there's an internal investigation at news corp, run by joel klein as a very respected person. so let's see what they find out. but there's more trouble ahead for the murdoch family, and so the dynasty that he hopes to put in place. >> you live in new york, did you know that frank lautenberg called for an investigation about the hacking of a 9/11 victim's family? >> yes, the reason is that in under american law, you can't hold a license to a television station if you have a criminal conviction. so if there's a criminal conviction in england, it might affect his ability to own and run television stations here. this is a man who started fox cable, which is now -- dominant cable news some he's got >>> issue three, american classic. >> there are women all over country like me, and if i don't make this public, then their lives will be gone. they're in jeopardy. >> former first lady elizabeth ford passed away a week ago. betty ford died peacefully in her home in palm desert, california, at the age of 93. her husband geralds ford, served as the 38th president for two and a half years,

his wife, wendy deng at his beck next to his lawyer joel klein and his son james at his side. the murdochs waited exactly 27 seconds to say "sorry." >> this is the most humble day of my life. >> i would like to say as well just how sorry i am and how sorry we are to particularly the victims of illegal voice mail interceptions and to their families. >> reporter: but sorry didn't mean they would admit knowing about widespread phone hacking and police bribery at the now- closed "news of the world" newspaper. though the lawmakers did try their best. >> mr. murdoch, at what point did you find out that criminality was endemic at "news of the world?" >> endemic is a very hard... very wide-ranging word and i also had to be extremely careful not to prejudice the course of justice which is taking place now. >> reporter: a criminal inquiry now under way let murdoch duck that question. but later, when he couldn't or wouldn't answer more pointed queries about who did know what was going on at the newspaper, his son tried to come to the rescue. >> did you or anyone else at your organization

education reform one of it's top priorities and mayor bloomberg has given two chancellors, first joel klein and now dennis walcott the authority and support they need to make the changes that have to be made. one of those changes has been the growth of public charter schools. charter schools have flourished here in harlem. the wall street journal last night -- last year reported that harlem had 37,700 students educating kids in these communities. these charters and the leaders like the harlem children zone, led by jeffrey canada, like the academies, and the success charter schools will not and cannot replace all of the public schools. but they are a right now educational option for students and families who need and deserve a better education. not some day, but right now. they are also great educational laboratories, where innovative approaches to learning can be tried, tested, and refined before being taken to scale in the public school system. and because they are choice options for students who believe that they are ill served by the system, school they attend, they are a competitive for

>> one of the things that was interesting to note was it was an american lawyer, joel klein, sittingver rupert murdock's shoulder there are actually some potential legal implications in this country. don't forget news corp is, in fact, based, legally incorporated in the united states. so there are some question whether the aed bribes might have triggered, you know, tripped the foreign corrupt practices act. >> bret: the f.b.i. is investigating. the attorney general apparently is going to meet with 9/11 victims on this very issue. >> news corp owns a lot of u.s. television stations in the past, for instance in the 1970s looked at the fitness of thely sen see deciding whether to renew licenses there are a number of other directions in this country this case could go. >> bret: do you really think it goes there? >> i don't know. the match has now been set to the gasoline. you don't know where they go. >> bret: charles? >> think it will depend hugely on whether the one report from one tabloid in england about the hacking of the 9/11 victims is a true story or not. it's unsourced, second h

now, right behind james is joel klein, the guy now touching his nose.e's an executive haven't at news corp. he's in charge of the interm na investigation. he started digging for clues in his nose and then he started going for his head, his ears. and examining the pickings, of the findings, as they're called in an evidentiary hearing. if this goes on any long erer, will not have a head left. now, see there? that's a guy that should get a monkey, right? [ applause ] he's got the money. got the inclination, certainly. the most interesting part of the hearing today came when a man suddenly attacked murdoch with a pie. which, i think it's nice that people are still throwing pies. it's like seeing somebody wear a walkman or something. here's the video. now, of course, now, he's being asked a question. unusually good looking questioner. i don't know how that happened. now watch this. the pie guy comes in there and -- my favorite part is this policeman. you see that guy? hold on. can we show that in slow motion. watch this again. okay. so, the pie -- his wife a

. >> you know joel klein who's on the murdoch defense team or is representing the murdochs. >> i haven't spoken to joel since he's got involved in the investigation, but i will say he is a brilliant choice to lead the internal investigation. he's tough and smart and will get to the bottom of it. the trick is, he has got to get the truth out and get it out quickly, because the longer it takes, the less they'll be in control of the story. >> richard, now, when we take a look at the response, at least from the markets themselves, yesterday as the murdochs started to answer the questions, the stock rose by something like 4%. it ended today in that same range. are we saying that the markets are basically saying it's okay, everything has made it past its nadir? >> well, 4% is not huge given where the slide has been but the market was clearly reassured that there seemed to be a plan to deal with this. because one thing that news corporation has been doing is changing its position almost on a daily basis. shutting a newspaper, getting rid of one executive, saying they're going to defend another.

there are very few cowboys and swashbucklers like joel klein who are willing to stand up to 'em. as a result, these organizations have set up a system whereby children are forced to attend the schools that are closest to their home. i ask you to think about this in any ore industry. imagine if your mother needed an encologist, and there was one just at another hospital, but there's a hospital close to you. that's now your neighborhood hospital. doesn't have the best encologist. would you for a second accept that? no. in -- but we're telling chirp and families the most important decision that any of us can make as parents, it's the most important decision, where you send your child to school, that you have to send your child to school that's closest to the house. the reason that's so is because the teachers' unions and other organizations like our good friends in naacp who fight to maintain the status quo so that these adults can keep their jobs. i don'ttive a damn if adults keep their job. that's not my point. that's not what i exist for. i'm here to make sure children get an edu

. >> reporter: sitting behind them you could see joel kleine who used to be at the new york city schoolow become very much a top aide there, also a very distinguished lawyer. i think the answers -- the advice you always give to clients in this situation is tell the truth but don't speculate. don't volunteer anything and they followed that advice as far as i could tell. they did not acknowledge anything that could be considered wrongdoing unless there was a specific document or a specific fact that they were confronted with. they were very contrite. rue pe rupert murdoch apologized. they didn't acknowledge they knew of the wrongdoing. one of the most interesting was towards the end rupert murdoch was asked, you're the boss here. what about your accountability? do you feel responsible? and in his very straightforward us a tr australian way he said, nope, i'm not responsible. i was let down by the people beneath me. now maybe that's not how leadership is supposed to work but, you know, this is his candy store. they own about 40% of the company and he sort of does what he wants. >> i was re