Return to Transcripts main page


Letterman Blackmail Sex Scandal; Captive Israeli Soldier Still Alive; Can't Believe She's Gone

Aired October 2, 2009 - 17:00   ET


WOLF BLITZER, CNN ANCHOR: A double shocker involving David Letterman, the late night TV host. He says he's the target of an alleged blackmail attempt by a CBS News producer, Robert Halderman. Halderman is accused of trying to extort $2 million from Letterman by threatening to reveal sexual encounters Letterman had with some of his employees -- encounters to which Letterman is now confessing. Halderman has just pleaded not guilty to first degree attempted grand larceny.

The New York district attorney explains Halderman's alleged scheme.


ROBERT MORGENTHAU, MANHATTAN DISTRICT ATTORNEY: Halderman waited outside Mr. Letterman's Manhattan home at 6:00 a.m. on September 9th to deliver a letter and other materials to him as he was leaving for work. Halderman wrote that he needed to make, "a large chunk of money" by selling Letterman a so-called "screenplay treatment."

The one page screenplay treatment attached to the letter referred to Mr. Letterman's great professional success and to his, "beautiful, loving son. The document related then that Mr. Letterman's, "world is about to collapse about him," as information about his private life is disclosed, leading to a "ruined reputation" and severe damage to his professional and family lives.

The package contained other materials supporting the, "screenplay treatment" and directed Mr. Letterman to call him by 8:00 a.m. to make a deal.

Mr. Letterman immediately contacted his attorney.


BLITZER: David Letterman himself blew the scandal wide open on his show last night.


DAVID LETTERMAN, HOST: The creepy stuff was that I have had sex with women who worked for me on this show. Now, my response to that is yes, I have.


LETTERMAN: I have had sex with women who work on this show.


LETTERMAN: And -- and would it be embarrassing if it were made public?

Perhaps it would. Perhaps it would.


LETTERMAN: Especially for the women.


LETTERMAN: But that's a decision for them to make, if they want to come public and talk about the relationships, if I want to go public and talk about the relationships.

But what you don't want is a guy saying oh, I -- I know you had sex with women, so I -- I -- I would like $2 million or I'm going to make trouble for you.


BLITZER: After pleading not guilty, Halderman was just released on $200,000 bail. His uncle and spokesman, Richard Smith, is joining us now live.

Mr. Smith, thanks very much for coming in.

Tell us when you first heard about all of this.

RICHARD SMITH, HALDERMAN'S UNCLE: We heard about this about 8:00 this morning.

BLITZER: You weren't watching David Letterman's show last night, I take it?

SMITH: No. No, we were not.

BLITZER: So who -- who told you about it?

SMITH: Well, we got a call from his mother (INAUDIBLE)...

BLITZER: His mother is your sister, is that right?

SMITH: Yes, it is.

BLITZER: So you -- your sister called you, the mother of Joe Halderman.

And what did she say?

SMITH: Well, she said Joe was in trouble, so we turned -- and mentioned CNN. So we turned it on and we started getting the feed. And that's all I can tell you. That's all I know... BLITZER: What else did she say?

SMITH: what's been on TV. Well, she just said he was trouble. She didn't know the facts at that point and I don't know that we do right now. Joe Halderman is a very loving individual with his family. He loved his job with CBS. Nobody has indicated to us any guilt other than that he was arrested, under suspicion.

BLITZER: Do you have any explanation at all in your mind?

You've known Mr. Halderman for many years -- I assume his whole life -- how he could get himself into -- into this kind of trouble?

SMITH: That is what is so shocking to us. We don't understand anything that would drive Joe into this position. It's just not his nature.

BLITZER: Did he have financial problems?

SMITH: That I would have no way of knowing. We talked to him just last Tuesday evening for about 45 minutes on the phone. We could tell that he was slightly down. He wasn't his normal, bubbly cheerful self. He sounded very tired.

BLITZER: We know he went through a divorce not that long ago and there are reports he was having to spend about $6,000 a month in alimony, is that right?

SMITH: Well, would I have no way to verify that, but I've heard the same story.

BLITZER: Because that -- that sounds like it could cause someone to be very, very depressed.

Did anyone suggest to you he was going through a period of depression?

SMITH: No, no. That's -- and I didn't pick up on that when I talked to him last Tuesday.

BLITZER: Did he have any history of depression, as far as you know, Mr. Smith?

SMITH: No. Joe and his family lived within 10 to 15 miles of me when I lived in Mesa. He was always a very happy child, very active. We did a lot of boating and skiing together. His mother and I grew up very close. We're only 13 months apart. And as far as I'm concerned, Joe has always been a very loving family member. He's just like a son to me.

BLITZER: How is your sister doing?

SMITH: She's kind of torn up over this. She doesn't know what's going on or how it could be going on. It's just so far out of character of Joe that none of us can understand it.

BLITZER: I -- I assume you have not spoken to Joe since you learned about all of this?

SMITH: No, I have not.

BLITZER: But did his family -- your sister, ask you to be a spokesman and to go out now and explain at least some -- some perspective from his side of the story?

SMITH: Yes. She called me around noon today and asked me if I would be willing to be the spokesperson for the family and explain what -- what the problems she knew of. And I said I'd do it for her.

BLITZER: What else do you want to say?

What else should we know about this based on -- you know the family and you know your nephew Joe?

SMITH: Well, I know that Joe was very close to his son and his daughter. And the -- his with ex-wife moved outside of Denver and took the two kids with them -- with her. And Joe was quite upset about that. But I never heard any hostility from him other than it hurt. So we had no reason to believe he would be depressed enough to get into this kind of a situation. And that has to be proven yet (INAUDIBLE).

BLITZER: He's innocent until he's proven guilty. He is out now on $200,000 bail.

What would you say to him right now if -- if he were watching?

SMITH: I would be asking him questions and, you know, after the fact, what -- what good can I do?

We will support him and help him wherever we can. And hopefully, he will be innocent.

BLITZER: Mr. Smith, thanks very much for coming in.

SMITH: You're welcome.

BLITZER: Let's go to Jack Cafferty right now.

He's got The Cafferty File -- Jack.

CAFFERTY: Distracted drivers are a deadly threat and it includes anybody who talks on cell phones, texts, eats, puts on makeup -- any of this stuff while behind the wheel of a moving vehicle.

Six thousand people estimated killed, more than half a million injured, in 2008 in crashes involving a distracted or inattentive driver. One study shows 80 percent of crashes -- 80 percent are related to drivers who aren't paying attention. And people using handheld devices are four times as likely to get into an accident that could result in injury -- four times as likely.

Safety advocates say they're especially worried about young people. Some kids -- listen to this some kids learning to drive now text 5,000 times a month.

How scary is that?

Washington wants people to take it seriously, so there's a Senate bill that would reduce federal highway funding for states that don't ban texting while driving. President Obama signed an executive order that bans fellow employees from texting while driving. The government plans to ban texting while driving by bus drivers and tracks across state lines and possibly prevent them from using their cell phones while driving. And a lot of companies have already banned employees from using cell phones while driving.

The problem is, there's no enforcement. There's none. I see literally dozens of people yakking away on cell phones in their cars every day on my ride into these studios from my home in New Jersey. It's about 15 miles. I see dozens of people every day.

They slam on their brakes, they change lanes, they swerve all over the road -- all while lost in their own little worlds on their cell phones.

You want to get serious?

Yank their driver's licenses permanently if they cause an accident while driving while texting or talking or putting on eye shadow or all of this stuff they do.

Here's the question -- what's the answer to people who insist on driving while doing other things?

Go to

They do it because they can. There is no enforcement of these laws. I mean I just -- I see it every single day. Nobody does anything about it.

BLITZER: I see it, too, Jack. Good point.

Thanks very much.

Hopefully, your commentary will save some lives.

Let's hope.

We have another way for you to follow up on what's going on right here in THE SITUATION ROOM.

I'm now on Twitter and can you get me Tweets at -- wolfblitzercnn, that's all one word.

It's as emotional as it is shocking -- an Israeli soldier captured three years ago now seen in a videotape proving he's alive and sending a heart-wrenching message to his family.

Also, a young girl literally swept from her mother's arms by a tsunami -- a family shares its grief. We're live in the disaster zone in Samoa.

Plus, a U.S. senator in disgrace and now under investigation by his peers. There's new fallout happening right now from Republican Senator John Ensign's affair with the wife of a former aide.


BLITZER: Proof of life for the first time in three years -- the family of Gilad Shalit knows for sure he's still alive. Shalit is the young soldier captured during a 2006 raid by Gaza militants on an Israeli Army post. He was 19 years old at the time. Today, his captors released a videotape.

CNN's Kevin Flower has from Jerusalem.


GILAD SHALIT (through translator): Hello. My name is Gilad, the son of Noam "The Late Show with David Letterman") and (INAUDIBLE) Shalit, the brother of (INAUDIBLE).

KEVIN FLOWER, CNN CORRESPONDENT: Wolf, with the help of Egyptian and German mediation, Israel and the militant group Hamas were able to make the first step in a potential deal for the release of a captured Israeli soldier.


FLOWER: Video that Gilad Shalit's family and many other Israeli families have been longing to see for more than three years -- proof that Shalit, who was abducted by Gaza-based Palestinian militants in a 2006 cross border raid, is still alive. Looking gaunt, but otherwise healthy the 23-year-old soldier had poignant words for his family.

"I wish to send my love to my family and say to them that I love them and I miss them very much and I am longing for the day when I see them again."

He held up a Gaza newspaper dated September 14th.

Israeli Prime Minister Benjamin Netanyahu called the footage "important proof of life" and warned Hamas that Israel holds the group responsible for Shalit's well-being. The release of the two minute and 40 second tape comes after months of arduous but indirect negotiations between Israel and the militant group, Hamas.

Hamas is seeking the release of up to a thousand Palestinian prisoners of the over 7,000 who currently sit in Israeli jails -- some involved in attacks on Israeli citizens. So far, it's a price Israel has been unwilling to pay.

But on this day, it agreed to release 19 female Palestinian prisoners to get the proof of life. And for the friends and families of the women, it was a day of celebration.

Fifty-eight-year-old Zuhour Hamdan from Ramallah in the West Bank, arrested in 2003 for allegedly aiding a potential suicide bomber, was reunited with her eight children and granddaughters she had never met.

"Really, I cannot believe this," she tells us. "It's indescribable. I thank God that he gave me this release to see my loved ones; also to see my mother."

In the Gaza Strip, Hamas wasted no time in taking credit for the releases, staging a hero's welcome for its returning prisoner. Fatama Yunia Al-Zouk "The Late Show with David Letterman") and her 1-year-old child, born inside an Israeli prison.

"This is a day of victory for the Palestinian people, for the Palestinian resistance and steadfastness," said this Hamas leader Ismail Haniyeh.

Both Israeli and Hamas officials have been quick to caution that the agreement for the release of the tape and the prisoners does not represent a breakthrough, but rather a confidence building measure. But with expectations raised on both sides, there's a glimmer of hope that a deal might be reached sooner rather than later -- Wolf.

BLITZER: Kevin Flower in Jerusalem with this story.

Meanwhile, the losses being measured after two disastrous earthquakes that rocked Sumatra this week. President Obama today managed to reach Indonesia's president by phone. In their five minute conversation, he offered U.S. assistance with the relief efforts. The first earthquake that struck Sumatra on Wednesday registered a powerful 7.6 magnitude. It was followed by a magnitude 6.6 quake yesterday in the same region. The United Nations says as many as 1,100 people are dead. Thousands more believed to be buried in the rubble.

In the Samoan Islands, survivors are still counting their losses from the magnitude eight earthquake and tsunami that struck there on Tuesday. So far, 139 people are known dead in Samoa, 22 of them in American Samoa and seven in Tonga. The Samoan government plans a ceremony and mass burial next Tuesday. Samoa's prime minister says several villages are destroyed. This morning, two C-17s left Davins Air Reserve Base "The Late Show with David Letterman") carrying relief supplies to American Samoa.

In American Samoa, the stories of tragedy are being felt and told one family at a time.

CNN's Ted Rowlands is in the village of Leone.


TAITASI FITIAO, MOTHER: And I can't believe she's gone. I mean she's only six years old.

TED ROWLANDS, CNN CORRESPONDENT: Baidressa Fitiao "The Late Show with David Letterman") and her mother were trying to make it home when they were both swept away by the tsunami.

FITIAO: I held her hand. The -- the wave got us. And then I was trapped between two cars. That's when her hand just -- her hand just left mine. And I could hear her say mom, please. And then I saw -- I saw her floating away. And I knew right there that she was gone -- that she was taken from us.

ROWLANDS: Baidressa's body was found the next day in some trees not far from the point where she and her mother were separated.

FITIAO: And they found her and she still had her backpack on from -- from school.

ROWLANDS: The village of Leone has been hit extremely hard by the tsunami. Sooto Sooto lost his mother.


NOFO PIO, VILLAGER: It happened so fast. And to me I'm so -- I'm so sorry that I miss my mom. She was a great woman.

UNIDENTIFIED FEMALE: And he was last seen...

UNIDENTIFIED MALE: On the main road?



ROWLANDS: On Thursday, a team from Hawaii's National Guard helped villagers search for a 6-year-old boy who is still missing.

NOFO PIO, VILLAGER: Well, it is important because our loved ones -- we -- we have to bury next to our -- in front of our houses.

ROWLANDS: Baidressa's parents say they plan to bury their daughter here, in their front yard.

FITIAO: We miss her.


BLITZER: Ted Rowlands reporting us -- for us from the scene in American Samoa.

At least two football players with the University of Utah have relatives who lost their lives to the earthquake and tsunami that hit Samoa and American Samoa. Between them, they learned that 11 aunts, uncles or cousins died in the disasters. The head coach, Kyle Wittingham, says a lot of his players were affected by this tragedy.

Country legend Willie Nelson has been fighting for 25 years to save American family farms.

Has anything really improved?

I'll ask him.

He's standing by live.


BLITZER: Fredericka Whitfield is monitoring some other important stories incoming into THE SITUATION ROOM right now -- Fred, what's going on?

WHITFIELD: Hello again, Wolf.

Hello, everyone.

Well, blame it own Rio -- the Brazilian city beat out Chicago, Tokyo and Madrid to host the 2016 Olympic Games. Rio de Janeiro won despite an unprecedented push for Chicago by the U.S. president. Mr. Obama saying this afternoon that you can play a great game and still not win.

We'll have much more on the president's reaction and the IOC decision next hour in THE SITUATION ROOM.

The nation's unemployment rate took an unexpected turn for the worse. Labor Department figures show the jobless rate climbed to 9.8 percent last month, as employers cut 263,000 more jobs. Some 7.2 million jobs have been lost since the recession began. And breaking it down even further, the big areas of job losses were construction, manufacturing and government positions. Among whites, the unemployment rate is 9 percent. For blacks, the rate is 15.4 percent. Hispanics are listed at 12.7 percent unemployed.

Since just the middle of summer, wealthy New York City mayor, Michael Bloomberg, has burned through nearly $65 million of his own money in his bid for a third term. The expenses are detailed in a report by Bloomberg's campaign. He's running against Democrat William Thompson, Jr. Who has raised about $8 million so far -- or about a sixteenth of what the mayor has already spent.

And it's the trip of a lifetime that reportedly cost $35 million. A Canadian billionaire made it to the International Space Station today on board a Russian spacecraft. Guy Laliberte, the founder of Cirque du Soleil, is the world's seventh space tourist. He returns to Earth on October 11th. And it was an incredible, out of this world experience, even though it cost him $35 million (INAUDIBLE)...

BLITZER: I hope it's...

WHITFIELD: A drop in the bucket...

BLITZER: I hope it's a safe trip for him.

Thanks very much, Fred, for that.


BLITZER: David Letterman heads off an alleged blackmail plot with an admission of sexual liaisons with employees.

Now that he's come clean, will the late night star's fans stick with him? Also, sex, lies, jobs and money -- they all figure into a deepening scandal here in Washington on Capitol Hill. Now, the U.S. senator at the center of it all could face serious repercussions -- deeper than just embarrassment.

And Willie Nelson lays it on the line once again for American farmer. I'll talk with him about Farm Aid and more.


WILLIE NELSON: Too much corruption and crime in the streets. But the long arm of the...



BLITZER: To our viewers, you're in THE SITUATION ROOM.

Happening now, harsh words for conservative pundits from a conservative known for speaking his mind, as well. You're going to hear what Senator Lindsey Graham of South Carolina has to say about Glenn Beck, among others.

And Peter Galbraith, the U.N.'s second highest official in Afghanistan, speaks out about being recalled from his diplomatic post there.

Was it because he called the Afghan elections fraudulent?

We'll ask him. He's here in THE SITUATION ROOM.

I'm Wolf Blitzer.


Let's get some more now on one of our top stories -- the sex and blackmail scandal swirling around late night TV host, David Letterman.

What impact will it have on his all-important ratings and his popularity and his own TV show, which is very successful?

Our CNN entertainment correspondent, Kareen Wynter, is working on this part of the story for us -- Kareen, what are you finding out?


Well, "The Late Show with David Letterman" has seen a recent spike in ratings. But some industry insiders say last night's confession could change all that.


WYNTER: (voice-over): This shocking admission drew applause during David Letterman's Thursday night taping.


LETTERMAN: I have had sex with women who work on this show.


WYNTER: The 62-year-old host revealed an alleged extortion attempt by a CBS employee, who demanded millions to keep hush about Letterman's affairs with staffers.


LETTERMAN: So that's where we stand right now.


WYNTER: The question is, will viewers continue to stand by Letterman in the long run?

ANDREW WALLENSTEIN, EDITOR, "THE HOLLYWOOD REPORTER": This couldn't happen at a worse time for Letterman.

WYNTER: That's because since Jay Leno's last night departure this summer, CBS' "Late Show with David Letterman" has been crushing its competition in the ratings. It trailed NBC's "The Tonight Show" for more than a decade. Letterman's recent guest spot with President Obama reportedly helped the network double its viewership, beating NBC among adults ages 18 49 for the first time since 2005.

As for this negative press, "The Hollywood Reporter's" Andrew Wallenstein says Letterman's likeability and the fact that he came clean by airing his own dirty laundry earned him some points. But...

WALLENSTEIN: The details of what's gone on here are -- are really very few and far in between. And I think once things start to come out of the woodwork, that will be the true test of which way this thing swings for Letterman.

WYNTER: And things haven't always swung Letterman's way.


WYNTER: The host faced a backlash earlier this year when he joked about former governor Sarah Palin's daughter being "knocked up" by Alex Rodriguez, while at a Yankee game. Letterman later apologized.

DAVID LETTERMAN, CBS TALK SHOW HOST: I take full blame for that. I told a bad joke.

WYNTER: This time Letterman is getting laughs at his own expense, but Hollywood critics say his confession may yet test the show's ratings and its longevity.


WYNTER (on camera): Now according to TVNewser, Letterman's show drew 5.8 million viewers last night. That's a jump from a million viewers the night before. Wolf, by the way "The Tonight Show with Conan O'brien" brought in 2.4 million viewers - Wolf.

WOLF BLITZER, CNN HOST: Thanks very much, for that, Kareen. Kareen Wynter reporting. Let's get some more on this case. We're joined by CNN Legal Analyst Lisa Bloom, she's in Los Angeles, and in New York, Ashleigh Banfield. She's the host of "Open Court" on truTV.

Ladies, thanks very much for coming. Lisa, how much trouble is Halderman in?

LISA BLOOM, CNN LEGAL ANALYST: He's in a lot of trouble, and I think the evidence against him is probably overwhelming. You know, all of us who cover crime stories think we could commit the perfect crime. This guy was a "48 Hours" producer. It turns out he really bungled the job. He met, apparently, in person, with attorneys. Hello? You'd think a TV producer might be aware the videotaping or audio taping possibilities there. And my favorite fact in this case was that he asked for and received a check - the most traceable way to send and receive money that we have.

So it sounds like the evidence against him is pretty overwhelming. He could be looking at up to 15 years behind bars for this thing.

BLITZER: Fifteen years? A lot of time. He's out on $200,000 bail, Ashleigh. As you look at this, what do you think? You know, what - what was he thinking, potentially?

ASHLEIGH BANFIELD, HOST, OPEN COURT: I - I don't think he was thinking. I have to be honest with you. As Lisa just said, you cover a show like "48 Hours", as a staffer, you know you're covering crime and punishment, so this was definitely not thought through.

What I am fascinated in, though, is the story that's not yet told, Wolf, and I heard a comment from his attorney today outside the - the hearing that was held just actually a short time ago where he said we intend to take this to trial, and I think everybody knows what that means. It means evidence comes out and it's made public, and there are potentially a few more victims in this story, perhaps women who had no intention of ever being photographed or on tape or being exposed in this way, and that kind of evidence isn't usually sealed, so there could be a whole world of embarrassment coming up, not to mention potential other charges. Who took the pictures?

BLITZER: Well, I guess that raises the question, Lisa, is this a slam dunk for Robert Morgenthau and - and the district attorney team there in New York?

BLOOM: Well, based on what we know of the evidence, I would say that it is, and Ashleigh raises a good point about the rights of privacy of other people who may be involved, whether those materials will be made public and whether that would all enter into a plea bargain, potentially a softer plea bargain for this defendant than he would otherwise have received because everybody wants this thing to go away and David Letterman and the other people involved probably don't want to go to trial with it. BLITZER: Ashleigh, what are the legal ramifications for David Letterman himself by acknowledging now, admitting he did have sexual relations with employees - female employees?

BANFIELD: Well, sexual harassment is not criminal. It can be a civil issue, but, to my knowledge, nobody is complaining. If he had consensual relationships with women on his staff, it's not a crime, and, you know what? He wasn't married until the spring, so I don't even think you can say that it's morally bankrupt either.

But I'll tell you something else, if - if there - if it's found out to be that surreptitious photographs were taken of sexual encounters, whoever was behind the camera could be in some criminal trouble, and if photographs were stolen in order to actually effectuate this extortion attempt - there could be additional...

BLITZER: Well, Ashleigh, do we know for sure that there were videotapes or photographs? I've heard of a diary that - that Halderman allegedly had access to in which descriptions were - were provided, but I haven't heard or seen evidence of pictures or - or videotapes.

BANFIELD: Correct. I think David Letterman has made references to what was in the special package that he received that - that was proof positive of what this alleged extortionist was claiming he could do, and I think we all know that if you want a game, set, match in a case - and I think Lisa will attest to this - some photographs and a wiretap from officials who were in the hotel room next door as you're asking for your $2 million check pretty much puts the nail in that coffin, unless, of course, you go to a plea bargain to protect all involved.

BLITZER: He did use the word creepy, Lisa - David Letterman - the word creepy describing...


BLITZER: ... some of these relationships. I don't know exactly what he meant. He said creepy - he followed it up by acknowledging that he did have some sexual relations with employees.

BLOOM: Yes. Well, David Letterman is a brilliant comedian, and what he has done so effectively is turned the joke on himself right away, has the audience laughing at himself and sort of shrugs off his own behavior, gets right out in front of the issue. From a PR angle, I think he handled it brilliantly.

You know, as to how this case goes forward, how much more information will be revealed, I'm sure the tabloids will be all over this story, trying to get statements from the women involved, trying to get their hands on the photographs. We'll see how well he continues to handle it. We'll see if he makes jokes about himself as if he would if this was somebody else involved in a sex scandal. That all remains to be seen.

BLITAER: Because if - if he really wanted money, if that was the motive, allegedly, of Halderman, Ashleigh, I suppose he could have taken whatever evidence he had - and I don't know what his evidence was - and gone to some tabloid and sold it and probably could have made some money.

BANFIELD: Well, it's a little hard to sell things that you - that you obtain illegally, and I don't know the circumstances in terms of how he allegedly obtained whatever he allegedly had and passed on to David Letterman, so that might have been a reason why he might not have done that. There's - there's so many 'maybe's and 'possibly's and 'allegedly's in this story that it's very, very difficult.

I am fascinated, though, Wolf, by what you just said, and that is the characterization of what happened as creepy. It's not creepy to have sexual relations with people who are consensual to that. What is creepy is if it's photographed or if it's recorded in a surreptitious way, so I'm curious to find out if that's going to be part of the evidence in this case or if we ever get to see any evidence in this case.

BLITZER: Well, we would see a lot of evidence if there actually is a trial, wouldn't we, Lisa?

BLOOM: Absolutely, Wolf. This would probably all be made public. We'll all be running the photos and the videos and talking about it. I don't know if they were obtained consensually or not. I don't know if other staffers that worked for David Letterman were uncomfortable with the situation or were even aware of the situation. We just don't have those facts yet.

You know, the sexual harassment laws do protect people against a hostile work environment. There have been claims brought by people because the boss and somebody else were involved in an affair, and that made them uncomfortable. I want to emphasize, we don't have any facts to support that right now. Nobody seems to be complaining from his staff, but this is still a very new story.

BLITZER: Lisa Bloom and Ashleigh - Ashleigh Banfield, guys, thanks very much for coming in.

BANFIELD: Sure thing.

BLITZER: An impressive roster of musicians. They are tuning up right now for Farm Aid. This year's concert is set for this weekend. And the annual event has raised millions for the family farmers' way of life. After almost a quarter century, though, of Farm Aid, has Farm Aid succeeded? I'll ask its founder, Willie Nelson. He's standing by live, right here in THE SITUATION ROOM.


BLITZER: Love that song. Love Willie Nelson. For the 24th time this Sunday, musicians take to the stage for Farm Aid, the annual concert to raise money for struggling family farmers. It's the brainchild of Willie Nelson. He's joining us now from Tulsa, Oklahoma.

Willie, thanks very much for coming in. Thanks for what you're doing, your music, Farm Aid. Has the situation of American family farmers over these past 25 years gotten better or worse?

WILLIE NELSON, MUSICIAN: Well, it's gotten worse because in the beginning we had about 8 million small family farms, when everything was good, when everybody was doing well and the country was doing well, and the farmers were getting what they call a 100 percent parity, which is the full cost of production and labor. But after the war they dropped that to a sliding, say 60 to 70 parity, and since then we've been losing farmers by the millions. Now we have probably less than 2 million, and we're losing 400, 500 a week.

BLITZER: So what - what, if anything, can be done about that?

NELSON: Well, one thing that we can do is get people to talk to their representatives and tell them we need a farm bill that will take care of the small family farmer, and the local, sustainable agriculture so we don't have to go 1,000 miles away for our breakfast, there's somebody over there who will grow it for us. So I think we need to start thinking locally and sustainable.

BLITZER: Because you believe that's even more - that's a lot healthier, too, if the product is organic and it's local as opposed to imports or sort of being driven across the country?

NELSON: Absolutely. Especially in places like farmers markets or even in your area where you know a farmer out there, you know what he's growing and you can make a deal with him to grow food for you. It's being done all over, and it turns out to be a great idea to have somebody in your area growing your vegetables for you.

BLITZER: But usually those organic vegetables, the home grown stuff, turns out to be more expensive than the stuff you're getting in the supermarkets that are either imported or come from the huge agribusiness farms, is that right?

NELSON: Well, if you start adding the health costs of pouring all that poison into your body that you're getting with all the extra stuff they put into food these days, the costs are really much lower when you do pay a couple of cents more for organic food. And it's just better for you.

BLITZER: Just healthier. You - you met recently with the Agriculture Secretary, Tom Vilsack. What did you say to him?

NELSON: Oh, he's a great guy, and he's really open to helping the farmers, and I think he's going to be at Farm Aid this year. So he was helpful in helping us figure out a way to give the dairy farmers more money, to start out, maybe talking about those guys because they're in serious trouble, and then grow from there and then help us - help the rest of the small family farmers.

BLITZER: I know the Farm Aid concert is this Sunday, Willie, but I see that guitar, and I see Willie Nelson. I know you've collaborated over the years with Bob Dylan, who's a - a legend, the great Bob Dylan. I wonder if you want to share with our viewers something special. NELSON: Well, I'd love to. You know, Bob and I talked a few years ago about writing a song for the farmers, and so one day I got a tape with Bob humming along on an already finished track - (singing) - so, he said finish it. So, really, what I did is I wrote another verse and sent it back, and we did that back and forth a few times. So I'll sing you a couple of verses if you've got time.

BLITZER: We've definitely got time and can you make it even more than just a couple.

NELSON: All right.

There's a home place under fire tonight in the heartland and the bankers are taking my home and my land from me. There's a big aching hole in my chest now where my heart was and a hole in the sky where God used to be. My American dream fell apart at the seams you tell me what it means you tell me what it means. There's a home place under fire tonight in the heartland and the bankers are taking the homes and the land away. There's a young boy closing his eyes tonight in the heartland who will wake up a man with some land and a loan he can't pay. His American dream fell apart at the seams. You tell me what it means; you tell me what it means.

BLITZER: Hey, that was fabulous. Willie, thank you so much. Good luck this weekend with farm aid. Good luck with everything you're doing. We appreciate it very much.

NELSON: Thank you. We're all big fans out here, Wolf. Keep going.

BLITZER: All right. We will, Willie Nelson joining us here in "The Situation Room." thank you.

Let's get to Capitol Hill next where there are new developments in a political sex scandal. Republican Senator John Ensign of Nevada now under investigation by his own peers as an explosive new report alleges multiple ethics violations.


BLITZER: An explosive new report today, raising hard new ethics questions surrounding Republican Senator John Ensign of Nevada and his effort to cover up an admitted 9-month-old affair with a campaign aid. The New York-Time reports that Ensign called long time friend and turned lover campaign aid, Cynthia Hampton often during a 2008 Congressional trip to a rocket and later gave her cash to pay the phone bill.

Continue the affair with Mrs. Athens even after he said it was over, used fellow Senator Tom Coburn of Oklahoma to act as a middle mad when Hampton saw a multi dollar pay off from Ensign for his wife's indiscretion used as contacts to find a job for Douglas Hampton, his lover's husband and secured clients for him afterward and that he may have violated lobbying restrictions. Let's bring in our senior congressional correspondent Dana Bash who's up on Capitol Hill. Wow, Dana, what are you hearing about all this? DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Well Wolf we now know that the senate ethics committee is investigating Senator Ensign with regard to allegations of improper conduct stemming from that affair that you were just talking about with his - the wife I should say of his then aid. Now today's "New York times" report as you just described certainly gives the committee new leads in particular with regard to the allegation that the Senator tried to cover up and then contain the damage by trying to get and actually successfully getting Doug Hampton jobs effectively lobbying jobs, but Wolf, the senate ethics committee, that is likely or possibly the least of Senator Ensign's worries.

And the reason is we talked to several legal experts and Congressional resources today, they said if, it's important to say if, the New York Times allegation is right and the Senator chose to ignore what is now a law that bans Senators and their aids for lobbying for one year, he could face criminal charges, we don't know if the Justice Department is actually investigating right now. We did of course ask Senator Ensign's staff and aid spokesman for a reaction and here's what she said. This is Rebecca Fisher, spokeswoman for Senator Ensign. "We aren't commenting other than to say, he plans to cooperate with any official inquiries." That's all she would say.

BLITZER: What are his Republican colleagues saying about all this Dana?

BASH: It, the sound of silence is deafening coming from his Republican colleague, the Republican leader Mitch McConnell had a press conference this morning, I was one of several reporters who tried to ask about Senator Ensign and Mitch McConnell wouldn't go there, listen.


BASH: I'm sure you've read this had some pretty damning suggestions that not only violated the rules in the Senate but criminal violations. As a Republican Leader did you reach out to him and ask what's going on?

MITCH MCCONNEL, REPUBLICAN LEADER: Well Dana, I don't think today is a day to make any observations about the matter; it just appeared in the newspaper today.

BASH: So you haven't reached to him yet?

MCCONNEL: I'm sorry?

BASH: So you haven't reached to him yet?

MCCONNEL: I don't have any observations to make about the Ensign matter today.


BASH: He wouldn't say anything at all, he very notably declined to defend Senator Ensign and you know Wolf, I have been talking to, checking around inside the Republican leadership, but doesn't seem as though there's a consensus position on what to do about Ensign, who of course, himself had to resign because of this a couple of months ago from the Republican Leadership but I did talk to Republican sources, former aides, current aides and they all said to a person that without a question Senator Ensign not only faces potential legal problems but also big political problems too

BLITZER: He's up for re-election in 2012, so he's got a little time.

BASH: He's got a few years.

BLITZER: Yes he's got some breathing point on that front, Dana, thanks very much.

A United Nations official in Afghanistan alleges massive fraud in the country's controversial presidential election, now he's been recalled by the U.N. -- why? He's coming here to join us in "The Situation Room" to explain what's going on.

Plus, potential fallout for President Obama -- what his unsuccessful bid for the Olympic Games might mean.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: ... a passionate supporter of the Olympics ...



BLITZER: On our Political Figure, Justice Sonia Sotomayor says she thinks she'd have trouble getting a good price for her apartment in New York, so she's keeping it, even as she gets a place here in Washington. Financial disclosure forms showed that the condo was worth about a million dollars back in May.

Remember, for all the latest political news any time, you can always check out And you can alsio follow what's going on in THE SITUATION ROOM on Twitter -- wolfblitzercnn, all one word, at Twitter.

Let's go to Jack for the Cafferty File - Jack.

CAFFERTY: Question this hour, What's the answer to people who insist on driving while doing other things?

Bob in Houston writes, "Automobiles could be made with shields in their roofs that block the ability of a cell phone to get through to the signal, or some sort of device in the dashboard that interferes with the cell phone's ability to get through to the signal once the engine is turned on. How about a cevice that renders the cell phone useless once the vehicle's speed exceeds five miles an hour. Use technology to make people get off the road and stop the car if they want to use their cell phones inside a car." Bob writes, "The cell phone problem's easy: cops ought to take the phone and mail it to our troops. Second offense, take the car. There's a section in most vehicle codes for unsafe driving that covers the rest of what drivers do. The problem is the enforcement and what the judges ultimately do about it."

Ron writes, "Anytime a collison occurs, one of the routine checks should be whether the driver has a cell phone number, and if so, was the phone in use at the time of the collision? If so, the driver on the phone should be charged with full responsibility for the accident, including all damages and possible criminal charges, such as vehicular assault, homicide, et cetera. If both drivers are on the phone, they should share the charges equally."

Sean in Phoeniz -- Maricopa County, Arizona, the county with the toughest sheriff in America, "If you are stopped while driving on a suspended license, the cops take you to jail. Even though your stay is just inder 24 hours, they don't have to take you, but it's done to prove a point. The same apply to these drivers who put the rest of us in danger, and I bet we'd start seeing a change. Lock'em up."

And Bill writes, "How come it is taking so long for all cars to be fitted with ways for communication to be sent to the driver without the use of their hands? If I could get" -- here we go -- "If I could get my text messages on my windshield and be able to speak my response and have it sent back as a text, thsn I wouldn't have to struggle to tell my boss I'm late because I am stuck behing Jack Cefferty taking his sweet time cruising in to work."

If you didn't see your e-mail here, too bad.

BLITZER: Jack Cafferty, thanks very much.