condoleezza rice for veep? before we go a to z with pros and cons, let's start with why. why team romney may have floated the balloon now. >> i'm going to work to reform and save -- >> reporter: romney getting booed at the naacp was running on a virtual loop. then suddenly an exclusive about a black woman being considered for romney's running mate pops on the drudge report. according to gop sources the go-to blog for a top romney aide when he wants to change the narrative. still, it's worth exploring. rice the running mate. first the condi pros. there are many. beginning with aforementioned would make the influential and romney happy. >> do you think he should nominate a woman? >> we've been looking at that. and i'd love that option as

well. >> reporter: rice has never run for office, but she's no stranger to presidential politics. by george w. bush's side during his campaigns. she's an intellectual with a good personal story. and a concert pianist. the former secretary of state and national security advisor would bring some needed foreign policy chops to romney's ticket, which brings us to the condi cons. she was a central bush administration player making the case for the iraq war, warning about saddam hussein's weapons of mass destruction that turned out not to exist. >> there will always be some uncertainty about how quickly he can acquire nuclear weapons. but we don't want the smoking gun to be a mushroom cloud. >> reporter: some gop sources tell cnn they can't imagine romney would want to reopen wounds from the bush years. last but hardly least, rice's stance on abortion. she calls herself "mildly pro-choice". >> i worry about the government

being involved in, but i'm like most americans. i think abortion is a terrible thing. >> reporter: one anti-abortion group already e-mailed around this clip of romney last year saying the running mates he would consider would be anti-abortion. >> i would expect they would all be pro-life and pro-traditional marriage. >> reporter: several prominent conservative leaders tell cnn rice's abortion stance disqualifies her because there's so much distrust of romney on the issue. >> he needs to have a running mate who is without question pro-life. but rather who has a portfolio of leading out on that issue and being a voice for the unborn. >> now, it's important to note that rice herself has had multiple times including to our own piers morgan that she doesn't want the job. and her statements appear to be more airtight and a bit more genuine that others who have said the same thing. though the timing of this trial balloon may be suspect, gop sources tell cnn some of romney advisors are and have been

pushing for her so much wolf that i spoke with a prominent evangelical leader today he heard this last week and called the romney campaign said please tell me this is not true because republicans and the base would not be happy about it. and hurt the base and not excite it. >> you have to weigh the pros and cons. you pointed out, there are pros and cons if you are the republican presidential candidate. dana, thanks very much. >> thank you. >> once again mitt romney is in "the situation room." jim acosta's getting ready to ask him some of the questions. maybe he'll ask about condoleezza rice. that interview will air in its entirety at exactly 6:00 p.m. eastern, 6:00 p.m. eastern right here in "the situation room." president obama's campaigning in virginia this hour trying to hold a long-time red state. he became the first democrat to carry since lyndon johnson in the '60s. jessica yellin is joining us now. she's keeping tabs on the president's travels. jessica, he's doing a lot of

traveling. >> reporter: he is increasingly, wolf. and the most recent polling shows that the president in virginia is ahead of romney in the state by five points, but that doesn't necessarily mean all that much for the obama campaign. because the same poll shows that 6% of voters there are still undecided. that means that state is up for grabs. and today the president went after that state's military vote. last time president obama won virginia by six points. >> when we win virginia, we're going to have won the election. >> reporter: this time he'll have to fight just as hard. >> i am going to need you more than ever in 2012. >> reporter: at least 12% of virginians have ties to the military, and the president is targeting their vote. >> we have gone after al qaeda, decimated their leadership ranks, taken out osama bin laden.

[ cheers and applause ] so now i think it's a good time for us to take half of those savings that we've gotten from winding down these wars, use half of it to pay for the deficit. use the other half to do some nation building here at home. [ cheers and applause ] >> reporter: the romney campaign is vying for this group as well. in a letter printed in the virginia pilot newspaper, the republican candidate said of the president, the defense cuts you signed into law will hit virginians hard and potentially shutter virginia's military bases. he's referring in part to the threat of almost $500 billion in defense cuts that will kick in along with cuts to medicare and other programs if congress can't agree on a long-term deficit reduction plan by next year. virginia as a battleground is a new political reality. >> virginia has changed. it's no longer that deep south state that is very red, very republican. it is now more of a swing state

because of the dc suburbs in northern virginia. but it also says that this race is going to be so close nationally that a handful of states matter. and the swingiest looks to be virginia. >> reporter: and, wolf, with so much government work in virginia, unemployment there is at 5.6%, that's well below the national rate. that's a fact the president hopes will play well in his favor. >> he's going to have to energize the african-american vote in virginia to make sure they show up like they did four years ago in the northern part of the state, elsewhere if he's going to be able to carry virginia. i assume they're working on that. >> reporter: that's right. 20% of that state's population is african-american. and they are aggressively targeting those voters as well. as you point out, the goal there they are already supporters of the president, the goal is to keep the turnout rate just as high as it was in 2008. and, yes, they are working on it aggressively. >> that's a major, major challenge. thanks so much, jessica yellin. we're expecting president obama

to deliver another speech in virginia this hour. you're looking at live pictures right there. we're going to show you some of the highlights and maybe carry some of it live as well. the president of the united states getting ready to speak to another group in virginia. our political director, mark preston, is joining us now here in "the situation room." mark, as you know, our own jim acosta getting ready to do an important interview, sensitive subjects with mitt romney. what does romney need to do on this day to get some of these other controversial issues behind him so he can move on and talk about the economy? >> two things. he needs to change the subject clearly. there's been a lot of questions about whether -- what time did he leave bain capital, but he really needs to focus on not only getting past that, but to focus on the economy. that's where he really shines his best. he needs to talk about how, wolf, he can be a job-creator. how him as a businessman should be the ceo that leads the country at thistime. and what's interesting is i think this could be the beginning of the message war that we're seeing in the presidential campaign.

we saw president obama do an interview with cbs which will run in length on sunday. and now we see these interviews that mitt romney's conducting today hastily put together, very quickly put together. he's talking to everybody. and i think we're starting to see mitt romney come a little bit out of his shell that we haven't seen in the past. >> how vulnerable is he on the refusal so far to release one year, maybe two years assuming he releases 2011 income tax returns, he's filed an extension for that. how vulnerable is he if he doesn't release several years passed? >> it feeds into a narrative that he's being very secretive about what his holdings are, how wealthy he is, and to a larger picture, what is he going to be like if he's president? is he going to be as secretive and open? that's why we're seeing the obama campaign hit very hard. interesting to hear president clinton come out the only way president clinton could not necessarily to attack mitt romney, but what he did was to say he was perplexed and surprised.

>> he was so smooth. >> he was so smooth. surprised he wouldn't release this information. >> on the whole issue of bain capital, what's the difference -- why is it such a big deal if he left in 1999 as oppose today 2002? we know in 2000, 2001, 2002 he was effectively running the winter olympic games in salt lake city. why is it such a big subject? >> one issue is the fact did mitt romney lie to us? did he lie to the voters and say in fact he had left bain capital when he had not? >> he said he left in 1999, but some documents show including one with the s.e.c. that he was still there in 2000 and 2001. >> still very much in control in 2000 and 2001. it comes through a credibility issue. is he being credibility and honest? at the same time it goes to the issue john king has a piece on cnn.com now km talks about one of the bain capital investments. one was in a firm that discarded fetuses, a medical company. and that could hurt mitt romney

when it really comes down to social conservative voters in the final week and john really details that as well. >> yes. the other sensitive issue is the outsourcing because the allegations were that after 1999 bain capital was dealing with some companies that were outsourcing american jobs overseas and not necessarily before. he says he wasn't involved in bain capital when they were doing it. but if he was involved, that would be another sensitive matter. >> it would be another sensitive matter and you hear the obama campaign call in the insourcer in chief and mitt romney would be the outsourcer in chief. that would play poorly in states like ohio and the rust belt. >> thank you, mark preston. our political director. once again, we're standing by, we're going to hear from mitt romney in "the situation room." he's going one-on-one with our political correspondent jim acosta. jim will join us live later this hour. the full interview with mitt romney will air at 6:00 p.m.

eastern in our brand new 6:00 p.m. eastern "the situation room" hour. up next, jpmorgan chase finally discloses how much they lost on this year's rather disastrous trades. the number's a lot, a lot bigger than officials first led us to believe. and researchers say chemicals, perfumes, cosmetics and plastic packaging may, repeat may, be linked to diabetes. ♪ hajimemashite. hajimemashite. hajimemashite. you guys like football ? thank you so much. i'm stoked. you stoked ? totally. ... and he says, "under the mattress." souse le matelas. ( laughter ) why's the new guy sending me emails from paris ? paris, france ? verizon's 4g lte devices are global-ready. plus, global data for just $25. only from verizon.

president-elect of the united states of america. >> excitement in virginia right now. looking at live pictures. they're getting ready to introduce the president of the united states, president obama will be speaking at a campaign event there. we're going to take some of that live. you'll see it here in "the situation room" this hour. virginia obviously a key, key battleground state. other news we're following right now including jpmorgan chase. it now says the disastrous investments officials first disclosed back in may were much,

much more costly than anyone guessed. $5.8 billion, billion, so far this year. originally they thought it was about $2 billion. but get this, the bank's stock still went up today. cnn's alison kosik is joining us from new york right now. all right. alison, a massive loss, more than $5 billion. that's what we know. we were originally told it was about $2 billion. >> right. >> but the company stock goes up. go ahead and explain what's going on. >> reporter: and you know, just so owe now, that trading loss is expected to go even higher. anyway, wall street is still pretty darn happy about it. jpmorgan shares rallied today up almost 6%. because, wolf, the way investors see it, they feel the worst is behind jpmorgan. they knew these big losses were coming. and guess what? they didn't think they were that bad after all. even with the controversy, jpmorgan has still made $5 billion for the april through june quarter, the second quarter. and it's made $9.9 billion so far this year.

plus, jamie dimon, the ceo of jpmorgan chase said they actually may make money on these risky trades that they made that they're unwinding. outside of this trading disaster, business is good atd jpmorgan, investment, retail and loan business. >> explain this to our viewers. a lot of them have 401(k)s how does this huge loss $5 billion or so for jpmorgan affect their 401(k)s. it's the largest bank in the united states. >> most people don't realize it's in a lot of their everyday investments. look at the total value held by mutual funds, it's actually more than $50 million. one person we talked with tells us that it's really tough to quantify at this point, but the trading loss isn't really likely to have a huge impact on your investments. you know, even with jpmorgan shares sliding 16% since this trading loss was revealed in may, shares of jpmorgan chase, they're still up 4.5% for the

year. so at least some investors may be making some money on jpmorgan shares despite this huge controversy. >> huge controversy indeed. thanks very much. good reporting, alison kosik. mitt romney takes a break from fund raising to talk to us. we're going to have a one-on-one interview with the republican presidential candidate. our own jim acosta will ask him about his tax returns, his departure from bain capital among other subjects. the interview will air exactly at 6:00 p.m. eastern in our new hour. also, another staggering death toll coming out of syria. protesters are demanding international intervention. i go? i go? instead we had someone go ahead of him and win fifty thousand dollars. congratulations you are our one millionth customer. people don't like to miss out on money that should have been theirs. that's why at ally we have the raise your rate 2-year cd. you can get a one-time rate increase if our two-year rate goes up.

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got anybody here? >> mark warner, he's pumping up the crowd. they're getting ready in hampton, virginia, to hear the president of the united states. as i've been pointing out, virginia being a key battleground state. they're all excited in virginia about some of the president's remarks live. we'll see what he has to say especially about his opponent mitt romney. mitt romney is sitting down with our own jim acosta for an interview. that will air at 6:00 p.m. eastern here in "the situation room." but there's other news we're

following as well including word of a massacre, another massacre in syria. and demands for an international envoy's removal. lisa sylvester's here. she's monitoring that, some other top stories in "the situation room" right now. so what's going on? >> hi there, wolf. well, the opposition reports syrian regime forces targeted a village and killed over 200 people late last night. opposition says yesterday's death toll was 287 making it the bloodiest day since the uprising began. special envoy kofi annan is ineffective and should be removed. we'll hear from two experts on syria within the next hour. rick santorum will make his first official campaign appearance for mitt romney tomorrow in pittsburgh. just a few days ago santorum said he hadn't been in contact with the campaign. the former senator has clashed with romney over immigration and health care issues. even after santorum suspended his own presidential bid, it took him nearly a month to endorse mitt romney.

and researchers say a commonly used chemical in perfumes, plastics, packaging and cosmetics may be linked to diabetes in women. a new study finds women with the highest level were twice at risk of having diabetes. one doctor says even if products say they're tlat free, the packaging still contains. and a chance to own arsenal of a couple legendary gangsters. arson officials expect two guns recovered from bonnie and clyde to go for $45,000 each. the colt 45 was strapped to one of bonnie parker's legs. the auction will be held september 30th. each one of those guns expected to fetch about $100,000. >> might even get more. people like that stuff. thank you. the questions are mounting. we're going to get some answers in our one-on-one interview with mitt romney with his career at

bain capital among other subjects. the interview will air at 6:00 p.m. eastern. and charges in a conspiracy to supply iran with the ingredients to make nuclear weapons. we have details of that case. that's coming up in our 5:00 p.m. eastern hour. i have to know the weather patterns. i upgraded to the new sprint direct connect. so i can get three times the coverage. [ chirp ] [ manager 2 ] it's like working in a giant sandbox with all these huge toys. and with the fastest push-to-talk... i can keep track of them all. [ chirp ] [ chirp ] [ male announcer ] upgrade to the new "done." with access to the fastest push-to-talk and three times the coverage. now when you buy one kyocera duracore rugged phone, for $49.99, you'll get four free. visit a sprint store, or call 855-878-4biz. [ chirp ] i've got a nice long life ahead. big plans. so when i found out medicare doesn't pay all my medical expenses, i looked at my options. then i got a medicare supplement insurance plan. [ male announcer ] if you're eligible for medicare, you may know it only covers about 80%

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romney's decision comes just one day after "the boston globe" started a fire storm about raising serious questions when he joined bain capital. joining us, howard kurtz and news week's washington bureau chief and the editor and chief of the daily download. howie, let me start with you. he's doing what they call a round robin series of interviews. all five of the television networks, news organizations, speaking deciding suddenly to be doing these interviews. what do you think is behind this strategy? not the first time a candidate or another senior official has done what we call a round robin series of interviews. >> well, it's about time because romney has been getting hammered. not just by the obama campaign and democrats, but by the media over not just when he left bain capital but offshore bank accounts, when he's going to release his tax returns. romney very reluctant to talk to the press, individual networks.

now he's doing five at once. they've decided they have to push back hard. >> why do you think he's doing it? >> i think he's doing it because he has to. any unanswered question doesn't bring silence, it brings more questions. if you don't come out and answer these questions, you're raw meat. >> so eric fehrnstrom or ed, if they had done a round robin series of interviews answering these questions, don't you think that would have worked? >> it's too late. especially when you have stephanie cutter from the obama campaign coming out and saying, hey, this could be a felony. they're playing hardball. he's got to come out swinging. >> this was after the romney campaign said the president of the united states -- the sitting president of the united states is a liar. >> earn fehrnstrom is a very important aide in the romney campaign. he's not going to get several minutes on evening newscast, mitt romney can. >> so you think this is smart on their part. >> obviously they've got something to say. he's got to answer these questions. why aren't you releasing all of your income tax returns? when exactly did you leave bain

capital? why did you appear on these s.e.c. documents in 2000/2001 saying you were still there when you were running the olympic games in utah? >> i think this may be overkill on the part of the obama campaign. all the tonnage it's dropped on mitt romney's head over the many events that happened 14 or 15 years ago. i've been increasingly worried about whether the media that have been pushing these stories seem to some people to be echoing the message of the obama campaign by raising so many questions about romney's business background. >> i don't agree with you. i think when it comes to this kind of stuff, the more questions, the better. this is a man that's running for president of the united states of america. ask the questions. answer the questions if you want to live at 1600 pennsylvania avenue. >> if you want to be president -- you know this, surprised to hear what you're saying because no more secrets. everything basically becomes an open book. if you want to be the president of the united states. >> i am not saying, wolf, that journalists shouldn't be asking these questions, probing romney's business background.

it is after all his principle credential for running and saying he's going to fix the economy. what i am saying is that when you combine all the stories, air time, column inches, it looks to many people -- i'll say it bluntly, like the press is giving much more aggressive scrutiny to romney and his background than it ever gave to barack obama. >> so what i'm hearing correct me if i'm wrong, mainstream media or liberal media doing the work of the obama campaign just like four years ago the conservative media doing the work of the mccain campaign going after barack obama and the reverend wright issues and other issues out there. >> i don't think they're intending to do that, but i think that may be the perception of many folks because of the 24/7 nature of these stories. there hasn't been another story broken through in the last ten days. >> who's fault is that? that's the fault of the romney campaign. if they had come out and answered questions all along about this, this would not be happening. mitt romney would not have to be doing a five-network blitz at

5:00 on a friday night. >> i would agree the romney campaign is very coarse and doesn't help itself by keeping arm's length with the press. we'll see if this is a turning point. >> there have been other questions including romney's decision which i think was the right decision going to the naacp. i think the president should have gone, but he decided to pass once again on that convention. that has nothing to do with bain capital, irs, he wanted to speak to the african-american community. >> and he was booed. and that story did have legs for quite some time. and actually i think it looked worse for the naacp than it did for mitt romney in that case. >> i agree with that. and i think the way in which some liberal congressmmmentator he went, too much conspiracy mongering but that did break an endless barrage -- >> when all the dust settles, we have almost four months to go,

do you think anyone will really care about bain capital or irs return sns. >> absolutely. >> or will they care about jobs and the economy? >> they care about jobs and economy. but they want to know the person in the office is someone they can trust. if this person turns out to be lying in any way, shape or form, they can't trust him. >> if it goes to credibility, it's a serious problem for mitt romney. but some of these stories are so complicated, i think a lot of swing voters are more interested what he's going to do for their jobs than the job he had 15 years ago. >> i suspect you will have a lot more on sunday morning on "reliable sources". >> excellent perception. >> thanks very much for coming in. the president's on a fwo two-day campaign swing in virginia. we're standing by for what's being called a grass roots event. standby for that. and a decision in a high profile trial. we'll have the verdict on a racial abuse charge against an english soccer star. the medicare debate continues in washington...

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you're looking at live pictures from hampton, virginia. this is the second of three events, campaign events, that president obama's doing today. earlier in the day he was at virginia beach, virginia. now hampton. later he'll be in roanoke.

he's going across the state. virginia, a key battleground state in this race for the white house, the president of the united states won virginia four years ago. a very important win at the time. he said earlier today, by the way, if he manages to carry virginia once again this time, he will stay in the white house for a second, a second, a second term. so we're going to hear what the president has to say. he's going to be speaking out. i assume he's going to be going after mitt romney in this campaign event. and later we're going to be hearing from mitt romney himself. he's sitting down speaking with our own jim acosta. in the meantime, there's some other important news we're watching right now. kate bolduan is standing by. she's got some of the headlines. what's going on? >> hey, wolf. lots of stuff fwoing on this hour. a burst of magnetic energy from the sun could light up night skies in northern europe and along the border between the u.s. and canada tomorrow night. the solar storm -- just look at that image, is expected to generate waving colorful lights in the sky. it also could cause problems for

power systems and high frequency radios at high altitudes. also another round of heavy rainfall put houston under a flash flood warning this afternoon. there were reports of three inches of rain falling in just three hours in the downtown area. some people had to be rescued from their homes. scattered showers are expected through the weekend unfortunately. also, one of england's biggest soccer stars is cleared of charges he racially abused a fellow player. the case against john terry was a highly unusual criminal trial over the language used on soccer fields. the week-long proceeding was filled with foul terminology. terry's chelsea team backed him throughout the trial and welcomed the verdict. and then there was one. jennifer lopez announced she's leaving "american idol." she told ryan seacrest that as her twins get older, something had to give. and that something was "american idol." her announcement comes a day after steven tyler announced his

departure. the last judge left, randy jackson, is rumored to be on his way out as well. wolf, might be calling for you. >> i was just going to say, kate, you know, you got the demos, you're ready for that kind of moving up. from "the situation room" to "american idol," what do you think? >> i would be hard pressed to critique them, but i'd be the supportive judge, i guess. >> you did tell all of our viewers in the united states accurately quoting you that you did personally sing the star spangled banner at george washington university once, is that right? >> i did. i sang for george w. bush once. and i'm regretting that i ever told you that factoid. you're going to hold it against me. >> we're looking for the videotape. especially if you had to read some of those words. >> there's no cheating. >> you knew it all by heart. >> i did. >> we're going to get that videotape. thanks. don't go too far away. documenting the details of a family murder. a video diary gives us a frightening look inside the mind of a killer.

and it's far from over at penn state university. we're going to update you on the investigations of the sexual abuse scandal that are still underway. and young iranian's postings on facebook lands his father back in iran in prison. how satire turned very, very serious. the postal service is critical to our economy, delivering mail, medicine and packages. yet the house is considering a bill to close thousands of offices, slash service and layoff over 100,000 workers. the postal service is recording financial losses, but not for reasons you might think. the problem ? a burden no other agency or company bears.

a 2006 law that drains $5 billion a year from post office revenue while the postal service is forced to overpay billions more into federal accounts. house bill 2309 is not the answer. how did the nba become the hottest league on the planet? by building on the cisco intelligent network they're able to serve up live video, and instant replays, creating fans from berlin to beijing. what can we help you build? nice shot kid. the nba around the world built by the only company that could. cisco.

you can see tim kaine in virginia. the president will sneak there shortly. we'll catch some of that speech. what he has to say about mitt romney. that's in hampton. in the meantime, there's other news we're following including one family's medical tragedy. how a simple, a very simple test could have saved a life. here's cnn's lisa sylvester. >> moments of childhood that are fleeting. >> there's nothing to indicate anything was wrong. >> moments she never takes for granted. >> it's important to focus on what you have and not on what you don't have. >> reporter: olivia has found a place of happiness after living through the terror every parent

fears. >> this is veronica jane easily. she was born yesterday april 29th. >> reporter: her daughter, ve r ron ka, died when she was only 7 weeks old. >> and i have her little -- these are the pajamas that she died in. i save it. i can still smell her. i save it in plastic so it kind of retains her scent. it's amazing someone's life fits in this little bag on the shelf. i gave birth to my third child, a girl, her name was veronica, in april of 2009. i'd had 20-week ultrasound, good prenatal care. we were under the assumption she was perfectly healthy. i put her down to bed and that was the last time i saw her

alive. >> reporter: olivia didn't know her new baby had a congenital heart defect. no shortness of breath, no blueness, nothing. >> your worst nightmare times 100. >> reporter: olivia later found out about a simple test that likely would have saved her daughter's life. it's called a pulse ek semitri test. >> it's a painless, effective, accurate way of measuring the oxygen in the blood. >> reporter: an inexpensive test that looks like a band-aid and is over in about five minutes. holy cross hospital in silver spring, maryland, began screening all newborns three years ago. since then, new jersey, indiana, west virginia and maryland have all adopted new laws. new jersey was the first state to pass the law requiring mandatory screening at all birthing facilities. and on that very first day a

baby was found with critical congenital heart disease. when a heart defect is detected, with early treatment a child can live a healthy normal life. >> we think there's about 200 babies each year that die undetected with critical congenital heart defects in the united states. 200 babies. we need to get those 200 babies. this is a loss that just can't keep happening. >> if it could happen to me, it really could happen to any parent. and that's why i think pulse screening is so important. >> reporter: the story has a happy ending. six months after veronica's death, olivia was pregnant again. this is her little boy, ryan. and the thing is, olivia herself is a medical doctor. and even she could not tell just by looking that her daughter had a congenital defect at birth. this is the pulse test.

this is a disposable one. wolf, it looks just like a band-aid. it's something you can wrap around your finger. this only costs about a dollar. and it can and has been proven to save lives. >> if there's no negative side effects, why isn't this done in every hospital at every place around the country? >> you know, it's one of those things simply awareness. i mean, doctors have always been taught you look for very specific things. you look at a child turning blue for instance. or if a child is having breathing problems. but there are many children out there like we saw with the baby in our piece, olivia's baby, who simply don't show any outward signs. and that is where this test is so important. and it's about getting out the word. there are a number of states, health secretary has now come out and said hospitals should start screening these tests. hopefully we will see more of this and we will prevent the 200 deaths we heard about. >> save the lives of some young kids. we'll post this story on our

cnn/situationroom website. thanks for the exposure. hope you save lives. >> i hope so. other news we're following especially on this friday in washington it means two important things, the house and the senate, they are in recess. they rarely work on fridays. rarely work on mondays for that matter as well. the president of the united states at the same time he's out of town campaigning. we're standing by to hear what he has to say in virginia. cnn's newest correspondent, the early start anchor, john burhman is joining us to find out what our elected officials have accomplished during the week. i don't know if we have enough time, john, to go through everything they accomplished. it was obviously a critically important week in washington. >> it takes exactly zero seconds to run over the important things they accomplished this week. you know what this week reminds me of, wolf? the season of "dallas" before bobby got out of the shower. in the show it was a season that never happened. it was imaginary. in washington this week, well, thankfully there was no shower

scene. it had about the same impact. pop quiz, what high profile washington event will do more to make america a better place, change your situation and improve life on earth? a, president obama's big white house pitch to extend tax cuts for the middle class but let taxes go up for the rich? >> this is about helping job creators. >> reporter: or, b, the great big house vote to repeal the president's health care plan? >> we are trying to end the era of washington-controlled health care. >> reporter: so which mattered more? the answer is, c, kourney kardashian having a baby. even if you don't know who she is, it can't possibly matter less than what happened in washington this week. it's not that the issues of deficits and taxes aren't important. it's that the president has been pitching this plan for years and has exactly 0% chance of getting through congress now. so the impact of his white house

announcement as bill murray would say in "meat balls". >> it just doesn't matter. >> reporter: and on health care it's not the debt issue isn't important. it's that this 33rd vote to repeal or weaken the president's plan has the same chance of actually repealing the law as the previous 32 votes. in other words, exactly zero. as "meatballs" would say. >> it just doesn't matter. >> reporter: so with anemic job growth, world economic turmoil and unrest in the middle east, how could we assess the net contribution from our nation's leaders this week? >> it just doesn't matter! it just doesn't matter! it just doesn't matter! >> reporter: even the all-star game. >> from the boston red sox, david ortiz. >> reporter: a mere shell of its illustrious past mattered more than the game of political charades this week. at least homefield advantage for

the world series is determined in the all-star game. this and this determined nothing. which is why home field advantage goes to kourtney kardashian. obviously there is a purpose to what democrats and republicans are doing, it's politics for the election. it's just on our time and our dime. let the record show kourtney kardashian never imposes like that. >> excellent points, john. you also posted a preview video about your new job here at cnn. there's one part that made a huge impression on the entire "the situation room" staff. let me play a little clip. >> okay. >> one thing about cnn that's really terrific is the very inclusive policy when it comes to facial hair. i've experimented with different types of beards over the years. there in 2000 i grew an old

beard during the recount there. some thought i looked like tom hanks in "cast away". >> i like the beard. obviously i'm a little prejudice on that. now that you're at cnn, i've been here, this is my 23rd year, are you thinking of something up there? >> anything i can do to look like you, wolf. it's an honor to be here. and it's an honor to get to work with you. >> we are thrilled that john berman is the newest addition to cnn. you're going to be getting up very early at 5:00 a.m. eastern until 7:00 a.m. but every friday, i hope, john, you're going to do something for us in "the situation room." is that a good hope? >> absolutely. it's great to be here, wolf. thanks. >> thanks so much. welcome to cnn john berman, our newest addition and very happy he's here. we'll take a quick break. when we come back, the president of the united states, president obama, he's in virginia speaking to a crowd just thanking a lot of folks there.

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call now to request your free decision guide. this easy-to-understand guide will answer some of your questions, and help you find the aarp medicare supplement plan that's right for you. the president of the united states is speaking in hampton, virginia, right now. i want to listen a little bit.

>> -- everywhere i went what was interesting was that for all the differences, there was something everybody had in common. and in people's lives i'd see my own life. i would meet an older vet and i'd think about my grandfather and my grandmother. part of that world war ii generation. my grandfather fighting in world war ii then coming home and my grandmother who had been working on a bomber assembly line they were able to go to college on the g.i. bill and how they were able to buy their first home with an fha mortgage. and i thought about my mom. because if i'd see a single mom, i'd think about, you know, how challenging it was for her to raise me without a dad and raise my sister without a dad, but how she was able to put herself through school and work at the same time and give her child the best education this country had

to offer. and i'd think about michelle's family. i meet a family and it didn't matter whether it was some rural area or small town. you'd meet folks who reminded me of michelle's dad who had multiple sclerosis. never missed a day of work. worked a blue collar job. michelle's mom stayed at home until the kids got old enough and then became a secretary at a bank. and she worked as a secretary all her life. and they never had a lot. but they had a lot of love. and they had strong values. and they had discipline. and that's why michelle and her brother could go on and achieve things their parents couldn't even imagine. and what i'd realize during that first campaign and all the

campaigns after that was that our lives all are a testament to that fundamental american idea. the idea that no matter who you are, no matter what you look like, no matter where you come from, no matter what your last name is, you can make it if you try. [ cheers and applause ] this country's never been -- this country's never been full of folks looking for handouts. we're a nation of workers. and doers and dreamers. we work hard for what we get. and all we ask for is that our hard work pays off. that our responsibility is rewarded. that if we're willing to put in the effort, we can find a job

that supports a family. and be able to get a home we can call our own. we won't go bankrupt when we get sick. take a little vacation once in a while. send our kids to college. and let them do things so much bigger than what we did. and then retire with some dignity and some respect and be part of a community and a neighborhood and a nation that looks after its own. >> the president of the united states in virginia. he's just getting started. we're going to continue to monitor what he's saying. our chief white house correspondent, jessica yellin, is joining us. jessica, one of three speeches today in virginia. this is a key battleground state. he carries virginia 56%, 46% four years. this time it's going to be a lot closer. >> that's right, wolf. for the president right now he's speaking in an area hampton which is 50% african-american, also largely military community, two groups he's targeting to win

in virginia together with the northern virginia suburban vote, more affluent vote. together he's hoping to put together that coalition plus latinos to try to carry the state, which could be the most decisive battleground state of them all in this election. expect them both to be in virginia a ton, wolf. >> we do expect that. and we will continue to monitor his speech. jessica, thanks very much. and you're in "the situation room." happening now, international condemnation of what may be the worst massacre yet in syria. and now new fears about the regime's chemical and poisonous weapons. also, charges filed in a horrifying case of abuse. the victim, a disabled young woman. plus, the diary of a family murder. a man lays out his deadly plan in chilling detail. we want to welcome our viewers in the united states and around the world. i'm wolf blitzer. you're in "the situation room."

we begin this hour with new u.s. efforts to quash iran's knew nuclear program. two people charged with trying to supply parts for uranium enrichment in iran. what are you finding out? >> prosecutors are saying a citizen of iran and resident of china both allegedly operating from the philippines. over the course of nearly three years, the men conspired to obtain materials typically used for uranium enrichment without a license. and then, as you said, send them onto iran. it's not your average shopping list. take a look at what prosecutors say the men were after.

lathes and nickel wire, aluminum alloy rods, mass speck trom ters, vacuum pumps and radioactive source materials themselves. the indictment lays out fascinating detail about just how the suspects allegedly planned to do this. according to prosecutors, by setting up a front business in the philippines, ordering the materials and then shipping them on ward to iran. we got more detail on that from assistant attorney general for national security lisa monaco who warned that iranian procurement networks continue to target u.s. and western companies for technology acquisition by using fraud and front companies and middlemen nations around the globe. called a complex conspiracy to deliver nuclear materials to iran in a significant threat to national security, wolf. >> do we know, susan, if any of this material actually made it to iran? >> well, we do know that a law enforcement source tells cnn that officials aren't in a position to say right now

whether all of those materials made it to iran. according to the indictment, the suspects were able to successfully ship the lathes and nickel alloy. trying to order radioactive source materials. can't say right now whether or not those materials, which were the most serious, actually made it into iran, wolf. >> susan kelly with that information, chilling information. thanks very much. let's dig deeper with our national security contributor, fran townsend. she serves on the external advisory boards of both the cia and homeland security department. fran, what exactly does this mean as far as what's going on behind the scenes with iran's nuclear program if these charges are accurate? >> well, wolf, what we know for certain right is that despite the heavy sanctions -- and remember the most recent ones just went into effect on july 1st, despite this sort of complex and very heavy sanctions regime, iran has found ways to work around that and try and obtain the component parts

necessary for their nuclear program. you know, this has been a concern of the u.s. government and in particular the department of defense for some time. i sat on a number of private boards for defense companies. and the defense department comes out and briefs companies who might be approached by one of these fronts. and warns them about the kinds of signs to look for in a front company. suspicious activity, suspicious kinds of requests in materials that they may be looking for to overcome the sanctions and to get these parts into iran. >> all right. standby for a moment. i want to pick your brain on another subject, namely syria. opposition groups are reporting at least 80 people killed today one day after an alleged government massacre that killed more than 200 people in a village. apparently the single deadliest assault in the regime's 16-month brutal crackdown. and there are now growing signs about syria's chemical weapons. our pentagon correspondent, barbara starr's working this part of the story for us. what's going on here, barbara? >> wolf, it's well-known that

syria has this deadly arsenal of chemical weapons. the question now is what are they planning to do with it? a new worry about how far bashar al-assad will go to keep his grip on power. the u.s. now believes the syrian regime has moved some of its chemical weapons in recent days. as the fighting continues, u.s. officials will only say the weapons are still under the control of assad's forces. but a former cia director says make no mistake, the u.s. is urgently trying to gather all the intelligence it can. >> i would see that ratcheting up. because you just want to know, look, at the end of the day if something untoward's happening, you want to have as much time as possible to assess what it is and be able to develop a response. >> reporter: the pentagon won't comment on the story first reported by "the wall street journal." but said any use of chemical

weapons by syria would be a redline for the international community. secretary of state hillary clinton has already warned damascus. >> given their behavior and the chemical weapons they possess, it is imperative that they understand their international responsibilities. >> reporter: the u.s. military estimates there are nearly 50 chemical weapon sites throughout the country. deadly mustard gas and serin among the holdings. with violence even spreading to damascus, officials suggest assad could have taken the risk of moving the weapons to put them in a safer place. but another theory, assad knows u.s. satellites watch those sites. and his communications are intercepted. is he just taunting the west to show he can freely move his deadly weapons around? >> i'm far more concerned about loss of control over the weapons

and what happens when the chaos that seems to be infecting larger society might touch upon some of these weapon stockpiles. >> reporter: but would the syrian leader really use the weapons? in 1988 in iraq saddam hussein did. thousands of kurds died in a chemical weapons attack. but that led to years of wondering if they maintained a stockpile. >> they're there. it's not like iraq where you have to guess at it. we know where they are. >> reporter: now, if assad were to use the chemical weapons, the u.s. believes that would be a red line for russia and china. they would withdraw their support for the syrian regime. and that could open the door to a military intervention. wolf. >> more chilling news out of syria. thanks very much, barbara, for that. once again, we'll dig a little deeper with our national security contributor fran townsend and a senior fellow at the hoover institution. let me start with you.

what do you think about these reports that bashar al-assad's regime, they are now moving around these chemical weapons. what does that signal to you? >> you know, wolf, i think this is a reckoning time for bashar in many ways. there's one dissident who put it well to say at least at the domestic setting of syria. he said massacres have become like breakfast to us. obviously there is something horrendous is going on in syria. and there are all kinds of scenarios. even scenario many of the standard weapons of the regime are being moved from other parts of syria to the al we homeland to the homeland of bashar al-assad in his own community. i think we have to watch what this regime is doing. my feeling is when bashar hears the word red line, i think he mocks this red line. he downed turkish fighter plane and nothing happened to him. he's been defying all kinds of red lines and mocking all kinds

of red lines. >> fran, based on what you know and without violating any classified information, how good is u.s. intelligence when it comes to monitoring syria's stockpiles of poisonous gas or chemical warfare, if you will? >> well, wolf, monitoring -- the whole counterproliferation effort, that is tracking and monitoring stockpiles of these sorts of weapons is of the highest priority within the u.s. intelligence community. and obviously since the sort of massacre of assad of his own people began, collection of intelligence inside syria about the opposition, about the assad regime's capabilities and their weapons has been a real collection priority. so i think you've got to assume, you know, barbara reported the fact the defense department acknowledges there's nearly 50 chemical weapon sites. that's because they know where they are. these are not that -- these things, once you know they exist, are not that difficult to track. so you have to assume it's been part of the defense department

contingency planning should there be operation to identify and what resources would take to secure them. >> foud, we've seen military defections including the syrian ambassador to iraq has now defected. all this happening i read this in "the washington post," there was an explosion in damascus, "the washington post" describing the city now feels pregnant with rage and ready to explode. defections coupled with the explosions in the capital, what does that say to you? >> well, wolf, i think the war is coming closer to the den of this awful monster. it's coming close to damascus. i mean, damascus was always, if you will, the last citadel of this regime. what's really interesting to me, wolf, about the recent violence is it's very premeditated, it's very precise. and the aim of bashar al-assad has become very obvious.

i believe he now thinks he can't win all the war so he beg's beg massacres between the highlanders and the sunnis in the plains. this forlorn but happens to be on the fault line between these sunni communities and they've begun ethnic cleansing. this begins to look like the balkans and believes the international community will not come to the rescue and not do anything to stop him. >> bring fran back in a moment. but another strong statement from hillary clinton, the secretary of state, today in the aftermath of this massacre. similar statements coming from the white house. let me read to you a line saying that the united nations security council has to act. history will judge this council, she says. members must ask themselves whether continuing to allow the assad regime to commit

unspeakable violence against its own people is the legacy they want to leave. here's the question, will the united nations security council do the right thing? >> the united nations security council, wolf, cannot do the right things. they will not do the right things. i don't think either the russians or chinese care about these statements. you know, senator mccain has wonderful expressions. the international community and the united states have run out of adjectives to describe the behavior of the assad regime on all kinds of terms. we've gone back to the united nations security council again and again. and we meet the same russian veto. and we meet the same chinese stalling. and we meet the same indifference. but bashar al-assad's attitude is how many divisions does the u.n. security council have? if they have no military division and if there's no intervention from the outside, i think bashar will go on with the killing and with the strategy that we've talked about, the

partitioning of the country, the setting up of alawe and i will burn this country before i lose this war. >> fran, as we look at what's going on right now, it's obvious to me that the situation is a mess. but what's fascinating is that even syrian opposition, the rebel forces, they are now saying to the u.n. special envoy, kofi annan, go away, it's over. we don't want you involved anymore. they're so frustrated. they're so angry at his inability so far to accomplish anything. >> and i think the syrian opposition is absolutely right to say that. look, every time kofi annan has met with bashar al-assad or the senior leadership of the syrian regime, he says one thing. kofi annan leaves or walks out of a meeting and the situation actually gets worse. so kofi annan's engagement gives this arab legitimacy or continuing legitimacy to the

extent assad has any left. so it undermines the syrian opposition. i think they're absolutely right. if the u.n. security council and the envoy can't make affirmative progress that can hold and protect the syrian people, then the syrian people are better off without them. >> one final question, bashar al-assad knowing what happened to mubarak in egypt, knowing what happened to gadhafi in libya, do you think he will remain on the ground in syria to the bitter end even if it means his life or at some point will he flee to russia or iran to some place else to save his life and his family and the billions he's probably hidden away some place? >> you know, wolf, there's no way of knowing what these dictators will do. there's no way of knowing they will stay on the groubd and fight the last fight or flee and unite with their bank accounts. it's very hard to know. i think what's very clear about bashar and his family, his mother, his younger brother, his sister, his brother-in-law,

these people are dug in. and what they've done is they've made sure now that the entire community is implicated in the crimes because they want to make sure their own communities stand by them. but the fielght is on. >> thanks so much for coming in. fran townsend, as usual, thanks to you as well. a chilling video diary, a man vows to live in a bunker in the woods and calmly plots to kill his wife and 18-year-old daughter. plus, there's a lot of new buzz out there about condoleezza rice as the republican vice presidential candidate. how likely is that? is it likely at all? o

i want to remind our viewers at the top of the hour, cnn's jim acosta will have his interview with republican presidential candidate mitt romney. they're speaking the entire interview will air in our special 6:00 p.m. eastern hour of "the situation room" coming up at the top of the hour.

lots of good questions for the republican presidential candidate. meanwhile, there's other news we're following. it was a chronicle of deadly plans that no one was supposed to see. but police did find the video inside one man's washington state home. and what they heard and what they saw was frightening. lisa sylvester's back once again in "the situation room." lisa, this was discovered after his wife and teenage daughter were killed. >> yeah. this is a story -- at least this video has now gone viral. it was breathtaking and evil. the extent peter keller went through to plan the murders of his wife and daughter. the chilling video diary shows peter keller calmly plotting to kill his wife and 18-year-old daughter and to live in a bunker in the woods in washington state. >> it's actually more comfortable for me to think about living out here, robbing banks, pharmacies, just taking

what i want for as long as i can. at least it will be exciting. won't be boring. and i don't have to worry about lynette or kayleen. >> reporter: police say after murdering his family, keller set his home on fire and left it trapped. but a pipe bomb failed to go off and was quickly put out. among the items investigators found at this home, this video. >> i used to sit here and think this whole thing is crazy. at times. and then i would think about it. and it would make sense and it was like, okay, this is what i got to do. >> reporter: the king county sheriff says keller made the interview during a series of day trips to the woods. authorities say he planned the killings for a long time and built a bunker in the woods stocked with foods, ammunition and supplies. question now, why? he leaves behind only this hint. >> getting to the point where just trying to live and pay

bills and live as a civilian and go to work, it just freaks me out. >> reporter: keller had a backup plan if he was ever tracked down. >> i'm ready to get caught right away. basically if i get caught, i'm just going to shoot myself. i mean, i could basically be dead in two weeks. or three weeks. i don't know. it's all up to chance at this point. i have my escape. and that's death. i can always shoot myself. i'm okay with that. >> reporter: photographs and construction drawings of the bunker site helped authorities find keller's hideout. he killed himself as sheriff deputies were closing in. a co-worker said he had no idea that peter keller was capable of any of this. meanwhile, family members of lynette and kayleen keller have set up a fund.

>> thanks for bringing it to us, lisa. you might not realize this here in the united states, but we're in the midst of what's being called the worst drought in a quarter century. and reminder why you should never ever run a red light. wow. look at that. traffic camera catches a terrifying crash. the medicare debate continues in washington... ...more talk on social security... ...but washington isn't talking to the american people. [ female announcer ] when it comes to the future of medicare and social security, you've earned the right to know. ♪ ...so what does it mean for you and your family?

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the secretary of state hillary clinton is headed to egypt for talks with that country's new leadership. she'll also be in israel this weekend. lisa sylvester's monitoring that, some of the other top stories in "the situation room" right now. what's going on, lisa? >> wolf, secretary of state clinton's visit to cairo will be highlighted by a meeting with egypt's new islamist president, mohamed morsi took over last month. aides say the visit is designed to show that the government wants to support egypt. federal authorities are classifying more than 1,000 counties as natural disaster areas as what some are calling the worst drought in a quarter of a century spreads across the united states. drought conditions extend from oregon to south carolina and are now being reported in more than 60% of the land that makes up

the lower 48 states. and check out this video from a traffic camera in new jersey. as you can see, oh, a car runs a red light, collides with another vehicle and then careens into oncoming traffic. police released the clip as part of a campaign to crack down on red light violations. according to reports, no one surprisingly was seriously injured in that crash. and arnold schwarzenegger confirming plans are in the works for a sequel to "twins." he made an announcement to promote his new movie, "expendables ii." >> i love the original. i can only imagine a remake how that was done. you saw it, right? >> yeah. look how young arnold schwarzenegger looks. that's the amazing thing. that was in 1988. so the young man he was back then. >> good for him. good movie. let's hope the next one is as good. thank you. one-on-one with mitt romney.

the presumptive republican presidential nominee talks to our own national political correspondent, jim acosta. that's coming up in our next hour. in fact, right at the top of our next hour. and straight ahead, why condoleezza rice won't be romney's running mate. that's what a lot of folks think. some folks think maybe she will. we've asked candy crowley to do a reality check to all the rumors. plus, a bank loss first put at $2 million has almost tripled. what's going on at the nation's largest bank, jpmorgan chase? ♪ ♪ [ male announcer ] what's the point of an epa estimated 42 miles per gallon if the miles aren't interesting? the lexus ct hybrid. this is the pursuit of perfection.

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new rumors are spoiling about the secretary of state condoleezza rice possibly, possibly as the vice presidential running mate for mitt romney. let's talk about that and more with host of "state of the union" candy crowley. you think romney might pick her? >> i don't. actually. look, i think the timing of this is suspicious. i'm not saying that someone didn't slip this to drudge because i'm sure they did. the fact of the matter is it was all bain, bain, bain. and now it's all condi. so that's good for the romney campaign. she doesn't have an economic background. she's a foreign policy specialist. she hates politics. she's just not a political animal at all. she's much more into policy. so there's just nothing that

sort of says, you know, condi rice is the right fit. let's remember, one of the biggest arguments against mitt romney that the obama campaign is making is, well, he's just bush all over again. and if you want what you had before, let's go back to bush. well, there's no one -- there are a lot of people, dick cheney one of them, that are perhaps closer to george bush. but she was a confidant. i think that fits in too easily with the obama argument. >> listen to what romney said way back last september to jim dement. >> governor, will the person you choose as your vice presidential running mate be someone who shares your pro-life and pro-marriage convictions? >> i would expect they'd all be pro-life and pro-traditional marriage. >> the issue of pro-life. condoleezza rice has indicated in the past she supports a woman's right to have an abortion. >> she does indeed.

and where is mitt romney having trouble other than the obama campaign throwing bain out there? and it is with conservatives. do they believe him? do they believe he will stay steady to his message? will they stay true to his message? will he stay true to his message? conservatives have always been skeptical. for him to go back now and say, well, yes, except she's really good. i think there are way too many things that run against this kind of pick. >> so your instinct i think like mine holds out for a rob portman or a tim pawlenty or a bobby jindal. >> sure. you know rob portman was also attached to the bush administration. not quite as closely. >> special trade representative. >> right. not as closely as condoleezza rice at least in the public eye. mitt romney's strength what they've been selling is he can handle the economy. what i see them doing is doubling down on that and getting someone who is also well-versed in the economy and going for it. >> and romney keeps saying and

it's smart for him to say he wants somebody qualified to be president of the united states and to make sure -- >> always helpful in a v.p. >> who's on "state of the union sunday". >> fortunately i wrote it down? >> tell me. >> massachusetts governor and agricultural secretary vilsack to talk about what you're talking about later in this show is the drought. it's going to drive food prices up. scary for the farmers, but also a huge impact inside the supermarket and also ed gillesp gillespie. >> a senior advisor to the romney campaign. >> yep. >> good guy too. >> we'll be there. >> thanks very much. we'll be watching 9:00 a.m. eastern, noon eastern sunday morning "state of the union" with candy crowley. >> thanks, wolf. today jpmorgan chase revealed the loss was more than the $2 billion originally

estimated. let's get more from erin burnett. i know you've been covering this story in depth on your show, erin. i was pretty surprised. i originally heard $2 billion, then some people floating $3 billion, not more than $5 billion? >> yeah. it's pretty amazing. i remember that first night i was hearing from people at jpmorgan it could be $3 billion and then why are you going with three and then days later you said it kept climbing and climbing. now they're coming out with $5.8. that's nearly triple that initial estimate. you say why is it that jpmorgan shares when they made this announcement today along with their quarterly earnings said -- jumped 6%? that's pretty stunning. why did the stock go up so much? we had the best overall day for the market, wolf, this month thanks to optimism about jpmorgan chase. investors said now you have the trade under control, at least we know the number. knowing it's $5.8 billion is better than wondering if it's 2 or 3 or 5 or 8. at least we have certainty.

but that sort of shows you where the market is right now. and of course jpmorgan chase still ended upcoming out and making money, which is pretty incredible. they were stronger in other areas. they were able to completely compensate for this loss. that's where the positive news is. still a lot of questions. of course the interest rate scandal is spreading through the industry as well. and ceo jamie dimon said he's not sure how far it will go. a lot of uncertainty still about the industry and jpmorgan. >> there's pictures of jamie dimon. everybody thought he was the golden boy of wall street. i guess the biggest question i have and i don't think there's an answer yet to this, how on his watch could $5 billion been lost like this? i mean, it's hard for me to believe given the excellent reputation jpmorgan they did well in the 2008 crash when lehman brothers were going down. jpmorgan did just fine. what happened? >> what's interesting, wolf, a lot of this comes down to just mistakes made in management. look at jpmorgan itself, wolf,

during the financial crisis, literally the federal government said you need to go out and take over behr sterns and they went ahead and did that. if you look at the assets of jpmorgan, it's almost 50%, just about 45% bigger than it was before the financial crisis. so it was enormous then and now it's even more enormous. the top few banks in this country, wells fargo, jpmorgan, bank of america and citi group, their assets equivalent to about 50% of our entire economy. so the reason jamie dimon may not have known even though this was pretty close to him is that his bank is incredibly huge. he may have the reputation of the top manager in the industry, which he did and he still does, i think it's safe to say, but you can't know everything. sometimes things just get too big. and that's the big question they have to deal with. he acknowledges that he doesn't agree with that assessment, but that may be the real answer of why this could happen. >> i'm going to watch your show tonight to get more information. >> thanks, wolf. it's video that's hard to watch. a disabled woman apparently

being abused by her care giver who has now been charged. we have an update on the story we brought you yesterday. and he was an icon at penn state university. now there are calls to actually take down the statue of the legendary coach, joe paterno. for a relaxing vacation. ♪ sometimes, we go for a ride in the park. maybe do a little sightseeing. or, get some fresh air. but this summer, we used our thank youpoints to just hang out with a few friends in london. [ male announcer ] the citi thankyou visa card. redeem the points you've earned to travel with no restrictions. rewarding you, every step of the way.

new developments in the disturbing story we brought you yesterday. the apparent abuse of a disabled woman by her caregiver all caught on videotape. now, charges have been filed. cnn's deborah feyerick is joining us from new york. she's got the details. what happened, deb? >> we can tell you the 34-year-old woman turned herself into police allegedly telling authorities that she's the employee in the video. this group home for mentally disabled adults and those with learning disabilities was supposed to be a safe place. yet watch how this woman dressed only in a short hospital-type gown is treated by a caregiver. the 34-year-old caregiver first kicks the disabled woman in the stomach. then hits and taunts her with some kind of belt or strap before dragging the distraught woman by the hair. options unlimited is a private nonprofit agency that contracts with connecticut's department of

developmental services to run about six such around the clock group homes. the company says it's deeply saddened and appalled by the incident. >> this is the most heinous crime i've seen in my 40 years. it takes your breath away. >> reporter: last year several options unlimited employees were fired from the group home and cameras install today monitor activities. it's unclear who shot this video, which was cut together into a 30-second montage. three copies were sent anonymously, one each to a local news station, the state agency in charge and options unlimited. >> the success of this and the fast-moving investigation and the arrest and the search warrant were a result of the great cooperative effort between the state police, department of developmental services and the east hartford police department. >> reporter: the caregiver has been charged with several felonies including cruelty, unlawful restraint and bias intimidation. a man who answered her phone would not comment on the allegations or refer us to an

attorney. and after rivera turned herself into police, they did obtain a search warrant for a second employee who made a video of additional abuse on a home computer. rivera is out on $25,000 bond. wolf. deb, thank you. a very, very disturbing story. from hometown hero to a figure of disgrace, now there are calls to take down coach joe paterno's statue at penn state university. plus, deadly and devastating floods. dramatic pictures of an unfolding disaster. our abundant natural gas is already saving us money, producing cleaner electricity, putting us to work here in america and supporting wind and solar. though all energy development comes with some risk, we're committed to safely and responsibly producing natural gas. it's not a dream. america's natural gas... putting us in control of our energy future, now.

getting ready -- we're getting some new information on a deadly train crash in south africa. lisa sylvester's monitoring that and some other top stories in "the situation room" right now. what's the latest, lisa? >> wolf, at least 26 people are dead after a train collided with a truck carrying farm workers in south africa. more than two dozen others are reported injured. authorities have arrested the driver of the truck who they say tried to beat the train through the crossing. and crews are combing through wreckage after torrential rains caused devastating flooding in japan. the death toll now stands at 19. and eight people are missing. here's cnn's paula hancocks with

the details. >> reporter: parts of japan have never seen rain like this. residents have been killed inside their homes as mud slides have engulfed entire buildings. rescue teams have been working through the night searching for those still missing. but rescue operation is continuing friday. helicopters are being brought in to save those cut off by the floods. rivers burst their banks and deadly torrents of water swept away anything in their path. tens of thousands of households were told to evacuate. many of those orders have since been lifted. the sheer force of water pushed cars into the sides of buildings, buses were stopped in their tracks. this man says it took just ten minutes for my car to be completely submerged. then it was just washed away. japan is no stranger to natural disasters, but the amount of rain has surprised many. parts of the southern-most main

island of kyushu saw a month's worth of rain in just eight hours. the meet logical agency says the rainfall in southern japan has never been experienced before. paula hancocks, cnn, seoul. >> authorities used helicopters to rescue some of the people from the roofs of their homes. wolf. lisa, thanks very very much. controversy at penn state university over the legendary football coach joe paterno. he's singled out in an independent report as one of the officials that enabled jerry sandusky to molest boys for more than a decade. some are still fiercely protective of coach paterno including a new penn state trustee. >> hello, i'm a very proud penn state graduate class of '82. what have we learned? first, this was not a penn state scandal. second, this was not a penn state football scandal. and, third, this was certainly

not a joe paterno scandal. >> that clip came before louis freeh's report, the head of the penn state investigation, he's the former fbi director. today, one day after freeh's brutal report about how top penn state officials put children at risk for a decade, the trustees are having their first meeting. our national correspondent, susan candiotti's in scranton, pennsylvania. she's joining us right now. susan, what's the latest? the fallout has been enormous. >> reporter: well, certainly some people are calling going so far as to call for that statue, that famous statue of joe paterno, to come down from outside the football stadium. and some of the people calling for it to come down, believe it or not, a supporter of joe paterno and admirer of his in his own words, former florida state coach bobby bowden. he's saying it should come down for the family's sake because in his opinion that statue is a

painful reminder to anyone who comes outside that stadium of the linkage between coach paterno and jerry sandusky, the convicted child sexual predator. now, i asked anthony lubrano about that. he ran on a platform just before he was elected recently to the board of trustees that the paterno family is owed an apology from penn state university and furthermore that the football stadium should be named after him. well, i asked him about all this today. you know, there are calls today from bobby bowden himself for example to pull down the statue of joe paterno. >> yeah. >> reporter: what do you think of that? >> well, i think karen pete said last night or yesterday afternoon in the press conference, that's a penn state community matter. and the penn state community will, you know, address it in due time. we all know my feeling for coach paterno. as far as i'm concerned, it's something that should stay. >> reporter: there are many calls to suspend the football program immediately --

>> i have no comment on that. >> you know, let me bring back susan candiotti. so what did we learn, susan, about what happened today at these meetings that are taking place where you are in scranton? >> reporter: at a news conference that just wrapped up with the board of trustees a little while trustees awhile ago, the new president rodney ericson thinks it is a sensitive issue to talk about removing joe paterno's statue. he feels they need some time to think about it, solicit opinions from the community at large before they make any kind of decision on that, wolf. >> susan candiotti in scranton, thank you. an alleged scam. woman that duped even cnn. and mitt romney responds to the controversy over the old

company he left behind. he has an interview with jim acosta.

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spoke about a bunch of sensitive subjects on the republican presidential nominee's agenda now. the interview with mitt romney in "the situation room" in the new 6:00 p.m. eastern hour of this program. let's look at some of this hour's hot shots. in london, members of the military look at a helicopter that will be used for olympic security. in cambodia, police he is courts await the arrival of secretary of state hillary clinton. and protesters outside the eu headquarters as they discuss the future of europe's farms. and in india, farmers wave from a tractor as they head to the fields. pictures from around the world. a charitable appeal to help dogs brought from iraq brought in millions of dollars. now there are questions where the money went. drew griffin of the special investigations unit confronted the woman who may have duped

even cnn. >> it is televised appeal on hln. >> the salute to the troops is live in studio. >> that many of you found outrageous. >> sitting beside nugget is terry with the spca, ivy is at my feet. >> march of 2011. terry crisp with spca international was telling viewers ivy and nugget. >> look at that face. >> were two bomb sniffing dogs that worked for a u.s. contractor in iraq and had been essentially abandoned by the company. she rescued them and was trying to find them homes. along for the visit, an unwitting retired military dog handler. hln anchor robin meade understandably couldn't believe the story. >> how is it they fall through the cracks and get stranded there, that's unthinkable to me. >> it is unthinkable. that's why we make sure these

dogs don't get forgotten. >> turns out ivy and nugget weren't abandoned, they were donated, taken from adoptive homes in iraq, a military contractor tells cnn, after terri crisp asked for them. the military contractor, reed security, told cnn they had no idea crisp would use ivy and nugget as fund-raising tools in the united states. for weeks, cnn has been trying to track down crisp. first, told by the spokesperson she was unavailable. this week, we drove to terri crisp's rural home in the foothills of sierra, nevada, and found crisp driving straight toward us. >> miss crisp, drew griffin with cnn. we would sure like to talk to you. terri, dog in hand, got out of the car, walked up to the camera, acted like she was about to answer our questions. >> this is not the place to do an interview. >> what is the place to do an interview. we have been trying to get an interview with you for a long

time. specifically to ask you about operation baghdad pups. >> yeah. stephanie scott, director of communications has communicated with you directly. >> yeah, i understand that. can you tell us why you came on cnn and basically lied to our viewers about ivy and nugget? >> you need to talk to stephanie. >> i think you need to talk to our viewers and explain to us what operation baghdad pups is all about, because it appears to be a fund raising effort for your life-style and quad reeg a art, quite frankly. >> like i said again, you need to contact stephanie. all our interviews are coordinated through her. we offered to do them with you. >> you've been on our air, ma'am, you told our viewers that ivy and nugget were abandoned dogs, which they were not, and you got an outpouring of support and likely money after that appearance. our viewers feel like they, and so do we, cnn feels like we were

lied to. do you have any explanation for how that happened? >> like i said, this is not the time and place. we're happy to talk to you. everything has to be coordinated through the director of communications. >> reporter: crisp is part of spca raising millions with a sympathetic fund-raising campaign, baghdad pups. according to irs filings, they have taken in more than $26 million in donations in the past three years. $23 million of that money has gone to the director of the company, not towards rescuing military dogs. what has it done with the rest of the remaining 3 million? spca international said they rescued about 447 soldier's pets from iraq and afghanistan.

bob ott enwho have says the numbers don't add up. >> i can't find out how much is spent on fund-raising and how much on programming, and what the sources of revenues are. i also can't measure the impact of this organization. what difference are they really making? >> reporter: drew griffin, cnn. happening now, breaking news. mitt romney talks about his taxes and time with bain capital in a cnn interview. we dissect the damage control. i'm wolf blitzer. you're in "the situation room." we have breaking news this hour. we begin with mitt romney, republican presidential candidate. he is responding to controversy

surrounding his taxes, controversy surrounding his time at bain capital, precisely when did he actually give up his role at bain capital. also accusing the obama campaign of stooping to a new low. there are lots and lots of questions to ask the republican presidential candidate. and our national political correspondent jim acosta just a little while ago here in "the situation room" had a chance to sit down and ask romney a whole bunch of questions. >> governor, thanks for joining us. let's talk first about the controversy over when you left bain capital. i'll put one of the documents in question up on screen. sec filings stating you were ceo at bain capital past 1999, when you say you left bain to run the olympics, why was your name still on these documents, and why didn't you clear this up sooner? >> well, i was the owner of an entity that is filing that information, but i had no role

whatsoever in the management of bain capital after february of 1999. not that that would have been a problem to have said i was with the firm beyond that, but i simply wasn't. i left in february of 1999 to run the olympics, i went and did that full time, relinquished all management, authority and role in bain capital after february of 1999. >> how do you explain that discrepancy that your name is on the filings and yet you said publicly you left the firm in 1999? weren't you concerned at some point the filings might become public, people would see your name was still on the filings? >> well, there's nothing wrong with being associated with bain capital, of course. the truth is i left any role at bain capital in february of '99, and that's known and said by the people at the firm, said by the documents, offering documents the firm made subsequently about people investing in the firm. i think anybody that knows i was out full time running the olympics would understand that's

where i was. i spent three years running the olympic games. after that was over, we worked out the retirement program, official for bain capital, handed over the shares hi. there's a difference being being a shareholder and running the entity. i had no role whatsoever in managing bain capital after february of 1999. and by the way, this is all an effort on the part of the president's campaign to divert attention from the fact that the president has been a failure when it comes to reigniting america's economy. we had 41 straight months with unemployment above 8%. he continues to find some way to attack me, other than to talk about policy, and it is time to talk about what it will take to get america working again. >> you also testified in 2002 in front of the massachusetts ballot law commission, your campaign provided us with a document from that filing, and it says, i will read you a line, says the respondent returned to

massachusetts from utah to attend meetings at staples. staples is of course a company you helped create when you were at bain capital. isn't that active participation at a bain-related company? >> well, actually staples at that point was an investment by bain capital. bain capital had already sold its shares, distributed its shares in staples. so my involvement with staples was entirely on a personal basis. i continued to be involved with the firm, but it was as a fiduciary for staples, not representative of bain capital, because bain capital had no further interest in staples at that point. >> you mention the president's campaign -- >> i know -- yeah. i know there's going to be every effort to try to find some kind of attack piece on the part of the obama campaign. but interestingly, every independent fact checker that looked at this in depth, not taking a quick interview, looked at it in great depth said the president's claims are false, misleading, wrong headed.

it got multiple pinocchios from one reviewer. what he is doing is doing everything in his power to try to divert attention from the fact his policies failed the american people. these kinds of attacks from his campaigns are simply completely out of character for what we expect from the president. >> let me ask you about what the campaign has said. as you know, president obama's deputy campaign manager, stephanie cutter, was harsh in a conference call thursday. listen to what she said. then we'll get your response afterwards. >> either mitt romney through his own words and his own signature was misrepresenting his position at bain to the sec, which is a felony, or he was misrepresenting his position at bain to the american people to avoid responsibility for some of the consequences of his investments. >> miss cutter suggested you might be guilty of a felony,

governor romney. what is your response to that? >> is that really what's expected from the campaign of the sitting president of the united states? of the republican nominee of his party? i mean, is this the level the obama campaign is willing to stoop to? is this up to the standards expected of the presidency of the united states? i don't think the american people think so. i certainly don't think so. i think it's a very disappointing revelation on their part. let's talk about what it takes to get america working again and to help the american people in very difficult times, as opposed to having a campaign doing what they said from the beginning, announced early on, one of the insiders said their campaign was going to be based on the strategy of quote, kill romney, end of quote. that's what they're doing. it is disgusting, demeaning, something i think the president should take responsibility for and stop. >> and do you believe you're being swift voted in this

campaign? >> i hadn't heard that term, but i'll give it some thought. i think what the president is doing is terribly destructive to the political process and beneath what the people of america expected from someone that said he would rise above partisan politics, bring a new era of change to washington. we're not seeing that in this campaign so far. >> because both campaigns thursday, governor romney, were basically calling each other liars. is that the kind of campaign the american people should expect and shouldn't your campaign take some responsibility for calling the president's campaign and their people liars? >> you know what, the president's campaign has done so far is run advertisement after advertisement which is then shown by independent fact checkers to be wrong, false, misleading, and yet they keep running them. and they hold press conferences, continuing to speak about them. at some point, you have to

respond. you can't just have the air waves saying it is false. >> is the president lying about your record, governor romney? >> there's no question but that his campaign is putting out information which is false, deceptive, dishonest, they know it, and they ought to stop. >> they called on you to release more tax returns. you released 2010 tax return, a 2011 estimate. bill clinton was on the "today" show today saying you should release more. as you know, during the republican primary, newt gingrich, rick santorum called for you to release taxes. those are leaders from both parties saying you should release more of your taxes. when are you going to release more of your taxes and how many years? >> i've indicated, first of all, we complied with the law. the law requires us to put out full financial disclosure. that i have done. in addition to that, i have already put out one year of tax returns, we will put out the

next year of tax returns as soon as the accountants have that ready, that's what we're going to put out. i know there will always be calls for more. people always want to get more. we're putting out what is required plus more that is not required, and those are the two years people are going to have. and that's all that's necessary for people to understand something about my finances. and look, if people believe this should be a campaign about attacking one another on a personal basis and go back to the kinds of attacks that were suggested in some campaigns in the past, i don't want to go there. i want this to be a campaign about the direction for america and about who can get america working again, and who can reign in excessive deficits you see in washington. the president apparently is not ready for an honest and important debate about the future of america. instead, is insistent trying to make it a campaign of attacks. >> i understand. we have to go, governor romney. i wanted to ask you, an item in

a report saying your campaign is looking at condoleezza rice as frontrunner for vice president. it is your position not to talk about the vetting process or vice presidential process. are you concerned about your campaign being associated with so many members of the bush administration? you were holding a fund-raiser with dick cheney thursday. john bolton is associated with your campaign, apparently you also have been talking with condoleezza rice. are you concerned about that association when that administration is still not popular with the american people? >> well, i don't have anything to say, of course, about the vice presidential process, and of course, i speak with people of a wide range of political backgrounds and views. john bolton is a very different person than condoleezza rice, who is a very different person than george schultz, henry kissinger. i speak with people i agree with and people i disagree with. i can tell you this, my policies

as relate to foreign policy and domestic policy are mine. they're not the carbon copy of any persons in the past. and particularly with regards to our domestic policy now, what we have to do to get this economy going is very different than what happened under prior presidencies of president bush. this is a very different time with a very serious on-going, distressed economy. i know what it takes to get this economy going. my jobs recovery plan will do just that, and is something i'm proud of, i think the american people deserve to have discussion about that issue, not the kind of attacks coming from the president. >> governor romney, thanks for your time. we appreciate it. >> thanks, guys. >> good interview. jim acosta joins us now to assess what we just heard. jim, excellent job. you go through, you cover him every single day. you watched him throughout all of these many months. first of all, give us your reaction. he was obviously well prepared for your questions. >> that's right. and we should mention, wolf, mitt romney not only did this

interview with us at cnn, he did this interview with all of the correspondents with the various networks that cover him on the campaign trail. so i think this was a coordinated, calculated effort on the part of the romney campaign to try to respond to questions going on all week long about when he left bain capital, and if you'll go back to that interview and listen to it, he said about four times, wolf, he left bain capital in 1999, and so if there are any documents out there that say otherwise, he is basically saying at this point he had no managerial role after 1999. says he went on to work at the olympics. the other news worthy item out of this, despite the calls for more tax returns from mitt romney, the gop contender said in that interview you're only going to see two tax returns, one for 2010 and one for 2011 and that's about it. and that's not the standard that his own father set when he ran

for president in 1968. it is not the standard that most presidential candidates have set for themselves in recent memory, wolf. >> you'll hear his critics, all of the democrats saying what does he have to hide, why is he afraid to release earlier tax returns. he already released tax returns for 2010. he released an estimate for 2011 because he asked for april extension. i assume once he files that extension, he will release 2011. all the earlier years, he made it abundantly clear, you can scream and cry, he is not releasing those tax returns. the other interesting point, and there were a lot of interesting points, he didn't back down at all on his campaign's accusations against the sitting president of the united states, that his campaign was effectively lying to the american people about him. >> that's right. when i went back to mitt romney and asked him about that, because his campaign has been accusing the president's people of lying, he basically went back

to his attack on the president. several times during that interview essentially said it was beneath the dignity of the president, that this was beneath the president to be engaging in this kind of politics, he wants to campaign on the issues. at this point, you know the president did an interview with local abc affiliate in washington where he called on mitt romney to talk more about his bain record, asked why his name appears on the sec documents, post 1999, when he says he left the company. the president himself is willing to keep this story going forward. mitt romney is not, wolf. >> we will hear from the president in that interview with our affiliate in washington, what the president has to say about mitt romney. we will have excerpts of that in "the situation room" this hour as well. jim acosta, as usual, good work. we have lots more to assess on the romney interview with cnn and whether his answers will satisfy voters. ron bron steen is standing by,

we will talk about what's going on. ben stein later. paul begala later. and jp morgan says the bad trade debacle is costing a lot more than all of us thought. if you haven't heard the number, brace yourself. and you can see cars flip all over the place in movies and video games. wow. but look at this. we'll show you what happened. stay with us in "the situation room." ♪

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let's talk more about mitt romney cnn interview with jim acosta, and some of the controversy doing the campaign. joined by the editorial director of the journal. >> terrific interview by jim. i thought mitt romney was forceful app calm, but it is

unlikely to end the discussion. in fact, wolf, i think we're not going to know the verdict how this issue plays out quite some time. it is something i can see running into the fall. this is one of the central battle fields of the campaign, effort to define for voters what's the meaning of mitt romney's experience at bain. is it as romney argues a background that uniquely prepares him to lift the economy out of doldrums or as the obama campaign paints it, something that stamps him as more of the embodiment of the problem, not the solution. we are not in early skirmishes and not in the last. i think we'll be talking about this off and on for awhile. >> clearest only releasing income tax returns, already gave 2010, when done, we'll see 2011. is this an issue that goes away

or will continue to dog him? >> democrats will make it an issue. some ways, this campaign feels more like the campaign of 2004. barack obama, like george w. bush, he is unlikely to have approval rating 50% or above as the campaign proceeds. it means he must convince some disappointed in his leadership would prefer the alternative less than continuing in the direction they're unsatisfied with. in 2004, that's where bush was. he used a variety of items to disqualify kerry, he was a flip flopper, they came in with the swift vote that you couldn't trust him. obama is in a similar situation. there's a certain increment of voters that in the end are unhappy with the direction of the country, disappointed with leadership, convinced to stick with him, nonetheless. it is clear bain capital and what it means is the central thrust of the argument to the constricted voters. >> question on condi rice,

didn't answer if she is or isn't being vetted as a running mate. he made it clear, i thought he was forceful, he is his own man, not copying the bush administration or anyone else, he has his own ideas. >> that's another line of arguments coming from democrats. you look at important economic ideas, in particular, another 20% cut in marginal tax rates, less regulation. in many ways, betting on economic strategy similar to bush administration. at some point, obama campaign will make that argument. the two step argument, romney and his career, public agenda would do the same. we are in a continuum of arguments we will see through the debates in the fall. >> ron brownstein, thanks very much. excellent analysis. >> thank you, wolf. >> we will have other perspectives later this hour. ben stein, everybody knows ben stein. paul begala, everybody knows him, they'll be here, weigh in on what we heard. there's a lot of other news we

are following. lot of other news, looking forward to the conversation about romney interview. get everybody else caught up. 6:55 eastern. you ask, wolf answers. wolf will field a question about his most memorable moment with a president. stick around for that. here is what's trending in "the situation room." number four, heart pounding video from a red light camera in new jersey. show you this. a driver runs a red light, is slammed and rams into a light post. just look at that. an amazing crash. no injuries, though. the driver did, however, go to jail. >> no injuries? >> no injuries they tell me. number three in the trending list, amazon may be ready to focus on same day deliveries. setting up places for faster shipping. there's a con. you could be charged a sales tax, which the company has avoided by only setting up shops in key states to this point. top two trending stories coming up after this. that our sales ha by...

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back to a list of what's trending in "the situation room" this evening. number four, red light runner caught on camera, getting slammed, going airborne, hit ago light post. very amazing video.

number three, new reports amazon may be ready to focus on same day deliveries setting up distribution centers in more places. and number two, no more j.lo on "american idol." jennifer lopez said she feels like the time has come to give up being a judge on the hit show, one day after fellow judge steven tyler announced he is leaving as well. and number one trending tonight, nasa's seven minutes of terror, the amount of time the curiosity rover will have to go from, get this, 13,000 miles an hour to zero as it lands on mars next month. nearly a half million people have watched the adrenaline rushing explanation how it will work on youtube. that's pretty fast. >> very fast. >> like the music going underneath there. that's good, that pounding beating. >> jazzing it up. >> good music. >> it is trending. >> you have other news? we have a lot of other --

>> hear the music, too? >> if you want it, it is your show. whatever you want. moving to the other big stories. jp morgan says its multi billion dollar deal is much worse than we thought. $5.8 billion gone so far this year. executives say the number could grow further. even so, the bank recorded second quarter profit of $5 billion. also, much of the world expressing outrage over what could be the worst massacre to date in the syrian uprising. more than 220 people reportedly killed in a syrian village of trenseh. hillary clinton says it is indisputable evidence they deliberately murdered innocent civilians. she's calling for ceasefire to let u.n. into the town. shocked and appalled about use of weapons including tanks and helicopters. kerry kennedy, daughter of

robert kennedy was arrested accused of driving on drugs. new york police say she was driving erratically when she hit a trailer. she's former wife of andrew cuomo. >> sad story. did they say what kind of drug, prescription drugs? >> they have not said yet. that news is just coming in recently as we were coming on air from new york police, very sad story regardless. we're looking into it. >> thanks so much. the former president and famously broke no new taxes pledge goes after a leader of the anti-tax movement. george h.w. bush. and a surprising take on this. what matters more, the kardashians or what's going on in washington? [ male announcer ] citi turns 200 this year.

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welcome back. president obama talks about fairness when he is promoting his plan to raise taxes on wealthier americans. i think we need to take a hard look at his claim that people with higher incomes aren't paying their fair share. listen to this pitch from the president. >> we're also going to ask the wealthiest americans like me to do a little bit more. and i promise you, we can afford

it. and i've got a vision that says we grow best when our tax code makes sure the wealthiest americans are paying a little bit more in order to bring down our debt. basic idea that everybody gets a fair shot. everybody does their fair share. asking the wealthiest americans to contribute their fair share. we can build the kind of economy where everybody is getting a fair shot, and everybody is doing their fair share, everybody is playing by the same rules. >> you hear what the president has to say. the president wants to end bush era tax cuts on income above $200,000 for individuals, and above $250,000 for families. he notes that only the top 2% of income earners would pay a higher tax. their current rate of 35% would gop to 39.6%. president's numbers are accurate, absolutely accurate,

but here is what he is not telling you. the top 2% of income earners in the united states who would be effected by his tax hike already pay 45% of all federal income tax, nearly half the revenue the irs gets on april 15th. nearly half. can they afford to pay the higher rate? many of them certainly, certainly can. but is it fair to say that these top 2% are not already doing their fair share? let's also not forget, 50% of american households filing income tax returns pay absolutely no federal income tax. zero. that's because their income is either too low, especially when combined with legitimate child, mortgage, education and other deductions. these people pay other taxes to be sure, including payroll, withholding, sales taxes, but pay no federal income tax. so again, about half of american households pay no federal income

tax, the top 2% pay nearly half all federal income tax. tax is an important issue in the 2012 election. i just wanted to make sure we give the debate some context. which i think we did. let's talk a little about this more with two guests, ben stein here in "the situation room," and our cnn contributor, democratic strategist, paul begala is here as well. what i said was accurate, right? >> absolutely. >> gives the perspective, top 2%, a lot of them can afford to pay more tax, but they do pay their fair share. >> they pay, but not their fair share. fair is a completely subjective thing. it is objective. you gave us objective facts and pointed out some of the friends on the right don't, middle class and poor people pay a lot of federal taxes, just not income taxes. people with higher incomes pay higher income tax. people that smoke cigarettes pay 100% of the cigarette tax. you shouldn't be surprised people with higher incomes pay

higher income taxes. the question about fair is simply in the eyes of the behold erin voters. voters believe strongly if you make more than $200,000, $250,000 a year, you should pay the same rate paid under president clinton when america was a marxist par dies. the president is not asking for rates like eisenhower had, that communist that paid 91%. he says 39.6. the facts are right. i think the question of fairness is not -- >> fairness in the eye of the beholder. >> a huge issue in this campaign, two very different perspectives of what is fair. ben, i wanted to ask you, you're a republican, you said you think that taxes should be increased when facing such dire deficits and debt. do you think that romney is on the losing side of this issue? how would you advise him? >> i would say a huge difference between earning 200,000 and a couple earning 20 million. we could have very, very high taxes on people earning 20, 30,

40 million a year, and i don't think we can afford more tax for 200,000 a year. i am in favor of weigh higher taxes on people with enormous incomes. >> what's the definition, where would the cut off be. the president says 250,000. >> 5 million is the number i arbitrarily choose. i don't see why they shouldn't pay 50, 60%. absolutely, believe me, a lot in my neighborhood in beverly hills, still will have nice things for the children, bentleys for the wives, send the children to nice summer camps. >> a job creator. >> and still be able to create jobs, still highly incentivized to work and start their businesses. and by the way, all ethnicities, didn't mean to single out jewish people, all people. person with an eight figure income can't afford to pay more income tax is comical. >> i am not sure paul begala

agrees with 50% tax rate. >> i haven't thought about t ben is an economist. i defer to him on that. the question where it becomes political, which is my expertise, i defer to ben on the economy. politically, we know from one peek a boo tax return from mitt romney, he paid less than 14% on income of 20 million. that is not going to sit. >> totally legal. >> totally legal. but politically problematic. >> it was investment. capital gains. >> and he's got investments in the cayman islands, switzerland, bermuda. >> totally legal. >> that's the point. the president wants to change the law. wants a buffett rule, guys like mitt romney and buffett should pay the same rate as his secretary, a famous person. >> nice woman. >> is she? >> yes. >> weigh into the tax issue. a huge issue on the campaign trail. >> he should be putting out income tax returns. i don't work for the romney campaign, never voted for a democratic, but i think we

should go back to when it was the acting, energetic, head of bain capital. i would like to get back to something heavily dealt with and dwelled on by mr. acosta in that good interview, the accusation that he was head of bain capital. there's no crime in being head of bain capital. bain capital was making money for harvard university endowment, yale endowment, for duke endowment, labor unions, county and municipal labor unions. their investors were not the al qaeda, they were good people, trying to provide for their retirements. bain capital is helping them. >> the president gave an interview to a d.c. affiliate, wjla and said this. >> ultimately mr. romney i think is going to have to answer those questions because if he aspires to be president, you are ultimately responsible for the conduct of your operations. again, that's probably a question he's going to have to answer, and i think that's a

legitimate part of the campaign. >> you think he should answer that soon? >> yeah, absolutely. >> you think the democrats, you work for one of the super pac, prodemocratic super pacs. you think you're going to keep pounding on the income tax return issue? >> this i don't think, i know. i advise the super pac. voters don't like this. the notion is playing by a different set of rules. ben is right, there's nothing wrong about being head of bain capital. but it is odd he can't answer simple questions. there are things he did there that voters cannot abide, laying people off, cancelling health benefits to make more money. you make money for endowments and pension funds, that's true. he doesn't say that. if he said what ben said, it would be fine. instead, he fibs, says i created jobs. that was ancillary. sometimes he did, sometimes he didn't. he made money for mitt romney, some of which he invested in the kay mans.

>> some went to universities, to allow poor children from the inner-city to go to school on scholarship. that has been totally loss sight of. his work was in large measure helpful to the educational institutions of the united states of america. that's been completely loss sight of. >> want my advice, we're running ads, the real people he laid off telling real stories, and they're very powerful. he could run an ad of somebody he helped. >> you know what -- >> there's staples. maybe you're right. you give good advice. run an ad from folks that have jobs at staples and sports authority. >> at the end of the day, he was a financial wizard. that's what he did. he didn't invent the ipad. he didn't invent the iphone. there's a whiff of gordon gecko about him. he fed that by the comments he makes. so out of touch with the middle class people. came on the air, told soledad

o'brien he didn't care because they already had a safety net. >> these people on wall street make gigantic amounts of money for investors make them for charitable, nonprofit organizations. >> and for themselves, paying 13% on that and investing in the caymans. >> he is sending a lot of kids from inner-city schools to college that otherwise wouldn't go by virtue of endowments. >> don't go away. we will hear from a man that mocked a muslim leader on facebook. said that led to his father's arrest in iran. a story you want to see. and a lot of debate and fireworks in washington this week. was it all just a waste of time? stand by. you see us, at the start of the day. on the company phone list that's a few names longer. you see us bank on busier highways.

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we have seen social media help democracy and freedom in the middle east. some cases led to arrest and oppression. an iranian man found out when he was punished for jokes his son

posted on facebook. brian todd spoke with the son about what happened. brian, share with the viewers this story. >> reporter: this man's son who lives in holland is scared now. he believes his father is still being held. he cut off direct contact with his mother and sister to protect them, and all because of satirical postings he made on facebook, but the iranian regime jumped on. it is a strange looking cartoon on a facebook page. charles manson's face, superimposed over an image of a 9th century imam. it is popular among young iranians. a 25-year-old college student in holland joined the page about a year ago, started to post jokes and irreverant video clips. >> almost everybody involved believes that everything would be subject of a joke, and nothing and nobody is too holey.

>> reporter: in may, he got frantic calls from family in iran. his father had been targeted for the alleged sins of his son, arrested, taken to a prison notorious for torturing prisoners. >> a few days after arresting my father, i received a call from my mother. she was very -- crying and said if you don't go to that facebook page, they will execute your father. >> he messaged the manager of the page asking for the page to be taken down, the manager refused. he says iranian officials accuse his father of supporting anti-religious activities by paying for his son's studies. what could the iranian regime have seized here? an analyst for rand corporation, speaks and reads flew incidentally. >> this word means superstition,

this website is basically making fun of imam, holy figure in the religion, saying that beliefs in them are superstition. >> considered sack ri religious that brought its fist down on social media since the green revolution. >> given the technological sophistication of the regime, did you not think they would see what you were doing on facebook, see they would do it and possibly target your family? >> i never thought they were going to target my family. i thought i am doing something that's not acceptable by the regime. i accept the consequence of my own activity. >> reporter: he says he still doesn't know the condition of his father, only that his father is not, quote, free. cnn efforts to get information on his father's arrest and condition from iranian officials

in tehran and the u.n. are unsuccessful. >> you mention the manager of that facebook page refused to take down the page, even though doing that may save this young man's father. why did the page manager refuse to take it down. >> we don't know for sure who the page manager is. he thinks it could be for maybe two reasons. one, the manager might suspect that his appeal was a fake, that it was someone in the iranian regime trying to trick the manager into taking down the page. another possibility, if the manager took down the page, it would defeat the reason it was created to challenge the regime's authority and promote free expression. he told us he does not resent the action in not taking it down. he wanted to try it. so far, hasn't worked. >> cautionary tale. thanks for sharing that with viewers. over the years, i interviewed quite a few presidents of the united states,

including barack obama. i'll tell you if one of the interviews stands out most in my mind. matters. pioneers in outsourcing us jobs supports tax breaks overseas. insourcing. industry and favors bring jobs home. it matters. i'm barack obama, and i approved this message.

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so you think you know a lot about what goes on here in washington? it's time for a quiz. here's cnn's newest correspondent, the early start

anchor, john berman. >> reporter: pop quiz. what high-profile washington event will do more to make america a better place, change your situation and improve life on earth? a, president obama's big white house pitch to extend tax cuts for the middle class but let taxes go up for the rich. >> this is about helping job creators. >> reporter: or b, the great big house vote to repeal the president's health care plan. >> we are trying to end the era of washington-controlled health care. >> reporter: so which mattered more? the answer is c, kourtney kardashian having a baby. even if you don't know exactly who she is and i don't, it can't possibly matter less than what happened in washington this week. it's not that the issue of deficits and taxes aren't important. it's just that the president's been pitching this plan for years and it has exactly 0% chance of getting through congress now. so the impact of his white house

announcement, as bill murray would say in the immortal film "meatballs,". >> it just doesn't matter. >> reporter: it's that this 33rd vote to repeal or weaken the president's plan has the same chance of actually repealing the law as the previous 32 votes. in other words, exactly zero. as "meatballs" would say -- >> it just doesn't matter! >> reporter: so with anemic job growth, world economic turmoil and unrest in the middle east, how could we assess the net contribution from our nation's leaders this week? >> i tell you, it just doesn't matter! it just doesn't matter! it just doesn't matter! it just doesn't matter! >> reporter: even the all-star game -- >> from the boston red sox, david ortiz! >> reporter: a mere shell of its illustrious past, mattered more than the game of political charades this week. at least the all-star game

determines home field advantage for the world series. >> at the wall, it's caught. >> reporter: this and this determined nothing. which is why home field advantage goes to kourtney kardashian. john berman, cnn. you can watch john berman every weekday morning, they're the new anchor team on "early start" beginning monday morning, 5:00 a.m. eastern, only on cnn. just into "the situation room." we have a response from kerry kennedy's spokesman about her arrest reported earlier this hour. as we reported a few moments a kerry kennedy, daughter of the late robert kennedy, was arrested this morning, accused of driving while on drugs. police say she hit a tractor trailer and was later found in her lux sus with a flat tire. kerry kennedy voluntarily took breathalyzer, blood and urine tests, all of which showed no drugs or alcohol whatsoever in

her system. the charges were filed before the test results were available. we wanted to make sure we brought you that latest update as it is clearly developing story still. sad news over the following updates. >> very, very sad. thanks so much for that. up next, maybe my most presidential interview. it's your turn, ask wolf, that's next. t they haven't experienced extra strength bayer advanced aspirin. in fact, in a recent survey, 95% of people who tried it agreed that it relieved their headache fast. visit fastreliefchallenge.com today for a special trial offer.

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there's a speed demon on the loose in canada, wolf, be very aware. he videotaped himself on his motorcycle racing down a busy highway and weaving through traffic at speeds allegedly reaching 100 miles per hour. he posted the video online. smarty pants. and has gotten almost 1 million hits. he also got the attention of police, shocker. now he's on the lam and we're guessing he may be traveling very, very fast. note to self, when you're doing something illegal, don't post it on the internet. >> that's frightening. >> or don't do something illegal. >> that's scary. he could have killed himself. could have killed somebody else too. >> oh, absolutely, are you kidding me? anyway, don't get me started about speeding. it is your turn to ask wolf a question. i ask him questions all the

time. now it's time for you. this one is coming to us in an i-report. listen here. >> this question's to wolf blitzer on "the situation room." what would be your most interview you've done with a u.s. president? >> i love our i-reporters. >> that's actually a fabulous question. not many people get the opportunity -- >> i knew i was going to be asked this question because you told me. >> i gave you a head's up. >> i've been thinking a lot about it. i have been fortunate to have interviewed every president since jimmy carter as a sitting president. and i have to say, i was a young reporter, jimmy carter was president. it was the first time i interviewed a president of the united states in the oval office. i said to myself, wow, here i am, a kid from buffalo, new york, and i'm interviewing the president of the united states. it was right after the historic signing of the camp david acc d accords. and here i was doing an interview with him. so probably -- that was the most exciting times.

i was young. >> big debates, big interviews, do you have a ritual? >> i try to go in prepared. >> that's good. >> i consult my colleagues, what would you ask the president of the united states. i want to make sure i'm up to speed, ready to go, if he says something that cries out for a follow-up. well, hold on, maybe that's not exactly precise. make sure i know what i'm talking about. that's the ritual. if you're asking me, do i have the same bowl of cereal in the morning or wear the same socks -- like a pitcher will wear the same whatever. no, i don't have rituals like that. >> you've interviewed so many presidents. what was a memorable moment with the current president, president obama? >> the first interview i did with him was back in 2004. when he gave the keynote address of the democratic convention in

boston. and he was just a young guy. all of a sudden, he was a rising star. i went back not that long ago, reread the transcript of that interview. it was at the convention. i thought that was pretty good because i got to know him a little bit. at the time, i said, well, this guy's got potential. wasn't exactly sure he was going to be president of the united states. >> it's pretty great to be a witness of history. awesome. >> one of the front-row seats we have and it's great to be here. we've got to leave right now. that's it for us. thanks very much for joining. erin burnett "outfront" starts right now. "outfront" next -- so you lose $6 billion and your stock goes up 6% for the biggest gainer in america. how does that add up? well, it adds up to how much we do not know about our banks. and the feds bust two men, accusing them of trying to supply iran with nuclear material. and billions spent to drill for oil in the arctic but will it actually ever happen?

actually ever happen? let's go "outfront." -- captions by vitac -- www.vitac.com well, good evening, everyone. "outfront" tonight, losing money, rewarded big time. today, jpmorgan's stock was up like a july firework. surging 6%. in fact, it brought the whole market along. for a friday the 13th surprise. it was the best day for stocks this month. and it doesn't add up. so, jpmorgan shares popped in reaction to the bank announcing that losses from that high-profile trading blunder we've been talking so much about now top $5.8 billion. now, that $5.8 billion is about three times more than the company said it would lose on this trade just weeks ago. today, the ceo of jpmorgan, jamie dimond, took questions on an earnings conference call, and he said he's earned