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GOP Rivals Trade Insults; Romney: Economy Getting Better; Mystery Man: I Was Kidnapped In Iraq; Tornado Watch Issued For Dallas Area; American Success Story Made In China; Your Stealth Apple Investment?

Aired March 19, 2012 - 16:00   ET

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

WOLF BLITZER, HOST, CNN'S THE SITUATION ROOM: Happening now: Republican rivals trading insults on this, the eve of a critical contest in Illinois. Romney calls Santorum an economic lightweight. Santorum calls Romney a Wall Street financier. And that's just for starters.

An American turns up in Baghdad saying he was held captive for months by militants, but no one even seemed to know he had been missing. We're digging into this mystery.

And Apple rings up massive sale of iPads and iPhones, but should it be employing Americans to make those devices at home instead of paying cheap wages in China?

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

We're only a day away from a crucial primary that could determine where this Republican marathon is headed. Fresh off a runaway win in Puerto Rico, Mitt Romney is now looking to score big in Illinois. Rick Santorum needs a strong showing as he tries to deny Romney the nomination. The two rivals have long since taken off the gloves, but now they have put on some brass knuckles as well.

Our national political correspondent Jim Acosta is in Chicago and he's got the very latest.

JIM ACOSTA, CNN CORRESPONDENT: Wolf, the top two GOP contenders are practicing their own brand of Chicago-style politics on this day before the Illinois primary and both Rick Santorum and Mitt Romney are proving to be untouchable.

(BEGIN VIDEOTAPE)

ACOSTA (voice-over): The battle for the GOP nomination has come to Illinois, and in the land of Lincoln the Republican Party is a house divided in an uncivil war of words.

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: I'm somewhat experienced in the economy. I'm not an economic lightweight. President Obama is. We're not going to be successful in replacing an economic lightweight with another economic lightweight.

ACOSTA: Mitt Romney calls Rick Santorum an economic lightweight. Santorum all but calls Romney Gordon Gekko.

RICK SANTORUM (R), PRESIDENTIAL CANDIDATE: I heard Governor Romney here call me an economic lightweight because I wasn't a Wall Street financier like he was. Do you really believe this country wants to elect a Wall Street financier as the president of the United States?

ACOSTA: Chicago-style brawling sounds like a scene straight out of the mobster movie classic "The Untouchables." When Santorum was asked about the now infamous story of Romney strapping the family dog Seamus on to the roof of a car in a crate, the former Pennsylvania senator wasn't about to give his rival a pass.

SANTORUM: As far are as Seamus the dog, all I would say is the issues of character are important in this election.

Nobody puts words into my mouth.

ACOSTA: But the Romney campaign has its own blast from the past with this Web ad featuring Santorum endorsing the former Massachusetts governor in 2008.

SANTORUM: If you want a conservative as the nominee of this party, you must vote for Mitt Romney.

ACOSTA: A look at the latest poll in Illinois explains why Santorum would like Newt Gingrich out of the way.

SANTORUM: As the race goes on, it shows that he is certainly just taking the conservative vote and dividing it. And, by and large, Governor Romney can't get above 35 percent of the vote anywhere.

ACOSTA: Don't tell that to voters in Puerto Rico, where Romney received more than 80 percent of vote.

ROMNEY: These pancakes are something else, I tell you. These pancakes are as large as my win in Puerto Rico last night.

(LAUGHTER)

ACOSTA: But boasts of an island victory are just the latest sign that Romney is far from focusing all of his energy on the president's economic record, something he tried to do in Mr. Obama's backyard in Chicago.

ROMNEY: He's put us deeper in debt, he's slowed the recovery, and he's harmed the economy.

ACOSTA: Even though earlier in the day, Romney admitted the economy was improving.

ROMNEY: I believe the economy is coming back, by the way. We will see what happens. It's had ups and downs. I think it's finally coming back.

(END VIDEOTAPE) ACOSTA: Both Santorum and Romney have been in different parts of the state today. Romney was here in Chicago earlier today. Santorum was in Dixon, Illinois, the home of Ronald Reagan, the boyhood home of the former president, and it was there where Santorum talked about Mitt Romney as having abandoned freedom in his quest for health care reform when he was governor of Massachusetts.

Wolf, it's worth noting that that boyhood home of Ronald Reagan, Ronald Reagan we should mention also coined the phrase, thou shalt not speak ill of another Republican. It was is 11th commandment, Wolf.

BLITZER: And just want to be precise. Newt Gingrich and Ron Paul, they are basically no-shows in Illinois right now. It's a two- man race between Romney and Santorum?

ACOSTA: That's right.

And it's very telling to see where both of these candidates, both Mitt Romney and Rick Santorum, will be here -- will be on primary day tomorrow. Mitt Romney will be in Illinois. Mitt Romney will be in Schaumburg, which is in the suburbs outside of Chicago where he hopes a lot of those moderate Republicans will turn out and vote for him.

Santorum will be in Gettysburg, Pennsylvania, in his home state, Wolf, to watch those returns come in, Gettysburg, of course, obviously one of the classic battles of the Civil War -- Wolf.

BLITZER: We will watch and see what's happening, and of course, we will have extensive coverage tomorrow night. Jim, thank you.

After a steady drumbeat about the overriding importance of the delegate count, Mitt Romney is now sounding a rather different tone.

Let's bring in our chief political analyst, Gloria Borger.

I will play a couple of clips, what he said a few days ago, what he's saying now and we will discuss.

(BEGIN VIDEO CLIP)

ROMNEY: This is all about delegates, and hope to get more delegates tonight. If the polls are right, we will pick up some delegates. And that's what it's all about.

I know a lot of people will talk about delegates and strategies and math, and that's all very interesting to the insiders, but I think the American people want to see someone who has the leadership, skill and presence to defeat the president and a vision of conservatism that will get America on track again.

(END VIDEO CLIP)

BLITZER: Sounds like a pivot.

(CROSSTALK) GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: A big pivot. It's clear his advisers got together and they told the candidate you have to stop talking about math. That doesn't inspire people to vote for you.

You have to take a turn and start talking about the economy and how you're the man to fix the economy, which is exactly what we heard him doing. He's also got to be a little nuanced on the economy. And I think Jim Acosta's piece also showed another pivot. Because earlier on in this campaign, he hadn't said that the economy is coming back.

Today, he at least acknowledged that the economy might be getting better, because the worst thing a Republican candidate can do is seem to be rooting against an economic recovery or not even acknowledge a recovery that seems to be in the making that the American people want.

BLITZER: Having said that, the climb for Rick Santorum seems to be getting steeper and steeper.

BORGER: As Mitt Romney points out, Rick Santorum lost all of those delegates in Puerto Rico. He now has a very, very steep climb.

By our count at CNN, Rick Santorum would have to win 70 percent of the remaining delegates in order to get across that finish line before the convention. We saw the poll in Illinois. He's losing by double digits so far to Mitt Romney in Illinois. He's got a long haul to go, which is why the Romney people -- I spoke to them today -- they call him an obstructionist and someone who's just trying to be spoiler if he tries to take to the convention.

BLITZER: Which raises the question, as this goes on and on and on, is this going to be good for the eventual nominee, good for the Republican Party or bad?

BORGER: Some Republicans are trying to put a positive spin on it, by saying this is good, this is going to make a candidate stronger, this is always good for the party to get its differences out before the general convention where we can unite.

But when you look at the polls -- there's a new poll by the Pew Research Center, which in particular takes a look at independent voters, and that's where this election will be decided. Look at the favorable ratings for Romney right now, 27 percent, unfavorable 49. Rick Santorum even lower at 23 percent.

As for the president, Wolf, his favorable ratings with independent voters is 53 percent. That's way higher than either of these Republican candidates. And you have to believe that this campaign has driven down those ratings with independent voters. It's just a snapshot. It could certainly go back up again. But it doesn't look like it's wearing well with independents.

BLITZER: As we always say, there's a lot of time between now and November. Those attitudes can obviously change. This is a snapshot right now.

(CROSSTALK)

BALDWIN: Thank you.

BALDWIN: President Obama's campaign reports it took in $45 million last month alone. Most of it was in small donations, the average amount $59. So is there anything at all wrong with that?

Our White House correspondent Brianna Keilar is taking a closer look.

What about all those fat cats out there, Brianna? What are you finding out?

BRIANNA KEILAR, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, President Obama has certainly lost some friends and made some enemies on Wall Street in the last few years, but that may not be his biggest challenge as he raises money.

(BEGIN VIDEOTAPE)

KEILAR (voice-over): President Obama is busy bringing in the bucks, from his Dinner With Barack contest which draws supporters to his campaign Web site where they can donate to more traditional fund- raising events, like the five he headlined Friday, including one at Tyler Perry Studios in Atlanta.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Hello, Georgia.

KEILAR: That one day of fund-raising likely netted about $5 million for Obama's campaign and the DNC.

Some top fund-raisers are rewarded handsomely -- 47 were invited to the state dinner for the British prime minister last week. Even so, donations from big money donors have dried up. At this point in the election in 2008, 23,000 donors had given Obama $2,000 or more. Now it's half that and just a fraction of the big donations George W. Bush secured at this point in 2004.

Why is that? It could be because President Obama hasn't exactly been making friends in rich circles.

OBAMA: I did not run for office to be helping out a bunch of, you know, fat cat bankers on Wall Street.

KEILAR: Republicans insist the trend spells big trouble for the president.

RNC Chairman Reince Priebus says "Whether it's showing in fund- raising or in the polls, Americans are enthusiastic about replacing Obama in the November."

But campaign finance experts say the lack of big donors matters little.

THOMAS MANN, SENIOR FELLOW IN GOVERNANCE STUDIES, BROOKINGS INSTITUTION: Obama looks to be in a weak position only relative to where George W. Bush was in 2004 and where Obama himself was four years ago, but neither is really a relevant comparison. This time, Obama is unopposed for the nomination. And, frankly, he's outraising all of the Republican candidates put together.

KEILAR: The Obama campaign has brought in $300 million since April of last year, Republican front-runner Mitt Romney just about $75 million. The bigger challenge for the Obama campaign are super PACs which can raise and spend unlimited amounts of money for a candidate. The biggest Republican super PAC, American Crossroads, has raised exponentially more funds than Priorities Action USA, the main super PAC backing Obama.

And that may be what all ultimately levels the playing field.

MANN: My guess is in the end Obama will raise more than the Republican nominee, but the Republican super PACs will raise and spend more than their Democratic counterparts, but that, overall, the resources will be roughly in balance.

(END VIDEOTAPE)

KEILAR: And, Wolf, President Obama continues his fund-raising tonight. According to a campaign official, he will be attending a fund-raiser at a local hotel, the W. Hotel. Approximately 20 people will be attending.

And speaking of big money donors, the price on this fund-raiser, $35,800 a head.

BLITZER: Yes, which is the maximum that they can contribute in a cycle, if you will.

I can't tell you how many of those Wall Street bankers who supported the president four years ago and gave him a ton of money were so deeply irritated by those comments and you had them: "I did not run for office to help fat cat bankers on Wall Street."

And that's why they're holding back right now. Let's see if they come forward in the months to come. Good report, Brianna. Thanks very, very much. We will stay on top of the money trail. Money talks in politics, as we all know.

He only has two primary wins and he's trailing badly in the delegate count, so why is Newt Gingrich still in the race? Jack Cafferty is coming up with "The Cafferty File."

Plus, there's a mysterious case of an American man freed by kidnappers in Iraq. Only, no one seemingly knew was missing. One expert says it simply doesn't add up.

And severe weather happening right now across parts of the United States. We're monitoring storm chasers. They're out in the thick of it.

(COMMERCIAL BREAK)

BLITZER: Jack Cafferty is here with "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN CONTRIBUTOR: Wolf, some people just can't take a hint. It's the eve of the Illinois primary, and Newt Gingrich is still here. Actually, as of yesterday, he was in Washington, taking in the cherry blossoms and reportedly seen dining at a trendy restaurant with his wife.

The voters have made it abundantly clear they are not interested in Mr. Gingrich being our next president. He's won a total of two states, South Carolina and his home state of Georgia. He was supposed to do well in the South, but Rick Santorum busted him up big-time in Alabama and Mississippi last Saturday.

The leadership of the Republican Party has quietly made it known that it would be a good idea for Mr. Gingrich to acknowledge what everyone else seems to be able to see so clearly and make his exit. But like an old hoofer addicted to the footlights, that's hoofer, he just can't bring himself to get off the stage. Gingrich has indicated he intends to remain in the race, all the way to the convention in Tampa, dumb idea.

The longer he stays in, the wider Romney's delegate lead becomes. As long as he and Santorum cut up the conservative votes, Romney edges closer to being the nominee. He continues to use his daughters to shill for him, which must be embarrassing for them on some level. They can read the numbers, like everyone else. The whole thing is becoming uncomfortable to watch.

Here's the question: What's Newt Gingrich up to?

Go to CNN.com/CaffertyFile, post a comment on my blog, or go to our post on THE SITUATION ROOM's Facebook page -- Wolf.

BLITZER: I guess, Jack, the same question can be asked about Ron Paul. Why is he still in this race? He has even fewer delegates than Newt Gingrich.

CAFFERTY: I don't know, I'm asking about Newt Gingrich.

BLITZER: I know.

(LAUGHTER)

CAFFERTY: You're absolutely right.

BLITZER: We can ask the same question, why -- I understand Ron Paul to a certain degree, because he's got a real agenda, he's pushing.

CAFFERTY: And he has a core constituency.

BLITZER: He certainly does.

CAFFERTY: And you can't say that Newt Gingrich has a core constituency, I don't think. If he had, it would have shown up in Mississippi and Alabama.

BLITZER: Yes. I suspect at some point, it will be a two-man race, Romney and Santorum. And we'll see where it goes from there. But the two of those guys are going to be fighting it out, I suspect.

CAFFERTY: It looks like it. Yes.

BLITZER: All right. Thanks very much, Jack. We'll get back to you. But I'm interested in what our viewers think as well.

An American teacher assassinated in Yemen. Lisa Sylvester is monitoring that and some of the top stories in THE SITUATION ROOM right now.

Lisa, what do you have?

LISA SYLVESTER, CNN CORRESPONDENT: Hi, Wolf.

Well, officials in Yemen say the al Qaeda affiliate there is claiming responsibility for the shooting death of the teacher who's not being identified right now. The terror group sent a text message to local news media saying the man was a missionary spreading Christian in a Muslim country. But his employer says the man was a development worker who had been in Yemen with his wife and two children since 2010.

The average price of gasoline is now just 28 cents from it's all-time high set in the summer of 2008. AAA reports the price inched up again yesterday for the ninth day in a row to just under $3.84 a gallon. But the average is already over $4 a gallon in seven states and the District of Columbia.

Quarterback Peyton Manning is reportedly in talks to join the Denver Broncos. ESPN and "The Denver Post" are among those reporting a deal in the works. Manning's agent won't comment. The four-time NFL MVP ended his 14-year career with the Indianapolis Colts this month after missing the entire 2011 season following neck surgery.

And congratulations to U.S. taxpayers, you just made a $25 billion profit. The Treasury Department sold one of the mortgage backed security portfolios it bought at the height of the financial crisis in 2008 and 2009. Treasury is now reporting it sold the securities for $250 billion, possibly the department's largest such profit ever, Wolf.

So good news on that front.

BLITZER: Yes, that's good news for American taxpayers, like you and me, and I suspect most of our viewers, as well. Congratulations, to the U.S. Treasury.

Appreciate it. Thank you.

Suddenly, sounding a different tune on the economy.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: I believe the economy's coming back, by the way. We'll see what happens. It's had ups and downs.

(END VIDEO CLIP)

BLITZER: So if Mitt Romney's right, how would he run a campaign against Barack Obama? Jamal Simmons and Mary Matalin, they are both standing live. Our strategy session, that's coming up.

(COMMERCIAL BREAK)

BLITZER: I'm Wolf Blitzer in THE SITUATION ROOM.

Here are some of the stories we're working on for our next hour:

The Justice Department in Washington steps into a racially charged case in Florida. An unarmed black teenager shot to death by a neighborhood watch captain.

Also, a gunman on a motorcycle goes on the killing spree in France for the third time in 10 days. This time, children are among the victims.

Plus, a collision at sea. A luxury cruise liner slams into a cargo ship. Passengers share their ordeal with us.

Stand by. You're in THE SITUATION ROOM.

(MUSIC)

BLITZER: Let's get back to the race for the White House right now.

Joining us in our strategy session, the Democratic strategist Jamal Simmons, and CNN contributor Mary Matalin, a Republican strategist.

Mary, let me start with you. Santorum got clobbered in Puerto Rico. He spent two days there. Obviously, in the political scheme of things, a waste of his time, because it was embarrassing how badly he did. What, Romney got 80 percent, 85 percent of the vote.

And he's not even -- looking ahead tomorrow in Illinois, your home state, he's not even on the ballot in four of the congressional districts in Illinois.

Here's the question, it's a tough question: is Santorum ready for prime time, ready to challenge the president of the United States who's got a ton of money and a huge organization?

MARY MATALIN, CNN CONTRIBUTOR: That is a good question. But as Jamal and I have always said, if the election were held today, the election is never held today. That's why we see it. The activities in the primary aren't necessarily predictive for the general. I guarantee you when they have a nominee, there will be a united party.

There are evidences in this, even as disunited primaries season that things will go well for the Republicans in the fall. We have higher registration. Our money's coming in to the committee at rates greater than it is to the Democratic committee.

So, this is -- what you're seeing here is the power of organization. Santorum didn't have one. He'd be on fewer -- had fewer delegates in Illinois. Mitt Romney hadn't drop a challenge to the many districts he didn't get into. And Romney has a solid, really strong organization and the governor in Puerto Rico. So, he deserves a lot of credit for thinking ahead and having this organization built for the long haul.

BLITZER: Maybe you can explain this to me, Jamal. The super PAC, the pro-Obama's super PAC, Bill Burton, Paul Begala, our CNN contributor, that pro-Obama super PAC, it's pitiful how limited their fundraising has been so far compared to the pro-Republican super PAC that Ed Gillespie and Karl Rove have undertaken.

Why is there such a disparity in the super PAC money going to a pro-Obama committee versus a -- let's say an anti-Obama committee?

JAMAL SIMMONS, DEMOCRATIC STRATEGIST: Well, Wolf, you know, for the first part, the president clearly was not in favor of super PACs. That's what most Americans believed for a long time. Now, the president sort of signal that he is OK to the idea because he sees the disparity between the Republican super PACs and Democratic super PACs.

It's a miserable situation. There's no getting around it. The numbers just don't make any Democrats feel comfortable. So, the Democratic donors are really going to have to step up, get in the game and start to really fund that super PAC or any of those so that the Democrats really have a fair shot.

The president's doing a good job in the campaign. They're raising a lot of small dollar donors, they need some more big dollar donors. But the super PAC has really got to do better.

BLITZER: You know, I want you to listen, Mary, to Mitt Romney talking about the improved U.S. economy right now. Listen to this.

(BEGIN VIDEO CLIP)

ROMNEY: I believe the economy is coming back, by the way. We'll see what happens. It's had ups and downs. I think it's finally coming back.

The economy always comes back after a recession, of course. There's never been one that we didn't recover from. The problem is that this one has been deeper than it need to be and a slower recovery that it should have been by virtue of the policies of this president.

(END VIDEO CLIP)

BLITZER: And he said that, Mary, I think you'll acknowledge if the economy continues to improve between now and November, that's very good news for the president's reelection chances.

MATALIN: But the real people in real homes, with real cars to put gas in don't measure their economic circumstances and their hope for the future based on jobs numbers. In fact, on jobs numbers, they look more poignantly at underemployment and labor force participation. They don't call it that, but everybody they know is either not in the job they want. They don't want jobs. They want family-sustaining long term reliable jobs.

They don't see that coming. They see energy prices going up and they see health care premiums going up and they see this rate of growth having the velocity of a belly crawl and that just bodes not well for the voters.

I'm talking about Obama 2008 voters have that sentiment, not Republicans. So it is improving and they credit the improvement that they do see to their own hard work and their sacrifice. I don't think the fundamentals for a bad economic job performance of the president has changed at all.

BLITZER: All right, Jamal, does she have a good point?

SIMMONS: No, Wolf, in the last segment you did, you had Gloria Borger talking about few polls and she looked at independent presumption of Mitt Romney and Santorum versus the president.

The Republicans on the 20s. The president is in the low 50s among independents. Those are the kind of things that matter. When people vote for president, it's not just about this issue or that issue, though the economy is the biggest issue, people wanting to move forward.

And finally the Republicans are acknowledging what's happening, they also vote on qualities, like leadership and temperament. We know Santorum doesn't have the temperament to be president.

We saw that again in Puerto Rico and we also know that Mitt Romney doesn't have the leadership to be president. When you can't stand up to Rush Limbaugh and you can't stand up for college education, what is it that you can be trusted to stand up for to show leadership?

So I think when we look at those kinds of qualities, we see a president that really ought to do really very well come this fall.

BLITZER: Who has a better answer for this question, Mary, you remember Ronald Reagan made it famous when he was running against Jimmy Carter. Are you better off now than you were four years ago?

If Barack Obama says that to the American people in November, are you better off now than you were four years ago in November 2008, or let's say if Mitt Romney or Rick Santorum were to ask that question, who would the American people go with?

MATALIN: Everything is about context. The better off now for Barack Obama, the new normal for Barack Obama is the absence of a free fall. It's over 8 percent unemployment. When Ronald Reagan asked it, and asked it subsequently in his re-election, the trajectory was not 1.7 percent growth.

At this point in the Ronald Reagan recovery, we were going at over 5 percent a year so people had hoped for the future. Elections aren't got the present course, and as Jamal rightly says, they're bigger than the economy.

They're really about an aspirational future. People do not feel that now and they're likely, by polls now say they don't think they're going to feel that way in the fall.

BLITZER: Very quickly, Jamal, do you think the president is going to be asking the American people that question?

SIMMONS: I think the president will have a very good case to make if he says we're on the right path to where we need to go. We're better than we were when we got started.

We got a ways to go, but stick with me. We can do it. If you go the other way, Mitt Romney will take you the way we were under the last administration when things didn't go so well toward the end.

BLITZER: Jamal, thank you. Mary, thank you as well.

A mystery man surfaces in Iraq. He's an American who claims he was kidnapped. One expert says the story simply doesn't add up. We have the latest.

A tornado watch just issued for a major metropolitan area. We're tracking severe weather right now.

(COMMERCIAL BREAK)

BLITZER: An American turns up at Baghdad saying he had been abducted and held for months by militants. No one apparently even knew he was missing.

Our foreign affairs correspondent, Jill Dougherty, has been digging into this mystery for us. Jill, what do you finding out?

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: You know, Wolf, it is a strange story and here at the State Department. They say that this man who has been at the U.S. Embassy now since he was released is getting some medical attention and is also being debriefed, but there are more questions than answers.

(BEGIN VIDEOTAPE)

DOUGHERTY (voice-over): He seemed to come out of nowhere. He says he's a former U.S. soldier, now a civilian contractor, kidnapped nine months ago in Iraq by Shiite paramilitaries, then freed.

RANDY HULTZ, ALLEGED KIDNAP VICTIM: I was taken inside Baghdad and have been kept in and around different locations within the city. It was explained to me that my release has been for humanitarian reasons and that there was no exchange involved.

DOUGHERTY: But no one seems to have known he was gone. The State Department says he had not registered with the embassy and initially scrambled for information on who he was.

Eventually identifying him as Randy Michael Hultz, a private citizen not an employee or contractor of the U.S. government, in Iraq on private business.

Hultz is listed as a partner in the Iraq Fund Advisers. In this interview, two years ago with U.S. funded Al-Hira TV, Hultz downplayed the danger in Iraq.

HULTZ: Being an investment company, we have to send a message and that is that we stand behind what we are saying to our investors, that Iraq is improving. It is relatively safe here. That Iraq isn't everything that we see in the 5:00 news. Life goes on.

DOUGHERTY: The Defense Department says so far there's no indication that Hultz served in the military. The State Department calls the apparent kidnapping and release an unusual story. Monday, the State Department says it did get notice something was amiss last year.

VICTORIA NULAND, STATE DEPARTMENT SPOKESWOMAN: We did receive an e- mail around June of 2011 from an Iraqi acquaintance of Mr. Hultz saying that he had not heard from this guy for several days and the Iraqi indicated in that e-mail that he was of the impression that Mr. Hultz was planning to leave Iraq in the near future.

DOUGHERTY: The department says it found his hotel, but found no trace of him. They figured he'd left Iraq. Former FBI Assistant Director Tom Fuentes says Hultz's story does not add up. So why was he freed?

TOM FUENTES, FORMER FBI ASSISTANT DIRECTOR: Maybe when they kidnapped him, after a while, they realized they had someone who was worthless to them in terms of political gain or economic gain and they tried to make the best of it and claimed that they released him for humanitarian reasons.

(END VIDEOTAPE)

DOUGHERTY: Some are speculating whether Hultz might have been working as an intelligence agent. But Tom Fuentes says there's no indication of that. In fact, he says this looks for weird than operational -- Wolf.

BLITZER: Certainly does. But he's still in Baghdad or is he back here in the United States already? Do we know?

DOUGHERTY: As far as we know, he has been at the embassy, but then he soon will be free to come back so maybe we'll find out more.

BLITZER: Let's see. We'll continue to -- to chase this mystery as we say. Thanks very much, Jill, for that.

A tornado watch has just been issued for the Dallas-Fort Worth area. There's a severe weather threat from Texas all the way to Iowa, beyond, we're tracking it all. Chad Myers is standing by.

Also, Apple announces plans for its $100 billion cash stockpile. How much of this American success story though is made in China.

(COMMERCIAL BREAK)

BLITZER: We're just getting word of a tornado watch for parts of Texas, including the Dallas-Fort Worth area. Let's go straight to our severe weather expert.

Our meteorologist Chad Myers, he's following the system threatening. Chad, large areas from the south all the way through the Midwest? What do you see?

CHAD MYERS, AMS METEOROLOGIST: All the way from Del Rio, Texas or even Northern Mexico, all the way into Iowa, parts of Illinois and even some strong weather in Ohio, a very large area to the east of the cold front.

It has been snowing for days now in Flagstaff. It's been in the 80s to the east of this cold front for days here. Cold, warm and now today they are clashing. And as they clash, we are going to see severe weather.

And we have seen a couple of storms pop up to the west of Dallas-Fort Worth and just a big hail core roll around mineral wells, a little bit further to the south down here around Del Rio. These storms down here are rotating with a report of a tornado on that storm there.

There will be many tornadoes tonight, I'm afraid, Wolf, and so I need you to pay attention and keep that weather radio on even for Decatur. This is Decatur, Texas right here. There's Dallas. There's Forth Worth and the hail marker in a rotation right there across Decatur.

Probably seeing golf ball-sized hail that storm is rotating and we could see a tornado pop-out of that at any time. We are watching many chasers here, Wolf, there's one right here. This is Mr. Twister, Zack Roberts. We also have about another dozen cars east of this location.

We will keep you up to date. We'll watch these chasers. We will get some video on TV if we do see anything on the ground. We have chasers all the way from Decatur all the way back to the west of Dallas-Fort Worth because we do expect obviously.

We have millions of viewers in the metroplex there. That will be the next big city that gets hit by something either hail or even possibly something that rotates tonight -- Wolf.

BLITZER: Let's hope it doesn't, but we'll stay on top of it. Chad, thanks very much. Let us know if something happens.

Meanwhile, Apple rings up massive sales of iPads, iPhones, but should it be employing Americans to make those devices right here at home instead of paying cheaper wages in China?

Also, the racially chase case involving the neighborhood watch captain who ended up shooting an unarmed Florida teenager. You're going to hear those 911 tapes.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: They always get away.

UNIDENTIFIED DISPATCHER: Are you following him?

UNIDENTIFIED MALE: Yes.

UNIDENTIFIED DISPATCHER: OK, we don't need you to do that.

UNIDENTIFIED MALE: OK.

(END VIDEO CLIP)

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BLITZER: Apple has just announced it sold, get this, 3 million of its new iPads since Friday. And today, the company also revealed plans for its almost $100 billion stockpile of cash.

Apple says it will pay a stock dividend for the first time since 1995 and buy back $10 billion worth of its own shares. But Apple's American success story certainly has some critics as well say China may be the biggest beneficiary.

CNN's Lisa Sylvester is working this story for us. Explain what's going on, Apple, China, American workers, go ahead.

SYLVESTER OK, Wolf, well, you know, throngs of people lined up outside Apple stores to get the new iPad. And the company that has accumulated a hoard of cash, a $100 billion hasn't been exactly an engine of U.S. manufacturing job growth in the United States.

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SYLVESTER (voice-over): Apple has made so much money it's worth more than several countries like Bangladesh, but the people who actually make the iPads and iPhones, not Americans. It's hundreds of thousands of workers in fox come factories based in China.

Working long hours, even sleeping in the dorms within the factories. One of our CNN producers ordered the new iPad 3. It went from Chengdu, China directly to the United States. The parts made in China, assembled in China, even packaged in China.

Alan Tonelson is with the U.S. Business and Industry Council, a group that fights to keep jobs in the United States. He says Apple like many U.S. multinational corporations maximizes profits by moving production to China.

ALAN TONELSON, U.S. BUSINESS AND INDUSTRY COUNCIL: Apple's success is a classic and glaring example of an American company free riding on American prosperity and not paying any of the costs for maintaining that prosperity.

SYLVESTER: At a Twitter town hall meeting last summer, President Obama gently prodded Apple executives.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES OF AMERICA: It's great that we have an Apple that's creating iPods, iPads and designing them and creating the software, but it would be nice if we're also making the iPads and the iPhones here in the United States because that's some more jobs that people can work at.

SYLVESTER: But why has Apple fled to China to make its iconic products. We contacted Apple, but they decline to the interview instead they pointed us to their web site.

While there are only 47,000 U.S. workers employed at Apple, the company likes to us what they call a holistic number, a multiplier effect of 514 American jobs from the people who make the FedEx planes that deliver those iPads to the developers of new iPad apps.

And Morgan Reed with the Association for Competitive Technology says Apple is doing what it's supposed to do maximizing shareholder value.

MORGAN REED, THE ASSOCIATION FOR COMPETITIVE TECHNOLOGY: In China, it's very difficult to sell into China if your company isn't based in China. They look at China as a place to manufacture because that's where the next generation of purchasers are going to be.

SYLVERSTER: But what about loyalty to the U.S., to the American worker? What about boosting the U.S. economy? Tonelson says the blame lies with Washington. Trade policies that were created that encourage companies like Apple to shift work overseas.

TONELSON: These trade policy decisions starting with Nafta back in the early '90s have enabled companies like Apple to supply a very lucrative, very high price U.S. market from super low cost, almost regulation free companies like China.

SYLVESTER: So the bottom line, Apple can pay workers less money in China than they ever could in the United States. Apple has been able to create cutting edge new products, but it hasn't been able to directly create U.S. manufacturing jobs.

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SLYVESTER: An Apple software engineer reportedly makes more than $100,000 a year. Retail worker at an Apple store makes between $11 to $18 an hour. Foxcom workers in China make only about $300 a month working incredibly long hours. Apple says it insists that its suppliers provide safe working conditions and treat their workers with dignity and respect.

BLITZER: Because the cost of manufacturing those iPads and iPhones in China are much lower than they would be if they were manufactured in the United States.

Millions of American consumers can buy a new iPad for $500 instead of $1,000 potentially if they were manufactured in the United States. So there is a benefit to millions and millions of Americans by making this stuff in China.

SYLVESTER: Yes, I think one of the things, you saw that number out today that's 3 million iPads since Friday. So we're talking basically in three days, 3 million iPads and I think the price point has a lot to do with that -- Wolf.

BLITZER: Yes, of course, a lot more can pay $500 than a $1,000. All right, thanks very much, Lisa for that.

CNN's Erin Burnett is going out on this story as well. You can see her tonight 7 p.m. Eastern. Erin is here right now here in THE SITUATION ROOM.

Erin, Apple stock may certainly seem out of reach for so many people about $600 a share, but a lot of people own it even without knowing they own it.

ERIN BURNETT, HOST, CNN'S "ERIN BURNESS OUTFRONT": Yes, that's right. They say a lot of people, Wolf, may actually have too much exposure to Apple. Now given that Apple shares have almost doubled over the past year. You might say how was that possible?

Well, in the event that anything goes wrong, a lot of Americans own a little bit more than they think. Whether you have a pension or a 401(k), or if you do invest on your own, you probably have a lot of Apple everywhere.

For example, TIA Creff is one of the top ten owners. So obviously, if you got a pension in that system, that's you and there are a lot of pension funds and mutual funds. That's Fidelity, if they manage your 401(k), or you have a mutual fund there, you probably own Apple.

And what happened today, Wolf, is because Apple initiated a dividend and by the way, this dividend relative to average American company dividends is that high. It's still a little bit low, but that will mean that a lot of dividend funds.

A lot of people who are looking for more income, older Americans, for example, may end up buying shares of Apple too. So we'll see if even more people get into Apple, but I will tell you today. It did end up another $15 over $600 for the first time ever, $600 a share.

BLITZER: Yes, Erin is going to have a lot more at 7 p.m. Eastern. Erin, we'll be watching. Thank you.

And coming up in our next hour, a deadly attack on a Jewish school in France prompts precautions to protect communities right here in the United States.

Also the dramatic 911 tapes that shed new light on the shooting of an unarmed black teenager. Now it could become a federal case.

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BLITZER: Jack Cafferty is back with "The Cafferty File" -- Jack.

CAFFERTY: The question this hour is what's Newt Gingrich up to? He can't win and he won't quit.

Jay writes, "I believe he just wants to appear at the convention, give his speech and get more attention, maybe get a spot in the new Republican administration if they win. He seems delusional got winning the White House, but if he drops out now, people will just forget about it. He's not thinking about the country, only about his own selfish ambition."

Paul writes, "The main breeding season for Newt is between months of June and August right around the time of the Republican convention. Many Newts produce toxins in their skin secretions as a defense mechanism against predators. Often with the initials of MR, RS or even RP. Newt simply getting ready for the convention."

Stephen writes, "Newt's not stupid. He actually is a very astute politician, knows the Washington game and electoral politics as well as anyone. It's possible the establishment we keep hearing that's telling Newt to pack it in his privately telling him to stay in the race and keep Santorum at bay."

David in Virginia writes, "Good afternoon, Mr. Gingrich. You know you can't win the general election. You also know that Santorum is DOA in November against Obama. So your assignment should you choose to accept it is to keep running to deny Santorum the delegate count, get Romney in the front seat to allow our best chance of unseating Obama in the fall. As always should you, Calista or any of your daughters get caught, the RNC will deny any knowledge of your activities."

Jenna writes from California, "Newt knows he doesn't have a snowball's chance, what Newt's looking for is a nice cushy job in exchange for his delegates. He'll not give them up until the convention and we all know that he'll make some backroom deal there."

J.D. in New Hampshire writes, "He's up to a couple of things. Number one, future book sales and speaking fees. And number two, a vendetta against Romney. It's a bit pathetic."

And Richard writes from South Dakota, "What's a dog and pony show without the dog." If you want to read more on this, go to my blog, cnn.com/caffertyfile or through our post on THE SITUATION ROOM's Facebook page -- Wolf.

BLITZER: Jack, thank you.