the giants would lose. >> she said you never pick the giants. love live tv. >> way to hang in there, buddy. >> erin burnett starts now. don't go anywhere. -- captions by vitac -- www.vitac.com thanks, john. panic on a cruise ship. new video tonight from on board the italian cruise ship showing a frantic evacuation and a tsa showdown. senator rand paul blocked from board i boarding a flight after refusing a pat-down. and news on beginning itch's work for freddie mac. we have the contract just released. let's go "outfront." good evening. i'm erin burnett and tonight, breaking news. the truth behind newt gingrich's

ties to freddie mac. literally, within the past eight minutes, the former speaker released records explaining his connection to the taxpayer subsidized mortgage giant. i've been reading through it, it's a 15-page contract and this is a contract for just one year, 2006. now, the speaker worked for freddie mac for several years, so 2006 is the only year that i have in my hands and here's what i can tell you it says. it says that the gingrich group had a $25,000 monthly retainer fee from freddie mac. he said that adds up to $300,000 a year, which is the maximum for the year 2006. i want to emphasize this is one out of the six that he worked for freddie mac. now, he was a consultant and he released this to make that point, to try to continue to make the distinction between consultant and quote unquote

lob lobbyist. he said he warned them about the looming housing crisis. >> i have never done any lobbying. i said to them at the time, this is a bubble. this is insane. this is impossible. turned out unfortunately, i was right. >> but when he was working at freddie mac from 1999 to 2002 and from 2006 to 2008, gingrich saying a much different tune. extolling the benefits of freddie. in an interview posted on freddie mac's website, this is my favorite quote. the former speaker said quote, i'm convinced that if nasa were a government sponsored enterprise, we probably would be on mars today. we have a much more liquid and stable financing system than we would without the gses. that refers to freddie mac. stable? housing prices are down 24% from their peak and the facts are, no matter what you believe about

freddie's contribution to helping people buy homes in this country, the fact is that america's home ownership rate today is about 66%, almost identical to canada's 68% and canada has no taxpayer subsidized institution like freddie. and more r outrage. freddie still owes 56 milli$56 billion to taxpayers. that's part of the $71 billion bailout they were handed during the crisis. that is more money than any bank in this country ever got. so just how much will gingrich's ties to freddie mac hurt him in florida? in florida, 44% of homeowners at this moment with under water on their mortgages. the average home in florida worth half what it was when newt gingrich worked for freddie mac. douglas is a former economic adviser to the 2008 mccain campaign. john avalon is a cnn contributor. what do you make of that?

he's putting out one year to say yes, i know, sounds like lobbyist. is that going to be enough? >> i don't think so. people are going to be interesting, motive republican primary voters, and the american public in general. the nature of his activities. mr. gingrich is a long time washington insider. freddie mac was one of the people he worked for. i'm sure there are many more, and people are going to want a full disclosure of the nature of his activities. he was in the business of influencing public policy and the broad opinions toward those public policies and i think people want to know the nature of these activities. >> i think that's true and john, there were a lot of people who missed this. that's not necessarily the point. but when you are receiving money from a company that still owes $51 billion to taxpayers, you look not so good.

>> this is not a crystal ball that looks good right now. this is an academic distinction p. people know historians don't get paid $1.6 million. otherwise, there would be a lot more of them. really, we're going to readjust the entire thing. but if someone's consulting and giving advice and their analysis and they're that far wrong, that can become an issue. >> and doug, how does that play out? >> a lot of people got this situation wrong, but you have newt gingrich come out saying barack obama should give back the money he gave in campaign donations from nmci freddie mac. should he be giving back the money from consulting fees as it was crashing? >> whether you got the housing bubble right or wrong -- i've been wrong many times.

i'm going to become a historian. fannie mae and freddie mac were gses and there was always a concern going back to 2001, 2 2002. there were many who warned about the problem who were worried about the structure of the gses and the congressional budget office wrote about this. the crew question is how consistent were his views and he said this is fine, then said no, they should never have been that way. >> the fight in florida, we're eight days away from the florida primary. both campaigns biting hard. >> not the most popular name. >> we'll check that out. what's important here is you've got a huge number of -- number of under watt err mortgages,

200,000 foreclosures each year. the economic pain that floridains are feeling will translate. >> this also lends itself to the broader conversation that newt gingrich is it seems going to have to have potential voters, which is do you believe that the government is who should be helping you get a home, encourage home ownership or is this something is government should not be involved in. at this time, he was promoting the government. >> there is no question about it. there is now and will be over the next several years, an ongoing policy decision about what is the role of the federal government in house purchases and finance. he owes the american people an explanation. i think the biggest issue he's going to face is he is trying to portray himself as a product of the tea party. he is no more than i'm a product of the seattle liberals. he's been in washington for all of the time i've been in

washington. deeply involved in the int ra kwasis and efforts this this town. the authenticity of his campaign vael the issue. >> newt is a government reformer. romney's going to have a problem here and in nevada where there's a lot of under water mortgages. when he told the board he thought the process should play out and hit bottom, that could rub a lot of people the wrong way. >> thanks very much to you and by the way, emphasizing again, i have one contract here just released eight minutes ago. i guess now, it's 16 minutes ago, but doing the math, assuming newt gingrich was paid $25,000 over the time, that would be $1.8 million from freddie. but that's based off the one-year rate. things get ugly on the campaign trial. romney and gingrich trading shots in florida and then, senator rand paul. something happened to him that may have happened to you, but he

fought back. refused to pat-down, got banned from a flight. and police using phones, cars and watches to track you and until today, they didn't need a warrant. the employee of the month isss...

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the tsa got personal today. when the outspoken libertarian leaning republican refused a pat-down at the nashville airport. an alerm went off when paul went through a scanner. that happens to me. i usually take the pat-down, but paul did not want to. but he wanted to go through the body scan again. and you know, we know they don't like it when you do that. so he wasn't allowed to get on hids flight, but laughed it off later. this is a serious issue for the senator. senator paul comes out tonight. let me ask you, senator paul rand, what really happened today? >> i did offer also to show them my leg. i pulled my sock down, but they really weren't sbrinterested. they wanted to do the pat-down and i said i'm happy to walk back through the screener, which i've done as other airports

before, been rescreened, and they weren't willing to do it. i had two tsa agents admit to me that the screener isn't always going off because it sees something. it also goes off because it's part of a random screening process and i think most airport passengers don't know this and we're sort of made to believe oh, it's okay to do the pat-down. it's actually random. >> it happened to me the other day and they admitted it was random. but let me ask you because i know you're frustrated with them and you don't like them, was there any theatrictheatrics? rand paul acting out a little bit? >> no, but i wouldn't put it that way. i wouldn't say i don't like tsa. there is a need for security at our airports. most of the tsa agents i see are

good and pat me on the back, but they're stuck with rules that don't allow them to have any consideration. i want the manager on the floor to have some discretion to say we don't have to do a pat-down here. i want them to have a trusted traveler program where business travelers can flow seemlessly through the airport without being harassed. >> i hear you on that point, but when you look at the trk sa, 70 million people go through those scanners. what if, god forbid, they thought someone looked normal and didn't submit them to the extra check and that's the person who blows up a plane? >> there's always the what if, but if you had a frequent travel terror program, you would sign up, give background information voluntarily. you would still go through an x-ray machine, but you wouldn't take your shoes off, your belt,

but wouldn't have to go through a pat-down search. we've had 88-year-old women having an adult diaper taken off. an 8-month-old child, the same thing. a 6-year-old girl from my town had an agent putting their hands inside her pants. we've gone too far and are not using our brain. let's use common sense in trying to figure out who r the people who want to ait can us. >> how did you get on the plane? >> well, i was detained for a while. and then when they got tired of detaining me, they then injected me and sent me outside under sort of duress. >> oh, ejected. i think you said injected. >> not injected. i was detained for a while and every time i tried to leave the cubicle, i was detained. then they got tired of me

because i made phone calls. they said, if you use your phone, you'll get the full body pat-down. >> is that just maybe of terms -- >> if you're told to get back in the cubicle, is that being detained? but then they got tired of me on my phone and they knew they were created more problems, so they forcefully ejected me and you know what they did in the end? they said if you go through the screener again, we'll pretend like it didn't happen. then the screener didn't pick up anything. so either the screeners aren't working or i was being suggested to a random pat-down, which i don't think the helping any of our safety. >> i want to do one final question for you, sir. i spoke to newt gingrich the day before the south carolina primary. and i asked him about your dad and he had a lot of praise for him. here's what he said.

>> it's a fact of life ron paul's going to get a significant vote and it's a fact of life that you want to find something that would give him a strong reason not to consider a third party and so you've got to say o kay, under what circumstance, he has a legitimate role. and you want to find something we're compatible on that you could find something to do. >> is there a something? >> well, i think one thing that ron paul has brought to the republican party is he's been a long time republican, but when you poll him against president obama, he's beating president obama by seven points among independents. he's bringing young people and independents to the party, so i think newt is right. they need to embrace ron paul and say we want you to be a prt of our party. we want all these new, young people. but in some ways, they have to embrace ron paul's message, because it's not about ron paul as a personal figure.

it's about my father's message that brings the young people. i think there is room for him in the republican party. there's room for me. we're not all the same, but most of us do believe in much smaller government than president obama does. much less taxes and much less debt than the president does. >> rand paul, thank you very much. apologies for the snafu with your name at the top. you were gracious. have a good one. tonight, under surveillance, how the government is watching us and we're talking about g prk s. in cell phones, cars, boats, planes. you can get it now in a wristwatch for as little as $100, but it's also used by police to track suspects. until now, they didn't need a search warrant, but today, the supreme court ruled that the police have to have a warrant in order to monitor a suspect with

the gps device. paul cowen, the case today was a suspected drug dealer. tracked him for 28 days. should they be aloud to do that? >> well, there's a big disagreement about that. those who support law enforcement officials and including the obama administration, people think it's a liberal administration. the justice department said they did not wrong. a search warrant expired after 11 days and they tracked the guy for 28 days, nailed him and then he got sentenced to life in prison and the justice department says it's okay. >> the obama administration supported the position that no warrant was required by the police. >> and i think people would be shocked by that. civil libertarians say they should have had a warrant. you can't have this sort of

unrestrained surveillance by police forces in the united states. >> what's the reaction going to be? >> people were hoping for a monumental decision about these new digital surveillance techniques. gps is kind of an old one. they were hoping the court would hand down a big decision, but it was a very confused decision. the only thing they agreed on is that they pres passed on somebody's property. can you follow somebody for 28 days and as a result of knowing where they go, then you arrest them for criminal activity. people thought we'd get a look at infrared, all these techni e techniqu techniques, but we did get a hint that a lot of supreme court justices think we need new laws in this area. that americans' privacy is being

violated by these techniques. >> remember, everyone, to turn it off. you know, you can turn off your g prk s thing. i think they're always watching. all right. got to go. >> okay. >> next, where is michelle parker. there is new video showing the missing mother just hours before she was last seen. it's a story we've been following and we're going to talk to her sister tonight. and the end of the line for one of your favorite television characters. the shat goes splat in tonight's number. [ male announcer ] in a small business, it's all you. that's why you have us. at staples, we have low prices on everything your small business needs. staples. that was easy. on everything your small business needs. montgomery and abigail higgins had... ...a tree that bore the most rare and magical fruit.

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sad news today. william shatner is dead. well, not really, but one of his characters is. in a new ad, shatner's negotiator is seen helping passengers off a bus moments before it falls off a bridge and explodes. it's part of the company's plan to stop its name your own price option that shatner has promoted successfully for 14 years, but don't worry, the shat is still under contract with price line, which brings me to tonight's number. 46. that's how many seconds it took for priceline.com to tell me there were no flights that matched my cry tier yachlt i searched for a flight to dubai. i entered january 24th as departure, january 28th as

return and i waited and waited. while i waited, i saw shatner doing karate and posing with something that looked like a gigantic pimp, then priceline said they don't even have any flights. 46 seconds is a long tile, so i tried another site. k kaya krk. maybe he got out at the right time. what's your favorite travel site? let us now. still "outfront," the outfront five. hanging by a thread. legacy versus lawsuits. all this in our second half. ea . they genatectry, wch le me rf t.

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we start the second half of our show on stories we care about and tonight, we begin with two people dying, 100 injured. there's been severe weather in the southeast today. one of the hardest hit areas was jackson county, alabama. officials there are telling us the storm destroyed more than

200 homes and damaged another 200. we're told that number will rise. alabama governor robert bentley has declared a state of emergency in all 67 counties. two, the u.s. has imposed sanctions on iran's biggest bank. the european union put pressure on iran saying they would ban oil imports. but the truth is, the u.s. and europe are not able to stop iran from getting the money it needs to build nukes. an analyst says one-third of tran transactions go through dubai and has been used a long time by iran to conduct back channel trades. three, gabrielle giffords will resign from congress this. daniel hernandez seen here hugging the congresswoman is credited with saving her life after a gunman opened fire at a

congress on your corner event january 8th, 2011. we talked to daniel hernandez after today's event and he told "outfront" that giffords talked to his mom and said, quote, she was always a fan of my mother's cakes and today, mentioned her name. number four, the new ceo of rim, said today that better marketing and product rollout are key to keeping the smart phone alive. market share has dropped below 10%. they need a change at the top, however, experts believe a change in markets will not be enough to turn around blackberry. it has been 171 days since america lost its top credit rating. we are hopeful congress to going to do more this year. only 90 public laws were passed in the senate in 2011.

that is the lowest number since 1995. forget positive campaigning. mitt romney and newt gingrich are going after each other today in florida. >> the you've been campaigning for six years, and you begin to see it slip away, you get desperate. and when you get desperate, you say almost anything. >> you look at the speaker's record over time, it's been highly erratic and in the case of the speaker, he's got records which could cause an october surprise. >> all right, plus breaking news tonight. newt gingrich releasing his 2006 contract with mortgage giant freddie mac. and that's what we've been looking through here today. it happened just a couple of moments before our program. gingrich's director is with us, along with adam goodwin. oh, love you guy haves to stand

side by side. that way you can't be too nasty to each other. let message start with you. i'm reading through this contract and this is just one year, 2006. newt gingrich's contract with freddie mac. $25,000 a month. but i just am looking at one sentence in here. the consultant will supply copies of reports filed by law such as reports filed under the lobbying disclosure act. it would seem this does not probt lobbying. >> in fairness, i haven't seen the contract. i just heard of this news from you. i've been focused here on florida and getting our team organized and running an election in the state, so i defer that to some of the smarter folks who know what's in that contract. >> let many ask you, adam, is this enough that newt gingrich has put out the year 2006 for his relationship with freddie

mac? one of six years. is that enough for your campaign? >> here in florida and welcome to florida, by the way. here in florida, home foreclosures have been a very, very big deal. that is about as hot as it gets. miami-dade for instance led the nation. three times the national average in terms of foreclosures. gotten worse, not better. the whole issue about someone getting millions of dollars from fannie mae, freddie mac, that really bothers people. that is a huge issue regardless of what the contract yul terms say. >> jose, what's your point? >> if i could jump in. at the end of the day, we're seeing a candidate with really no substance. they're attacking the speaker and trying draw a distinction.

the speaker is the only true conservative in this race. the only reagan conservative that can do the things that need to be done. this is just another attempt by the romney campaign to try to distract voters not to talk about the issues. to talk about things while they seem important, they don't want to get down to the core and be able to debate gingrich on the issues here in florida. >> this is politics, okay? adam, mitt romney says he's going to be releasing his tax returns tomorrow. now, this is really important. people are going to look at these. can you tell us what we're going to see? >> i like jose. i haven't really reviewed those documents at all, actually. i think it's going show a guy who's got a big heart and also someone, last night, actually, we were in daytona beach, close to the speedway, which jose knows very well. i found mitt romney coming out

of south carolina as someone with a great heart. there was a crowd of over 2,000 people going nuts for him. i think this race is going to move in the direction the romney team moved in the very beginning, which has solidity, the tremendous track record, a wonderful family guy. i think in florida, it's going to be a very strong campaign. >> all right. thanks to both of you. going to keep going through the freddie contract and we are going to comb through those tax returns tomorrow. and now, let's check in with anderson. what's coming up? >> we're going to have the latest on the news you're reporting on, after a lot of pressure, they have released part of gingrich's consulting contract. the bigger story appears to be what isn't in the contract. no specifics on what the mortgage giant paid gingrich to do. plus, more on the severe weather in the southeast that left two dead, hundreds injured. the pictures, unbelievable. hundreds of homes destroyed or

damages. reynolds wolf joins us from clay, alabama. plus, we go up close. it has been just over a year since gabbie giffords with was gunned down. she's going to step down to focus on her rehab. dr. gupta joins me live. >> thank you very much. we're looking forward to that and up next, we're going to take you inside that italian cruise ship. we have video that came in today on board the ship literally as it was sinking. and new clues into the disappearance of michelle parker. her center with us, next.

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we do this at the same time every night, our outer circle and we begin tonight in italy with a cruise ship disaster. tonight, we have newly released video of the moments just after the costa concordia ran aground in italy. honeymooners denise and david were among the first to evacuate and david captured moments of sheer panic on his camera. now, as the rescue mission continues, officials announce that two more bodies were recovered in the area near the ship's internet cafe. that brings the number of con if i wered deaths to 15. a new phase of the operation began today. dan rivers has been covering the

story and i asked him about it. >> it's been a watershed day here. finally, they have now formally started the salvage operation to empty the fuel. that starts with one of the 13 fuel tanks. 2.5 thousand tons need to be removed. >> and next, in nigeria, where blasts killed at least 157 people and left police headquarters and government builds in ruins. nigeria is the most populous country in africa, split between muslims and christians. the group claimed responsibility according to a nigerian newspaper. the group has been blamed for months of widespread bloodshed.

>> they seem to have multiple targets depending on the particular attack at hand, but at its root, i think they're looking to dely jit miz the administration, the sense among northern muslims that this group is illegitimate. >> and now to afghanistan and the development in the taliban talk negotiations. in meetings between the u.s. special envoy, karzai's government indicated it is will be. however, ambassador grossman said no decisions have been

made. a senior adviser at the center for strategic and international studies and we said what needs to happen before official talking with the taliban can start. >> we need to find out if the taliban are serious. they haven't been in previous talks. second, we need to keep karzai on board and thirdly, pakistan has to be a part of this. there will be no long-term political settlement unless the pakistanis are are involved. >> he was the winningest coach in division i history. the 85-year-old former penn state football coach died sunday from lung cancer. they are honoring the legend, but there are so many questions concerning the program. paterno's former assistant coach is jerry san dus. he was charged with molesting ten boys. several more have come forward. before he died, paterno said he

wished he had done more. sarah gannon is in state college tonight. i know you spoke to scott paterno, joe paterno's son. what did he say? >> he told me that his father died in a way that he wishes he has the courage to die that way when his time comes. he said he was completely at peace with his life. he told his children, just take care of your mother. he kept saying that over and over again. that you know everything he has accomplished, in his life, he has done with his wife by his side and really moving forward, they're focused on their mom. they're concerned about her, but they're really looking forward to celebrating joe paterno's life and legacy in the coming days at a campus memorial service on thursday. >> is there any indication from

your reporting on this as to whether joe paterno's death will impact the case against sandusky since he was the won that mike mcqueary told that he saw jerry sandusky abusing the boy in the shower? >> it's a good question. a lot of people are are asking that now. what legal experts are telling me is that joe paterno's statements would have been a dramatic moment in court for sure. that people would have wanted to hear what he said. there's going to be some unanswered questions because he now can't take the stand. however, as far as it being crucial to either of the two cases, probably wasn't going to be crucial or key and the reason is because he really was just a piece in a timeline. the key people here are eyewitnesses and victims. and in the perjury case, the key people are the two defendants and the people they talked to directly. so, you know, of course people wanted to hear from joe paterno,

but is it going make a huge difference in the prosecution or defense? people are speculating that the answer is no. >> we appreciate it. well, it has been nine weeks since michelle parker disappeared in orlando, florida. on friday, she turned 34 and police have released new video of her. this is significant. we've been covering this story, there had not been any video. this is video of her at a fast food restaurant. that is zooming in on our face there. michelle was last seen dropping off the children with her exfiance, dale smith. he has custody of their children. they had a relationship which ended in a fight over an engagement ring on the people's court. lauren ericson is michelle

parker's sister, and the attorney. i wish you weren't here because i wish this story ended and ended well, but you are. lauren, the new video released of your sister coming through the fast food, it helps police with the timeline of what happened to her and where she was. have they learned anything from this video? >> the video itself, it just shows her going through the drive through, getting lunch. it just shows it was a normal day. she was on the way to a beauty simply store that day to pick up color for her salon, but as far as anything significant, it doesn't really show too much. >> let me ask you, my understanding is and tell me if i'm wrong, there was a decal on the back of her car, which apparently was not there when they actually got the car. is there any, in your view, significance of that?

or what did it say? what's your belief and what are you hearing from police? >> that's correct that when the vehicle was found the next day, that friday, the were off of it. in the video, when she went through the kfc, the stickers were still on there. we saw her 2:30 that day in the salon. i remember watching her leave and know the stickers were on it then. the time between when she was last seen and it was found when it was taken off. >> what's your thoughts on the video of what happened with the timeline and michelle? >> it shows they're doing a great job and searching on every single tip that comes in and have it narrowed down to her driving through a fast-food restaurant. the significance is it shows they were on there before and later on, you know, in the timeline, those decals were gone. it show us, a, the police are

doing a great job and, b, the decals were removed and we don't know why. >> lauren, how are the children doing now? obviously, they're still with the dad? >> the twins are with the dad and austin, the oldest, he's back in school and doing all right. i haven't seen the kids recently. as far as their well-being, i'm sure they're fine. >> i know you're still searching for your sister. how often are you going out at this point? do you feel there's still stones left unturned? >> i feel, until my feet have crossed over every inch of the state of florida or until she's found there will be stones unturned. there will never be a stone unturned until the kday i see hr again or this family has closure one way or another or justice is served. >> matt, what else do you think -- i know you've always talked and said the orlando police department has done a great job. you had said before you want more assistance and more help.

do you still think you need more assistance to find out what really happened? >> erin, at this point, we're actually regrouping, in that sense this week. what we need at this point is a more organized effort. we're going to be assisting opd and the surrounding law enforcement agencies with that effort. we're going to be gathering our support group torque wi-- to wo with them to finds out what happened and say this is a high probability area, we believe she could be here and we'll get our people together and join forces with opd and hopefully, bring michelle home. >> all right. thank you very much to both of you. i appreciate your taking the time. we still all the viewers who have been involved with your story are all hoping there will be a miracle and a nice outcome. thanks to both of you. good to see you again. >> thank you. >> thank you. a strange thing happened in south carolina when we were there.

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while we were in south carolina covering the primary runoff last week, we made a stop at a company called firefly vodka, on a barrier island in the middle of nowhere. you might have seen a story on the show we did. while we were there, in between

drinks, the company told us about an amazing thing firefly vodka does for independent music acts. >> we do lot of promotions through indy bands. we offer our rv and pay for gas when they're on the road and we offer our studio for use for grata. >> it's a wonderful thing. we appreciate it? you're welcome. >> that's right. the company gives the bands a free tour bus. they can drive around the country, play shows and it doesn't cost them nianything, n even gas. all they have to do is park the rv, a giant billboard, really, see? it says firefly. they have to park it in front of the venue and mention firefly vodka when they're on stage. it's a great promotion for firefly and incredible get for the band. capitalism meets entrepreneurialism and freedom. the band we met, called yarn is

using it to play in south carolina, north carolina, georgia and florida. when we met the singer you saw talking a moment ago, he asked where we were from. we said new york. he said, we're from new york, too. it was a long drive, huh? we stopped in our tracks and someone thought we would have driven. we thought how amazing that would have been and how scheduled our lives are and how freeing a road trip is. we stood there talking about how amazing it would be to be young and in a band. we're not either one of those things but we did a road trip from charleston, south carolina to atlanta for election coverage, and flea markets and small stores and even porn shops. bottom line is yarn is doing what they want to do how they want to do it. stop when they have to stop, go where they want to go. we thought we'd play a little bit of yarn. by the way, it's an amazing plant. they have a great song that you're going to listen to here.

i'm waiting for the key line. playing good music and living the real american dream, it's pretty amazing. "sk "schenectady." hold on. ♪ >> schenectady. ♪ ♪ i've been waiting so long for you to comfort me ♪ >> we even know all the words. one word to you, yarn, if you make it big, you will end up having to fly and you will miss the good old days of the rv. thanks for watching. the state of any union is tomorrow. we're excited for that. anderson cooper starts right now. >> we begin tonight "keeping them honest" with breaking news on several fronts in the battle for florida. newt gingrich, a short time ago, trying to take a campaign trail weapon out of mitt romney's hands the allegation speaker gi