and check out our show page. that's it for "the lead" i'm jake tapper. i turn you over to wolf blitzer. take it away. >> jake, thanks. happening now, government spying on a really massive scale. new details of a secret sur violence program targeting potentially millions of american phone users. also tropical storm andrea taking aim at the rest of the east coast. plus an exclusive interview with mitt and ann romney. they talk about their regrets and jarring transition to life out of politics. i'm wolf blitzer, you're in "the situation room." a terror attack alleged by thwarted by a stunning secret

surveillance program that's just been revealed. it was first reported that the national security agency has been collecting the phone records of millions of verizon customers every day. they reportedly show who they call, who's called them and the date and duration of each conversation. but as controversial as the surveillance may be, lawmakers are split right now over whether it's appropriate or legal. jim acosta has been working this story for us. jim, what are you picking up. >> reporter: obama administration officials are neither confirming or denying the report. but they are defending the practice of collecting phone data for national security purposes fl all of a sudden the white house is facting a brand new controversy one that is yienting relationship c--

republicans and democrats. under a court order signed in april obtained by the british newspaper the guardian, verizon is retired to hand over to the government all call detail records within the u.s. and abroad. without commenting, the obama administration cautioned that they were only complying date lay and not listening in on programs. but some in congress aren't buying it. >> they basically said to verizon, give us your call logged. if they involve international give them to us, domestic calls, purely local calls, give them to us. >> not one more thing where we're trying to protect america and then it looks like we're spieg on america.

>> reporter: the controversy stilled over to eric holder who's already in -- >> we're just asked, could you ensure to us that no phones inside the capital were monitored. >> with all due respect, i don't think this is an appropriate setting for me to discuss that issue. >> reporter: but the program also has its fierce defenders. >> so you keep up what you're doing. and if you've gone outside the lane, you fix it. president bush started it, president obama is continuing it. we need it from my point of view. >> reporter: sbregt committee members insist that it is authorized under fisa, and renewed by congress. >> it is lawful. it has been briefed to congress. >> this program was used to stop a program -- excuse me -- stop a terrorist attack in the united states. we know that.

>> reporter: but the president's critics arc that it's another issue of him walking away from his own tough talks six years ago. >> this administration acts like it's a way to enhance our security. it is not. there are no shortcuts to protecting america. >> now because of the exposure of this program came from the news media, it is likely that there will be some sort of investigation into who leaked that information. but for now the white house is not saying anything more about it, whether any other phone calls were involved of the verizon has no comment on this controversy. the president who was down in north carolina, also did not address the matter. but members of congress are demanding answers. there is a letter from a congress from wisconsin and author of the patriot act who says this collection of phone records in his words is an

overbroad interpretation of the act. and he's one of many members that wants answers. >> looks like at least so far a real split developing among memgz of congre members of congress. the new york times editorial board is blasting the obama administration phone surveillance program in a stinging editorial head loiped, "president obama's dragnet." it goes on to say this, the administration has now lost all credibility. mr. obama is proving the truism that the executive will use any power it is given and very likely abuse it. the stunning use of the patriot act shows once again why it needs to be sharply occur tald if not repealed. those words in an editorial just released by the new york times

editorial board. tom, walk us through this surveillance program. how does it work? >> we're talking about billions and billions of phone calls all across this country. let's narrow it down to one neighborhood. imagine all of those calls taking place just here. and imagine you have a computer that's tracking every time a call it made, when it's received, and how long it lasted. that is megadate. you don't know what was said, you just know that contact was made. that's the corner stone of this program as we understand it. >> even if the goft has all of this information, how does that help top terrorism? >> in and of itself, it doesn't. but if you analyze the information you could establish if there were networks here. for example all the red houses here, the yellow houses. we all talk to the same people most of the time. then, if you have an event in the calendar year, you have some kind of terrorist event happen

here, investigators can go back and look through that meg data and look for patterns. was one group, like the red group here, really active and talking a lot near and close to the time of this attack and should they be looked at more closely? that maybe triggered by looking at the material or a suspect more likely that you would say let's look in this area. privacy advocates go crazy over this. they say in effect if there were in the real world, it would be like posting a police office outside every person's door who wrote down when you left and when you came back. >> is the government simply combing through a lot of this material constantly looking for something suspicious? >> no. and that's really important to understand. what we're told by members of congress who have been briefed

on this program, is that the information even though it's being collected constantly, the information is not accessed without law enforcement having suspicion of something and without an additional fisa court order. imagine this computer packed it all of this information about all of our calls but they can't go into it unless they have justice indication to look boo it. first of all, how detailed or extensive is this data? does it include tracking every place you go, every hour of the day? we don't know that. how long is it being kept? we don't know that either. will it be there for years and years. and what about the possible future uses? this is one of the really big ones out there. you say it's about national security now, but the concern is

in the future as administrations change and politics change, could it be used for something else that could really up set an awful lot of people out there. who really, right now even the government would say, have done nothing at all wrong. >> we'll have much more later here in "the situation room." thanks very much. this just coming in right now. we're getting word that current and former u.s. marines and sailors are among 50 people arrested in a massive criminal network bust out in california. let's go to barbara starr. she's got the details. >> reporter: wolf, nasty business out in san diego, southern california. 50 people, 64 criminal indictments. and it does include 7 currently marines, 7 former marines and a navy sailor. involving stolen cars, drugs,

weapons and other military gear. the charges include vehicle theft. i want to read this all to you. sales of cocaine and methamphetamines. sale of high capacity ammunition magazines. what kind of military involved, wolf? over 10,000 rounds of ammunition, high capacity magazines, bullet proof vests, kevlar vests. this was being run by local, federal, military law enforcement officials. it was a sting. they stung these guys into come to a store front operation in san diego and then videotaped them trying to sell all of this equipment. so now, a number of people under arrest. and according to the marine corps here at the pentagon, those 7 currently serving mar e marines are in custody. >> thanks for that report.

disturbing information. up next, powerful winds, we're tracking tropical storm andrea. plus, a candid conversation with ann romney. she tells condition's goria borger why she and her husband were convinced, she says they were convinced, he would win the white house. [ male announcer ] erica had a rough day. there was this and this. she got a parking ticket... ♪ and she forgot to pay her credit card bill on time. good thing she's got the citi simplicity card. it doesn't charge late fees or a penalty rate. ever. as in never ever. now about that parking ticket. [ grunting ] [ male announcer ] the citi simplicity card

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this is cnn breaking news. tropical storm andrea now making landfall in florida with sustained winds of up to 65 miles per hour. and this is only the beginning.

it's charting a path right up the east coast. our severe weather expert chad highers is tracking the storm. >> we're seeing andrea making landfall right now at horseshoe beach, florida. it was right there near jacksonville and traveling to amelia island. and more of these storms could be spinning later on tonight as it moves on land. right now moving on shore and eventually as you said moving on up towards the northeast. and this is the bigger story, how much rainfall is still to come with this storm. and on up into washington, d.c., there will be a swath of 6 to 10 inches of rainfall. and remember, this has been so hard hit with all of this sandy damage through here, even though the winds may be only 40 or 50 miles per hour, that will be enough to cause more damage of things that aren't truly yet

nailed down. and we'll see that causing more flooding all along here. all this rain eventually has to work its way back down to the ocean. there's andrea right now. moving right on shore, 65 miles per hour. only 9 miles per hour from a hurricane. right now, there's not even cloud cover the center and this is not the first hurricane of the year. >> and just because it's not a hurricane, a tropical storm, that can be pretty serious? >> this is a very sat you aur >> this is a very sat you auate area. you bring in winds sustained, wind gusts to 75, trees are going to be falling all night long. flooding, especially at night. starts to get dark here in about three to four hours. another three to six inches of rainfall. and on up into d.c. and up into

new york city. and late tomorrow night, this almost over boston, massachusetts. and it's putting down an awful lost tropical rain. >> andrea in this hurricane season began on june 1st. when we come back, she says it's like going from 100 miles an hour to zero row. ann romney talks about moving on after the election. plus a bombshell announcement from the russian president. vladimir putin and his wife of more than 30 years. more trouble for taco bell this week. we'll explain when we come back. [ male announcer ] it's intuitive and customizable,

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quick look at some of the other stories we're monitoring right now in "the situation room." governor christie of new jersey has named jeffrey chiesa to replace frank lautenberg who decide at age of '89. in changes -- clued in that majority are two independents who kau cause with the democrats. he will not run in the special legislation for the seat. just days after announcing the government's -- chrysler is now recalling 630 newer model

suvs due to separate issues. today's recall involves the sensor activated restraint system in more than 400,0002010 to 2012 jeep patriot and come pass molz models and a power steering component in 2012, 2013 jeep wrangers. >> and take a look at this. terrifying video of a minivan out of control. crossing lanes plowing into an ohio taco bell restaurant. three people were transported to an area hospital with minor injuries. two others were said to be in the restaurant when it occurred. the russian president vladimir putin and his wife have announce the the end of their nearly 30-year marriage. the couple says it's a joint decision. that they almost never see each

other and have different lives. the announcement comes afterward long-time speculation about their relationship. they have two children. up next, ann romney opening up to our own gloria borger revealing what was the hardest part of her husband's presidential campaign. i turned 65 last week. the math of retirement is different today. money has to last longer. i don't want to pour over pie charts all day. i want to travel, and i want the income to do it. ishares incomes etfs. low cost and diversified.

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happening now, ann romney's candid conversation with gloria borger. she opens up about getting over the election, her marriage and what she says her husband would be doing differently if he were in the white house right now. also the irs official who played mr. spock hammered on capital hill for the millioned in taxpayer dollars spent on the conference and where it was used. new details of the secret program targeting millions of american's phone users. i'm wolf blitzer, you're in

"the situation room." it was 7 months ago today that mitt romney lost the presidential election paving the way for what's been a controversial second term. and they talk about how they're doing and now what they think of the ways things are going in the country. we begin with ann romney and what she told gloria about life after the campaign. >> so i have to ask you just as i asked your hugs, are you over it? >> i am over it. it's still hard to watch things and watch the news and feel like you wish you were there. but you move on. i think our life is actually pretty wonderful right now and we're enjoying our life very much right now. >> you were in the public eye every single day for, what, almost two years?

>> right. >> how do you go from that -- >> to from going 100 miles an hour to discovery overnight? >> yeah. >> it's what it's like you're in a bubble of secret service, private jets, 737s, the entire press corps following you, and then bang, you're done. mitt's father used to say this, and i lost it, he said politics, it's the fastest way to go from who's who to who's that. and that's just an attitude that we always had. we knew that our life was more important, our private life. and that this public life was something that was -- it's just a unique thing that you go through. and you go back very quickly to enjoying being together and to enjoying a little bit more slow pace. it's -- it is an adjustment, however. >> but talk more about that. because you just don't go from 100 to zero roer. >> no you don't. and obviously in any process,

whether it's a grieving process or anything, there's an adjustment period that you go through. but i feel like we've come out the other end. >> you did do the grieving, though? >> you do. it's like a brief e grieving. and i have to say the most common refrain that i heard when i would see people that were sad as well about the outcomp the election, is they said that to me, thee feel like they're grieving. they said, nobody died but i feel like somebody died. and that was their reaction when they would see me. a lot of times people burst into tears when they would see me. it just happened yesterday. it's happening less and less that people start to cry. but i think that it was pretty eveningly divided in this country. it was a pretty close race. and there are about half the country that still -- that literally went through a grieving process when we lost. >> was it harder for you because you thought you were going to win? >> i think so. i think mitt was more balanced

about the whole thing. he's very rational about everything. and he was saying how close this election is going to be and it was a difficult race. and he was always saying that. and i said don't worry about it, we're going to win. and i -- on the campaign trail, i would see people and they would be so intensely, you know, concerned about the country and everything. i would say, don't worry, we're going to win. and i felt that. i really truly felt that we were going to win. so i'm glad as i look back that i felt that way. it's the way i had to feel. because i believed in it, i believed in mitt, i believed in what we were doing. i had to believe we were going to win as well for me to be okay to go through what we had to go through. >> after 2008, you were the one who said to mitt romney, never again. and then you change your mind. >> i did. i completely, i just knew we had to do it again. ill tell you gloria, i know we

never will do it again. it's a very difficult thing for families. it's very difficult emotionally to invests yourself at that level, at that depth. and, you know, i was just looking at the list of people that are coming to this conference. there's a lot of friends of ours that are going to be here that i haven't seen. it was hard for me to see their names and just say their name because it brought up so much emotion again of how committed so many people were and how they tried so hard. we feel like we let people down. >> is that the hardest part? >> for right now it is for me. i think it's frustrating as well to see what's going on in washington and i wish mitt were there. >> why? why is it frustrating to see what's going on? >> i know that mitt is a good executive. he is, you know, a lot of people used to say that i was a good campaigner. well, i like to say, i would love for the american people to

have had the opportunity to see what a good executive mitt would have been. and being the president is an executive position, it's not a campaign position. it's a person that acts, that brings people together that has great vision, leadership skills, and takes the country in a new direction. i think he would have done that. >> what's frustrating in particular. >> i think everyone thinks that the economy is improving, but i think under mitt it would have dramatically improved. we were in that to make a difference in people's lives. to make sure that america would stay competitive in the world. >> i remember at one point during the end of the campaign when republicans were piling on the campaign and you said this is hard. stop it. this is hard. you want to try it, get in the ring. who were you talking to when you

said that? >> well, you know, it's just -- you could pick about anybody at that point. it felt so many times that it wasn't just that we were fighting against, you know, a democratic machine that was operating quite well, but that we were fighting even against some of our own fellow republicans and kmen tarts that should have been a little more helpful. it's fine. everyone does what they want to do. but you really did feel like you were taking on the world sometimes. >> we'll have much more of that just ahead. when we come back, she talks about the impact of the campaign on her marriage, health, and even why she decided to turn down "dancing with the start." stay with us. she's always been able to brighten your day.

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we're back with part two of gloria borger's interview with ann romney. she talks about what her relationship is like with her husband now that the campaign is over. >> what does the presidential campaign do to a marriage? >> you know, for us, nothing, except to make it better. and it's a blessing that we've had this amazing marriage. i think we have a unique marriage. i think we care for each other very deeply. i -- we were always concerned about each other. i think when i was on the road and not with mitt and he was -- i would always be calling, being upset, you're working him too hard, stop, stop. he would be doing the same thing calling into my staff, saying, stop it, don't make her work so

hard. we were always worried about each other when we weren't together. >> you had a relapse of ms, super tuesday. >> i had a bubble step there. >> how are you feeling now? >> i'm feeling terrific. i was very careful after the campaign was over. i took two months to really just be quiet and recover and rest. and i was very worried at that time that the adrenalin rush who somehow, you know, have some impact on my disease, the lack of the adrenalin rush. >> what's next? i know there's a cookbook. >> i've had an absolute ball doing that. i've had so much fun doing that. it comes out in october, just before christmas. >> are you cooking again? >> i'm cooking again. believe it or not, even though i swore i never would after the last child left. mitt's helping a lot. you can't believe how helpful

he's been in the kitchen, going to the grocery store. he's even doing laundry. >> okay. >> he's been great. >> and then i have to ask you this question. did you really turn down "dancing with the stars"? >> i love the show so much, and i actually turned it down. they called me a couple of times and i -- i went to the finals last -- was it the season before. and it was after the campaign. i can't even remember what month that would have been. and got to meet a lot of dancers, got to meet who would have been my partner. and i was very tempted. but i decided not to. >> it's gruling. >> i was a little worried about it for coming off the campaign and how intense it would have been. and i told them, i do have ms. can i -- can i do this? i'm not sure i would have been able to have done it. i love the show. i'm sure anyone that watches it gets hooked and loves it.

>> so no dancing for you with the stars. >> not with the stars, just with my husband. >> and gloria, your excellent interview. much more in our next hour as well. why have they decided -- why do you think they've died now to come out and speak? >> i think it's taken them this long to kind of come down, regroup after the campaign. i think mitt romney is in the process of trying to figure out what he wants to do with the rest of his life. as we speak, they're having a confab in park city. >> in utah. >> and they've invited republican presidential possibilities, like chris christie, paul ryan, ran paul. david ax r axelrod talking about epilepsy which is an important cause of his.

i think mitt romney's idea is he wants to be in the world of ideas. the politics is kind of over for him. >> it sounds like he wants to do what bill clinton has done and see if there's opportunities in that area. just to have a voice and do good, if youle. >> i think he wants to have a policy voice. i asked him specifically would he rule out government service forever? and you know, he doesn't do that. >> he doesn't rule it out? >> there could be some pointed position in his future. but i think that this is the part of sort of coming out and saying, i'm not gone, i haven't disappeared. i have something to contribute in the world of ideas. and i think that's why he's gathering people this weekend to try and sort of start taking it to another level. i don't know, wolf, where it's going to lead him. >> we'll soon -- much more of the interview. >> you know ann will be dancing

with him. >> good work. thank you. much more coming up in our next hour of gloria's interview. she'll be speaking with mitt romney and jointly with mitt and ann romney as well. coming up, surgery for britain's prince philip. possibly as soon as tomorrow. and a personal man cave set up in a government facility. shocking revelations of more government waste. but first a. preview of this weekend's the next list. ♪

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britain's prince philip is hospitalized and likely to go under -- undergo an exploratory

operation as soon as tomorrow. he could be in the hospital for as long as two weeks. max foster is in london for us. what else are you hearing about prince philip? >> reporter: well, it will happen tomorrow if the medical at vice is unchanged. he will go under jen an thetic. he was at a gardenen party today and he looked well. what we didn't know is he was awaiting test results and when he got them, he set off from the garden party and he went to the hospital. he's going to be there for two weeks. so there's quite something to say he's going to be in for two weeks. it's a long period of time. we've been asked not to speculate about what's actually wrong with him. so it does seem serious. it's got a serious tone to it. but himself, he certainly looks and feels well.

>> they don't want to tell us exactly what's going on, is that what you're saying? >> reporter: yeah. there's something he's had some tests on his abdominal area. so that's all we really know. it's as a result of that. he has canceled a couple of engagements this week already, but that was because he lost his voice, not related to this. and we've reported in the past about his health problems. he went into the hospital with a heart problem on one indication, with an infection on another occasion. they're saying none of this is linked to what has happened today. but certainly their at the hospital with some serious medics there and going under general anesthetic that's going to happen tomorrow. >> thanks very much. president obama meets with his chinese counterpart tomorrow. and our time magazine marks the

importance of the occasion with a very special cover, the world according to china. take a look at this. let's talk about this cover and let's keep it up for a moment as we talk about it. the cover -- what does this cover say? what is it trying to project to all of the readers of time, "time," rick? >> yes, he did the cover for us in beijing and he's limited to staying in the city. he's a great artist and disdent. and the cover is a -- is a kind of chuf nisk chinese cover. that shape using the flowers there is the shape of china. and what he's saying is that this is how the chinese see themselves they see themselves as central in the world, central in world history. and that era of china now is

coming to >> as you know, we reported that the chinese president, that the american president will be meeting with the chinese leader in california starting tomorrow for a couple of days. i assume china's cyber spying on the u.s. is going to be high on the agenda, but how do they deal with what's going on? >> you know, that's a good question, wolf. i would assume it's very, very high on president obama's agenda. but the talks have been billed as something special, a kind of more informal gathering between the two men. the talks have been orchestrated in a way that gives the president -- the new president of china more time together. i'm sure it will range over a wide range of topics. obviously the economic ties between the two countries are enormous. that will be something they'll

discuss as well. >> xi shin ping will be in california with his wife. but the president is not bringing the first lady out to california. is that a snub? what does that mean? >> i really don't know, wolf. what would be interesting, of course, is that the chinese president's wife is -- she's the first wife who has actually been on the public stage as a head of china. china's wife. she's a well-known singer. she's a singer for the chinese army. she's stylish, and they follow her fashion choices. so it would have been interesting for her to meet the first lady. i'm sure they will at some point. >> a lot of people are surprised that the first lady is not going out there, given how important this u.s./chinese relationship is, and new chinese leader right now. we'll have more on this part of the story in our next hour. rick, thanks very much for coming in. great cover, by the way. >> thank you, wolf. when we come back, the latest twist in the irs targeting scandal. mr. spock gets grilled up on capitol hill. plus, we debate national

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impersonation of mr. spock. today he was ul on capitol hill for one of the hottest dprilings yet in congress' probe into the irs. our chief congressional correspondent dana bash was watching it every step of the way. dana, what happened? >> what happened is that lawmakers really tried to channel their squaeconstituent outrage and aim it at one person. he thought it was important to star in an irs spoof, i kid you not, a tax no-tax. >> my calculations are correct, total anarchy will occur in 111 hours. >> what were you thinking? those videos were at the time they were made, were an attempt to, well-intentioned way, use humor. the fact of the matter is, it's embarrassing. and i apologize.

>> farris fink is now commissioner of the irs division that held a lavish $4 million conference in anaheim, california, where parody videos estimated to cost $50,000 were played. the committee's top democrat was outraged. >> i live in a bloc where most people don't even make $50,000 a year. yet we can produce a video that has no redeeming value. none. >> during the conference, fink, a 32-year irs veteran, stayed in an upgraded hotel suite like this. the irs inspector general called that inappropriate and other spending wasteful. like $17,000 for an artist to paint celebrities. and $64,000 in swag we first showed you earlier this week, canvas bags, notebooks, even a plastic squirting fish. >> why would people get a plastic squirting fish? >> i honestly have no idea what the plastic squirting fish was. >> the division's second in

command admitted he didn't know how or why millions of taxpayer dollars were spent at this conference. >> you're totally ignorant in -- of the expenses? >> i was not involved in the planning. >> who was? you're in charge. this is what's so infuriating. you're in charge. >> lawmakers repeatedly blasted fink for irs hypocrisy. the agency that requires taxpayers to save receipts did not save its own documents to show what it spent at the conference. >> at the time of the conference, there was no guidelines or requirement to track costs. >> fimpg admitted it actually may have cost millions more. >> could it be $5 million? yes or no. >> yes. >> all right. could it be $6 million? think carefully. you're under oath. >> yes. >> could it be $6 million? >> there's no way that i know that. >> two irs employees were placed on administrative leave this

week for violating ethics rules. they say because they accepted free food at a party at one of those -- at the conference. one thing that we should keep in mind, wolf, is part of the problem here is that most of this lavish spending was compliant with irs rules at the time. since, they have changed. but really, became clear watching this today, that the rules were not good at the time, and it allowed the spending to run amok. >> before i let you go, dana, congratulations on winning an slept award last night, you and your producer, deidre walsh, winning the joan barone sleps in reporting award at the correspondents association. >> it was great to share it with you, wolf. >> i just sat around and watched you get that award. and tony also getting an excellent award. big night for cnn here in washington. thanks to you. thanks to deidre. congratulations to tony as well. >> thank you.

tropical storm andrea has just made landfall. chad myers is tracking the storm for us. where it is right now, chad? >> it is right near steen hatche, florida, in an unpopulated area, compared to the rest of florida. right here, moving up to the west of jacksonville. you know, of all the beaches down here, clearwater beach, panama city and destin, and this horseshoe area right here, including st. marks and a couple of little towns, lake city, it's moving on up to the northeast about 15 miles per hour. it will continue all night. so landfall is no more problem. but we still have the potential for tornadoes. they could still be a problem. these are not the f-4 and f-5 tornadoes i was tracking last week in oklahoma. these are tornadoes that could eventually become f-1s or 2s. speeds around 100 miles per hour. that's enough to make a significant difference. four to six inches of rainfall, another problem. we could have flooding all the way from florida right on into d.c. where we could see upwards

of six inches of rainfall in areas that are already wet. >> we'll check back with you, chad. thanks very much. happening now, millions of americans' phone records apparently turned over to the feds every day under secret court order. an nsa whistleblower joins us to discuss what's going on on national security. and privacy. secret personal lounging inside a government warehouse. another outrageous expense on the taxpayers' dime, now revealed. michelle obama is opting out of a sensitive trip with her husband. is she concerned to be upstaged by a rock star. i'm wolf blitzer. we want to welcome our viewers in the united states and around the world. the world. you're in "the situation room." -- captions by vitac -- www.vitac.com a key u.s. lawmaker said more than one terrorist attack was prevented because of a top-set kret program to seize americans' phone records.

an explosive new report is reigniting the concerns that your privacy is being violated to protect america's security. it reveals a court order giving the national security agency, the nsa, blanket access to millions of verizon customers' records on a daily basis. here is our crime and justice correspondent, joe johns. he's got the latest. >> wolf, this was an order that basically says two things to verizon. give us your business and phone records and don't tell anybody about it. but the guardian newspaper got ahold of it and now the u.s. government seemingly consumed by leaks of sensitive information is coming to grips with a big one. the court order, a top-secret document from the most secretive court in the land, gives a black-and-white view for the first time of the massive efforts by the government to collect call records of american communications. authorized by congress under the patriot act, the judge's order demands verizon hand over

details of its customer calls within the united states and overseas. including, quote, the originating and terminating telephone number and duration of the call, but not the content of the call. the white house defended the program as a critical tool that is subject to strict controls. a good way to catch terrorists. >> it's called protecting america. >> reporter: in fact, it's already proven effective, argued the chair of the house intelligence committee. >> i can tell you why this program is important. it was in the last few years, this program was used to stop a program -- excuse me, stop a terrorist attack in the united states. we know that. >> reporter: so how does it work? it's a secret process. the national security agency wants the information from verizon business network services. the fbi makes the request to the secret intelligence court with federal judges. if a judge says okay, the telephone company forks over the information. but if the government wants to look through that data, say, because of a terror concern, it

takes more court permission. how long has it been going on? since the bush administration. >> as far as i know, this is the exact three-month renewal of what has been the case for the past seven years. >> reporter: earlier this year, the director of national intelligence said there was no widespread surveillance effort. >> does the nsa collect any type of data at all on millions, or hundreds of millions of americans? >> no, sir. >> it does not? >> not willingly. >> reporter: former intelligence officials and privacy advocates say it's reasonable to presume other telephone companies have gotten similar orders. >> if this is an open-ended, and indiscriminate collection process, as it seems to be, then logically one would expect it to be much bigger than verizon business. >> reporter: the law gives

companies secret orders at least some power to challenge them. but no way to tell if verizon did, because by law they can't talk about it. verizon's general counsel in a statement to the employees, without confirming the existence of the order, suggested the company would, quote, be required to comply. if you wonder where all of this is headed, the government is expanding its efforts. the national security agency is building this massive new data center in utah, meant to store billions of gigabytes of collected data. senator diane feinstein said today the telephone data collection program actually stopped more than one plot. but did not elaborate. what's stunning here, perhaps, is that the document at the center of the story marked top-secret actually made its way public. the justice department's been very aggressive in trying to track down leakers, and it's just hard to see how the investigators will be able to ignore this one. wolf? >> i assume there will be a full-scale leak investigation on this one as well. john, thanks very much. surprisingly, the phone

snooping controversy isn't hurting verizon's bottom line at all. verizon communication stock was up nearly 3.5% at the closing bell. joining us now to discuss what's going on, a former nsa moiee, and whisz whislower. a program he invented to track u.s. enemies overseas. he said it was twisted after 9/11 to allow domestic spying, and says it violated americans' rights. he said he became a political target after that armed federal agents raided his home, held him and his wife at gun point between the eyes. he's here. also joining us, his lawyer, she's with the government accountability project. that's a private organization. and cnn national security analyst fran townsend, the former bush homeland security adviser. she serves on the cia and homeland security external advisory boards. thanks to all of you, by the way, for coming in. thanks especially to you. you worked in the nsa for a long

time. you left back in 2001. you were upset about what you said the nsa was using, with some data collection techniques. you had actually created it. >> it was more like the data they were taking in. it was coming from the telecoms, the specific one that i knew was at&t. at&t was giving nsa on the order of 320 million records of u.s. citizens' communications with other u.s. citizens every day. >> what do you make of this current disclosure about what's going on? >> this is the fbi trying to get evidence to take into a t. it doesn't talk about the intelligence community and the collection that's been ongoing since 9/11. >> according to dianne feinstein, what we learn now has been going on for seven years, but every 90 days or so they have to reauthorize it and get the court to approve it. >> it used to be every 45 days. and now i guess it's every 90 days. >> there's nothing illegal based

on everything you've seen? this is all legal the way the obama administration is engaged in this? >> just because, you know, the court approved it -- >> but they're not breaking the law? >> they are. >> how are they doing that? >> because that authorizes only foreign surveillance, or clandestine agencies. that had been the first commandment at nsa is you were always able to spy on foreigners, but not domestic. >> is the obama administration with the congressional backing, as congress has known about this this for seven years, are they violating the law? >> no. i mean, you heard senator dianne feinstein say, the program is legal. the statute was passed. and there's a whole protocol, wolf, about what they can collect, who can look at it, and the process by which they have to get court approval to actually use that data. >> you worked for 30 years in the nsa. when you hear mike rogers, the

chairman of the house intelligence committee say today, this program, this new one we just learned about, that's been around for a while, prevent terror attacks in the united states, what do you stay? >> they never had to do that. they never had to collect data on all u.s. citizens to get bad guys. we were able to do that without any problems. >> he said without this, there would have been a successful terror attack, maybe more. >> only through incompetence, yes. >> what does that mean? >> that means the people looking at the data weren't competent to see a threat coming. >> so in other words, you think that terror attack could have been prevented in other ways without violating the privacy -- >> absolutely. >> and you heard what dianne feinstein said, she's a liberal progressive democrat, she said america needs this to save lives. you say to dianne feinstein -- >> i say to her, her colleagues on intel disagree, and say that most americans would be mortified if they knew the breadth and scope and depth of

this. it far exceeds the plain language. it may comport with the secret interpretation, but we're supposed to be a free and democratic society. >> what do you make of that? >> it goes to an independent court. it goes to the surveillance court. >> that's their job. >> that's their job, to review the probable cause, the basis upon which they're going to permit this collection. so this is not just congress, or just the executive branch. you've got all three branches of government. there's a statute that's been passed and the documents are consistent and reviewed by those standards. >> dianne feinstein said if under this broad sweeping surveillance that nsa is engaged in, they come across something that they flag, a phone conversation, let's say, between someone suspected of being a terrorist -- just making this up -- in yemen, and someone calling to the united states, they then have to go back to another court and get further authorization to engage in additional surveillance. >> actually, that kind of thing they could surveil, if it is

with a certain entity. i respect what fran said. but this did not involve probable cause. this did not even involve reasonable suspicion. we're talking about tens of millions of americans who weren't suspected of doing anything, to anybody, who were surveilled in this kind of way. i have no problem with people want to go to the federal court. the surveillance is an independent court, but it's like a grand jury. it possible hears one side of the story, from the government, and it doesn't hear any opposing argument. >> this is the actual court document. it says top-secret. no foreigners can see this. united states foreign intelligence surveillance court, washington, d.c. but go ahead. >> the foreign intelligence surveillance, let's just be clear, it's staffed by what's called article 3 judges. they have lifetime appointments. they are completely independent of the executive branch, and provide a completely independent review. >> so when roger vinson, the

judge, the united states foreign intelligence surveillance judge, who signed this court order says this is okay, you say? >> i say that, i have no idea what the probable cause is. this whole thing is secret. whatever the court does, it only hears the government's side of the story about why it needs an order like that. and i don't know what the government could have possibly told the judge to necessitate, or to get this kind of order. >> so i ran the unit that presents the cases to the federal judge. >> when you were at the justice department. >> when i was at the justice department. one, there is a sworn federal agent who has to give a factual recitation that he swears under oath, that supports the request to the court. the court then has the ability to ask questions of the agents and lawyers. and frequently will make them go back and get additional information before they'll approve an application. >> mr. binney, you know, a lot of americans say they're willing to sacrifice a little bit of their privacy if it will prevent

another 9/11 from happening. what do you say to those folks who say, you know what, it's not that bad? >> my point all along, even with when i was working at nsa, you don't have to sacrifice anybody's privacy to stop people like terrorists coming in and trying to commit some terrorist act inside this country. you do not have to violate their privacy. this is not technically that difficult to do. >> you want to respond to that? >> well, in this case, what you're getting, again, is not the content of these conversations. you're not surveilling the -- you're getting the data, who called who, the duration and location. but you're not getting the content. >> you have to go back to another judge and get authorization to do that. >> right. >> hold your thoughts for a moment. i want to continue this conversation. because these are really important sensitive issues, and the public out there has a right to know what's going on. stand by. up next, stay with us. we're also getting more breaking news coming into "the situation room." it's not just phones apparently, the "washington post" has just

revealed another secret surveillance program involving the internet. we're going to have details of that. we'll discuss with our panel. and it looks like someone's basement rec room. but it's actually, get this, a federal government warehouse, and taxpayers are footing the bill. plus an exclusive joint interview with mitt and ann romney. they're opening up to cnn's gloria borger about their most difficult moments after losing the race for the white house. [ male announcer ] when gloria and her financial advisor made a retirement plan, they considered all her assets, even those held elsewhere, giving her the confidence to pursue all her goals. when you want a financial advisor who sees the whole picture, turn to us. wells fargo advisors. even in stupid loud places. to prove it, we set up our call center right here... [ chirp ] all good? [ chirp ] getty up. seriously, this is really happening!

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another explosive article has just appeared, this time in the "washington post." it's breaking news, and it reveals another broad and secret u.s. government surveillance program. the "washington post" and "the guardian," london, reporting that the nsa and fbi are tapping directly into the central servers of nine leading internet

companies, including microsoft, aol, google, skype, youtube and apple. the post said they're getting e-mails and documents and connection logs that enable analysts to track a person's movements and contacts over time. let's discuss this latest revelation, they're coming out fast, very, very quickly. bill binney is still with us, the former official of the nsa who quit back in 2001. you were angry over what was going on. you've been known as a whistleblower right now. and jocelyn is joining us from the accountability project, representing bill binney, among others, a private organization. and fran townsend is here as well. well, bill, what do you think about this "washington post" story? >> i assume it's just a continuation of what they've been doing all along. mark kline exposed the nsa room in the at&t facility in san francisco where they had devices

connected up to the fiber optic lines inside the united states. what that technically meant to me -- >> do you want some water? >> it means that the devices could concessionize everything on that line and pass it on to the nsa. >> so you're not surprised by this? >> no. >> are you surprised? >> although, i find it very disturbing, i'm not surprised. not only, bill, but tom and two other nsa whistleblowers have been shouting this from the rooftops for the last three years, that nsa was collecting all digital data, not just telephone envelope type information. which i know people like to argue, don't worry, it's only the name and numbers. you can actually get a lot more information from that than from content. but again, my clients have been talking about this for years. >> if this story is true, fran, the "washington post" story just posted on their website,

obviously the obama administration would be court authorization for some massive surveillance program like this. >> right. look, wolf, i haven't read the thing yet, but yeah, that's right. you would presume this was done under a court authorization, with showing of probable cause. and it would have been briefed to congress. >> congress would be informed of it. the chairs of the intelligence committees, ranking members, the speaker presumably, the senate majority leader, among others. so there's no suggestion this is illegal, right? >> well, i think if you read the plain language of section 215, which i know most people -- >> the patriot act was pretty broad. so there is a basis -- a legal basis for the government to intrude like this. >> not on domestic to domestic communications. there's plenty of latitude to hurry up the process, to quicken that, to have foreign to domestic. you don't have to go through a bunch of red tape. but it does not approve the letter -- >> right now, basically they

could say, if there's a foreign partner in a conversation, or an in an e-mail, that's okay, but if it's strictly within the u.s., then that's not okay, is that your understanding? >> wolf, we should be clear that there's a whole process by which what the nsa collects, legally collects, there's an audit done by lawyers of the collection of the fbi and nsa. if they collect things they are not authorized to either collect or access, that's done on a regular basis, and those reports are provided to congress. >> very quickly, when the fbi raided your home, your wife was there. you were in the shower when they showed up? >> yes, i was. >> guns in their -- >> yes. >> did they ever charge you? >> no. >> did they ever charge you with a crime? >> no. it was to intimidate me. >> you were never accused of any espionage or leaking classified information? >> no. >> do you have any idea who's leaking this information? because you've represented whistleblowe

whistleblowers. >> yeah. your co-whistleblower was charged. i don't know who leaked this. i have no doubt that the administration will launch an investigation. not into who approved these programs, but into who leaked the information. >> i'm sure there will be these investigations. to all of you, thank you very much. i want our viewers to get a better appreciation of what's going on. thank you, all three of you, for coming in. it looks like someone's basement rec room, but it's a federal government warehouse, taxpayers footing the bill. and our interview with mitt and ann romney. they're opening up to gloria borger about their most difficult moments after losing the white house. i'm on expert on softball. and tea parties. i'll have more awkward conversations than i'm equipped for, because i'm raising two girls on my own. i'll worry about the economy

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happening now, mitt and anne romney in a candid and exclusive interview on the heart break of losing the white house and their lives out the political spotlight. michelle obama, is she snubbing a global power? she's skipping a trip with her husband, and it's raising some eyebrows. and secret personal lounges inside, get this, a government warehouse. another outrageous expense on the taxpayers' dime. it has now been revealed. i'm wolf blitzer. you're in "the situation room." tonight for the first time, and only here on cnn, mitt and anne romney are opening up about the 2012 presidential election, and the wrenching loss that took both of them by surprise.

the romneys sat down with our chief political analyst, gloria borger, for this exclusive and extraordinarily candid interview, talking about when they started to realize election night wasn't going their way. >> my team tells me i was still holding out hope at 8:00. i don't think i was. but at 6:00, i was really worried. by 8:00, i think we knew it wasn't going well. >> who kept hope alive? >> me. >> i gather karl rove was -- >> yeah, he was saying, don't give up. this isn't right. whatever's happening, our numbers in ohio are better than what they're thinking. so, yeah. >> what about you? >> well, i think the reason that karl rove and others, including members of my campaign team, not all, but some, felt that we were going to win, even as the evening went on, was that we looked at the numbers, and it showed that we were winning among independent voters.

by a good margin. they said, you're not going to lose ohio. if we win independent voters in ohio. but we did. and i think they just had counted on the kind of turnout that would come from various minority groups where we had not done as good a job as i wish we would have. >> when did you know? >> well, probably, you know, you don't really know until 7:00 or 8:00. but the exit polls showed we were struggling in florida and north carolina. we thought we were going to win big in florida and north carolina. so if we were struggling there, that was a pretty good indication. >> did you call each other? >> i got back about 4:00, 5:00 in the afternoon so we were together. and i said, the exit polls are not good. ann said, they're looking pretty good. you don't know immediately because the numbers were close. you don't know until the last counties are counted. >> you're a numbers guy. the analytics of the obama campaign were so stunning, and

their door knocking and their ability to predict the electorate was really outgunned, your campaign. did you sort of sit there and go, why didn't i know this? why didn't i know that? >> oh, no. >> why didn't i expect this? >> no, no. because we -- we had, i don't know, maybe four or five months in a general election campaign. i was, before that, in a primary campaign. i wasn't the nominee. we didn't begin our general election effort until i became the nominee. and began putting people together and doing our get out the vote effort. but the president had four years. one of the advantages of incumbency and one of the reasons it's difficult to replace an incumbent, as an incumbent you don't have a primary. you can raise money during the entire season, use it on the general election. you can hit your opponent when they come out of their primary. and you can build the kind of team -- i think he had as many as ten times the number of

ground workers, paid staff that we had because he could afford them and we couldn't. >> had you written a concession speech? >> no. i had written a very good winning speech. >> it's great. >> i certainly didn't want to write a concession speech. but i think around -- i think around 7:30 or 8:00 when it was pretty clear we were not sure we were going to win, that it was time to begin to put together some thoughts for a concession speech, which i did. >> did you stay up half the night? >> well, the kids were there, so we had pizza with the kids. and talked about what we were going to be doing next, and what each of them was doing. put the grandkids to bed. the next morning, we drove home to belmont in massachusetts. we have a condo there we live in. and we -- the refrigerator was bare, so go to the market and get some food. and we spoke with the secret service. they said, look, we'd like to transition over a week or so, maybe a little longer, because you're still very much in the public eye. we said, no, we would like to

transition faster than that. we don't want the taxpayers to be picking up your costs any longer. we're no longer -- >> it's just the two of you. >> just the two of us. >> who took it the hardest? >> i don't think it was -- i think initially maybe i did. i think initially i was more upset. >> you know, we -- the next day we went to the campaign office, and the workers were there. all the campaign workers. and gathered. and i got on the stand and spoke to them. they had worked really hard for a long, long, long time. >> there were a lot of tears. a lot of tears. >> it's very hard. it's a real heart-wrenching experience, to say, you know, we just didn't get the job done. but i also said to them, look, life's currency is the friendships you make. and we have made friendships in this campaign we will never forget. we were in the foxhole together. and this is something we won't lose. and we are all richer from the experience. by virtue of those friendships that we've made. >> because we all saw the

pictures of you at thanksgiving, in california. the governor and the boys at disneyland. that was the public face of the romneys. >> right. >> after the election. and so the question is, what's going on behind that public view? >> obviously there's a lot of healing that has to happen when anything is as traumatic as that that you go through. but i also can be very quickly reminded of how traumatic life experiences are for everyone in this country. people, you know, we lost an election. let's put that in perspective. people lost a husband, lost a wife, lost a child. lost someone in battle. there were so many things that people have to deal with in this life. and, you know, yes, that was hard. but i think we can put it in perspective very quickly and say, aren't we blessed to live in this country.

i think it would have been a better one if mitt had won, but aren't we blessed. this is an amazing country, amazing people. >> we loved the experience. it was hard work. i said it was like a roller coaster, there are ups and downs. but you still pay to get on the roller coaster. it is a real thrill and experience we will never forget. frankly, i'd do it again. >> you would? >> look -- >> again? >> i would do it again, but it's not my time. >> i would go with that. >> but i would love to do it again. are you kidding? i would love to do it and win. but it's not my time. i had my chance. i expressed my views. i didn't win. it's time for someone else now to get in there, and give it their best shot. i'm optimistic that a republican is going to win in 2016. but i'm not going to be that guy. there will be somebody else that takes that mantle. and more power to them. i hope i can help them in some way. but that's something which time will tell. >> how do you get back to living a life without that single-mi

single-minded intensity and focus that you have to have during a campaign every single minute of every single day? >> i'd say it's almost the opposite. it's easy to live life with family, with household chores you have, with the privacy you enjoy. what's difficult is going into a campaign and becoming extraordinarily focused, day after day, speaking to large groups of people, getting to know individuals one on one, learning their experiences, dealing with the media, that's what's difficult. >> dealing with your mistakes. >> dealing with your mistakes. that's what's difficult. that's what's challenging. when that's over, it's like, oh, back to real life. isn't this great. so it's not hard going back. it's hard going into the campaign. it's a new experience, and a thrill. but at the same time, it's a real challenge. >> don't you spend a lot of your time kicking yourself, like after the 47% remark, which was a real problem, didn't you kick

yourself? >> oh, yeah, i was very upset. there are a number of times i said things that didn't come out right. and one of the things about campaigns today, unlike probably 25 or 30 years ago, is that everything you say is being recorded. and, you know, now and then things don't come out exactly the way you want them to come out. they don't sound the way you thought they sounded. now, with the good opposition campaign, they grabbed it, they blow it up, maybe they take it a bit out of context, maybe they don't, but it obviously is paraded in a way that you hadn't intended. but that's just the nature of politics today and you have to get over it and live with it. >> do you miss it? >> i'll tell you what i do miss. i miss the associations that we had. the staff that i loved. the secret service agents, loved them. having those -- it was the personal feelgsz things with th. it was exciting, a lot of days were a lot of fun.

so yes, i do miss the personal associations that we had. >> do you miss it? the limelight? >> not the limelight, no, not the limelight and constant v scrutiny, and the microscope. is your hair slightly out of alignment, what kind of shirt do you have? you don't enjoy that. but you do miss the friendships. the friendships we've made during this campaign, and the one before, are life-long friendships. i wish i could spend more time with those people. >> fascinating stuff. we'll have more from mitt romney just ahead. stand by for his advice to future presidential candidates. also, we'll hear his take on hillary clinton. more of the interview with gloria coming up. we're also going to show you the secret personal lounges built inside a federal government warehouse on your dime. my mantra?

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when cnn's chief political analyst gloria borger spoke with mitt romney, they spoke about the lessons he learned in 2012. he also looked ahead to 2016. >> let me ask you, governor.

you're here with republican presidential candidates, fund-raisers, democrats are coming here to -- you've run twice. what advice will you be giving to these candidates? chris christie, paul ryan if he runs, rand paul, candidates who are thinking about running for the presidency? >> well, you've got to make sure your family's entirely united, and they understand what they're getting into, and they're willing to give themselves to the effort. because it's going to be a lot of work. number two, you've got to make sure you build the best staff in the world. an extraordinary group of people who are loyal to you and one another, and that are experienced. i'd say number three, you've got to begin raising money. >> what should they dnot do? >> don't make any mistakes. are perfect. the funny thing is, people say, be spontaneous, don't act like you're being crafted.

well, everything you say today is being captured by video, or, you know, hand-held camera and so forth. so jokes, for instance, will get you in trouble. anytime you're trying to be funny -- >> it happened to you. >> yeah. i mean, you've just got to be very, very careful. and every question asked, you've got to stop and say, okay, what's the intent of the question, what do i really want to say here. don't get pulled off your message by something that -- >> doesn't that keep people from knowing who you are, though? >> there's got to be a better way to have people get to know the person running for office. because right now, most people only see you in a 30-second ad which doesn't tell them much, or debates. >> gloria "here with us. gloria, you also asked about hillary clinton maybe running for the democratic presidential nomination in 2016. >> i did. and it's interesting, wolf. he clearly believes that benghazi has damaged hillary clinton's currency to a great degree. and also, he believes that

barack obama's foreign policy has. take a listen. >> i think secretary clinton's challenge will -- not just be benghazi, but more the record of american foreign policy over the last four years, while she was secretary of state. we'll look at everything from north korea, to iran, to pakistan, to afghanistan, to syria, to egypt, and you look across the world and our prospects, the prospects for stability, for liberal democracy, for freedom have retreated over the period of her administration, in the department of state. and i think that's something that will be a challenge for her. >> well, wolf, you see, he's clearly already getting back into the fray of 2016. i should also add that he had nice things to say about chris christie, whom lots of republicans were angry about during the campaign. paul ryan, as well as rand paul,

all of whom are going to be in his event in park city. >> sounds like a good event. excellent work, gloria. >> thank you. just got back late last night from park city, utah. >> beautiful, wasn't it? >> it was lovely. an investigation exposing secret lounges set up by workers getting paid by you, the taxpayer. i want to make things more secure. [ whirring ] [ dog barks ] i want to treat more dogs. ♪ our business needs more cases. [ male announcer ] where do you want to take your business? i need help selling art. [ male announcer ] from broadband to web hosting to mobile apps, small business solutions from at&t have the security you need to get you there. call us. we can show you how at&t solutions can help you do what you do... even better. ♪

here's another outrageous look at what some workers are doing at taxpayers' expense. contractors setting up secret personal lounges inside a huge environmental protection agency warehouse. but now, an epa investigator has blown the whistle on them. our brian todd has this report. >> reporter: how's this for a man cave? a private space with a couch, chairs, tv, a weight set, this isn't your cousin's basement, it's a u.s. government facility, a warehouse in landover,

maryland, overseen by the environment protection agency. leased and operated by a private contractor for $1.6 million of your tax dollars a year. >> when the auditors first saw it, it was overwhelming. >> reporter: robert was the lead auditor for the epa's inspector general who just issued a report on the facility. the document looks like a brochure, with pictures of other man caves in the same warehouse. here's a space with an even larger tv, a chair, artwork on the wall. some had personal photos and pinups, and -- >> they had put in a refrigerator, microwave ovens. >> reporter: that black object? that's a hair trimmer. >> we hired these people. we paid taxpayer money for these people to manage our inventory, take care of the warehouse, and as far as we can tell from what the inspector general found, they didn't do any of that. >> reporter: and the record says these personal spaces were hidden from security cameras by partitions, curtains and piled up boxes. the epa said we couldn't get

access inside this warehouse, but epa officials say as soon as they learned what the inspector general found, they had the private contractors who operated this building escorted out. they prohibited them from coming back and began taking an inventory of everything inside. the little specks on the box lower right? >> we did take pictures of places where they had taken rat traps, and where there were rat feces all throughout the building. >> reporter: one place the contractors kept immaculate, the gym, with upgraded equipment including -- >> showing a computer that was attached to some speakers, and it appeared to be used for music. >> reporter: there was a security breach, expired passports of epa employees with all their identity information lying there in open boxes. did we mention the inexplicable inventory? pardon my language, but what the hell do we need with pianos at an epa warehouse? >> good question. and why they had all this other

inventory in the warehouse. why they had all this stuff that we weren't using. >> an epa spokeswoman said those pianos had been at epa headquarters for award ceremonies, receptions and other functions there, and then they were moved to the warehouse. the agency said in a statement that it moved quickly to address all of these problems, and indeed, the inspector general does give the epa high marks for fast response. we e-mailed the private contractor that managed that warehouse. we never heard back. wolf? >> if you do, let us know. brian todd, excellent report. thanks very much. we'll have more of the breaking news coming up here in "the situation room." the "washington post" now reporting the u.s. government is tapping directly into the servers of the biggest internet companies in the united states. the post has now published top-secret slides detailing what's going on. caroline penry began usingnn] olay total effects in 2001. and one wedding, 2 kids, 43 bottles of olay total effects

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[ male announcer ] get adt for as little as $99 and save a lot more than money. call or click today. let's get back to the breaking news now. t"the washington post" and guardian reporting the u.s. government is tapping directly into the central servers of nine leading internet companies including microsoft, yahoo, google, facebook, aol, skype, youtube and apple. tom foreman is here taking a closer look. what's the latest? >> this information is really stunning, wolf. look at this one quote from the end of this article from "the washington post." these are actually the slides here. but look at this quote. the reason they say they have the slides from a power point presentation done for the intelligence community, what was said in here is that firsthand experience with the systems and

horror at their capabilities is what drove a career intelligence officer to provide power point slides about prism and supporting the materials to "the washington post" in order to expose what he believes to be a gross intrusion on privacy. they quite literally can watch your ideas form as you type. the officer said. now let's look at the slides here, wolf, that were from the presentation. they were surprising. this is the overview slides. you notice at the bottom the date there, april 2013. very recent. now look at what the sithing is all about. if you look at the next slide. they're talking in here about how communications flow from place to place on systems like google and yahoo and they're apparently, according to this program, monitoring and now look at the next part here, what is being monitored. this is the part will most likely get people's attention. look at that. those are the companies on the left. but what they're allegedly able to look at is e-mail, chats, videos, photos, stored data,

video conferences, all sorts of things that people would have thought were private. that were just on their desktop. this is what is certainly going to put people up in arms to some degree. you look at that plus look at the data agreements they made with the different companies. there are the dates if you look side to side. their a little hard to see, 2007 to 2013. that is the time line of how they entered into the program with all these companies that virtually all of us rely on all the time. again, reporting from the guardian and "washington post" suggesting that all the coverage today by cell phones looks like the tip of the iceberg. here is the ultra secret program called prism they're reporting on which is allowing the government to look in on the desk tops of computer users if this report is correct and simply see what we're doing. who we're communicating with, the thins we're writing, the video message that's we're exchanging and many, many computer users thought were private. >> apparently though authorized by congress and the patriot act,

authorized by a judge with the foreign intelligence courts, authorized by the president of the united states. we'll have much more on this coming up. we'll see what's going on. pretty shocking information. coming up also here on "the situation room," why the first lady isn't going with her husband for an important meeting with china's new president and his wife. (announcer) born with a natural energy cycle... cats. they were born to play. to eat. then rest. to fuel the metabolic cycle they were born to have, purina one created new healthy metabolism wet and dry. with purina one and the right activity, we're turning feeding into a true nature experience. join us at purinaone.com

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with u-verse high speed internet. rethink possible. there's a lot of speculation about the first lady michelle obama why she won't be joining her husband when he meets with the new chinese president. erin mcpike is looking into this for us. >> reporter: a chinese state

visit is usually filled with pomp and circumstance. but when president obama travels all the way to california this weekend to meet with new chinese president, the setting will be casual. it is build as a sign of progress for american and chinese diplomacy. the two world leaders rolling up sleeves and building a personal relationship. the chinese president will be bringing along his wife. like michelle obama, she is considered a rock star in china, accept she actual sli a rock star. but she won't be serenading michelle obama. president obama is going it alone. meaning there will be no face time for the first ladies. it's a curious turn. first ladies entertaining other first ladies is customary for mr. state visits. there are mixed reaction on

chinese social media about mrs. obama's decision to stay home. one said because our first laid ji so pretty she was scared to show up? another, why disappointed? it is for sure understandable that she put family and her i kids in the first place. also, she's a mom in the first place, then the first lady. still, critics say that's a mistake for the white house as it tries to thaw tensions with the chinese. >> this is kind of political gesture from the u.s. or this is part of a disrespect and people in china will think, you know, this may not be just a family matter. >> reporter: this man studies u.s. chinese relations for the brookings institution. >> it is unfortunate that the first lady will not be there. otherwi otherwise, it will be a perfect story, a double date. >> reporter: now i should point out if sasha obama's 12th birthday on monday and the white house says they haven't heard any complaints from their chinese counterparts about the

mom and chief's decision to stay home. erin mcpike, cnn, washington. >> that's it for me. thanks very much for watching. see you back here in "the situation room" tomorrow. erin burnett "out front" starts right now. we begin with breaking news. we learn uncle tam is spying on the phone records of americans and now tonight we find out that the government is in your computer as well. >> plus, oil company bp spent millions, billions of dollars on projects to restore the coastline after the deep water horizon oil spill. but you know what? some of these projects are bogus. and a new study says cheerful women are promoted less often than their, you know, roughy counterparts. does that add up? let's go "out front." and good evening, everyone. i'm erin burnett. we begin with our breaking news.