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CNN NEWSROOM

Debt Ceiling Battle Continues; Brooklyn Boy Murdered; Home Videos of Dugard Captivity House; Dugard: Daily Life with Kidnapper; Shuttle Awe; Sign Warns Drivers of Zombies; Elderly Nude Calendar; Pawlenty, Conan and Twitter

Aired July 13, 2011 - 16:00   ET

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


BROOKE BALDWIN, CNN ANCHOR: And now, as we're at the top of the hour, debt talks at the White House, they are due to start again right now. And you know the deal. We have been talking about this reach and every day, a potential default of the United States Treasury if Congress will not approve more borrowing by that deadline of August 2.

Now, congressional Republicans are demanding deep federal spending cuts equal to any dollar amount they would let the government borrow. The White House, on the flip side, is saying that that would hurt the poor, that would hurt the middle class and wouldn't cost the wealthy a dime.

So the Democrats are saying, yes, we will cut spending, but let's raise some taxes, too.

Jessica Yellin, chief White House correspondent, is there any give at all on either side's position here?

JESSICA YELLIN, CNN CHIEF WHITE HOUSE CORRESPONDENT: Both sides seem pretty locked down and increasingly so, Brooke.

So, I should say that for today's 4:00 p.m. meeting, staff on all sides were dispatched to come up with a list of detailed spending cuts that could help everybody get to the $1.5 trillion to $1.7 trillion that has been the working goal for the total spending cuts. So there's something concrete, at least.

But, beyond that, there continues to be this ongoing, seemingly mushy discussion about taxes vs. entitlement changes. We know that yesterday Treasury Secretary Tim Geithner came in and gave the group a warning about the catastrophic consequences of a default.

And we got varying accounts of the mood in there. Yesterday, some said it was weary. Some said they were tired of hearing each other's talking points. At times, it's testy, but everyone says it's very professional. The problem is, no one is reporting any major progress toward a deal. And the clock is ticking.

BALDWIN: I was talking to Jay Newton-Small of "TIME" magazine just yesterday. She was talking to me about how she is also hearing that it's more the number-two Republican, Cantor, who has been doing a lot of the talking, not as much Speaker Boehner. But I do know that you have spoken with the House speaker, John Boehner. What is Boehner's response to this White House charge that he and his Republicans absolutely will not put taxes on the table; they just won't even go there?

YELLIN: Well, the speaker had a meeting with a small group of reporters in his office this morning.

And when we met with him, he said, first of all, that the tax increase proposal is just a nonstarter. It's not going to go anywhere. There are not going to be votes for it under this midway deal that they've been talking about. He continues to say that that big deal option is a great idea, would have worked, could work if there were more time, if there were other ways.

He did say that the president, what he is asking us to do just won't pass. That would be that midway deal.

(CROSSTALK)

BALDWIN: The $2.4 trillion or the $4.0 trillion?

YELLIN: Two-point-four is my -- and everyone warns us against using those absolute numbers, but that midway deal.

BALDWIN: OK. OK.

YELLIN: But the general sense that one gets by talking to everybody is that everyone agrees that something has to pass. And something will pass. The question is, how do you get there? The clock is ticking. There's not a lot of trust. What's going to get done, so what other options are out there?

BALDWIN: That's a great question.

Jessica Yellin, let us know if you hear anything. They're all supposed to be back in the White House yet again today talking about this potential deal. They all say they want to get a deal done. But just how is the big question. Thank you, ma'am. Appreciate it.

And I actually talked a short time ago with Republican Paul Broun of Georgia and I asked him about the Republican Party's position that any tax increase against anyone would kill job creation. Watch this.

(BEGIN VIDEO CLIP)

BALDWIN: When you talk to families, the one word that resonates no matter what side you're on is jobs. And you and your party say raising taxes will kill jobs.

(CROSSTALK)

REP. PAUL BROUN (R), GEORGIA: It will.

BALDWIN: But Bill Clinton raised taxes his eight years in office. The economy created 23 million jobs. That is a record. By the way, these numbers are from "The Wall Street Journal" and the Census Bureau. George Bush cut taxes eight years in office, three million jobs.

So, if raising taxes automatically, irrefutably kills jobs, as your side is saying, how did Bill Clinton raise taxes and create those 23 million jobs?

BROUN: Brooke, we had a good economic environment during the Clinton administration. We do not have that today.

What we have is we have a business community that's overtaxed and over-regulated. We have the highest corporate tax rate in the world. Every single other country in the world are lowering their corporate tax rate.

BALDWIN: Will your side compromise on taxes at all?

BROUN: Well, I don't see that we can or will, for the simple reason that it's going to tax away jobs and it's going to hurt our economy. And it's absolutely adverse to the financial situation here in this country.

We're in an economic emergency, Brooke. And in an economic emergency, you have to do emergent procedures. I'm a medical doctor. I have worked in emergency rooms, and I know about those types of things. And we have got to start paying down the debt. We have got to stop spending money that we don't have today. We have got to look into every single corner of the federal expenditures, discretionary, as well as the non-discretionary spending...

BALDWIN: OK.

BROUN: ... and start cutting, and stop spending money we just don't have. It hasn't worked in the past, and it never will work.

(CROSSTALK)

(END VIDEO CLIP)

BALDWIN: Congressman Paul Broun of Georgia, Republican, says no compromise.

(NEWS BREAK)

BALDWIN: And we could be facing another financial crisis with catastrophic consequences -- the urgent warning coming from Fed Chairman Ben Bernanke. We're live at the Stock Exchange coming up.

Also, this:

(BEGIN VIDEO CLIP)

RAYMOND KELLY, NEW YORK CITY POLICE COMMISSIONER: When detectives asked where the boy was, Aron nodded toward the kitchen, where detectives observed blood on the freezer handle of the refrigerator.

(END VIDEO CLIP)

BALDWIN: This is horrendous. What they found in that freezer is, quite frankly, unbelievable. A little boy, 8 years of age, begs his parents to let him walk home alone just this one day from day camp, and now he is dead and a suspect is in custody.

There's also surveillance video now showing what may have happened in the boy's final moments. That story is unfolding right now. You don't want to miss this. It's a tough one. It's next.

(COMMERCIAL BREAK)

BALDWIN: A boy allowed to walk home alone for the first time from his summer day camp never made it back to his mom and dad in Brooklyn.

This morning, police found his body in pieces, parts in a dumpster, parts in a refrigerator. Eight-year-old Leiby Kletzky disappeared Monday afternoon. And I want you to take a look at this. This is surveillance video. And police say this is the last time anyone saw him. There he is, backpack, a couple bags. And it looks like -- at one point eventually, it looks like he's asking a man for directions.

So that's one surveillance video. Let's flip to another one. This is what happened -- and this is what helped police track down their 35-year-old suspect today. He was the person last seen with this boy outside a dentist office. See, inside the spotlight, you see the two of them passing by.

Now, the suspect apparently stopped to pay a bill and the staff in the dental office actually helped police locate this suspect's address. Listen to how the body was found.

(BEGIN VIDEO CLIP)

KELLY: They found the door to the suspect's third-floor apartment ajar, with Aron inside. When detectives asked where the boy was, Aron nodded toward the kitchen, where detectives observed blood on the freezer handle of the refrigerator.

Inside the refrigerator was a cutting board with three carving knives with blood on them. Some of the remains were in the freezer and others in the dumpster two-and-a-half miles away.

(END VIDEO CLIP)

BALDWIN: Steve Kardian, former New York police detective, joins me now.

And, Steve, to be clear, he's talking about Aron -- Aron -- Levi -- he's the suspect here. He's not been charged with anything, pending the medical examiner coming forward with a specific cause of death. But I know you have seen, Steve Kardian, some of that surveillance video, and I just want to loop it again, because you see this boy trailing along behind this man, the suspect, Levi Aron, and it doesn't look like he's forcing him to go somewhere. He's not pulling him along anywhere. So just that little detail, what does that tell you?

STEVE KARDIAN, FORMER NEW YORK STATE POLICE DETECTIVE: You know, Brooke, my condolences out to the Kletzky family.

BALDWIN: Of course.

KARDIAN: He -- in the video, he looks obviously out of place, that he's lost his bearings.

And in the Hasidic community, they're very much -- it's is a closed community. So this is someone, according to the information that I have recently received, that was known to the family. So it's likely that he attached himself to him and he was being guided by him. And we see the longer that a young child or anyone stays within the close confines of a predator under his direction, the worse that it can be.

BALDWIN: Did I hear you, Steve Kardian? You may be breaking some news for us. You're telling me that you have been talking to folks, and he knew his family?

KARDIAN: Yes. According to a source close to the Hasidic community, I have been told that the perpetrator and the family are known to each other.

BALDWIN: Do we know how they knew each other?

KARDIAN: I don't know that. I don't know that, Brooke. But to -- my information from someone close to the community is that they -- they were known to the family, that Aron was known to the family.

BALDWIN: It was -- I was listening to the news conference this morning and taking notes. NYPD Commissioner Ray Kelly saying, look, you know, characterizing this as happenstance, this is likely random. He said this morning, although perhaps new details coming forward indicating otherwise, saying he didn't think that Levi had contact with this 8-year-old boy.

But let's just say, you know, in your years in law enforcement, is it typically the case to have a random killing, this kind of brutal random killing, or would somehow, you know, the perpetrator would know his or her victim?

KARDIAN: According to a (INAUDIBLE) study, Brooke, less than 1/2 of 1 percent of all childhood abductions are your stereotypical stranger abductions. So, for the most part, the vast majority, almost all of them are known entities in some way, shape or form to that child to the family. He has a tie back to that individual in some way, shape or form.

And in this case, as the investigation unfolds and developments, I think we're going to find that is just the case.

BALDWIN: And then what about -- what is it that possesses someone to kill this way? I mean, from the details I've heard, they're gruesome, gruesome. Feet were found in a freezer. Other pieces of this little boy's body were found, you know, in garbage bags in a red suitcase some two miles away in a dumpster.

Why? Why that extreme?

KARDIAN: It -- this individual is likely a psychopath with mental illness. I mean, to do this, it's likely not the first time he's done something like this. I know that he has roots in Memphis. He spent some time there. I'm sure that the Memphis authorities are going to be consulting with the NYPD. Commissioner Kelly said it exactly as gruesome as it could be what occurred to this poor child.

This is a sick man, a sick individual. He is a predator and this is a heinous crime.

BALDWIN: Sick indeed. Steve Kardian, I appreciate you coming on. Thank you.

KARDIAN: My pleasure.

BALDWIN: Coming up next, an explosive CNN investigation. There's a guy, he's out traveling across the country, telling people Islam and terror are inseparable. He says he knows this because he used to be a terrorist. Problem is: there are some major, major holes in his story and he could be using your money.

Drew Griffin has the staggering investigation. You have to hear this next.

(COMMERCIAL BREAK)

BALDWIN: He is a favorite on the security talk circuit. A former Islamic who has been born again as a Christian and he has a story for sale. But this self-proclaimed ex-terrorist may be selling more story than fact.

Let's bring in CNN's Drew Griffin. You've been looking into Walid Shoebat and his story may not be entirely true.

DREW GRIFFIN, CNN SPECIAL INVESTIGATIONS UNIT: Brooke, Walid Shoebat is the perfect person, in his eyes, to warn the U.S. about Islam and terrorisms. What we found in our investigation, maybe his story is a little too perfect.

(BEGIN VIDEOTAPE)

WALID SHOEBAT, TERRORISM SPEAKER: I think we are at war with Islamic fundamentalism and Islamism, which stems from Islam. You know, no historian can deny that Islamists basically invaded Christendom.

GRIFFIN: Walid Shoebat's message is the epitome of good versus evil. He has an advertise pedigree that makes him an expert -- Islamic-terrorist-turned-ultraconservative Christian. A U.S. citizen because his mother is American, he is a darling on the terror circuits, the church and university circuits. And, yes, he believes the war on terror is a holy war.

He portrays himself as a man converted and on a mission. Once a Jew-hating, bomb-throwing terrorist, now a devout Christian convert, warning the world Islam is out to destroy you.

SHOEBAT: (SPEAKING ARABIC)

That's how you recite the Koran. I know the Koran inside out.

English: if you believe the other believers, then smite off their necks. But what part of smite off their necks you Americans don't understand?

GRIFFIN: His message before a largely positive crowd of cops and emergency responders at this South Dakota homeland security conference: trust no Muslim, especially those who organize.

SHOEBAT: Know your enemy. Know your enemy. All Islamist organizations in America should be the number one enemy. All of them, Islamist organizations. Islamists in America should be focused on. You've got that on camera.

GRIFFIN: He is being paid $5,000 plus expenses to speak here with your tax dollars. He was also given a Rapid City police guard during his time in the city, a nice day's work. Judging by his Web site, where he highlights more than three dozen speaking engagements, Shoebat gets a lot of work.

(END VIDEOTAPE)

BALDWIN: As we were talking through the piece, we have a Jerusalem bureau. So you were able to get some answers. I mean, what did you find? What kind of holes are in his story?

GRIFFIN: Actually, it's just one big hole. We know that he lived for a time in Bethlehem. We know that his father was apparently a Muslim and his mother was a Christian, and we know he moved here when he was about 18 years old. Everything else he told us, and we went painstakingly through with him, each detail, we really couldn't find much fact about him.

Begging the question, why South Dakota's Homeland Security didn't do the check we did? Why is he getting Department of Homeland Security funds to speak to cops about terrorism and Islam? And why he is allowed to stay what he' saying?

BALDWIN: I took some time today. I think I watched your bigger piece. And I just want everyone to know you will be on "A.C. 360" tonight, 10:00 p.m., with this colorful (ph) story, this investigation, asking a lot of question, as you seem to be doing well, Drew Griffin. Thank you very much.

GRIFFIN: Thanks, Brooke.

BALDWIN: Let's take a live look at the White House and just remind you the president and congressional leaders are negotiating on whether or not to extend America's credit line. Remember that deadline, August 2, according to Treasury Secretary Tim Geithner? The clock is ticking, folks are warning of nasty consequences of f a deal does not get done.

Coming up next: how the 2012 election is complicating things a bit, big time.

But first, would you pay $28 for a CD or 20 bucks for a club sandwich and soda? If you live in the world's most expensive city, apparently you would. We have a list here of the costliest places on the globe.

So, let's take a look, shall we?

Rounding out the top five: Geneva, Switzerland. Coming in at number four: Moscow. And the number three most expensive city in the world? N'Djamena, Chad. Never been there.

Did any U.S. cities crack the top two? We got the answer after the break.

(COMMERCIAL BREAK)

BALDWIN: Next time you're tempted to complain about the rising costs, be thankful you're not living in one of the world's expensive cities. We showed you those three.

Here's the top two. Coming in at second place: Tokyo. And the number one costliest place to live on Earth? Luanda, Angola.

If you're curious, New York came in at number 23.

Not too cheap to live in Washington, D.C., either. Let's go there for your "CNN Equals Politics" update.

Gloria Borger, let's talk about these debt talks. We know that, you know, this day currently, they should be talking inside the White House. And what are you hearing?

You know, you talked to sources all the time. What are you hearing in terms of progress in these meetings? I mean, is this Groundhog Day? Same issues?

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Yes, it is Groundhog Day. And I guess the question of the day is: how many ways can you count to $1 trillion or $2 trillion without raising taxes or cutting entitlements? The answer is: it's not easy. And that's exactly what they're going to be doing in that room today.

And it's very clear at this point that they're kind of at an impasse. You know, Republicans don't want to raise their taxes. Democrats say they're not going to be touch entitlements unless Republicans give, which is why you had the Senate Leader Mitch McConnell throw that little paraphernalia chute in there and come up with this little ingenious plan which would essentially pass the debt limit without Republicans having to vote on it.

That sounds good unless you're a conservative Republican but -- because they think it's abdication.

So, I tell you what, we're at the same place. And the question is: when do you go from negotiating to political positioning? We may be there.

BALDWIN: Well, with political positioning, we all keep in mind that this is happening with the backdrop of the presidential campaign, right?

BORGER: Yes.

BALDWIN: And the GOP candidates are in a bit of an odd position here.

BORGER: Yes, they are. It's interesting to me because they're almost irrelevant to this when you think about it. You've got Michele Bachmann out there saying no debt limit, no way. Tim Pawlenty saying he hopes and prays you don't raise the debt limit. Mitt Romney is kind of MIA on this. Ron Paul is opposed to it.

But if you go back to the 2008 race, you had all these senators running for president and they were very involved in the thick of all the budget votes and budget negotiations and in the final stages of the campaign, of course, the question of bailing out the banks. They were right on the thick of it.

But this time, you've got a lot of governors running, for example. So it's like you have two different parallel universes going out there. The presidential candidate saying no, don't raise the debt ceiling. Easy political move if you're a conservative Republican. And the leaders of the Republicans and the Congress saying you know what? We have to figure out a way to do this.

BALDWIN: Then you look at the two parties, you see these signs, these splits in the flank of each party of conservatives. None too pleased. You mentioned, Senator McConnell's ingenious plan here, and then you have progressive groups threatening not to help President Obama's re-election campaign if those entitlements are cut. So, that has to complicate efforts as well.

BORGER: Right, and you know, this is what happens when you play base politics in the country. And at some point, compromise really can't be a dirty word. Because at some point, at some point, people do have a figure out a way to give and to actually get this debt ceiling passed.

Look, nobody likes to vote for a debt ceiling. President Obama when he was Senator Obama actually voted against the debt ceiling. He now says that was a pretty stupid move. But at some point, people have to understand that this is important to the country, and now we sort of start seeing people actually starting to explain it to the country. That is, your Social Security checks might not arrive. But they're walking a fine line there, too. Because they want to explain it but they don't want to panic the country because they actually do want to get it done.

So wake me when it's over, OK?

BALDWIN: I know. We'll see. Oddly enough, all those Social Security checks are supposed to go out the day after this deadline.

Gloria Borger, Groundhog Day in Washington. Thank you so much.

BORGER: Yep, see you tomorrow.

BALDWIN: Thank you.

Coming up, it's being called a national health crisis. Hospitals running out of drugs. Every patient could be at risk.

Also, Ben Bernanke has just issued an urgent warning saying we could face another financial crisis with catastrophic consequences. We're live at the stock exchange.

Plus, have you ever heard of this? This couch surfing? Apparently it's a new vacation trend, and police say it's extremely dangerous. "Reporter Roulette," next.

(COMMERCIAL BREAK)

BALDWIN: Hospitals across the country are running out of drugs. Fed chairman Ben Bernanke warns we could be facing another financial crisis. And a heat wave stifling large parts of the country. Time to play "Reporter Roulette."

Elizabeth Cohen, sitting right here next to me, I want to begin with you. More than 150 medications that patients need at the hospital may not be available?

ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: It's scary.

BALDWIN: Why?

COHEN: You go to the hospital, you think that's where they keep the drugs, right? There's a shortage of a bunch of them.

It is this perfect storm of two things. One, these are cheap drugs. And a lot of pharmaceutical companies say, well, we don't want to make these anymore because they weren't making money off of them. And the companies that still do make them had some quality control issues, and they had to stop making them and sort of redo their factories.

BALDWIN: Is this just certain hospitals or is it pretty widespread? COHEN: You know, there is a survey out among hospital pharmacists, and it turns out that over 80 percent of hospitals and health care systems say they are experiencing shortages. That's a lot.

BALDWIN: Well, you talk a lot, Elizabeth Cohen, about being an empowered patient?How can we be empowered before we go to the hospital?

COHEN: All right, you want to take a look at those three drugs right there. Dextrose syringes, epinephrine injections and succinylocholine injections. Those are three of them. They're used for various things in the hospital. And before you go in the hospital, you can ask, do you think I'll need any of these first of all?

BALDWIN: If you're in a state where you can think about asking those questions.

COHEN: Well, sure. But a lot of hospital admissions are planned. I mean, you know. You can ask beforehand before you go in for your knee surgery or whatever. You can ask the doctor, do you think I will need any of these? And so that way in the hospital, you can then ask them, am I getting a substitute?

So, there are substitutes for these drugs, but they don't necessarily work quite as well as these do.

The other thing you can do is go to CNN.com/empoweredpatient, and we have a link to lots of information about this shortage and how you can find out more.

BALDWIN: Excellent. Thank you, Elizabeth Cohen. Appreciate it.

And next here on "Reporter Roulette," Fed chief Ben Bernanke has some strong words for Congress regarding raising the debt ceiling. Alison Kosik is in New York. And Alison, what is it that is he is saying?

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: You know what's interesting about his comments? You know, the Fed chief is not always the most direct guy, but today he was very direct. He reiterated a dire warning that if the debt ceiling isn't waved, it would throw shock waves through the entire financial system. He said the economic fallout could be catastrophic, self-defeating and dire because failing to raise the debt limit would lead to a national default.

Now, it is worth noting, Brooke, that the debate over the debt ceiling is not about authorizing more money to be spent. It's about paying for what we already spent. It's like the government went on this big shopping spree, and now it's time to pay the bills, time to pay up. Time for Washington to get its act together. Brooke?

BALDWIN: Topic number two, Ms. Kosik. This is something I have never heard of until this morning. But apparently a lot of people I'm tweeting with know exactly what this is. Couch surfing. Please explain.

KOSIK: Yes, so apparently this has a lot of interest. It has three million members across 250 countries. And this Web site called CouchSurfing.org. You go to it, it helps you find a local host when you go on vacation, and you get to stay with them for free.

Here's how it works. You set up pages like Facebook and friends, they put pictures and recommendations on this Web site. And you don't necessarily have to stay on a couch at someone's place. You could also stay in a room, but I tell you what, it's staying with a stranger. You're basically knocking on a door saying hey, I'm here, I'm ready to stay.

BALDWIN: Um, yeah. I've heard about house swapping. So, you'd have to deal with a perfect stranger, right? I mean, you swap homes with them. But walking into a perfect stranger's house and, you know, catching some z's on the sofa. I don't know about that. What's the police saying?

KOSIK: Kind of weird. They're concerned about safety. What if this person shows up at your house, Brooke, and it's not the person that's been advertised? What if they steal something? You know, can you report it as theft since you invited them into your home?

And, you know, forget about the safety. What about the bed bugs?

(LAUGHTER)

KOSIK: How do you know what their house is like?

BALDWIN: Couch bugs!

KOSIK: Couch bugs! And what if they take out a knife in the middle of the night and want to kill you? You don't know these people. To me, I think it's ridiculous. Absolutely bizarre to do this.

BALDWIN: I think we know how you feel about it. Alison Kosik will not be couch surfing on a sofa near you. But like you said, I checked out the Web site, 3 million people are doing it.

KOSIK: Kind of interesting.

BALDWIN: Just -- ask smart questions before you borrow someone's sofa. Alison Kosik, thank you so much.

And finally here on "Reporter Roulette." Chad Myers in the studio talking about the heat. Triple digits in a number of places. Who's got it worse, Chad?

CHAD MYERS, AMS METEOROLOGIST: I think Augusta, Georgia to Charleston. The Lowcountry of South Carolina, you guys are really in to win it today. But Owensboro, Kentucky was the place not to be yesterday when the heat index got to 126. I'm not even sure what that means.

BALDWIN: Whoo! What does that feel like? I never want to know.

MYERS: I was in the desert with 114 it didn't feel so bad. But in the muggies and 126? I don't even want to think about that. At least it's cooler in Kentucky today. A little bit of a cool front came through. It's also very nice into places like Cleveland and Buffalo and Detroit because a cool front did come down. I say cool because cool jumped 15 degrees. When you take away the humidity.

Yesterday we had 23 states with heat advisories or warnings. Today only 12. I guess it's twice as good as it was yesterday. There is the cold front. It is kicking off, though, a couple of showers. One significant thunderstorm moved through Baltimore really into Rockville, D.C. and now down into parts of central Virginia, and eventually towards the -- I would even call the Delmarva of Virginia.

But the whole day, we're going to see showers and thunderstorms all the way up and down. Anytime you get this type of heat and humidity in one place, thunderstorms are going to pop up. If you're in a pool staying cool, if you can hear the thunder, the lightning can get to you. Get out of the pool.

BALDWIN: Yes, get out of the pool. Wear your SPF. Chad Myers, thank you so much. That's your "Reporter Roulette" on this Wednesday. Now this.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Okay, why is this door unlocked?

(END VIDEO CLIP)

BALDWIN: Chilling new videos showing how Phillip and Nancy Garrido lived their lives. All the while, they held Jaycee Dugard captive in their backyard. One of these videos reveals how Nancy Garrido helped her husband fulfill his sick fantasies.

Sunny Hostin has had a look at some of these videos. You will too here in a minute. She's "On the Case," next.

(COMMERCIAL BREAK)

BALDWIN: OK, you have to see these home videos. They show the home where Jacyee Dugard was held captive for 18 years. Sunny Hostin's "On the Case."

And Sunny, we'll look at these videos here because not only do they show the home of convicted sex offender Phillip Garrido, but we also see a visit from his parole officer. Let's look, and we'll talk on the other side.

(BEGIN VIDEO CLIP)

OFFICER: OK, and this room here.

NANCY GARRIDO: We've been sleeping in there.

OFFICER: OK, why is this door locked? Can you move that out and open the door?

GARRIDO: Because she's convalescing - and so we use this bathroom.

OFFICER: All right. This door right here.

GARRIDO: That's where we sleep.

OFFICER: Turn on the light on.

(END VIDEO CLIP)

BALDWIN: So we see them, Sunny, going, opening the doors, going room by room. But now we know the officers never went actually into the backyard where he kept Jaycee and her two kids. Who is at fault there? I mean, is that a breach of someone who should be checking in or should have been more thorough consider he is a convicted sex offender?

SUNNY HOSTIN, LEGAL CONTRIBUTOR, "IN SESSION" ON TRUTV: Well, he did certainly, this officer search the entire home. And, you know, hindsight is 20/20, but I wonder if anyone imagined that he had this backyard tent home that, you know, where he had Jaycee Dugard.

I will say this. The El Dorado district attorney released these videos because he wanted to highlight the gravity and the mistakes that were made. So I think we can all agree that perhaps mistakes, grave mistakes were made.

But at least we see that someone was visiting the home. Apparently, there were I think approximately 60 home visits over a 10- year period. Were they doing their jobs? They were doing what they need to do, but just not enough.

BALDWIN: Not enough. So many people are talking about how do you know the system really failed Jaycee Dugard who we have been hearing from for the very first time this week? I mean, her story of survival is absolutely incredible.

We know it, you know, she was taken as a child and held captive by this, you know, monster, this convicted child molester who then, you know, forced himself on her. She had two children. Let's just play a portion of this interview. ABC's Diane Sawyer talk to Jaycee about what life was like.

(BEGIN VIDEO CLIP)

JAYCEE DUGARD: You know, he would dress me up for hours because he was taking methamphetamines and speed. He called it speed. He would get focused on one thing for long periods of time.

And then it usually went to him with his little books that he would cut out for hours and paste on little girls from magazines and porno magazines. I mean, it didn't take sense to me at all, but that's what he did.

(END VIDEO CLIP)

BALDWIN: It is sick, but it helps us. I suppose, you know, learning more. Thank goodness, you know, she's brave and she's speaking out. What can we learn? What can people learn about her story and about what happened going forward?

HOSTIN: You know, I think we will learn a lot. On August 3rd, there's going to be a public hearing, an open hearing in Sacramento and we're going to go over what went wrong in this case and what we can learn and perhaps reform the system.

Because as we mentioned before, Brooke, there were home visits, but they just missed it. They didn't do enough and we don't want this to ever happen to any other child because remember she was 11 years old when this happened.

And we now know that Phillip Garrido had four other victims before this. So what do we learn from Jaycee Dugard's story? I think we're going to learn how to do this better, how to prevent other children from being subjected to these monsters, as you called him.

And so August 3rd, something to look out for, it's going to be a Sacramento public hearing and my hope is that some reform will come from that hearing.

BALDWIN: OK, August 3rd. Let's talk about that then. At least we know as you and I have talked about before, Phillip and Nancy Garrido in prison for a long, long time. Thank you. Now this.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: My God! My God! My God!

(END VIDEO CLIP)

BALDWIN: OK, that's not me squealing, although I may have a similar video when I got to see this in person, but one woman did share the same excitement over the launch. You have to see this. I tell you what it's amazing to see him in person.

Also, listen to this. Dozens of women and I'm talking grandmas in their 70s, taking it all off. Their photo is about to go public. Why you ask? Find out next.

(COMMERCIAL BREAK)

BALDWIN: Millions of people probably including you watched the final space shuttle launch just last Friday and many of them just totally in awe. You've got to see this.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Here we go. There it goes!

(END VIDEO CLIP) BALDWIN: It's amazing. We're so used to seeing planes in the sky going one way, but then to see the shuttle just puncture the clouds is unbelievable.

This woman -- hearing her squeals. She traveled to Florida from North Carolina to see the space shuttle "Atlantis" launch last Friday morning. And I can tell you from personal experience now, it is very easy to get caught up in that magical moment.

So imagine seeing this on your morning commute, raging zombies, one mile. That's exactly popped up on a road construction sign in Vermont. There it is.

Setup with heavy traffic delays caused by construction work, a couple of pranksters with a morbid sense of humor took matters into their own hands by hacking into the highway sign. In case you're wondering, no zombie attacks reported there.

OK, looking to buy a 2012 calendar, take a look at this one. Yes, 12 ladies from North Carolina all in their 70s or 80 years young showing off a little skin in their new charity-driven calendar.

Here they are, placed with conveniently placed objects in those areas. The calendar girls planning to do a little publicity next week and autograph some of their work for fans, but don't get too excited. The ladies will be fully clothed for that.

And now, "THE SITUATION ROOM," there's no segue way here so we'll just continue reading. "SITUATION ROOM" with Wolf Blitzer coming up at the top of the hour. Mr. Blitzer --

WOLF BLITZER, THE SITUATION ROOM: Did you have a nice birthday yesterday?

BALDWIN: I had a wonderful birthday. I had a wonderful dinner and I'm going off the grid for a couple of days for a little vacation.

BLITZER: Really? Some place special?

BALDWIN: I hope so.

BLITZER: You tell me later. I don't everybody - you deserve some privacy.

BALDWIN: Thank you.

BLITZER: All right, belatedly happy birthday although I did say happy birthday to you yesterday as well.

BALDWIN: And on Twitter.

BLITZER: I did that tweet as well to all my followers out there. We got a lot nice responses. A lot of people love you. You have a huge following.

BALDWIN: Thanks. BLITZER: Let's talk a little about what's coming up on "THE SITUATION ROOM." I know you're going to want to watch all of our viewers are going to want to watch Grover Norquist. A lot of our viewers probably don't know who is.

Here in Washington, everyone knows who Grover Norquist is. Some say he's one of the most powerful guys in Washington when it comes to taxes and other issues. We've got an interview Lisa Sylvester has a little background piece on him. We're going to be speaking with him about the debt ceiling, tax reform, all of those issues.

If you don't know Grover Norquist is, you're going to want to watch it. Even if you do know who is I think you're going to want to watch it as well.

And the other interview we have in "THE SITUATION ROOM" is Democratic Senator Bob Menendez of New Jersey is coming in. He wants the Justice Department, the attorney general of the United States, Eric Holder, the FBI to investigate News Corporation, the Rupert Murdoch's company to see if they were engaged in illegal activities here in the United States.

Specifically whether they hacked into phones, voice mail from survivors and victims of the 9/11 disaster, we're approaching the 10th anniversary of that. So you'll be interested, Brooke, to hear what he has to say. A lot more all the day's important news coming up in "THE SITUATION ROOM."

BALDWIN: Good deal. We'll see you in 5 minutes. Wolf Blitzer, thank you so much.

There's a bit of a new feud brewing in politics and it involves the usually even tempered Tim Pawlenty. The Republican in the middle of this Twitter war with one comedian and he's not holding anything back. That is next.

(COMMERCIAL BREAK)

BALDWIN: So presidential candidate Tim Pawlenty has a little bit of an image problem, but he's spoofing it up on Twitter. Joe Johns here with the "Political Pop." So we're talking Pawlenty versus O'Brien. What's the story?

JOE JOHNS, CNN SENIOR CORRESPONDENT: Well, you know, Brooke, normally when you talk about a candidate having an image problem, you're talking about somebody who's hypocritical or somebody who, you know, lies too much or whatever.

But this thing Tim Pawlenty has is completely different. His image problem people say is that he's dull. He puts people to sleep or he's boring or whatever. And, you know, it's kind of a tough position for him right now in fact.

But maybe what we're seeing is him trying to fix that problem. Tweeting with Conan O'Brien over a running joke certainly can't hurt. Started with Conan who tweeted this, "Is it too early to predict that Tim Pawlenty will not be a popular Halloween costume, right?

All right, so Pawlenty picks it up, tweets back, "Wait until I unveil my team coco, team coco followers of Conan O'Brien, wait until I unveil my team coco wig then everyone would want the costume. It might even deliver Iowa for me."

And then back from Conan again, "If wearing a team coco wig helps you win Iowa, it's probably because Iowans think it's corn silk." So there you go.

Tim Pawlenty does have a sense of humor, but for the record, he's actually said he doesn't care people call him dull. He's been quoted as saying, if people want an entertainer in chief, they should vote for someone else.

BALDWIN: OK, well, speaking of the current commander-in-chief, President Obama, we cut off yesterday. Let's talk about peas. What did he say? What kind of push back? I want to hear the sound.

JOHNS: OK, well, this was the president's comment in a debt negotiation. We might as well eat our peas. If you haven't heard it, let's listen.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES OF AMERICA: It's not going to get easier. It's going to get harder. So we might as well do it now. Pull off the band-aid. Eat our peas.

(END VIDEO CLIP)

JOHNS: All right, OK now, you get the meaning. But that statement prompted all kinds of political reactions including from the "L.A. Times," which called on the president to give peas a chance. You know the Beatle song and then we got this comment from the Trade Association representing peas known as believe it or not, the Peas Council.

We know that if tasty nutrition meals featuring peas are served more frequently in the White House and the cafeterias of both of Houses of Congress it will contribute to a balanced diet, if not a balanced budget.

Actually, they do serve peas on Capitol Hill. I know that. Right? OKJ sounds familiar. Do you have time for bush's broccoli sound bite? Probably not.

BALDWIN: We don't. Wolf Blitzer will pinch me if we do that. So we do have to go, but eat your peas I think those folks are saying and that is where we have to leave it. Joe Johns, thank you so much and now to Wolf Blitzer.