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Mitt Romney Rebounds; President Obama Targets Gas Prices, Shuttle Fly-By Wows Washington; Out Of The Race, But Not On Board; "Families Are Off-Limits"; Strong Earthquake Rocks Chile; Strike at Hostess; Biggest Stock Gains in a Month; Baldwin: I'd Love To Run For Mayor; Secret Service "Honey Trap" Fears

Aired April 17, 2012 - 16:00   ET


WOLF BLITZER, CNN ANCHOR: Happening now: Mitt Romney rebounds and resets for November. We're watching all this unfold. A new poll shows voters like him better now, but they still like President Barack Obama more.

The president blames Wall Street for the high price of keeping your car on the street. He goes after gas prices by targeting speculators in the oil markets.

And the nation's capital transfixed, transfixed by a farewell flyby as the shuttle Discovery hitches a ride on the jumbo jet and heads for a museum.

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

But this just coming in to THE SITUATION ROOM. We are live here in Brussels, Belgium. I will have an exclusive joint interview tomorrow with Secretary of State Hillary Clinton and Defense Secretary Leon Panetta tomorrow from NATO headquarters right outside Brussels.

Lots to discuss, including the situation in Afghanistan, certainly a crisis right now, what's going on with Iran and its nuclear program, North Korea, a lot to discuss with the secretary of state and the secretary of defense. I just got here to Brussels, flew in with the secretary of defense just a little while ago.

But right now, we want to get to politics. We have a brand new CNN poll that's just coming out and it sheds new light on the presidential race. Look at this -- 56 percent have a favorable opinion of President Obama. That's what they think of him as a person, not necessarily his performance as president of the United States -- 42 percent have an unfavorable view; 44 percent view Mitt Romney favorably; 43 percent have an unfavorable view of the presumptive Republican presidential nominee; 13 percent, by the way, still aren't sure.

So is Mitt Romney already rebounding to a certain degree from the low point of the very nasty Republican primaries as he prepares for November?

Let's go live to our national political correspondent, Jim Acosta. He's watching all of this unfold. What's the latest, Jim?

JIM ACOSTA, CNN CORRESPONDENT: Wolf, that CNN/ORC polling is significant because just yesterday some polling from "The Washington Post" suggested that Mitt Romney was in a much weaker position heading into this general election season.

And, you know, everything Mitt Romney is doing this week suggests he is attempting something of a reset for the general election campaign. The question is just how often his campaign will have to hit the reset button.


ACOSTA (voice-over): Mitt Romney is hard at work on his general election checklist, like firing up Tea Party activists who were divided during the GOP primaries. Check.

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: This campaign is just getting going. It's going to be fun.

ACOSTA: Or getting up close and personal with voters who may have doubts he can relate to them. Check.

M. ROMNEY: I think this election will come down to jobs and kids. Who has the capacity to create good jobs?

ACOSTA: Or picking up one of those last high-profile endorsements still out there. Check.

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: It is clear now that Mitt Romney is going to be our nominee. I think Mitt Romney has a set of economic policies that can put Americans back to work and, frankly, contrast sharply with the failed economic policies of President Obama.

ACOSTA: And even explain Seamus the dog's ride atop the Romney family car perhaps for the last time.

UNIDENTIFIED FEMALE: You said it was most wounding in the campaign so far.



UNIDENTIFIED FEMALE: But the dog got sick, right?

A. ROMNEY: Once. We traveled all of the time and he ate the turkey on the counter. I mean, he had the runs.

ACOSTA: Romney is tying up these loose ends for good reason. The latest CNN/ORC poll shows his favorability numbers which took a nosedive during the primaries are only now starting to recover.

So Romney is taking care of some campaign housekeeping, like naming top staffer Beth Myers to head his vice presidential search. He's also beefing up his staff, and that means more 20-somethings staffing the campaign's war room, as we saw inside Romney headquarters, monitoring tweets and social media content about the GOP contender.

TED NUGENT, MUSICIAN: But if you can't go home and get everybody in your lives to clean house in this vile, evil, America-hating administration, I don't even know what you're made out of.

ACOSTA: And there are plenty of distractions to keep the campaign busy, like Romney supporter and rock 'n' roller Ted Nugent, who went on an incendiary rant about the president at a National Rifle Association event last week.

NUGENT: If Barack Obama becomes president in November again, I will either be dead or in jail by this time next year. Why are you laughing? Do you think that's funny? That's not funny at all. I'm serious as a heart attack.

M. ROMNEY: It's been fun getting to know him, Ted Nugent.

ACOSTA: The DNC fired off a Web video including the fact Romney welcomed Nugent's endorsement last month, along with some of the self- described Motor City Madman's NRA comments.

NUGENT: We need to ride into that battlefield and chop their heads off in November.

ACOSTA: After hours of silence on the controversy the Romney campaign put out a statement saying, "Divisive language is offensive no matter what side of the political aisle it comes from. Mitt Romney believes everyone needs to be civil."


ACOSTA: And Mitt Romney will have another chance to reset the campaign narrative tomorrow in Charlotte and that is where he will be giving what he is calling a prebuttal to the president's convention speech that the president Mr. Obama will be delivering later this summer down in North Carolina.

Wolf, the trick in this campaign it seems as of late is staying in control of the narrative and not having to reset it every day -- Wolf.

BLITZER: What are they saying, the Romney folks, about the "New York Times" story today saying he's likely to raise about $800 million to try to beat President Obama between his own campaign, his pro- Romney super PAC, and other Republican super PACs and the Republican National Committee? The $800 million number, what are they saying about that?

ACOSTA: Wolf, we have tried all day to get the Romney campaign to respond to that report. As of right now they have not, although, as you have seen, there is a lot of reporting out there on that figure. It's an eye-popping number, but the RNC and the Romney campaign will have to raise that kind of money if they will take on the president. It's been reported that the president's reelection campaign may raise along with the DNC $1 billion although there are Democrats who have pushed back on that number also, Wolf.

BLITZER: Yes. Whoever -- there will be a ton, a ton of money that will be going toward advertising in those key battleground states, hundreds and hundreds of millions of dollars and maybe $1 billion when all the dust settles in November.

Jim Acosta, reporting for us, thanks very much.


BLITZER: Let's a little bit dig deeper right now with our chief political analyst, Gloria Borger, and she's watching all of these situations unfold.

Gloria, the president's favorable rating 56 percent and Romney's 44 percent, but that's an improvement for Romney and still very early. Can we make any hard and fast conclusions as to this snapshot right now?


Look, they have just finished a really bruising Republican primary process and what we can say about Mitt Romney, I was talking to some of his people today, is that they're pleased that the numbers seem to be moving in the right direction. Take a look at this.

Favorable opinion of Mitt Romney, now 44 percent, but back in February, Wolf, when we were in the middle of those primaries, it was 10 points less, and there's one more thing that could also be working for Mitt Romney. While the public really likes Barack Obama, as you pointed out earlier, they're less approving of the job President Obama is doing.

Take a look at this. His approval rate is 49 percent. That's the president's. His disapproval rate is 48 percent, Wolf, so a lot less than his favorability, and, by the way, about three to five points behind where Bill Clinton was, Ronald Reagan was and George W. Bush was as they embarked upon their reelection.


The people like him a lot more than they approve of the job that he's doing.

BORGER: Exactly.

BLITZER: They like him as a person more than the performance he's done so far.

I think it's clear, though, that six-and-a-half months and there's still plenty of time for people to change their minds and make up their minds and get that enthusiasm level a little bit stronger on both sides.

BORGER: In fact, our poll shows, Wolf, that people have not made up their minds about Mitt Romney.

We asked voters whether they had enough information right now to vote. And they said about Mitt Romney that 45 percent said they know enough, but look at that number. Plan to give him a second look, 53 percent, and this is just what Jim Acosta was talking about, because the Romney campaign wants to start now to reintroduce Mitt Romney to the American public.

Now, when you talk to the people running Barack Obama's campaign, they want to remind voters about what this primary was like and particularly Hispanic voters where they believe he moved far to the right on immigration issues. So as the Romney campaign wants to push the reset button, as Jim Acosta puts it, the Barack Obama campaign wants to say, not so fast, we will keep reminding you about what happened during those divisive primaries, Wolf.

BLITZER: They certainly are. Gloria, thank you.

Meanwhile, taking heat from Republicans for the very high prices right now relatively speaking at the pump, President Obama calls for a crackdown on oil speculators.

Let's turn to our chief White House correspondent, Jessica Yellin. She's working the story.

Jessica, what's going on here?

JESSICA YELLIN, CNN CHIEF WHITE HOUSE CORRESPONDENT: Wolf, you remember when President Obama campaigned for office, he attacked then President Bush for letting gas prices stay high.

Well, when President Bush found that all else failed, guess what he blamed for high gas prices? Illegal market manipulation.


YELLIN (voice-over): With gas ringing up to an average $3.90 a gallon on tax day, the president blamed Wall Street.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We can't afford a situation where speculators artificially manipulate markets by buying up oil, creating the perception of a shortage and driving prices higher only to flip the oil for a quick profit.

YELLIN: He called on Congress to pass a package of reforms that includes higher penalties, stepped-up enforcement and more data collection to help crack down on illegal market manipulation.

Speaker Boehner says not so fast.

BOEHNER: Where is his Federal Trade Commission? Where is the SEC? He's got agencies there. Instead of just another political gimmick, why doesn't he put his administration to work to get to the bottom of it?

YELLIN: With Republicans in control of the House don't expect this to become law any time soon. The White House must have proof that the illegal activity is driving up oil prices, right? Or do they?

Attorney General Holder heads a task force dedicated to finding fraud in the nation's energy markets. He said if illegal conduct is responsible for increasing gas prices, state and federal authorities should take swift action. That was a year ago. The Department of Justice tells CNN to date they have not charged a single firm or individual.

According to the White House, two other agencies have opened cases against firms for potential manipulation and notice the president's argument keeps changing. Recall two months ago the president blames the high price of gas on the Middle East.

OBAMA: The single biggest thing that's causing the price of oil to spike right now is instability in the Middle East.

YELLIN: He said in the future, the problem is elsewhere.

OBAMA: Over the long term the biggest reason oil prices will probably keep going up is growing demand in countries like China, India and Brazil.

YELLIN: An independent energy analyst says the focus on speculators isn't all bad.

KEVIN BOOK, ENERGY ANALYST: What you have is a political response to a political problem. The proposals say we're doing something to look out for the consumer. The problem remains fundamentals. We're energy importers and we will be captive to global energy prices.


YELLIN: Wolf, on the political front, by blaming Wall Street for the high price of gas that allows -- going forward, that would allow the president to draw an alliance between, say, for example, Wall Street speculators and his opponent Mitt Romney who the campaign, the Obama campaign likes to tie to Wall Street.

For his part, Mr. Romney says that this is just another example of President Obama's "government by gimmick" and he dismisses this proposal to crack down on oil speculator out of hand. He, like the Republicans in Congress, believe that the current rules and the current agencies could crack down on illegal speculation if it's there to be cracked down on -- Wolf.

BLITZER: Yes. Price of a gallon of gasoline will be a huge issue going forward between now and November.

Jessica Yellin reporting for us, thank you.

Meanwhile, a growing prostitution scandal is swirling around the U.S. Secret Service. We have new details of what the White House is saying about the agency's director.

Also, the extraordinary sight that had thousands of people from Florida to Washington, D.C., staring into the sky.

And why hasn't Rick Santorum endorsed Mitt Romney yet? I will ask his former spokeswoman, Alice Stewart. She and James Carville, they are both standing by live for our "Strategy Session."


BLITZER: Jack Cafferty is here with "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: Wolf, call it your government gone wild. As details of the secret service and GSA scandals emerge, there's growing sense that Washington isn't always working for the people who pay their salaries. That would be you and me, the taxpayers.

The Secret Service has now yanked the security clearances of 11 members accused of bringing hookers to a Colombian hotel. The investigation also includes at least five, maybe as many as 10 members of the U.S. military who were working there as part of an advanced team, ahead of President Obama's trip. "Reuters" reports there were as many as 21 prostitutes involved.

If it's true, this is more than disgraceful, more than a moral lapse. It's a threat to national security. Reports are some of the Secret Service agents who brought prostitutes to their hotel room his copies of the president's schedule lying around and were apparently bragging that they were there to protect President Obama.

It's not the first time the Secret Service has lapsed, either. The most glaring example, remember in 2009, an uninvited couple managed to crash a White House state dinner? They were inside the White House mingling with the president and his guests.

Meanwhile, the GSA official at the center of the $823,000 lavish conference is refusing to answer any questions. Jeff Neely -- do we have the picture? Yes, there he is, sitting in the hot tub in Vegas with his wine. That's a lovely shot.

He organized the conference in Las Vegas, and then reportedly took the Fifth Amendment yesterday when questioned in front of Congressman Issa's committee. His former boss has already resigned in disgraced, and Neely might face a federal criminal investigation.

While the GSA was spending thousands of your dollars on things like commemorative coins, a team building exercise and a mind reader as entertainment, the Senate yesterday voted on whether or not to raises taxes some more.

This is the kind of stuff that makes Americans increasingly disgusted with their government. So far, President Obama hasn't said a whole lot about any of this, maybe it's time he did.

Here's the question: in light of the Secret Service and GSA scandals, who is minding the store?

Go to Post a comment on my blog or go to my post on THE SITUATION ROOM's Facebook page -- Wolf.

BLITZER: Good question, Jack. Thanks very, very much.

It was an extraordinary morning in Washington, D.C., starting at 10:00 a.m., offices emptied out, traffic snarled as drivers simply jumped out of their cars, people by the thousands looked to the sky -- as space shuttle Discovery, riding piggybacked, circled the city for about 45 minutes marking its arrival in its new hometown.

CNN aviation and regulation correspondent, Lizzie O'Leary is there for us in Chantilly, Virginia. That's the new hometown for Discovery.

When will people, Lizzie, get a chance to see discovery up close?

LIZZIE O'LEARY, CNN AVIATION AND REGULATION CORRESPONDENT: Well, they'll be able to see it on Friday, Wolf. Behind me, you can see enterprise which is a sister shuttle that never flew into space. So, by Friday, Discovery will be in here and people will get in and have a chance to see it. It takes about two days to get Discovery off of the roof of that 747.

But this shuttle which flew 148 million miles in its lifetime got to take a very special trip today.



O'LEARY (voice-over): After almost 28 years of service and 39 trips into space --

ANNOUNCER: And the final liftoff of Discovery --

O'LEARY: It was one heck of a good-bye party.


O'LEARY: Unlike many Americans, Discovery left Florida in its retirement, flying on the back of a special 747. It played tourist in Washington, D.C. -- buzzing the airport and then taking in the town -- the Monument, the National Mall and the U.S. Capitol, playing to adoring crowds all around the city.



UNIDENTIFIED MALE: I remember being a kid coming down from New York with my parents and seeing it launch going out of Cape Canaveral.

UNIDENTIFIED MALE: It was fantastic to see it. It's a wonderful, spiritual thing for the United States.

O'LEARY: Yes, even our Washington staff took a peek.

Discovery's trip was a victory lap of sorts, but it's a final lap for the U.S. shuttle program. After 30 years of flights, would-be astronauts will have to look elsewhere for inspiration.

That's the plane and that's the rocket.

O'LEARY: And so will former kids who grew up to be NASA legends, like Discovery astronaut Joe Allen.

JOE ALLEN, FORMER SHUTTLE ASTRONAUT: It's a very emotional experience, and I'm sorry that this nation is out of the space travel business for a while, but hopefully we'll get back in.

O'LEARY: But for now, anyone who wants to discover Discovery will have to do it here, in a museum.


O'LEARY: Now the future of this space flight program, Wolf, as you know, in many ways, is a commercial one. We are starting to see much more activity on the commercial side.

One important thing to remember about Discovery, I spoke to one of its former astronauts who first joined the program in 1986. This was the shuttle that really got NASA back to the skies after the Challenger disaster. So it has a special resonance for the astronauts who watched it today and for the thousands of people who watched it take that final lap and land here in Virginia, Wolf.

BLITZER: And they'll have a chance to see it up close very, very soon.

All right. Thanks very much, Lizzie, for that report.

Michelle Obama is speak out about candidates' families and the controversial or rather controversial remarks about Mitt Romney's wife. We're going to hear what the first lady of the United States is saying.

And we'll talk about that and more with James Carville and Alice Stewart. They're both standing by live in our strategy session.


BLITZER: And joining us right now in our strategy session, our political contributor, the Democratic strategist James Carville, along with Republican strategist and former Rick Santorum spokeswoman Alice Stewart.

Alice, let me start with you.

Most of the Republican leadership are coalescing around Mitt Romney, but Rick Santorum still has not publicly, formally endorsed Mitt Romney. Why?

ALICE STEWART, REPUBLICAN STRATEGIST: Well, they spoke last week prior to Rick suspending the campaign and he's going do exactly what he's been saying all along that he'll do. Once the nominee is announced, he's going to do everything he can to coalesce conservatives and unite behind that person. And that's exactly what he'll do with Governor Romney.

They agreed -- they had a short conversation last week and they agreed to talk later and they'll work out the best way to move forward. And the most important thing, what we need more than anything else is to coalesce conservatives, the fiscal and social conservatives together, behind the Romney campaign and do what we must -- job number one, which is to defeat Barack Obama.

And the Romney campaign is moving full speed ahead, and along the great start with that in days and weeks to come. They will all work together and, as I said, defeat Barack Obama.

BLITZER: I'm sure, James, Rick Santorum eventually will publicly have some sort of event and formally endorse Mitt Romney. But do you see anything unusual that's taking this long?

JAMES CARVILLE, CNN CONTRIBUTOR: Yes, it is -- it is -- it is a little unusual. And I agree, I'm sure -- but I think there's bad blood there. And if you listen to some of the things that Santorum said and Gingrich -- you know, Romney's run tens and millions of dollars of negative ads on these guys.

And, you know, Rick Santorum was a man and a dream. He thought he would be the Republican nominee and the super PAC came in and crushed him, and they were getting ready to do that in Pennsylvania.

So, my guess is he's not particularly enthusiastic about having the negative ads run against him, but he'll come around and I'm sure he'll endorse him. And I suspect Gingrich will, too.

STEWART: I will say this: there's absolutely no bad blood between the two of them. It was a difficult campaign. There was a lot of negative ads on both sides, but there's certainly no bad blood and they have a mutual respect for each other. And in due time, they'll work together to coalesce the conservatives in this cause.

But Rick, first of all, is winding the campaign, taking some time of with his family and looking ahead to what he's going to do himself moving forward. He had a call last night with supporters and donors, talking about his plan to give a voice to conservatives as he did throughout the campaign. And in due time, he will work to coalesce and work to help Mitt Romney.

CARVILLE: Well, I believe that you believe there's no bad blood. I just don't believe that. Defy anything that I've ever known. There's always bad blood after primaries.

There's particular bad blood when you run the primary that Romney ran. Rick Santorum would not be human if he didn't feel animosity toward Mitt Romney.

And I suspect that he might put on a good game face, but I can assure you that from my experience is, and I know, we went through it in '92 and every time you go through a primary there's bad blood at the end of it.

That church is still split in Pennsylvania from the '76 Republican primary. So if it is, then Rick Santorum is a classy human being I have not encountered in politics.

STEWART: Rick certainly is a strong fighter and he's not one to really start a fight, but he will certainly fight when the time has comes.

But at the end of the day, he realizes that the people have spoken and popular vote has gone towards Mitt Romney and his job number one is to put those personal feelings aside and do what's best for the country.

And right now, politics is front and center and he's going to do whatever he can to help Mitt Romney.

BLITZER: I'd love both of you to weigh in on the first lady Michelle Obama's comments. She was asked about the criticism levelled against Ann Romney by Hilary Rosen, our CNN contributor and Democratic strategist. Listen to this exchange on NPR.


MICHEL MARTIN: Wasn't it a fair point, even if you don't agree with it, to say that perhaps Ann Romney is not best positioned to advise her husband on economic issues affecting American women?

MICHELLE OBAMA, FIRST LADY: You know, let me tell you, the one thing I believe is that families are off-limits. And I think my husband said it and he was clear on that. And I totally agree with hi him. I also, my comment that I tweeted, which was we need respect all women in whatever positions and roles they play in this society.


BLITZER: James, first to you. What do you think about this whole issue and the latest comments from the first lady?

CARVILLE: Well, look, I agree with the comments. Remember during the Clinton administration when the right viciously attacked Hillary Clinton every day from God knows what to what, so I would leave anybody's spouse or children are off limits.

I suspect what Hilary was trying to -- Rosen was trying to address was the fact that Romney said his wife advised him on women's issues. I wouldn't say anything bad about Mrs. Romney or anybody else's wife in politics.

I've seen that with Hillary Clinton and I've seen how vicious people can be. I don't have any desire to emulate them.

STEWART: I agree with what James said. I mean --

BLITZER: Should the right stay away from Michelle Obama, Alice?

STEWART: Well, the same -- the way the left should stay away from Ann Romney. I mean, this is ridiculous. President Obama said in '08 that wives are off limits and families are off limits and that should be the way it is.

And I agree with Michelle Obama, wives, spouses and families should be off limits, but the truth is evidently Hilary Rosen didn't get that memo attacking Ann Romney for claiming that being a stay-at- home mom doesn't give you insight or input on the economic issues of the day.

But the reality is we all know what she was doing and she was trying to distract from the real issues in this campaign, which is a terrible economy, a bad unemployment numbers, a $14.7 trillion debt and she wants to wage a war on women.

And that's what we have here, but it's not about attacking the, you know, the first lady. That's not going to help. What we need to do is focus on what this is going to be. This will be a referendum on the Barack Obama policies and it's not going to be good for him.

BLITZER: Hilary Rosen certainly did not want to wage a war on women. She was just -- she misspoke. She apologized for that. She explained what she meant, but she certainly wasn't waging a war on women.

We have to leave it, unfortunately, guys, right there. James Carville, Alice Stewart, thanks very much.

Secret Service agents caught up in a huge and growing controversy. There's new information coming into THE SITUATION ROOM. Could they have left themselves vulnerable to blackmail and even put the president of the United States at risk?

And a quake caught on camera, you are going to see how it rattled folks in our sister network in Chile.

Plus could Twinkies and Wonder Bread -- yes, Twinkies and Wonder Bread soon be gone forever. We're going to tell you what could threaten the future of Hostess brands. Stay with us. You're in THE SITUATION ROOM.


BLITZER: Lisa Sylvester is monitoring some of the other top stories in THE SITUATION ROOM right now. Lisa, what's going on?

LISA SYLVESTER, CNN CORRESPONDENT: Crews in Chile are assessing damage of an earthquake strong enough to cause mud slides. You are seeing video as the earthquake rattles the newscast on our sister network, CNN Chile.

The magnitude 6.7 earthquake knocked out power lines and it could be felt in the capital about 70 miles away. In 2010, hundreds died from an earthquake in the same region of Chile.

The company that makes the popular treat Twinkies, well, it may go wonder. Hostess Brands is taking legal action to throw out union contracts, which may lead to a strike that management and the unions agree will end the company. Hostess' employees over 1,800 people, three-quarters of whom are union members. Some Hostess treats have been around since 1888.

And stocks rallied today for the biggest gains in over a month. The Dow Jones Industrial average added 190 points pushing above the key 13,000 milestone for the first time in over a week. The S&P gained 21 points and the Nasdaq, 54. Apple's stock rebounded, too, jumping more than 5 percent after five straight down days.

And Alec Baldwin could soon have more power than the executive he plays on NBC's "30 Rock." The actor tells CNN he would love to run for mayor of New York, but that he's just not sure that he can put together a campaign in time for the 2013 race.

Baldwin, a Democrat, says New York needs a mayor that is more inspiring, taking a jab at long time Mayor Michael Bloomberg -- Wolf.

BLITZER: I suspect he's not going to run for mayor of New York, but we'll see. It could always happen. Lisa, thank you.

We are live here in Brussels, Belgium. I'll have an exclusive interview here at NATO headquarters, a joint interview with the Secretary of State Hillary Clinton and Secretary of Defense Leon Panetta.

We'll be at NATO Headquarters for the big summit meetings tomorrow. Standby for that. It will air tomorrow here on THE SITUATION ROOM.

It's some of the most outrageous government spending on lawmakers' pet projects and it's all detailed in the brand new edition so-called "Pig Book." So who makes the cut this year? Standby.

Did the U.S. Secret Service members involved in that prostitution scandal really open themselves up to blackmail? We're digging deeper.


BLITZER: It's called "The Pig Book." "The Pig Book" is an annual report from a watchdog group highlighting what it says is some of the most wasteful government spending.

CNN's Erin Burnett is going "Outfront" on this story tonight. Erin, give us the bad news and I'm sure it is very ugly.

ERIN BURNETT, HOST, CNN'S "OUTFRONT": Yes. There is ugliness. Of course, you know, technically now you're not supposed to have earmarks, but it's all in how you can write the words however you want, an earmark to one person is not to another.

The Citizens Against Government Waste has come out with this "Pig Book." Wolf, interesting, I mean, some of the cases that they've looked in, in fiscal year 2012, which is pretty interesting.

Of course, you have the chairman of Appropriations Committee, Senator Inouye has come out with, well, this one's kind of interesting, almost $6 million for a so-called "East-West Center" in Hawaii. He has gotten about 104 million earmarks for this particular center since the year 1997.

The State Department every year comes out, Wolf, purposely asks for no money for this center. They don't want it. He comes in and gets it. Of course, the "Pig Book" allegation is, well, he gets it because he's the chairman and it's his home state.

There are other examples, as well, the M1 Abrams tank. The DOD has said that they don't need any more of those, that they have plenty. And we all know the DOD is frustrated with the cuts they're facing.

So they've said they don't need any more of these. Well, we have an appropriation for $255 million to have continued work done on that in Michigan. So there are plenty of quote, unquote, "earmarks" if you look for them. So we're going to dig into that tonight.

BLITZER: We'll be watching at 7:00 p.m. Eastern, Erin Burnett "OUTFRONT". Thank you, Erin.

The White House now weighing in on the scandal that has rocked the United States Secret Service. Could agents have put themselves or even the president at risk?

And 100-year-old rule said he's simply too old to play. Well, we're going to tell you how a school is trying to keep a very special player on the court.


BLITZER: Turning now to the scandal that's rocked the United States Secret Service. A number -- a number of members of the Secret Service have had their security clearances pulled.

Amid allegations that the agents hired prostitutes while in Colombia to prepare for the president's visit. The White House says administrators are on top of the situation.


JAY CARNEY, WHITE HOUSE PRESS SECRETARY: The president has confidence in the director of the Secret Service. Director Sullivan acted quickly in response to this incident and is overseeing an investigation as we speak into the matter.


BLITZER: Our Brian Todd says a key concern is that agents could have left themselves vulnerable to blackmail. Brian, what's going on here?

BRIAN TODD, CNN CORRESPONDENT: Well, Wolf, what drug cartels, rebel groups like the Farc and other U.S. enemies operating in Colombia, members of Congress, security experts are really worried about what could have happened in Cartagena.

Aside from the terrible optics of this, they say there's all sorts of potential that the women involved could have compromised security.


TODD (voice-over): They arrived in Colombia 48 hours before the president then the Secret Service agents went out for drinks in several groups according to officials with knowledge of the investigation.

And some allegedly brought prostitutes back to their hotel. According to Senator Susan Collins, as many as 21 women were involved and some could have been with military personnel.

House Homeland Security Chairman Peter King says a dispute over money later broke out. He told Wolf Blitzer it's what happened in the interim that worries him.

REPRESENTATIVE PETER KING (R), HOMELAND SECURITY CHAIRMAN: What these 11 agents did potentially puts any president at risk, put themselves at risk, and leaves themselves open to blackmail and to threats.

TODD: Or to being compromised for sensitive information. Experts are concerned that with the Secret Service agents, there was potential for a so-called "honey trap."

ERIC O'NEILL, FORMER FBI COUNTER INTELLIGENCE OFFICER: You use someone who is very attractive and it might be a she and it is also sometimes a he. You need to know your target.

TODD: Eric O'Neill knows how a law enforcement or intelligence official can be compromised. He's a former FBI counter intelligence officer who took down FBI Agent Robert Hanson who was spying for the Russians.

O'Neill was portrayed by Ryan Phillippe in the Hollywood movie "Breach." He says prostitutes or others have often been used to steal crucial information.

(on camera): When they get them in those compromising situations, how do they get the information?

O'NEILL: Some guys just have a problem when they're in an intimate situation with beautiful women and they feel flattered. They engage in pillow talk. They want to sound impressive. And you might get innocuous questions from the prostitute or the spy and you might receive pretty good answers in response. More than you expected.

The other thing is when the guy's not looking, look around the room. Take a quick scan and grab.

TODD (voice-over): There's no evidence yet that the agents were blackmailed or compromised. U.S. government sources say the agents under investigation were not part of the president's protective detail. One former Secret Service agent says he doesn't think they were targeted for intelligence.

DAN EMMETT, FORMER SECRET SERVICE AGENT: They just simply don't have the information that would be valuable to one of those services to go to this extent.

TODD: A federal law enforcement official with knowledge of operations tells us Secret Service agents used secure facilities while traveling to store sensitive documents, even weapons.

But O'Neill says any Secret Service officer has basic information U.S. adversaries can use. They know schedules, routes, routines and even the president's favorite color.


TODD: A Secret Service spokesman tells us the possibility of a breach is part of what he calls a comprehensive investigation with no limits -- Wolf.

BLITZER: Brian, aren't some Secret Service agents, at least maybe all of them trained to be on guard against this sort of thing? Aren't they alerted that there could be what you described as a so-called "honey trap?"

TODD: Yes, current and former Secret Service officials tell us they are trained on what to look out for in a foreign country and even in the U.S. They discussed the possibility of being compromised.

One former official says the need to act professionally in these situations is, quote, "embedded" in them from the first day, clearly something slipped here, something major and they're looking into it. It could take a while.

BLITZER: Yes, we'll have more on the story in our next hour as well. Brian, thank you.

Let's go back to Jack. He's got "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: Well, the question this hour is in light of that Secret Service and GSA scandals, who's minding the store?

Jim in Dallas writes, "The people responsible for the Secret Service and GSA need to explain their internal controls and if they were violated. A public explanation and what actions were taken appear to be in order now. This is not a political issue. This is an accountability issue."

Joshua writes, "The Obamas have set a high standard for high living off the taxpayers, why would the GSA and the Secret Service think otherwise?"

Jay writes, "Maybe now the mainstream press and political hacks will understand why many of us will vote for Ron Paul or nobody at all?"

Bobby in Mississippi writes, "Why punish the entire agency for the action of a few screw-ups? Just fire them and move on. It's still one of the great organizations in this country, talking about the Secret Service and those guys aren't going to hurt anybody, but themselves."

Tom in Texas says, "Whoever is minding the agency is behind closed doors and deep in the basement. The who, what and wheres of these agencies have an air of omnipotence about them, the door must be cracked and light must be let in. Too much of Washington is behind closed doors."

George in Pennsylvania says, "Does anybody really think this is the first time this has happened? This incident is another example of how our tax dollars are being spent. I'm not sure this is the transparency in government that we were promised."

And Kimmy writes from North Carolina, "No one is minding the store, that's who. Someone left the cookie jar open and it was raided because government workers feel they are entitled. The Secret Service agents, let's just call them boys gone wild. The administration has gone for change and this is what we got."

If you want to read more about this, go to the blog or through our post on THE SITUATION ROOM's Facebook page -- Wolf.

BLITZER: Thanks very much, Jack, for that.

Coming up in our next hour, fresh outrage over the spending scandal at an embattled government agency.


UNIDENTIFIED MALE: It's 44 bucks for breakfast. I'm a big man. I can't spend 44 bucks for breakfast. Somebody had to say that. Are you kidding me?


BLITZER: And there's more coming to light besides that $44 breakfast. We're learning about details about more lavish trips including one for interns.

Also, controversial remarks by the rocker Ted Nugent put Mitt Romney's campaign on the defensive.

Up next, his whole school is cheering him on, but a 100-year- old rule might keep this teen from playing.


BLITZER: A Michigan high school is fighting to keep one of its most prized basketball and football players on the -- in the game, but if it fails a 19-year-old with down syndrome will no longer get to do one of the things he loves most, play sports. Here's CNN's Ted Rowlands.


TED ROWLANDS, CNN CORRESPONDENT (voice-over): Spend a few minutes with Eric Dompierre and you'll see why his teammates love him.

(on camera): Do you practice a lot?

ERIC DOMPIERRE, HIGH SCHOOL ATHLETE: I practice a lot so I can go to playoffs when I'm on the field.

ROWLANDS (voice-over): Eric is on the high school basketball and football team in Ishpeming, a small mining town on Michigan's Upper Peninsula.

Eric's coaches put him in near the end if a game's been decided. Last year, he brought the house down when he made this three-point shot against Ishpeming's rival.

DOMPIERRE: Then I shot it and it made it, and I heard fans and my mom crying.

UNIDENTIFIED MALE: I videotaped the crowd on the other side, and it was made up mostly of Migoni fans including their student section and they were all on their feet cheering for Eric.

ROWLANDS: The same thing happened when Eric made his first extra point kicking for the football team.

UNIDENTIFIED FEMALE: Watching the kids react and they carried him off the field and it was just one of the best moments.

ROWLANDS: Eric will be a senior in the fall, but unless something changes, he won't be able to play sports. Because, with down syndrome, he was held back in elementary school so he turned 19 in January. He's too old.

(on camera): Eric's high school is trying to get the rules changed so that he can keep playing, but a committee with the athletic association has denied two of the school's petitions.

UNIDENTIFIED MALE: Members have to change the constitution. At this point in time, they've told us not to.

ROWLANDS (on camera): Eric's cause is getting a lot of attention and support, a online petition has more than 80,000 signatures. A local t-shirt shop is selling this shirt that says let him play.

UNIDENTIFIED MALE: It's one of the things that you don't see of too much in our society anymore.

ROWLANDS: As a last attempt, Eric's school has submitted a third petition to the athletic association.

UNIDENTIFIED FEMALE: What is the harm in letting him play? What is your fear about allowing this to happen because I don't understand it?

UNIDENTIFIED MALE: The rule is 100 years old. We've come a long way in those hundred years here in this country, as to how we involve and include people with disabilities, and I think it's time that the rule catches up with that.

ROWLANDS: Eric says he'll continue to practice to get ready for next season even though he knows he may not be able to play.


ROWLANDS: In order for the rule to change, two thirds of the high schools in Michigan have to agree to it. At this point the problem has been this committee, which has held up a vote. It is expected that Eric will learn his fate one way or the other after the committee meets next month.

BLITZER: You'll keep us informed, Ted. Thanks very, very much.