it for us. "special report" is next. i'm bret baier in washington and this is a fox news alert. legislation ended the national security agency's collections of your phone records while preserving some of its other surveillance authorities. senate republican leaders opposed the house passed usa freedom act but they were forced to accept it unchanged after last-ditch attempts to amend it or reject it. a short time ago, president obama tweeted he will sign the bill as soon as he gets it. speaking of surveillance we're learning tonight the fbi is losing low-flying airplanes to keep an eye on you. and a lot of people are upset

about it. chief intelligence correspondent catherine herridge is here tonight. >> thein many cases, they are flying without approval using technology to gather video or cell phone data and tonight the fbi emphasized to fox news the program is not secret and the data collection is targeted. over a 30-day period the a.p. investigation found more than 100 flights over at least 11 cities including seattle, houston, phoenix, chicago, boston minneapolis and over southern california. the a.p. says it was asked by the fbi not to identify used by the bureau. this plane was unusual and photographed last week in northern virginia. congressional records show the fbi's fleet has 115 planes including 90 cessnas. today, a member of the senate intel convenience committee questioned legal boundaries. >> is it consistent? is it authorized?

does it have oversight? we'll be asking all of these questions sooner rather than later. >> the aircraft are not equipped or designed for bulk collection activities or mass surveillance. the fbi uses all tools and equipment and conducts all investigations in accordance with the attorney general guidelines. but critics, including the aclu question whether the data is retained or destroyed. >> the fbi might be looking for a particular person but a lot of these technologies will still sweep up information about thousands or tens of thousands of people and it's a reminder what we've seen in the last 15 20 years is this huge surveillance apparatus that our american kboerngovernment has created is turning around on the people. >> they also used planes for similar collection programs, bret. >> catherine, there are new developments on the anthrax case that we brought you yesterday that the pentagon was sending out live anthrax spores to labs? >> that's right.

defense officials are confirming that live spores were sent to labs in canada and in washington, d.c. and three countries are now affected. no one has become ill but investigators have not ruled out the possibility that more live anthrax was shipped on purpose. >> is there a pattern here? >> a defense official confirmed there was an incident in 2006. a vial of anthrax was sent to the pentagon to test the bio weapon detection system for incoming mail and the sample most likely contained live anthrax and the vial came from the same utah lab responsible for this recent scare. bret? >> well i was posted there in 2006. hopefully it all works out. thanks catherine. now to iran and how much nuclear fuel iran has been stockpiling while negotiating a nuclear drawdown with the west. new developments as we learn from former white house aides that president obama's feelings were apparently hurt by the charge that he's no friend of israel an idea that has been

fueled by his desperate nuclear outreach to the republic. kevin corke from the white house tontd. >> we know what you did for us. we are forever grateful. >> reporter: on a day when the president honored two world war ii heroes a key aide to the commander in chief said that the president was frustrated that it was expressed that he wasn't a strong supporter of israel. david axelrod said to him, "you know i think i'm the closest thing to a jew that has ever sat in this office. for people to say that i am anti-israel or anti-semitic it hurts." president obama addressed concerns that iran won't live up to a nuclear arms deal. >> now, it may be that iran is not able to make the necessary

concessions for us to know we can verify it. then there's going to be no deal. >> reporter: pessimism is growing. inspectors reported that tehran's stockpile of nuclear fuel increased 17% over the last eight months. >> to say that is an obstacle is absurd. they are permitted to do what they are doing here. >> reporter: but it's tehran's right to deny inspection. prince foreign minister is telling "the wall street journal," "several countries in the region would say, okay a paper has been signed but we think it's not strong enough and therefore we ourselves have to become nuclear." al abadi said that he needs all of the support of the world to encounter the isis advance but

was not getting much. secretary of state john kerry said despite territorial gains, isis is not a state. saying that daesh is no more of a state than i am a helicopter. >> if we can defeat isil but we can't keep them defeated. only the people who live in the region. in this case in iraq can do that. >> secretary kerry was supposed to attend that anti-isis summit but couldn't because he broke his leg in the cycling accident a couple of days ago. we were told today he had surgery on that leg and as long as he's recovering he'll continue to work on the p5+1 talks. >> kevin corke thank you. there appear to be only a few survivors from a cruise on the yangtze river. it capsized with 458 people on board, most of them elderly tourists. so far, only about 15 have been rescued.

two of those, the ship captain and chief engineer have been taken into custody. new documents obtained by fox news show officials at the national archives passed up numerous opportunities to secure hillary clinton's e-mails, both while she was secretary of state and while she was a private citizen. and unilaterally purged her private server of 30,000 pages of e-mails. chief washington correspondent james rosen reports. >> reporter: during hillary clinton's final days as secretary of state, the chief records custodian at the national archives and records administration e-mailed his colleagues to sound the alarm that clinton might run off with her official records. there are or may be plans afoot for clinton taking her records from state to little rock" which was wrote in december 2012. we need to discuss what we know and how we should learn more

about her departure from state. a nonpartisan watch dog. >> a system of noncompliance, a system of national archive employees supposed to be objective delicately dealing with the potential of illegal activity. >> reporter: entrusted with supervisory authority over the executive branch territories making sure that the records are properly stored but the officers offer precious little authority over hillary clinton. the issue was written about with the preservation of high-level memos generated within s/es. that's within the department's secretary. they will be establishing their own recordkeeping system. after "the new york times" broke the private e-mail system months

ago, gary stern privately e-mailed the national archivist himself to say nara does look into allegations of this type. this case if true would present a concern. and james springs, nara's acting inspector general, swiftly e-mailed to ask, were we aware the government e-mail system was not being used by ms. clinton? and it was written back i will talk to james. >> i remain mystified that a private e-mail account went unnoticed or unremarked upon during a four-year tenure. tim simply put, where was everyone? >> the controversy is taking a toll on hillary clinton's favorability rating reaching a 14-year low. 55% of americans did isapproving of

the way that clinton has handled questions about her e-mails. >> james rosen thank you. up next why the irs can't seem to protect your personal information. first, fox 25 in boston a man fatly shot by law enforcement officers was under surveillance by the fbi joint terrorism task force. police say the man pulled a knife on officers and refused to put it down. the commission of the boston police would not say why the suspect was being watched. kvrr in fargo north dakota a man has been convicted of driving while drunk. he was driving a zamboni. fans complained he was driving the machine erratically and crashing into the boards. drunken driving laws do not apply, says his attorney. this is live in new york. fox 5 is covering the arrival of american pharaoh.

he will attempt to be horse racing's first triple crown winner since 1978. that's the live look outside the beltway for "special report." we'll be right back.

the irs knew its computer systems were vulnerable to hackers but failed to combat cyberattacks. that's just one of the takeaways from a pair of congressional hearings today that focused on the tax's inability to protect its self and you. here's correspondent shannon bream. >> it's clear to me that if you have i.t. from the dark ages you're not going to be able to stay on top of all of these kinds of problems. >> reporter: yet, that's exactly what the irs commissioner says his agency is facing outdated infrastructure making it vulnerable to breaches

attacking more than 100,000 taxpayers whose personal information was illegally accessed earlier this year. the information was used to file fraudulent refund to the tune of $39 million. >> in many ways this event is a shot across the bow to remind people of the nature of the battle we're fighting and the sophistication of the enemy. >> reporter: during two senate hearings today, lawmakers it and irs officials speculated about the source of the breach most blaming blaming international crime syndicates. some may have been stolen but other data could have been gathered from the taxpayer's themselves via postings on social media sites like facebook. irs inspector general testified that the agency has been repeatedly warned for years about vulnerabilities and in many cases, refused to act on his recommendation. >> managed to periodically

review access to systems, limiting to people who only have a need for that information. >> mr. george those do not sound like resource issues. that sounds like a management issue. >> i agree, sir. >> reporter: victim mike kasper realized that his information had been stolen and failed efforts to get help directly from the irs. >> they said privacy rules at every step of the case when i tried to get more information, they would say privacy rules prevented them from doing that. >> reporter: the climb will extend far beyond the initial breach says a privacy expert. >> it's a very active black market in trading this information. >> reporter: though he repeatedly talked about the need for increasing funding and the agency can't keep up with cybercriminals much less get a step ahead of them he also admitted the latest breach was not caused by a lack of sufficient funding. bret? >> shannon thank you. the ceo of amtrak is

promising safety technology which could have prevented the deadly derailment in philadelphia would be put into operation. eight people died after the train entered a 50-miles-per-hour curve. >> at that time the notion that an engineer might have accelerated into the northbound curve was not a circumstance we anticipated and thus we didn't mitigate for it. it was a reasonable decision reached by reasonable experts under reasonable circumstances. >> also today, the preliminary ntsb report on the crash confirms the engineer did activate the emergency brakes seconds before the derailment. no word on whether his cell phone was in use around that time. remember what president obama said about bringing health premiums down? well in recent days millions of obamacare subskrimcribers are

seeing a rapidly increase in their premiums. >> reporter: the obama administration has revealed how much insurance companies propose raising premiums next year. in many cases, it's a lot. in texas, bluecross and blue shield said it lost $400 million last year selling individual insurance plans. next year it proposes raising premiums by nearly 20%. aetna in new jersey is requesting 30% hike. >> these big rate increases mean obamacare insurance policies will cost a lot more. >> reporter: the administration contends these projections are only initial estimates. the white house says thanks to obamacare, these increases are now transparent and negotiable. >> now insurance companies have to publicly notify or publicly put people on note notice that they are preparing a double digit increase and we see those rate increases are reviewed by state regulators and the result typically has been that after that state review is conducted,

that insurance companies would slash their rates. >> reporter: the administration has only released information on plans with proposed increases of at least 10% and says insurers project most will enroll with premium hikes of less than 10%. these estimates from insurance companies show a fundamental weakness in the health care law. >> not having confidence that more healthy people are coming into the pool and they are starting to take their rate actions a year earlier than we expected. >> reporter: the administration says they will publish the final rate increases by november. this while there are questions as to how much the government can help americans pay for their insurance. if the supreme court rules against it citizens in up to 40 states could lose their health subsidies. bret? >> rick, thank you. president obama is ordering many federal cafeterias serving food with fewer antibiotics, part of the administration's plan to stop the threat posed by

antibiotic resistance bacteria. when we come back carl cameron with why florida may be the key state for republican presidential contenders. the first administrative head rolls when we learn how ineffective the tsa is against good guys pretending to be bad

much of the republican presidential field is in florida tonight. by the time that contest rolls around as many as half of all republican primary voters may ha ballots. chief political correspondent carl cameron reports that means florida could propel one candidate to a breakout lead.

>> reporter: former arkansas governor mike huckabee took a blast at fellow republicans for proposing entitlement reforms to pay debt. >> i know the man ta has been that we need to make changes to the social security and medicare recipients. that's a recipe for not only political recipe but also economic suicide. >> if you don't talk about what you're going to do with the 71%, in my view you have no right to talk about the other 29%. they said don't touch this. it's the third rail. instead of touching t. i'm hugging it. >> republican governor scott walker mans to talk about it in the weeks ahead but plans change for younger workers. >> anyone at or near retirement,

we're not touching social security. apply it to me and people younger than me. >> reporter: jeb bush the first two-term republican governor in the state's history said it will fail come fleetly without serious reform. >> we need to work on it now and progressively raise the retirement age. >> reporter: senator rubio will be on the stage as well as white house rivals. >> the united states nate is taking up the reauthorization of the patriot act. it's a vote i couldn't miss. >> reporter: rubio had to appear by video and had a double barrel blast against hillary and jeb bush. >> our outdated leaders talk about an outdated idea. >> reporter: republican scottgovernor bush and senator rubio certainly would

have a competitive advantage over anybody because of their presence having won in the state elections. >> reporter: for decades, florida has tried with only mixed results to make its primary as impactful as possible. while some say it's likely even probable that florida will turn up a nominee, it's even more probable that it will turn out candidates that never will. >> carl cameron thank you. the house may try to ban funding for an embassy or other diplomatic facility in cuba. president obama is trying to normalize relations with the communist nation but republicans on the appropriations committee plan to prohibit the embassy. sepp blatter says fifa needs pro found restructuring and

resigned. we are sure you'll be thrilled to learn when one state lawmakers get so hammered they can't drive home. it isn't the lawmakers. the grapevine is next.

and now some fresh pickings

from the political grapevine. hillary clinton had to call in reinforcements for the campaign fund-raiser. the talk was scheduled as a woman's only event only about 50 tickets were sold before the deadline and then the deadline was pushed back. twitter critics were quick to the punch line. what difference does it make? a washington examiner noted imagine the outrage if a male candidate held a "men only" event. in the end, only a few people showed up to hear the former secretary of state. and paying for taxi rides for drunk state officials? more than $2500 a month goes for a 24-hour taxi service for senators who apparently just

can't say no. members are given small plastic cards with the 24-hour transportation number available when the legislature is in session. critics say the rides are reflective of the lawmakers sent with entitlement. the answer is not in providing them drivers. the answer is in showing restraint. finally, chickens do not have eight legs and kfc wants everyone to know it. the fast food giant is suing three chinese companies whose social media account spread false claims including that the company's krik kens were genetically modified to have six wings and eight legs. marketers hired to mock online false competitors. kfc is asking for the company to apologize and pay a fine. the transportation security administration is under new

management tonight. the acting head of the tsa was yanked out of the job shortly after we learned about his staff's bismol record of discovering threats to airports and planes. correspondent doug mckelway is at reagan national airport tonight. >> reporter: hi bret. there is a new six-point plan to check equipment and appoint a new management team to oversee those changes. he urged the nate to quickly confirm the nominee. it's been a little more than a day now since the security tests were leaked to the press and there's been a swift condemnation from capitol hill. the chairman and the ranking member of the commerce science and transportation committee noting quote, terrorist groups like isis take note when tsa

fails to intercept 67 out of 70 attempts by undercover investigators to penetrate airport checkpoints. despite his management actions, secretary johnson is defending the results. he said in a statement last night, and i quote, the numbers in these reports never look good out of context. well, in 2013 then tsa administrator, had a similar response after a simulated bomb made it through airport security checkpoints in newark new jersey. >> the whole purpose of the routine testing, those are our folks that can create and devise and conceal items that only the best terrorists in the world -- not even best terrorists in the world would be able to produce. >> white house press secretary josh earnest today said the president has high expectations that the tsa will do the right thing. >> that's why, you know the prompt action that was taken by

secretary johnson just last night is consistent with that philosophy. >> nevertheless the senate leadership is pushing back against johnson's call for a quick confirmation of the tsa administrator nominee, noting that the previous administrator, pistole, announced his resignation last october but it took seven months to come up with a new nominee. bret? >> doug mckelway, thank you. the stocks are off today. dow is down 28 and s&p down 2 and nasdaq down 6. iran stocking up on fuel. we'll talk about it all with the panel after a quick break.

our diplomacy with respect to iran where for the first

time in a decade we've halted the progress of its nuclear program and reduced its stockpile of nuclear material. >> how do you square that with the ie announcing a 20% increase in the nuclear feel? >> the iae report published at the end of last week is a snapshot in time and the joint plan of action requires iran by the end of that joint plan of action period in this case by june 30th to be at the appropriate cap on their stockpile. >> well the snapshot in time is the time over the last 18 months as this nuclear deal has been being negotiated with iran the nuclear fuel increasing by 20%, according to the iaea this as former key aides to the commander in chief that the president was pretty frustrated by the perception that he wasn't a strong supporter of israel.

david axelrod saying that the president said to him, obama vented during a time of contemplation telling him, you know i think i am the closest thing to a jew that has ever sat in this office. for people to say that i am anti-israel or even worse, anti-semitic it hurts. steve hayes, senior writer for the weekly standard mara of national public radio and syndicated columnist charles krauthammer? >> according to the agreement, what he didn't say is how they are going to get rid of it by june 30th and, why if they are trying to negotiate an end to the nuclear weapons program, they were increasing it as the negotiations were going on. not a good sign. you know if the administration does get something that it says is good is going to have a lot of explaining to do. >> meantime you have the french

foreign minister giving an interview to the wall street journal. the possible nuclear deal with eastern risks sparking a nuclear arms deal in the middle east and "the best agreement if you cannot verify it it's useless. several countries in the region would say a paper has been signed but it's not strong enough and therefore we need to become nuclear." these are the french. >> it doesn't risk it. it's happening. the idea that this is some point down the road is silly. we know it is happening. we have seen what the saudis are up to and what they have been doing behind the scenes. look if you take josh earnest's argument at face value, we know that they are cheating now but we take them at their word that they are not going to cheat later. that is a preposterous they were

feeding banned centrifuges at a time when the iaea called them on it and the obama administration not only refused to call it cheating but, in effect started making excuses for them. so they gave an interview, a senior administration official gave an interview to bloomberg and said it was probably a mistake that they were using these banned centrifuges. at a certain point, it can't be the case that the nuclear program because a side issue for barack obama and his iranian legacy. the iranian nuclear program really matters and ought to be the center of this discussion. >> what about the quote from david axelrod, that i'm the closest thing to a jew that's ever sat in this office? >> well i'm not sure i can understand what that means. but perhaps the judgment of israelis 6 million of them are jews and, more importantly v. have a good idea of what a friend is i think the approval

rating for obama is 15% among israelis. so the administration has a favorable view of obama and overwhelming majority of the israelis know that this president has been probably the least favorable to israel of any in israel's history and at a moment where israel's existence is actually in question, for oem obama, this is matter of personal hurt? who cares? it will acquire the means to do so and the issue here is that after 40 years of nonproliferation based on the principle that nobody enriches uranium, we are going to be signing a deal proudly with iran which is a rogue state and has

broken every promise it has made a. a rogue state ending the nonproliferation regime in the world and enter a period of hyper proliferation starting now. >> i have two sound bites here. one is president obama talking and addressing israel directly. i want to play that one to the israeli people. >> to the israeli people i understand your concerns and i understand your fears. but what is the worst scenario is the path that we're currently on in which there's no nuclear resolution and ultimately we have no way to verify whether iran has a weapon or not. sanctions won't do it. a military solution is temporary. the deal that we're negotiating potentially takes a nuclear weapon off the table for 20 years. >> potentially takes it off the table for 20 years. >> look that is ridiculous. assuming there's no cheating we will legitimatize a bomb in a

lot shorter time than that. but this sin comprehensible. we already heard about iran cheating on the enrichment and it's succeeded its caps every month in the last 20 months. all of this has been happening with sanctions and under restrictions. imagine how iran is going to act after sanctions arist willed after the agreement is signed when it has zero incentive to refrain from cheating and we know it will? and even if it cheats and we find out about it i guarantee you that this idea that we're going to have snap-back sanctions in the u.n. is something that will never happen. >> is there a sense, mara in the white house that this is kind of slipping away? that it's slipping out of their grip? >> i haven't heard anything like that. president obama said to jeffrey goldberg if this deal turns out to be bad and they get a bomb either before or after the 10 or 15 years, it's going to be on me. in other words, it's going to be

my fault. it's going to ruin my legacy. and he's absolutely right. and that's why i don't understand the incentive for him. why would you agree to a deal that isn't good or won't work if it's not going to help him politically at all. this deal has to be a good one or he goes down in history as someone who gave iran the bomb. >> we don't talk about this enough but the house foreign affairs committee today called on eastern to release three americans currently held a fourth missing. take a listen to this testimony real quick. >> we do worry, that regardless of the outcome of the deal, whether there is a successful deal and improved relations, i don't know if there will be an urgency to get our family members home anymore. >> it's crucial. if we don't get the americans

out, i don't know when we will have more leverage. >> we don't hear any of that secretary kerry doesn't say, release the americans, too. >> the administration from the very beginning had what it decoupled the nuclear talk from every aspect of iranian regime's behavior. it matters that there's a fake trial of a washington post journalist and it matters that they have been sponsoring anti-american terrorists for decades and doing so today. the administration thinks it doesn't matter in terms of our negotiations and it does. next up obamacare premiums are about to skyrocket. we'll go down that road.

you can get the same good rates as a group that if you're an employee at a big company you can get ride now, which means premiums will not go down. . >> it's no, sir the fiscal disaster that critics warned about. >> premiums are on the increase. >> there are big increases happening. bluecross blue shield was raised

20%. aetna, 30% hike. wellmark 43% increase in south dakota. . experts say it's a big problem. >> all of the insurance companies that bid these rate increases were doing it wrok. blind when the biggest companies with the most data are asking for the big increases that's a bad omen. by potentially 40 million people. it's going to cost something. and yet the promise was it won't cost the government a dime

which, of course isn't true. it's going to cost hundreds and billions. it's costing right now hundreds and billions in subsidies and you will get a cut. it's simply inconceivable that you will get a cut. i mean i'm not arguing against insuring the uninsured. i'm arguing doing it as a matter of perception. it is perhaps something that the government ought to do but you should be open and honest about it and insure the uninsured, it will cost you and the government. >> this is huge. 43%. >> it's huge. we don't know what the national numbers are going to be. it is big. it comes at a time when we're waiting for the supreme court to decide if there are going to be subsidies for these plans because if the supreme court decides that states set up their own exchange 7 million people won't be able to afford their own insurance. >> yeah. >> it will be a huge, huge deal. >> but is there a plan b?

>> there's certainly not a plan b from the white house. the interesting thing for me is what would the republicans do? most the states are states with republican governors and the senators up for re-election are in those same states. there are some ideas floating around like yes, we'll continue minimum requirements. i don't know how any of that could get past congress. >> even if the states change you're looking at premiums that are increasing 43%. >> here's what i think makes this doubly outrageous. if you go back to 2011 2010 time frame, the white house produced a report in which it predicted using facts and analysis as the president might say suggesting that these premiums the very premiums we're talking about skyrocketing now would go down between 14% and 20% and based on cbo and numbers.

a lot of people at the time said those numbers are phony, that doesn't mean anything. this couldn't be deficit neutral or save you money on your own premiums and couldn't possibly result in better care as the white house was saying. it was a silly thing to try and sell but we know that the white house sold it and sold it with specifics that were in effect meaningless. i think that's what's galling to so many americans and the reasons you see americans frustrated with washington. there's no accountability for things like that. >> there's an interesting interview in our web site from 2010 which some of the questions were asked to president obama. >> look. yeah. it was made by a certain person who we won't even mention and you didn't stop asking him because he kept running away. there was a double issue that was obvious, fact. it wasn't an opinion and kept pretending it wasn't happening. i think he ought to replay that several times. >> the last thing, does the supreme court, do you think it comes down? >> absolutely no idea.

i mean i really don't. they took up this case which surprised a lot of people and i don't know how they're going to rule. >> we're watching by the test test

in the news business we cover all stories. some serious some not. transitions between the two can be a bit rocky at times.

cleaning your cat box twice a month? give me a break. no wonder your house smells. >> already cleaning it twice a month? >> i attempt to make a rude gesture at you. >> twice a month? >> get a couple of extra boxes. not just one. clean it every day with a scoop is what i told my husband. >> all right, some random shootings in colorado. >> oh dear. robin. thanks for inviting us into your home tonight. that is it for this special report. fair balanced and unafraid. greta goes on the record right now. >> it is wednesday june 3rd, a fox news alert. alter or suspect who wanted to kill cops and wage jihad is shot dead in boston. now a new arrest overnight as the investigation widens.

>> president obama signing a sweeping over hall of the nsa program. will it be enough to stop another terror attack. >> a quick thinking cop hailed a hero for saying a man's life. a dramatic moment a car goes up in flames and the dramatic rescue. "fox & friends" starts right now. >> good morning to you. you are watching "fox & friends first" on this wednesday. we appreciate it. i am heather chieders. >> i am ainsley earhardt. thank you for waking up this early with us. a terror take down in boston. a police officer and an fbi agent shoot and kill a knife wielding man who has been under 24-hour government surveillance. >> a second suspect is under arrest. patricia stark has the breaking details. >> a terror suspect is shot dead

in boston after a man charges at police armed with a knife. that suspect now identified as 26-year-old usama raheem. he has been sur slains for the last 24-hours. a police officer and member of the fbi joint terrorist task force approached rahid outside of the cvs where he worked in boston. >> we have a gentlemen black male coming out without a knife.-- with a knife. >> what was meant to be an interrogation turned deadly. >> we thought it was appropriate to question him about his doings today. unprovoked he came out with a knife. >> this is the large military knife he charged