIM ACOSTA, CNN CORRESPONDENT: Good morning, Kiran and Ali.
Michele Bachmann and her husband Marcus run a Christian counseling service that's come under scrutiny in recent years. The questions - these questions are now resurfacing again as she runs for president with a record of controversial views on homosexuality. The clinic, Bachmann and Associates, located outside Minneapolis has faced accusations it encourages gay and lesbian patients to change their sexual orientation.
We sat down with one of the senator's (sic) former patients, Andrew Ramirez, who says he went to Bachmann and Associates when he was 17 years old to talk about his own homosexuality. He told us he was immediately skeptical of what one of the clinic's counselors said to him.
(BEGIN VIDEO CLIP)
ANDREW RAMIREZ, FMR. BACHMANN AND ASSOCIATES CLINIC PATIENT: Was therapy that would help me change from being homosexual to straight.
ACOSTA (on camera): That's how he described it?
RAMIREZ: Yes.
ACOSTA: He basically said, if you do this, what? You wouldn't be gay anymore.
RAMIREZ: If I do this and worked his therapy program, that could perform a miracle and I could no longer be gay.
(END VIDEO CLIP)
ACOSTA: Now this week, a gay rights group called Truth Wins Out released its own hidden camera video recorded by one of its activists who went undercover and posed as a patient at Bachmann and Associates. The footage shows a counselor there who suggests homosexuality can be treated at the clinic, but that counselor also says he's not an expert on the subject.
(BEGIN VIDEO CLIP)
UNDERCOVER ACTIVIST: You can actually leave homosexuality completely and become heterosexual?
COUNSELOR: Oh, yes. Yes. Definitely, definitely. Oh, I believe. I believe it's always about that.
UNDERCOVER ACTIVIST: Yes.
COUNSELOR: And it's happened before, it really has.
(END VIDEO CLIP)
ACOSTA: We reached out to the Bachmanns, they declined our requests for interviews, but the campaign did release a statement to CNN saying, quote, "The Bachmanns are in no position ethically, legally or morally to discuss specific courses of treatment concerning the clinic's patients."
The Republican presidential contender was also asked about the clinic on the campaign trail in Iowa, she dodged the question only saying she is proud of her family business and, Kiran and Ali, by my account, she has been asked this question three times, all three of those times she has not answered the question about this clinic.
CHETRY: All right. Well, great job, Jim, digging a little deeper on that. And to read more of Jim's reporting on the Bachmann - Bachmann Family Clinic, you can log on to CNNPolitics.com. Jim, thanks.
VELSHI: OK. It's easy and convenient, but how much more are you willing to pay for Netflix? Everybody is talking about this new rate plan. And here's the spoiler, the folks talking about it are not happy. We'll have details on it coming up.
CHETRY: And our question of the day. What would be the impact of social security checks not going out on August 3rd? The president saying in an interview yesterday that's a real possibility if these debt talks don't get worked out.
E-mail, tweet, and talk to us on Facebook. We'll read some of your comments a bit later in the show.
It's 21 minutes past the hour.
(COMMERCIAL BREAK)
VELSHI: Twenty-five minutes after the hour. "Minding Your Business" this morning.
Markets ended the day lower yesterday. The Dow, NASDAQ, S&P 500, all dropped less than a percent toward the end of the trading day. Stocks erased earlier gains after Moody's slashed Ireland's credit rating to junk in the afternoon.
An uncertainty that debt problems in Europe could now be spreading to Italy have investors on edge this morning. Top lawmakers there going head to head over budget cuts to increase financial stability and ease Euro zone concerns. The extent of U.S. exposure to debt problems in European countries is still unclear.
Federal Reserve Chairman Ben Bernanke in for a grilling today on Capitol Hill. It's got nothing to do with the weather. The nation's debt ceiling, European debt, fears and the future of the U.S. economy are all fair game for questions from the House Financial Services Committee. That testimony begins at 10:00 A.M. Eastern time.
Investors rushing to gold on fears of a weak dollar that's after the Feds released details from a meeting last month saying that the Central Bank could be opened to providing further stimulus. Gold futures climbed nearly one percent to a record $1,562 an ounce. Netflix hiking prices by 60 percent. That's for subscribers who want to keep the mail and streaming options. The move comes as the company refocuses on its streaming business, away from DVD mailings.
And Connecticut employee layoffs start this week. No details yet on the numbers of notices sent out so far, but the governor said he hopes to shed more than 6,000 employees. The cuts are part of a new $40 billion state budget that was passed in May.
Don't forget for the latest news about your money and the impact that it can have on your pocketbook, check out the all-new CNNMoney.com.
AMERICAN MORNING right back after the break.
(COMMERCIAL BREAK)
VELSHI: Congressional leaders return to the White House this afternoon to negotiate raising the debt ceiling. The divide separating Democrats and Republicans and the divide separating Republicans from Republicans may be wider than ever on this AMERICAN MORNING.
CHETRY: We're covering that and also other top stories this morning.
Two explosions targeting an Afghan governor as he was on his way to the funeral for President Karzai's half-brother. The governor survived that attack, but his office says the blast killed two soldiers. An afghan official says that Ahmed Wali Karzai was shot dead by one of his most trusted guards. The Taliban claims that the guard, who was also killed, was working for them.
VELSHI: Tough lawmakers are going back to the White House this afternoon for another round of tense debt talks. Republicans are still refusing to accept a deal with any tax hikes in it, and the president is now warning that there won't be enough money to cover Social Security checks if they don't raise the debt ceiling by August 2nd.
(VIDEO CLIP PLAYS)
VELSHI: Good morning, Atlantis. The crew of the final shuttle mission woke up to a fitting tune this morning, Elton John's "Rocket Man."
Crews will spend most of the day transferring equipment and supplies to the International Space Station.
Astronauts completed the final spacewalk of the shuttle era yesterday. The 160th spacewalk devoted to building and maintaining the International Space Station.
CHETRY: Well, back to our top story, the debt talks.
President Obama and lawmakers from both parties will meet again to try to hammer out a deal to raising the nation's debt ceiling. Republican leaders have refused to consider any tax hikes and now, the president says if there's no deal before the August 2nd default deadline, he cannot guarantee that Social Security checks will go out.
VELSHI: Now, some people say the Tea Party's influence in the GOP may be standing in the way of getting a deal done.
Our next guest has been called by some the godfather of the Tea Party, Dick Armey. You know him. He's the former House majority leader. He's now chairman of the FreedomWorks. He's also the author of "Give Us Liberty: A Tea Party Manifesto."
Dick Armey joins us.
Welcome, sir. Thank you for being here.
You have been at the helm when -- for an unrelated reason the government of the United States had to shut down. We have a different situation here. But it could be equally disastrous, it could be more serious.
Give me your take on it.
DICK ARMEY, CHAIRMAN, FREEDOMWORKS: Well, first of all, what we have, when we talk about this movement, this grassroots movement, known as the Tea Party movement, we have a serious reservation about the workmanship and the dedication to public duty of everybody from both political parties. And what we're fearful is, we're just seeing a bunch of political positioning back and forth and so forth.
The fact of the matter is, we understand the urgency to do something to correct the fundamental budget problems of this country so that even if, in fact, we do come to the point where we raise the debt ceiling at this level, we don't do it in such a way that simply allows these guys to go back to business as usual, and borrow and spend.
CHETRY: You're officially tying approval of the debt ceiling to trying to trying to spend less. They don't have to be -- they don't have to go together.
ARMEY: It's not artificial. Let's say your own family's budget and you, all of a sudden, find look, we've run up all the credit cards.
CHETRY: Right.
ARMEY: We've exhausted our credit. People are now not only not willing to lend us money, but we're in serious trouble. The first thing you got to do is we got to cut back on what we spend.
(CROSSTALK)
CHETRY: I hear. But they don't have to go together.
VELSHI: Let's pull this --
ARMEY: But one of the problems that we have -- VELSHI: Let me just take your analogy a little further because I want to get your thinking on this. If you are -- if it's my household and I can't pay my bills, I do have to deal with my spending but that doesn't give me the right to not pay the bills for things I already bought.
So, the analogy is mixed up there. If I have to cut my spending, I still have to pay the bills.
ARMEY: Right.
VELSHI: If I bought a TV and I spent too much got to keep paying for the TV.
ARMEY: Absolutely. So, what we say is first thing we got to do is we got to get a handle on our spending and we make sure we're not spending crazy again in the future. Secondly, we got to set some priorities and fulfill our current obligations.
Now, let's deal with the first order boulder dash coming out of Washington today, which is the president's contention that if on August the 2nd he doesn't get everything he wants, he's got to cut out Social Security. That's absolute nonsense.
The fact of the matter, the Republicans have said we'll go with a short-term extension to continue the discussions. You can set some priorities. The president, for example, on 30-day extension, cut $200 billion. I'll tell you where we can get the first $100 billion, which is to shut down AmeriCorps. It's an asinine program. We shouldn't have been spending money on it in the first place.
But you can, in fact, set a set of priorities. Anybody that says the first thing we must do is cut off the seniors' Social Security and Medicare is blowing hot air.
VELSHI: The problem is it's mathematical. On day one, on August 3rd, the amount that Social Security has to pay out is more money than the government will take in. So, it's mathematical. It's not a matter of paying something else instead of Social Security.
ARMEY: That's not all -- the more money they have to pay out in the entire budget, is more than it they'll take in. But the fact of the matter is, there are many places you can cut back and do the nation a service.
The first problem that the president has in dealing with the population at large in America is they understand the way the economy works better than he does. And they understand you can't -- you're not getting growth in the private sector, the job creation from the private sector because it's being choked off by this government that is just like a great big old fat cork in the bottle, just sitting there being unproductive, counterproductive, wasteful and a hindrance to the private sector.
CHETRY: Well, let me ask you about two sticks points, first of all, and see if there's -- what your take would be on solving this problem. The first one is that liberals and the Democratic Party said anything that looks like cuts to Medicare or cuts to social programs, we are not going to go with. Whether that means raising the Social Security -- raising the age which people collect it, any change that has to do with possibly privatizing Medicare, they say it's a no go. That's a huge chunk of our spending as you know.
What would you propose if you were there today, if you were the House majority leader to bring the liberals along?
ARMEY: Well, the first two best proposals out there that show promise, the current crisis and the future of this country is Paul Ryan -- certainly the most popular guy. The Democrats simply don't want old people to be free to choose. Or even for that matter --
CHETRY: They say they don't want them to be free to choose to get a voucher that doesn't begin to cover their medical costs?
ARMEY: Franklin Roosevelt, 1935, when Franklin Roosevelt himself looking at Social Security said, eventually, this program will have to become a program of private retirement accounts. Franklin Roosevelt knew the problem. They denied it.
Barry Goldwater tried to point out the problems we're having today. They just crucified him.
The fact of the matter is, the Democrats are so -- let's say, lustful for power and control over the lives of old people, they won't give up to them the right to choose. The fact of the matter is, today, you're forced to be in Medicare being a burden to this system and to the taxpayers, whether you want it and need it or not.
I make the point, most of our activists, be se the obvious point, this nation is not going broke taking care of the people who truly need public assistance. It's going broke taking care of people who don't need it.
VELSHI: I'll leave you on that point. That's why some people say the rich should pay more taxes in this country. But I got the last word on that.
Dick Armey, good to see you. Dick Armey is the chairman of FreedomWorks, former House majority leader, and the author of "Give Us Liberty: A Tea Party Manifesto." Good to see you, sir.
CHETRY: Thank you for joining us this morning. Good to talk to you.
ARMEY: Thank you.
VELSHI: It is 38 minutes after the hour.
Here's what's new this morning. Casey Anthony is reportedly planning to live in a secret location under a new name once released from jail on Sunday. According to a source close to her legal team, Anthony turned down plans to get plastic surgery but she did agree to alter her appearance in more modest ways. CHETRY: A man from Salt Lake City is in jail after authorities say he threw peanuts and pretzels at a flight attendant. That happened on a Southwest flight from Los Angeles to Utah. Authorities say the man became upset after a flight attendant repeatedly told him he could not spoke an electronic cigarette on board a plane.
VELSHI: That's an interesting one. I've seen that happen on a plane, of people are saying, "Why can't I smoke my electronic cigarette? There's no smoke that comes out of it."
Arnold Schwarzenegger is ready to resume his acting career. The former governor's on again/off again project is back on. It's a western called "Last Stand."
You'll remember, Schwarzenegger decided to put his movie career on hold after acknowledging that he fathered a child outside of his marriage.
CHETRY: Two acrobats busted after scaling Brooklyn's Williamsburg Bridge and swinging from a silk rope 300 feet above traffic. It happened on Monday and the whole performance lasted about half an hour. The 24-year-old and her partner were charged with criminal trespassing and reckless endangerment.
VELSHI: Whatever floating your boat I suppose.
And check this out -- this has got to be the best picture of the day. An 18-foot, 8-year-old crocodile leaping from the water to snack on a chunk of buffalo meat. The picture was taking during a jumping crocodile cruise in Australia. Brutus, by the way, is what this one is called.
CHETRY: What a perfect name.
VELSHI: Yes. Totally. He's a saltwater crock, one of the largest creatures in the world. I mean, I was surprised. I've never seen something like that.
It's believed, by the way, that Brutus lost his right front leg to a shark. You can sort of see that the right front leg is missing. Would have been a fight between Brutus and the shark.
CHETRY: I know. I wonder what happened to the shark.
VELSHI: Yes.
CHETRY: All right.
VELSHI: The shark got his leg.
CHETRY: Still ahead on AMERICAN MORNING: tabloid scandal, of course, costing Rupert Murdoch more than just one tabloid. His media empire is now taking a huge financial hit over new allegations.
VELSHI: And our question of the day: what is the impact of Social Security checks not going out on August 3rd, as the president has said could happen?
E-mail, tweet us, talk to us on Facebook. We'll read some of your comments a bit later.
You're watching AMERICAN MORNING. It is 40 minutes after the hour.
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VELSHI: Welcome back to AMERICAN MORNING.
Rupert Murdoch's media empire is taking a huge financial hit this morning as a phone hacking scandal spreads beyond one Sunday tabloid and gets more shocking by the day. News Corporation's market value has dropped by more than $6 billion in five days. The company includes the FOX Television Network and "The Wall Street Journal" here in the United States.
CHETRY: Also developing this morning, British lawmakers now calling on Murdoch and his son to answer questions about the phone hacking scandal. And a U.S. senator is warning of, quote, "serious consequences" if this happened in our country.
Dan Rivers is live in London with the very latest.
How big of a deal is it, the calling of Rupert Murdock as well as, perhaps, his son James to answer these questions in front of the government?
DAN RIVERS, CNN SENIOR INTERNATIONAL CORRESPONDENT: Oh. It's a massive deal here. I mean, whether they turn up or not, we don't know because they cannot be forced to appear before this committee because they're not British citizens. But their chief executive, Rebekah Brooks, can be forced to come and answer questions.
It's going to be fascinating next Tuesday to see who turns up and what they say. And I would imagine this story will just keep rumbling all summer.
And, now, as you say, with Senator Jay Rockefeller also getting interested in this in the States as well, this is now not only a U.K. story, it's an international story. It's a U.S. story as well because, of course, Rupert Murdoch has interests all around the place, not just here. He's got "The Wall Street Journal," FOX News, "New York Post," that's to name but a few.
VELSHI: Dan, I want to ask you this. You mentioned that Rupert Murdoch and his son not being British citizens, can't be forced to testify before parliament.
What is the outcome if they do? I mean, here in the United States, we have a lot of people who are called to testify before Congress, subpoenaed, they have to go. But it's unclear unless you lie to Congress, what the consequences are of that.
Are there really consequences to this editor-in-chief being called before parliament? RIVERS: Well, it's tricky. I mean, for a British citizen, if you are sort of caught kind of lying to one of these committees, then you can be held in sort of contempt of parliament. It's kind of murky.
I mean, it's not a court. So, they can't imprison you. And I don't think there has been any modern example of that happening. In the old days, of course, you'd be executed, you know, 400 years ago for lying to parliament. Now, that's not the case.
But, you know, this is running in tandem with a police investigation. So, I think they will be careful not to try and step on the toes of the police investigation. As to what they can do to a non-British citizen, I think that's a lot less clear, but he is, James Murdoch is the chairman of a U.K. company. So, therefore, potentially, you know, he is responsible here.
Talk even of him having come to being (ph) the foreign corrupt business practices act in the U.S. which, you know, means that you can be charged pretty much regardless of where you are and what nationality you are. So, this is getting very serious for all concerned. Of course, news international, News Corp, you know, are saying they didn't know what was going on in their papers at the time.
VELSHI: Right.
RIVERS: And, you know, initially saying it was one rogue reporter. Now, it's clearly bigger than that.
VELSHI: Really bigger than that. All right. Dan, thanks very much. We'll continue to follow this. Boy, I wouldn't have thought we would be following this for as long as we are, but we are.
CHETRY: Yes.
VELSHI: Time now for our question of the day. What is the impact of Social Security checks not going out on August 3rd? Just to be clear, we don't know whether they're going out or not, but President Obama did say to CBS News, if we don't get a deal on the debt ceiling, socially, he can't guarantee the Social Security checks --
CHETRY: Or other benefit checks as well as to veterans, et cetera.
Well, Ty writes on Facebook, "Since most seniors and disabled exist for month-to-month, the consequences are potentially devastating. Likely to cause a notable amount of panic among the elderly, probably more psychologically devastating than anything. Definitely shaking the sense of security that most recipients feel."
VELSHI: And on Twitter, it says, "Just another scare tactic by Obama. If he's so concerned, why doesn't he give some of $86 million in campaign funds to Social Security recipients?" By the way, that refers to the fact that this morning, there's news that in the second quarter, the second three months of this year, both the Obama campaign and the Democratic National Committee jointly raised $86 million. I don't think they're giving it to Social Security.
CHETRY: No. I don't think so either. But some good comments, so keep them coming.
VELSHI: Yes.
CHETRY: Send us an e-mail, a tweet, or tell us on Facebook, and we'll read more a little bit later in the show.
VELSHI: Coming up next, American women just one game away from the World Cup final. Can they keep their focus today after an epic win over Brazil?
CHETRY: We're going to be talking about it with our Richard Roth. Huge soccer fan. Why is the federal government telling people what kind of light bulbs to use in their homes? That's what House Republicans are asking. Why they're trying to repeal a bill requiring new efficiency standards when it comes to light bulbs? It's 48 minutes past the hour.
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CHETRY: Forty-nine minutes past the hour. Here's a look at your headlines this morning.
(BEGIN VIDEOTAPE)
CHETRY (voice-over): There will be little relief today from the heat wave that has blanketed much of the country. Extreme heat advisories are up still in 12 states. Parts of Oklahoma had triple-digit temperatures for 14 days straight now.
Another round of debt ceiling talks on tap at the White House this afternoon. President Obama says that without a deal to prevent a government default, he cannot guarantee that seniors and veterans will get benefit checks come August 3rd.
New legal trouble for Rodney King. He was booked for allegedly driving under the influence of alcohol in Southern California yesterday. Officers say they saw King commit, quote, "several traffic violations." King made national headlines back in 1991 when he was beaten by four police officers. The beating was caught on video. The officers were arrested, but their acquittal in 1992 triggered a riot in Los Angeles that lasted for days and left 55 people dead.
House Republicans failing to repeal a bill that cause for old-style incandescent bulbs to be phased out in favor of more efficient lighting. GOP lawmakers say light bulb standards are a symbol of big government interfering in people's lives.
A Delta plane with more than 260 passengers on board clipped a light post as it was taxiing for takeoff from an airport. This happened in South Carolina last night. No injuries were reported. The airbus A- 330 sustained minor damage to its wing.
(END VIDEOTAPE)
CHETRY (on-camera): You're caught up on the day's headlines. AMERICAN MORNING is back right after a quick break. (COMMERCIAL BREAK)
VELSHI: Fifty-two minutes after the hour. Welcome back to AMERICAN MORNING. It looks like Jonah Duval's 15 minutes of fame might just last a lifetime. The 12-year-old from Washington State is an internet hit ever since he busted a move at a Seattle Mariners game two weeks ago. Someone used a cell phone to tape Jonah dancing, and the video wound up on the Safeco Field scoreboard.
(BEGIN VIDEO CLIP)
UNIDENTIFIED KID: As soon as they saw the big screen on me, I just was like, oh, I'm on the big screen. Sweet.
UNIDENTIFIED FEMALE: It's a little overwhelming for a mom, but I'm excited for him. And it's exactly his passion.
(END VIDEO CLIP)
VELSHI: I want to keep you guessing so we're going to show you the video later on.
CHETRY: Right, because he's just re-enacting it there on the street.
VELSHI: There's a little bit of the video. We'll show you more of it a little later on. I promise, right, Kiran?
CHETRY: Well, you know, you can't necessarily guarantee these things. It got 2 million hits, by the way, in just two weeks. Rock on. He should be on "Dancing with the Stars" or, you know, one of those "America's Got Talent." Jonah's dance, two weeks, two million hits.
VELSHI: All right. The U.S. women are one game away from a trip to soccer's World Cup final. They haven't done that since winning the title in 1999. They've got to beat France today to do it.
CHETRY: That match-up comes on the heels of an epic victory, the shoot-out powerhouse victory over Brazil, American, Amy Wambach's, incredible header knotting the score in the second half, and she says in today's game, losing is not an option.
VELSHI: And it's not an option to discuss World Cup here without our resident soccer guru --
CHETRY: Richard Roth.
VELSHI: Richard Roth, welcome.
CHETRY: Can I ask you a question?
RICHARD ROTH, CNN SENIOR U.N. CORRESPONDENT: Good morning.
CHETRY: 1999 when they won, is that when the girl took her shirt off and she spun it around and she just had her sports bra and it was a huge sensation?
ROTH: Somebody remembers that. Yes, definitely. Yes.
(LAUGHTER)
CHETRY: I remember thinking -- I remember thinking two things. That girl, great woman, Brandi.
ROTH: Yes, Brandy Chastain.
CHETRY: I thought she's incredible and two, I thought, how the heck do you get abs like that?
ROTH: Losing is not an option is something I tell management around here all the time, by the way.
(LAUGHTER)
VELSHI: So, why don't we talk about soccer.
ROTH: I mean, I was still recovering from Derek Jeter's 3,000 hit on Sunday, and I was aware of the women's team was playing, and I stumbled into the second half, and you could tell immediately this was going to be some game. An American squad overseas, controversial referee calls, then, they go one woman down and they go into extra time. There are Brazilian players flopping, stalling for time.
VELSHI: We're now 123 minutes into the game before the goal.
ROTH: Right. Right. It was the latest goal ever scored there in a World Cup. And the Americans always made it to the semifinals. So, you have a former heavy favorite all the time, ranked one, now the world has caught up, then, you have this great historic epic match which I think is really going to provide a lot of viewers for this high noon New York time match today against France.
CHETRY: So, they're playing France. This is also, this is interesting on many levels. They're playing France today.
ROTH: Yes. But there's no really unbelievable rivalry between the two. The U.S. has 11 wins out of 12 matches against them, but there could be a letdown for the U.S. team. I mean, the U.S. men's team scored against Algeria late. It was a year ago we were talking about it.
VELSHI: Sure. Yes.
ROTH: And they went out in the next round to Ghana. So, could be the trap game, so to speak.
VELSHI: Are you going to do the typical Richard Roth? You're going to be at the bar at noon watching this game.
ROTH: I'm always at a bar at noon.
(CROSSTALK)
CHETRY: He may as well watch a game. (LAUGHTER)
VELSHI: Might as well be watching the game.
ROTH: We prefer to call them restaurants here in New York.
CHETRY: Pubs.
(LAUGHTER)
ROTH: Because a lot of people don't like to let me in at noon in their home. I don't know. They're still in their pajamas. So, we have to go with there's a lot of people and that passion (ph).
CHETRY: Now, do you, guys, still bring the vuvuzelas or is that done now, because --
ROTH: I was asked to bring that. I thought it was a bit done, but you may see it later today. But I'm not bringing it to the bar. That's not something you walk around with.
VELSHI: That's a little gosh (ph). Yes.
ROTH: No.
VELSHI: Richard, we look forward to checking in with you later today and watching this game.
CHETRY: Good luck to USA. We'll be watching. Thanks.
Ahead on AMERICAN MORNING, top stories at the top of the hour. Just how close did police come to possibly saving Jaycee Dugard? About 30 feet. Old home movies released showing an officer searching Philip Garrido's home. You almost want to scream, check the backyard. It really is difficult to see. Fifty-six minutes past the hour.
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