hour of cnn "newsroom." with tony harris. >> good morning, everyone. it's monday, july 27th. here are the top stories in the cnn "newsroom." and how an operator in nevada can take part in a war on the other side of the world and get paid to get rid of your gas guzzler. the government's cash for clungers program is picking up speed. good morning. i'm tony harris and you're in the cnn news roonl. number one, the economy, the cnn money team is all over it. cnn's susan lisovicz is all over it. and susan, wow.

a lot of talk with these numbers and christine, jump in any time you'd like. >> well, you should have heard heidi. she had been on the air saying that the estimates for new home sales was an increase for 1.37%. instead, it came in at 11% and that's the biggest monthly jump that we've seen since late 2000. of course, you know, this comes with a year over year decline for a new home is down in the vicinity of 12%. but the bottom line, tony harris s. that we are seeing a trend here that is encouraging. three months now of increases both in new home sales and existing home sales, which is the broadest part of the housing market. and another thing we saw with the june housing number is that the monthly supplies, the

inventory, something that has to be worked down, is an 8.5% supp supply and obvious three these companies are fighting something. >> does this mean that the banks are starting to loosen up on credit with lending? because i would like to think that that's the case. >> i think there's a lot of investor-type -- home buyers here. >> yeah. and if you look back at how old it takes to book the sale, if you look at the trough with the mortgage rates, maybe two weeks ago, two months ago, you can see why they are being looked at

sales for existing homes and for new homes. because mortgage rates were very low. people who had good credit, a lot of them were distressed home sales. in some cases, those were investors who had money going in. so i don't know how much of it is first-time home buyers or trying to clear the lot, but there's some activity. susan, i'm looking at the number two. it's 21% below last june. so we know that it's much better than last month but we know that still year on year home sales are pretty significantly, aren't they? >> yeah. >> i mean, it's all relative. the housing market is weak and still has a way to go. but it is encouraging. this is something that -- this is where we all first saw that the u.s. economy was in trouble. >> right. i agree. it was a bubble and it burst.

we had several years of record sales. >> right. >> and it burst and then the credit bubble bursted right after that and working our way slowly out of it but this is encouraging because you're starting to see activity. >> ladies, appreciate it. maybe next time we get together we'll talk about the earning season. this is another stiff season for earning reports. ladies, great to see you. a couple key financial indicators. we'll show where the housing prices stand and then on wednesday, the beige book comes out. it provides snapshots of regional economic divisions and then we have the jobless claims and gross and product report. as you know, the gdp is the broadest measure of activity. analysts will be watching for signs ever an economic decline that is slowing.

a busy week ahead in the fight over health care reform. president obama tries to build support. suzanne malveaux joins us. boy, at the end of last week, for this president, it's back on message and the message is health care reform? >> it is, tony. it's health care reform. we just got out of the briefing. it's kind of an off camera on the report a gagle, if you will. he gave us an autopsy date on this, if you will and said that the president is not at this point planning to call lawmakers or sit down with lawmakers over this issue but it's going to start all in earnest. once again, tomorrow he will be making some sort of a town hall, if you will, and he will the traveling and they say and it's

the other 20% but that's the in hard 20%. robert says, look, there was designs made a month ago when he went to visit the doctors and the doctors were not in support of a lot of the plans being put forth. now they have the doctors on board and there's a lot of practice being made. we asked about the senate committee. are they going to have something that is ready to go and that this president can approve? he said, well, there are still optimistic but in his words they don't expect him to burst anything this week. so we're -- we see this is the white house and the president but they have learned that they can't say, this is the deadline and that's what is going to

happen. >> well, there is new information with the police. what's the message on that? >> well, there's going to be a meeting here at the white house. they are going to sit down, the three of them, the president and we understand that the president drinks budweiser. they said that trolly asked for a blue moon and gates doesn't apparently drink but they're all going to get together here at the white house this week and hash all of this out. >> okay. >> and there's probably going to be media access because we asked if there was going to be any chance for her to have some sort of picture of the three of them together in some form.

>> okay. uninsured americans and some of them are doyounger people who don't think that they need health insurance. >> each step, it was like my back was on fire. leukemia, diagnosed finally then learn about health care.

real estate part of the ft. worth area hospital network, that has not only given rose care, but including five cycles of chemotherapy and deal with the health care bureaucracy. first medicaid and then social security disability payments. next, a painful lesson in texas, it would put her over the limit to receive medicaid. no insurance and a bagful of medications that runs more than 5,000 a month. >> every day. every day. >> eight spros spekt of cancer comes back. >> the bone marrow testing alone is costing like $300,000. that's just the testing part of

it at least that's what i was told. >> 800,000 patients pass through every year and fewer than 7% of them have private health insurance. and then robert, the chief of medicine, dr. gary floyd, promises to squeeze into save frgs those federal programs, they worry. but among other things, could exacerbate a shortage in texas. >> in texas we have a significant problem with medicaid. only 38% of our positions port pat in medicaid programs. if we start freezing them and we're going to see people in positions will want to participate in those programs. >> while public hospitals see the bulk of the.

>> and then and we even had one time a gentlemen that didn't have health insurance and i asked him, charlie, why don't you have that? and i said, what do you do? he runs an insurance agency. what? he says, well, i can't afford it. >> gregory proudly displays his political allegiance as he watches the debate in washington and gets more and more frustrated. >> a typical fight? >> his first reflex is to blame republicans but democrats not only have the white house but big majority teas in the house and senate. i and should spend time in his shoes. >> they really need to get their heads together and get their acts straight with the majority teas in place, they should be

happy. if ne don't get it done. >> john king, cnn, ft. worth, texas. well, we just learned, this just in to cnn, that the cambridge police department gets a news conference. next hour, at the top of the hours, at noon eastern time. we'll bring that to you live: sergeant crowley and president obama plan to meet at the white house today. and he is r the police department right here into the cnn "newsroom." still to come, rob marciano. we're going to be talking about the cleanup after the severe storms slam my home state. rob will have the latest as you look at the maps right now. and facebook number five, we are live from outer space. next, what is going on there?

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from the space shuttle "endeavor" and it's the sixth walk of the mission. they are going to undock from the station tomorrow. good-looking pictures tomorrow, as always. cameras on the porch. >> you mentioned maryland and there are a lot of trees down and there are one or two people injured. the car is crushed by big old

trees and power lines as well. and then also up for the western great lakes and colorado and and seeing some bubble up and 30 minutes, boston, cincinnati seeing delays as well. and near record breaking heat in places like portland, oregon. temperatures will reach 100 deargs. typically it's dry because the flow is not as humid but they

have humid and many folks have air conditioner. >> yes. >> 84 degrees in dallas but it's going to rain today. look at that. the coldest winter i ever had was in san francisco. kgo. the fog has moved in this time of year. you and i are always on television. this is the birthday week. >> thank you. >> a big number but i celebrated in a big way. rob, appreciate it. >> all right z golf this week. you know that's only -- >> yes. >> still to come, the critics

say that the cash for clunkers program is environmentally counterproductive but still shifting into high gear today, gerri willis has details that you need to thththththththththth.

sfloo prices stumbled to $2.55 a gallon. it's getting close to the bottom, too. so if your car is on empty jerry, good monday to you. finally, finally are we getting some clarity from the dips on this program? >> it's not the dealerships. it's really, really complicated. they had to register every dealer in the country. technically the program started back on july 1st and many auto

dealers were reluctant to fill the requirements. on friday, final rules were details how they can get their cars into the program. the car allowance rebate system or cars for short, get cars and clunkers out of your brain. it's from july 1st or until the money runs out. anybody may still be eligible for a rebate as long as you meet those requirements. tony? >> remind us about the program's qualifying rules. >> it has to get 18 cents per gallon or less and eninsured under your name for at least a year. the credit will be anywhere from 3500 bucks to 4500 and that's based on how many more gallons your new car gets.

and you could get more since the program involves the scrapping of your vehicle the dealer gets the first 50 and this is in addition. full limit and call the hotline. cars.gov. >> so if your car qualifies, what do you need to bring to the dealership to make this happen? >> you don't have to register. however, you'll have to take a lot of stuff to the dealership. proof of registration going back at least a year and a clear title. the car will have to be free of any lanes and you'll find it on

the driver's door. if your vehicle doesn't meet those requirements and you're in the need for a new car, wait until the fall to buy knew. it's the current year model and, of course, if you have any questions about any money questions for us, send them to me at gerri@cnn.com. >> gerri, thank you. next we go inside and show you how the vehicles are creating an unprecedented type of warfare. e. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long.

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the u.s. and china kicked off two days of high-level and high-stakes talk in washington. budget deficit is among the hot topics. let's start in with remarks by president obama. jill doe we are tea is live with details. talk about a busy agenda. a lot for the delegations of these two countries to talk about, jill. >> you name it. really, tony. that's what they are trying to do. they say that the relationship up until now has been a lot of times focused on economic issues and those are important but what they are saying is that they want to broaden the dialogue and

you have the top officials there along with president obama who opened up this session and at one point they were actually speaking each other's languages. the treasury secretary tim geithner had a state counselor who was quoting barack obama and saying, yes, we can, bringing down the house. it's interesting and it's a broad spectrum of issues as you mentioned. and the president made a point that the u.s. achina can be partners in spite of their differences. let's listen to what he said. >> let us be honest. we know that some are wary of the future. some in china think that america will try to contain america's ambitions. some in america think that there is something to fear in the rising of china. i take a different view and i

believe mr. kuu takes a different view as well. i believe china is a strong prosperous and successful aa future when they are our partners out of necessity and opportunity. the future is not fixed but it's a destination that can be reached if we sur sue a sis sustained dialogue. >> some of the issues that you can hear, some of the issues that geithner brought up, demand and in china, not having the export company and country. and they have their own issues and there's a lot to talk about. >> jill, appreciate it. thank you. >> we are also keeping a close eye on the middle east. tensions are rising over iran's nuclear ambition and suggesting

that they don't stlik out the minister said that the remark comes as this strong over washington. secretary of state and falling of a preemptive strike and the british military has a victory and flushing the military from parts of afghanistan. taliban fighters from the province and the defense says that they will keep some troops in the region and it adds to the success and will allow for a more open vote. british troops have been killed in afghanistan. the british officer said that the taliban suffered significant damage. >> unmanned aerial better known as drones are facing the warfare where the skilling carried out by robots.

how and why this is happening. >> watch these two men in iraq. they have no idea that they are being hunted by a deadly uav. it is following their every move even recording them firing their weapons. they have no idea that their insurgent activities has been flaunted and no idea that the uab operated thousands of miles away is about to fire a missile at them and what makes the drones much for the u.s. military. >> the real advantage of lining up power and and as they move

over iraq and the pilots have a request and of the weapons first installed on drones. >> so far, firing missiles on the predators, this is providing not only the pictures and the video thaw need but also capable of taking out targets where there may not be any assets available. >> an estimated china, russian, and japan are developing drones. even hezbollah, the political party and paramilitary group to use them against israel. no one feels the urgency of staying ahead of the competition more than the personnel at the air force base. >> right now we are hanging on to everybody. it's mobilize reserve if you are assigned right now to move out. >> it's a considering way to cut

out pilots all together. >> we're looking at a future where we can operate and within groups among themselves with weapons or without weapons. >> unimaginable a few years ago. new weapons appeared destined to work with less and less human input. >> there is nothing that is a technological barrier to using that. we think of it as a never, ever thing and yet it's not the technology that is holding us back. it's time to say that war will never be the same again. if ever to borrow a line from a science fiction movie, this is it. mankind has never been there before. towards that unchartered era.

the warfare. cnn, air force base, nevada. >> this just in to cnn, we've got a tornado warning. rob marciano? >> the worst spot that did damage, today we have a highly populated area along tampa bay. this includes the a main thoroughfare that connects pinellas county to hillsborough county. it's at 15 miles an hour. that would include the folks who want to stay cover. and one area where most of that sacks happening, this could do damage, tony f. it heads inland and if it keeps itself together until north of 275.

be aware in western hillsborough county. a warning in effect for the next 20 minutes. >> appreciate it. thank you. doctors say that too much heat caused him to collapse nicholas nar koz zee. there's the first lady of france. doctors ordered the 54-year-old to take it easy today. decision day is tomorrow for sonia sotomayor. they will vote on her nomination to the supreme court. some republicans on the familiar are backing her. senator sessions says that he will vote against the confirmation. still, with democrats

controlling the senate, she is expected to get the confirmation. and comic-con craze celebrates history. highlights coming up. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways.

the event comic-con is the largest comic professionals in the world. joining us now, what did the i-reporters see? hope it was good stuff. >> we're always amazed by what the i-reporters send in. this is a good event. this weekend in san diego, it was the comic-con's 40th anniversary. this is really big business. as you know, typically it ends up being huge in the mainstream later on. and this is just to give you an

idea of what is going on here, 120,000 people flocking to this event. what we're going to do right now, we're going to test your pop culture, tony, by showing you some of the i-reports that we got. let's start with photos from santa monica. >> oh, yes. he's ledger from the "batman" movie. you don't have to tell me the answer. i know the answer. >> thank you. >> this is a test and i want to pass or fail on my end. >> let's keep them going. >> and do you know who this is? >> no. i have no idea, what the heck is that? >> all right. someone correct me if i'm wrong, but i think that is a green lantern. >> okay. >> and a friend.

>> okay. >> i have no idea what that is. >> okay. >> got another one? >> those are the storm storm troopers, right? >> yeah. >> and what about the guy on the right? do you know who this is? >> no. >> that's not what i was thinking at all. >> okay. >> we have a couple more here. the freaks come out at night and all day and all night. okay. all right. >> you know what? can we take care of the zombie video? this is the place for hollywood and they start hyping the film. there's a new film coming out. this is the kind of thing that you can expect to see. i've never been. i really hope to go some day.

>> all right. so it's friends come out at night. >> yes. >> there are amazing photos and video and you can go to i-report.com and check it out. it's really great. >> all right. still to come in the newsroom, astonishing home numbers with gerri willis. me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid.

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only meineke lets you choose the brake service that's right for you. and save 50% on pads and shoes. meineke. boy, 11% in new home sales and it's a sign that the market is starting to bounce back here. we had gerri willis weigh in on this. if you would, break the numbers down for us. >> absolutely. new home sales going up 11% to 349,000. guess what? wall street was surprised about this. they expected it to about be 2%. this is the largest increase in nearly nine years and so it comes to this very big positive

result for people watching these numbers and i want to tell you, new home sales is really a small part of the market. look at what has been going on in the big part of the market. existing home sales have been out for three state months. look at these numbers. april, may, june, you can see a building effect going on here and there are more and more home sales and even when you drill down with this market, las vegas, the market has been hit by this crash. it had the highest sales since 2006, the height of the boom in june. so you're seeing a real rebound with sales. they are increasing and going up. so good news. >> yes. and that was my next question. is it all positive news here? >> well, okay, so we have contacts that may be darn close. i called mark zandi and he said that the coast is not clear.

and 70% of the sales were foreclosure sales. these are bargain basement prices. existing home price, median price right now is 181,000, $800. and, of course, job loss is to stabilize, improvement in the jobs market, that would really contribute to making this a better marketplace. but frankly it was predicted to go south. the unemployment rate is at 10%. we continue to see headwinds for the housing market but the fact that you are seeing some recovery in sales and of course we still have the tax credit of 800,000 for first time home buyers, that's going to continue but only until later this

talking about folks buying foreclosures, at least they fwet the excess supply off the market. >> you want to reduce inventory. that is one of things hamstringing this market that there's so many houses on the market for people to choose from and frankly the banks are in the way too because lending is still not back. >> appreciate it. thank you. >> we're waiting for a live news conference by police in massachusetts. presumably it will deal with last week's arrest of harvard professor and the conversation it generated. gates and the arresting officer, james crowley with meet with president obama, happening sometime this week. also in the next hour of cnn newsroom, washington debates

health care, a free clinic sets a record. we will take you to the clinic that was forced to turn away sick patients over the weekend. plus the stimulus package was billed as an emergency lifeline for troubled cities, but some say it is taking too long. jim acosta talks with one of the toughest critics and what's in the package for home builders. allan chernoff looks at contracts open forbidding. specially formulated to promote hairball control and healthy weight. friskies indoor wet cat food. feed the senses. betall day long. and it's not a steroid. announceit keeps my airways. top me b better l dalo.and i's noeroid. nounceit my airwayopen. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways.

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very quickly, we want to take you out to california, we have a warehouse fire going on right now. we don't have a lot of information at this point know how it started or if anyone is potentially hurt in all of this. but it's burning pretty hot

right now and a lot of smoke as you can see. some flames coming through the roof which is an indication there is a fire inside the structure as well. firefighters are working the scene. we're making calls on it to make sure that everyone got out of the structure okay, no injuries. we don't know -- live pictures from our affiliate, ktla. that roof took some significant damage as you can see. we're making calls to find out if everyone made it out okay. she is citizen palin today. a lucrative book deal and republican speech circuit or perhaps 2012. here's candy crowley with politics, palin style. >> reporter: she is a one-woman sound byte machine. >> molly wood needs to know, we

eat, therefore we hunt. >> reporter: a warning from the moose hunting sarah palin that hollywood wants to take away the right bear arms. as palin handed over the governorship, the wear and tear on stage was evident. a parting shot at the media. >> so, how about in honor of the american soldier, you quit making things up. >> reporter: palin's farewell was a three-day rolling picnic surrounded by supporters dreaming big. >> if we get a woman president, let it be her. she's a real woman and knows what a woman is supposed to be. pro-life, pro-family, pro-woman. >> reporter: palin has lost some of our light in alaska and a lot of it on the national stage. >> she abandoned her state in

the middle of a term they didn't ask for her to run. >> reporter: the latest abc washington post poll found 5 3% of americans view her negatively, 40% positively. 4 in 10 don't think she understands complex issues. it's clear while she's handing over the governor's chair, she's not relinquishing the microphone. >> with this decision now, i will be able to fight even harder for you for what is right and for truth. palin is writing a book and says she'll help other candidates and give speeches and one of her post-governor events is at the ronald reagan library. she could be on a path to 2012, it's called keeping your options open. >> i asked her that five minutes ago and she -- you want to know what she said. she said, i don't know, with her

little smirk. >> reporter: one thing is crystal clear, sarah palin private citizen sounds a lot like sarah palin, politician. >> our new governor has a very nice family too, so leave his kids alone. >> reporter: exit stage right but definitely don't fade to black. candy crowley, cnn, washington. palin, palin, palin. we heard a ton about the woman leaving office. who's the new governor of alaska. nicole has been looking into that. >> i didn't find a whole lot. we found some stuff. he's been called a competent conservative. >> oh, my. >> whatever that means. >> in 2006 he campaigned on the theme alaskans free of fear, alaskans with hope an opportunity. he has come out and said he shares many of the same republican core values as sarah palin. a difference may be in the way

he communicates with the house leaders, a leader has already communicated that parnell does play well with the leaders and communicates with them effectively and inclusively. for instance, before announcing he wanted to expand a special session he contacted them first. an issue that might go away the ethics reform in the state. already asking the state attorney general to recommend ways to stop people from leaking confidential information for ethics investigation and said this, if we allow public officials to be tried and convicted in the press through the abuse of the legal process then the executive branch is at risk, the rule of law is threatened. as for the man behind the politician, he's been married for 2 1 years, has two daughters. >> lovely. >> i dug around, not a lot of personal info out there. he has a facebook page. has about 500 followers, which is a lot less than most

politicians, but give him time. it still says lieutenant governor, he has to update that. one day on the job. let's give him time. we'll be checking in with him no doubt. >> he needs to be an effective advocate for the good people of alaska, correct? >> you got it. >> thank you. once again, we're waiting for a news conference to begin any moment now from cambridge, massachusetts, the police department putting on the news conference, we presume it will deal in some measure with the controversy involving police sergeant james crowley and harvard professor henry louis gates. gates accused crowley of racism and crowley arrested gates and a confrontation in cambridge. president obama entered the controversy then wanted to immediately take back the comments that he had made. elaine will join us from the phone with more on this story. the obama administration opens a full-court press on israel.

he is also urging dialogue. >> i think we are in full agreement on the negative consequences of iran obtaining this type of capability. i think we're also agreed that it is important to take every opportunity to try to persuade the iranians to reconsider what is actually in their own security interest. and we are in the process of doing that both in terms of the president's offer to engage with the iranians but also through sanctions to impose costs on them for pursuing that course. >> told the u.s. defense secretary upon his arrival, it won't rule out a strike on the nuclear sites. cal, george mitchell is on this trip as well. he started in syria.

why not israel? >> reporter: it was an interesting message to send to the israelis, they have been the staunchest allies for over 06 years, now the united states is finding itself in a position where syria has a lot to offer. >> cal, i apologize so much, we're going to try to get back to you in just a couple of minutes, but we have to get to cambridge, massachusetts, the promised news conference is under way. >> learned from that incident. since then we asked chuck wexler to convene a committee to facilitate an analysis and develop recommendations that the department can use as guidance in the future. the mission of this committee is larger than a mere investigation into the events of july 16th. while it it is important for the committee to understand those events, this committee will not be conducting an internal

investigation, nor will it make any official judgments on the actions of the officers in the department. rather, the committee will identify lessens to be taken from the circumstances surrounding the incident and how the lessons can be applied to the practices and training programs of the cambridge police department. it will examine the organization of the cambridge police department, its currently policies and its relationships with all parts of the cambridge community. the scope of the committee's work will include identifying learning points about the interaction between residents and the police by examining the departmental policies and training and conflict resolution and strategies to defuse difficult situations and gauging the spek rum of views through focus group meetings with the

diverse segment of the larger cambridge community and officers representing a wide range of ranks and assignments. identifying areas where the department can enhance its operations to handle similar incidents in the future in the best possible way. assessing how issues of race and perceptions can impact on daily encounters between the police and community members. produce findings and presenting best practices to the cambridge police department and the entire law enforcement community of this nation. bob wasserman, worked extensively with the federal government and agencies on the issue of diversity and management. i have known bob for some years he assisted many government executives to address complex issues facing policing in an

urban community. he is a nationally recognized leader in issues and has national respect. i have asked chuck wexler, the executive director of the police executive research forum to chair this committee. chuck is no stranger to cambridge. i have known chuck for 20 years and chuck has worked with me and the city of cambridge over that time. he is a native and earned his bachelor's and doctorate at mit. i expect he'll be with us later in the week with announcements. providing honest assessments of police departments for calling it like they see it. for those who are not familiar, it is a think tank in washington, d.c. dedicated to advancing professionalism in

policing across the united states. i encourage you to go to the website. i'm confident with the leadership assembled here today that this committee will help us emerge as a stronger committee. individuals have already been identified to serve in this committee and i look forward to announcing them later this week. i would like at this point to ask mayor denise simmons to say a few words and i'll return to the podium for questions and answers after the mayor speaks. >> thank you, mr. city manager and good afternoon. what you hear this afternoon is an important occasion and it's one we shall remember as a turning point for the city and for its city's residents. while this has been a trying time for cambridge, we are

confident that we can ultimately come out stronger and more unified community. i stand representing our city as the mayor, my colleagues, i see sam sigh seidel to show a sign of support and community. we have going to have discussions that shall continue throughout the continuing weeks and months. and we'll ultimately prove that the way that we interact as neighbors and colleagues and fellow citizens one that we have to do very consciously. i strongly support our commissioner bob haas and endorse this committee and the plans to convene on this matter. i look forward to the facilitated social discourse conversation and i shall continue to focus my energy on helping the community learn from this experience. it is my hope and expectation

that these events will serve as a catalyst for some important discussions and that we shall come all the way with -- understanding that will come away with a better understanding of how we can interact as a community. and how we can avoid situations like this from recurring. i also have sincere hope that the people of cambridge will ultimately walk away from this experience. healthier and more epithetic as a city. i thank you for your time. >> and there you have cambridge's mayor, mayor denise simmons and the man at the podium who started the conference, robert healy, announcing that a committee is being set up to investigate the july 16th arrest of professor gates. but interestingly enough, the committee will not offer a statement on the conduct of the arresting officer, the committee

will explore conflict resolution. will conduct focus group meetings with police and cambridge community. so in essence in short this will be used as a learning teaching moment. as you know, the president is scheduled to meet sometime this week with sergeant crowley, with professor gates and the three men will meet at the white house then have a beer, although professor gates doesn't drink beer but the men will talk through the july 16th arrest. and move this forward. close that chapter and move it forward. we'll keep you posted on any developments in this story. >> a big surprise in the latest housing report. my goodness, the commerce department showing 11% jump in sales of newly constructed single family homes. it was much greater than economists projected. but sales are still 28% below the levels of one year ago.

following the money, the government has spent about 10% of the massive $787 billion stimulus package, that's your tax dollars we're talking about and christine is tracking where it's gone. she joins us now from new york. what have you been learning? >> i've been learning first of all, we have $67 billion paid out so far. 67 billion of your tax money has been paid out and we're following the projects. you can follow them at recovery.gov. this is a project on the top of the list of the critics, this is for an abandoned train station. we're going to pay $9.3 million to fix up an unused train station in elizabethtown that 80,000 people a year use the platform, but they'll use the money to spruce up the train station, we're told there is increased ridership on this line. it could be helpful. but critics say this is not a

good use of money. another one on here in colorado. a bird watching road. a bird road, a few million dollars. $2.5 million. this is a place in colorado where if you want to watch raptors, there's been erosion on the roads, they are going to fix up the roads. we don't know how much jobs will be saved or created but this is for bird watching roads. there are several different ecological projects happening around the country to try to help tourism on the one but also because some of in is maintenance and upkeep that needs to happen. this one is people and brains. this is about $3 million. fellowships for young scientists, fundsing for people to continue their advanced fellowship for global health leadersh leadership. another one is studying sif list

and not a building and road, but that gives an idea of the various different kinds of projects out there that are getting underway. >> $67 billion so far? >> 67 has been paid out. 180 some bill has been allocate the. they've paid out 67 billion. even as we're talking about health care and other things, there's still this huge chunk of money now moving out the door. also on the website, recov recovery.gov, you can report it to us or the government and we'll follow up. there are estimates that $55 billion will be wasted or will just disappear because of fraud in all of this. everyone wants to keep an eye on the money. >> christine, appreciate it. thank you. >> here is a look at the few other issue number one stories in today's economic headlines,

verizon cutting another 8,000 jobs, bringing the total to $16,000. reductions will come in land line operations. they could be offset by hiring in the company's wireless division. an unusual event for a federal reserve chairman to say the least. ben bernanke had to hold his nose on government bailout but wasn't about to be the fed chairman presided over a second great depression and gas is getting a little cheaper. 7 cents a gallon cheaper. a survey says we're paying $2.47 for regular unleaded. for latest financial news and analysis, cnnmoney.com. all right, let's look at the big board quickly. dow future has indicated a positive start but the dow has turned in the negative territory. the dow is down 35 points.

and nasdaq -- nasdaq is down 11. still to come, pushing out the taliban, a new operation in afghanistan and new details on the afghan government. tony, we're watching the spacewalk, the last spacewalk of this mission. they are saying a hodge-podge of mun dain jobs. we'll figure that out after the break. ng. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long.

london says there is an opening so take it. british government wants kobul to open -- what exactly is great britain demanding in return for this outreach? >> well, it believes this sort of outreach is the way to defeat the taliban. it is not just a military problem, if you can make it down and break away the more moderate taliban elements, then you can deal with the taliban and corner the militant ones who want to continue to fight and defeat them that way. that's their objective, they completed the operation, ten british soldiers killed in that. 20 killed this month. it's been a bloody time for british troops and u.s. troops but have been playing quite negatively in public opinion here. british government trying to

tamp down the sort of negative backlash there, if you will they are seeing at the moment in britain. we're hearing from the foreign minister here, that britain should still expect more casualties to come. >> we know recent sacrifices will not be the last and we also explain the seriousness of the security situation in afghanistan. our enemies should never doubt our determination to accomplish this mission because we know the very high cost of failure. just as our friends should know they can truly count on us because we know our own security depends on that. for that, we need politics to succeed in afghanistan. >> so he means the politics to succeed, that's the elections coming up in afghanistan next month. the presidential elections which means the 80,000 people that live in the area, ministry defense officials will now be able to vote in those elections, but it also hints it's the

politics of afghanistan that have to work and that's part of what the british message is here, the politics of the elections taking place but the political leaders also talking to their opponents here. >> this idea of moderate taliban, i guess that's sort of smallty as opposed to big t taliban. has british intelligence received indications that there is a small t taliban that is willing to talk peace? >> you know, i think there are a lot of answers to that. if you look across the border at pakistan, a look at how the pakistani government is dealing with the same problem. they are trying to divide parts of those key tribes away from the taliban. what there's been is this underground effort over the years. look back to september last year when some taliban leaders met with some government officials,

weren't the real hard liners but there was a way that was trying to split people away. this has been going on behind the scenes and britt ain leads e way. one of the extreme leaders, his representatives in britain been talking to officials here. britain has been making efforts in that direction, nothing concrete so far that we know about though. >> senior correspondent nick robertson for us. u.s. troops in iraq are leaving the battle field. what's the new rule there and how about the future of contractors in iran? we'll talk to the woman that wrote the book on it. ng. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid.

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the u.s. military mission in iraq changed dramatically at the first of the month. that's when american troops left the big cities and turned over security to the iraqis, almost a month later, how is the transition going? arwa is just back from the sad

er city. >> reporter: tony, i have to say, it has, there were a number of examples we came across, let's point out that the u.s. military withdrew its combat units. we still have american troops inside cities but they are no longer being called combat troops. they are being called these souped up advisory units. a couple of examples to give you. the u.s. compiled a fair amount of intelligence on a targett thy wanted to go over and called the in the brigade commander and handed over the intelligence to them, the entire folder and said, look, will you go after this guy? the army commander said yes. he asked if he wanted american troops? he said no, thank you, but i'll take your air support. another example, the base we were on had been mortared so the

u.s. military wanted to conduct a disruptive patrol they had to coordinate that with the iraqi police unit that patrolled the area. it was a joint patrol, but actually under the control of the iraqis. and while therapeutic they were out there, they could no longer knock on doors or question or interrogate them. what we did is we patrolled the streets and able to talk to people on the streets and showed the iraqi police, the location where they believed the mortar fire had come from. told them to keep their eye on it. it's a different dynamic for the u.s. soldiers. that being said, they still do maintain the right to protect themselves. we also went out on a perimeter patrol. they could conduct on their own but they did prenotify the iraqis of their actions. they do have a right to conduct route clearance to run logistical convoys. the iraqis have to be notified of everything.

the average u.s. soldier is used to going after the target and being offensive and now they are moving into this sort of passive more advisory role. it's a complete change of mind set. in the past, if the iraqis didn't want to go by the american advice, the americans could basically have the last word. now the iraqis can choose to ignore that. it's a great challenge for these young soldiers and has caused some friction on the ground but they are working through it. the guys we're talking to are saying, basically this had to happen at some point. and we have to begin trusting them. >> arwa damon, good report. with u.s. troops shifting away from the battlefield in iraq and officials reducing american troop numbers, right now there are more contractors in iraq than military forces. so what happens to them? cnn executive producer joins me now, her book "master of war" focuses on blackwater which was

huge in iraq. is blackwater out of iraq? let me start there. first of all, good to see you. >> good to see you too. >> formerly known as blackwater. >> they were stripped of most of their responsibilities earlier this year when the iraqi government says we don't want these guys here any more. >> and talk to us about that. that was a horrific incident. >> it was. >> it changed the way we look, a., a blackwater and the work at contractors in iraq. >> it did. ultimately it led to kind of down fall of the company and you kind of see the snow ball effect. that day was a day like any other. there were contractors in the street and therapeuty were tryi clear it for another convoy

coming through. the contractors fired off with incredible fire power, 17 iraqis dead at the end of the day. the iraqi government saying its murder, get them out of here. the u.s. state department saying, that's not going to work for us, we kind of need them. >> let's take a big step back and let's talk about the role that contractors play in iraq, but if we can, let's broaden this out, they are working in afghanistan as well, correct? >> they are. >> let's talk about the role of contractors and the kinds of jobs they are doing? >> the u.s. has really changed the way it goes to war with iraq and afghanistan. >> absolutely. >> so a lot of jobs that troops were doing, whether it's i driving convoys from point a to point b or cooking break fast, are now done by contractors. they used to be done by members of the military. a huge shift. >> is there an overarching philosophy from the state department on the use, the role

of contractors because the criticism is it's akin to farming out war. >> it's not just department of state, it's also the pentagon and the cia and various other intelligence agencies, all doing it now. you've seen this seismic shift. but they do have guidelines. this september 16th, we talked about the shooting, has put pressure on the government to be more responsible, if you ask me, to work more on defining what is governmental. what job should not be ever given to a contractor or done by a member of the military. >> did the pentagon admit it was not doing -- >> the state department did. >> the state department did. after that shooting, the iraqi government was insistent on getting the company out and the state department went back and said, we don't have another company or enough troops in the military who can take over the function they are providing for us right now. we need time. >> the blackwater story is

fascinating. how did blackwater become the biggest player in this military contracting world? >> it's a perfect storm. you have it headed by eric prince who is someone who had enormous wealth on his own, military background, former navy s.e.a.l. and desire to make a business out of providing the government what it needed and what it did need. >> eric prince has a personalty. you were so good. i wanted to dig into the more zell ashs aspect. you focused on his company. he is a complex individual. >> well, his private life stuff is not my thing. >> you're good. >> like stay away from it, tony. >> he's an incredible drive that dictated the personality of the

company for quite a while. he wants to get things done and doesn't want to take no for an answer. sometimes it seems like a good things but -- >> as i hold up the book, "master of war", your first book? >> yes. >> and doing well, you're selling copies? >> yes. >> we love you around here. what's the big actor, who's looking at at least possibly doing -- >> there are -- you know -- >> i can. we'll see if there will be a movie. >> this guy is a really compelling character and trust me -- >> kinds of looks like nick robertson. >> it's a great story. you've done some blogging for us? >> i did, yeah. >> more of suzanne's thoughts on my blog -- log on to cnn.com/tony and check out her post. lawmakers trying to overcome opposition from republicans and

some democrats, house speaker nancy pelosi tells john king she's confident democrats will come together. it is the speaker's job sometimes, are you worried your family is coming apart on this? >> absolutely, positively not. i take in bill to the floor, if will win. but we will move forward thrks will happen. >> well, some members of both parties say it will take gop support for getting a reform bill pass. the senate minority leader wants to put malpractice on the table and back to the drawing board. >> we've basically been negotiating off the set of democrat preferred options, shall i say. we would like to start off with a genuine bipartisan approach. let me give you the kinds of things we ought to be able to do. we know we're losing billions in

junk lawsuits against doctors and hospitals. we don't see any kind of legal abuse, reform in any of these proposals. >> let's get an update with the negotiations and legislation. senior congress at correspondent dana bash. let's start with the house, where are we in these negotiations? >> reporter: we're in a place where the clock is starting to tick faster and louder because at the end of this week, the house is scheduled to go on their month-plus long august break. you heard nancy pelosi say it, she still is hoping and insisting they are going to try to get this actually passed by the full house by the time they go away. it is looking extremely hard, not impossible but extremely hard to do that. the fighting still exists and continues among democrats. you still have those conservative so-called blue dog democrats fighting for a lot of

changes in their party's plan. has not changed. you had some negotiations among staff over the weekend. we expect talks to continue today but so far the ball hasn't moved much. maybe it has moved back a little bit. over the weekend, tony, they got pretty bad news from the congressional budget office. do you remember last week, one of the only things they could tout in terms of congress is the fact the president and conservative democrats and house leaders agreed to an independent commission to set medicare rates. why does that matter? it matters in terms of the overall objective of cutting cost. they thought, this is a great way to cut cost. the congressional budget office said that would make about $2 billion. 2 billion compared to the trillion dollar price tag. that's a drop in the bucket. >> where are we on the senate side of things? have we yet to get anything from the senate finance committee? >>. >> reporter: nothing yet. things move a little slowly on

monday mornings on capitol hill. probably about 5:00 we're told those bipartisan negotiators, see the pictures right there, six of them will get together again. there is still a hope at the white house and amongst senate democratic leaders that they can have some bipartisan agreement or some concept out of the committee by the time the senate leaves for a recess, but over the weekend we heard the key players in the room pretty pessimistic that that is possible. we'll see what happens. >> we'll keep watching, dana bash, good to see you. >> what goes up, must come down. a builder who rode the housing boom is dealing with the housing bust. how is getting by and does he regret his work? i was in the grocery store when i had a heart attack. my daughter was with me.

i took a bayer aspirin out of my purse and chewed it. my doctor said the bayer aspirin saved my life. please talk to your doctor about aspirin and your heart. i'm going to be grandma for a long time. po@@ ♪ ♪ to my family [ female announcer ] clean you can see. softness you can feel. tide with a touch of downy.

some of the hardest hit business owners in the recession is home builders, alan chernoff

has a story of one builder who's strategy for survival depends on uncle sam. >> reporter: accountant gave up a secure number crunching career for the nail banging of home building. his timing was perfect 18 years ago. he rode the housing boom to build a thriving business. employing a dozen full-time employees, putting up as many as 50 homes a year. >> people need places to live, that is the american dream. >> reporter: after two decades, the housing bust has been a business nightmare for him. today he is down to two full-time employees and building two homes of this year, two of which are unsold. >> right now, you just living for a better time. >> reporter: home builders are suffering in every state. the business is down by

two-thirds nationwide since peaking in 2005. new jersey is doing a little better than that, you would never know it talking to kratelli. to survive he is turning to uncle sam, not for a bailout but a piece of the stimulus pie. bidding for contracts to repair military recruiting centers as well as other government business and to improve his odds, he is partnering with larger companies experienced in doing construction for the military. >> people need to work and my company needs to work. >> reporter: a lot it riding on his bid for new business. he has a son in college and a daughter about to enroll. they already have had to raid their 401(k) and tap our savings. >> do you regret having left accounti accounting? >> no regrets. >> reporter: even now? >> sure. i always said we can go back and do that. >> reporter: he is optimistic

he'll win a contract from uncle sam to eventually rebuild his business. alan chernoff, cnn, manchester township, new jersey. >> for more, tune in to cnn at 8:00 eastern time thursday night. it keeps my airways open.. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways.

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i think i'll go with the preferred package. good choice. only meineke lets you choose the brake service that's right for you. and save 50% on pads and shoes. meineke. chad myers, have you seen the most recent pictures from the space shuttle "endeavour"? >> yes, doing mundane jobs. >> yes. >> here's the thing, the astronauts are taking part in the space walk right now. i guess the watch word is to go slowly because there have been

issuewise carbon dioxide, take your time, don't push too fast early. and get through the spacewalk successfully looks like it's going on right now. >> anybody who has ever done a dive will understand what that means, especially if you're doing anything like going on a deep dive or working on a dive. you can begin to use up your oxygen very quickly if you're huffing and puffing. let the recycler work and everything will be just fine. they are so far ahead on this. really take your time because we've got nowhere to go and a lot of time. so that's the good news. we talked about these walks over the weekend. they didn't go as well and they are really going very well. >> on schedule to undock tomorrow from the space station. >> and be back here on friday. >> rain showers and thunderstorms. one area that's really getting affected is dallas-ft. worth

with cloud cover. we have a live short from wfaa from dallas. when you're trying to get all of the planes on the ground at the right time. you have visibility down like this but can't see the next building in the background, you'll slow down the airports, boston, and cincinnati and houston, down to 30 minutes, we talked about this earlier in the house and had rob talk about this earlier, a water spout over the causeway, a little bit of a spout as well. if you want to go on toto the ll tampa affiliate websites have pictures. you can see those small little -- a small water spout won't hurt you unless you're close to it or unless it comes on land. it will do damage if it comes on land. i don't know if you've seen this, 5,000 ratings on youtube,

have you heard them do the rain? >> do you have that? >> i have that. >> i would love to see it. >> it is terrific. are you going to tee it up for sn us? >> i'm going to be quiet. >> let's watch it. >> all they did was jump on the stands and cause that awesome stand thunderstorm as well. then they sing toto the rain down in africa after this. >> that's terrific. i saw a bit of it. started with snap, a light rain. >> then some of them doing this -- it's fantastic. >> good stuff. thank you, sir. >> what are cnn.com viewers clicking on the most.

nicole is following that for us. >> sex, lies and a little bend and snap. did i get your attention? >> you did. >> most popular stories on cnn.com. we'll have that coming up. airwa. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways. to help me breathe better all day long. and it's not a steroid. announceit keeps my airways.

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well, doctors see heat and too much work caused french president sarkozy to collapse while jogging yesterday. he left the hospital after a battery of tests with his lovely bride right there with him. all of the tests came back normal. doctors ordersed the 54-year-old president to take it easy the next couple of days. it is not the finish the seven-time winner is accustomed too but pretty darn impressive, 37-year-old cyclist, lance armstrong finished third in tour defrance. his teammate came in first. there he is. armstrong talked exclusively with our dr. sanjay gupta after taking the podium. >> coming in first, is that something you thought about? did you care?

>> do you care if you come in first or not? >> well, i wanted to come in first. but sometimes in sports there's somebody that's better. and i was that guy for seven years and i never understood what it felt like to get second or third. i'm 38 now and you race guy that's are 24 or 25 or 26 and they are fast or strong, they have acceleration. they have all of things that you had at that age. and you get third. that's the great thing about the tour, the best man always wins. >> 37. 37 years old. >> looking good. >> a month out there riding a dog gone bike. to me feels like -- let's find out what you're clicking on at cnn.com. >> numbers don't lie, when you have spandex in a headline, you're going to get a lot of clicks, what can i say?

>> comic-con is wrapping up, $125,000 people showed up for the largest comic book, movie and pop culture convention. this is like ground zero for all things cool. people went crazy when they saw stars from twilight show up. johnny depp was there as well. also, sex in saudi. foreplay, sexual con quests and pickup lines all ta boo in saudi arabia. a man was arrested after talking about the scandalous things on a channel. now saying, i'm sorry. men and women are not allowed to mingle, so don't two there. it is not for you. >> all right. >> she taught me not to settle for american pie. she taught the ladies how to

bend and snap and gold diggers everywhere, the value of soup in best in show. jennifer cool ij, one of the funniest actresses out there. >> his mom has got it going on. >> i interviewed her along with my colleague. she talks about how they relies on her resume. kids, don't try this at home. >> bends an snap doesn't really work because it doesn't make sense. you don't really -- what would really work in bend in snap if i could redesign, i would have bent over and really have grabbed my breasts. >> i will say, tony, that that interview was quite revealing. >> why are you looking at me like that? >> did she say what i thought she said? >> that's at cnn.com, most popular. >> nicole, appreciate that. thank you. hundreds of people lining up in the middle of the night.

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if you don't have health

insurance, take a number and get in line. the site of a massive free clinic over the weekend, wjhl affiliate tells us more people are asking for help than ever before. >> 65, 66. >> reporter: before dawn friday morning, hundreds of people wait for their number to be called. >> i got here about 9:00 last night and i'm 790. >> reporter: for many camping out was necessary. by sunrise tickets were gone. >> midnight, 28, 29. >> last year at midnight we were at 300. >> i'm seeing a growth. seeing each clinic becoming larger. >> reporter: without these clinics. >> wouldn't get what i needed. >> be without.

>> i wouldn't be getting glasses. >> reporter: it's not your typical doctor's office here, but this weekend about 1600 patients each day will be served. at least 1100 pairs of glasses and 28 pairs of den tours and over 3,000 teeth will be taken out behind me. >> reporter: volunteers get time and supplies. >> a set of den tours in my practice is about $2500. that's a pretty good sum of free work when you consider the labs donating their part of it too. >> reporter: because people need it. >> it blows my mind how many people are here who don't have medical care. >> reporter: volunteers share what they can. >> the feeling you're driving home from wherever it is knowing you turned out a thousand pair of glasses and that's a thousand people seeing sharper than earlier. >> reporter: even if they have to wait all weekend, in wise, virginia, dana walker. >> we're pushing forward with the next hour of cnn newsroom right now with kyra