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ERIN BURNETT OUTFRONT

Interview with Senator Charles Grassley; Secret Service Sex Scandal; Rape and Bribery; Vice President Nominee?

Aired April 25, 2012 - 19:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


ERIN BURNETT, HOST: The latest on the Secret Service sex scandal. An agency insider says it is all about the wink and the nod and it's getting bigger.

And the case of a mad cow in the United States. The bigger question, is our food supply not being tested? We get answers and we go inside the TSA, a former head of the agency OUTFRONT tonight and says you should be able to bring knives and a whole lot more on planes.

Let's go OUTFRONT.

Good evening, everyone. I'm Erin Burnett live from New York. OUTFRONT tonight winks and nods in the Secret Service. Is the agency's culture to blame for the prostitution scandal that has now forced nine agents either out of their jobs or stripped of their clearances? That was the key question today. The secretary of homeland security, the department which oversees the Secret Service, was in the hot seat on Capitol Hill.

(BEGIN VIDEO CLIP)

SEN. PATRICK LEAHY (D), VERMONT: To your knowledge is this the first time something like this has happened?

JANET NAPOLITANO, HOMELAND SECURITY SECRETARY: There was nothing in the record to suggest that this behavior would happen.

(END VIDEO CLIP)

BURNETT: "The Washington Post" today, though, painted a much different picture of the agency's culture. In fact it said one agent that wasn't implicated in the matter but talked to the "Post" off the record said quote, "of course this has happened before. This is not the first time." Another agent said and I quote, "you take a bunch of guys out of the country and a lot of women showering them with attention, bad things are bound to happen."

Now agents who did not want to be identified told "The Washington Post" that on a 2009 visit to Buenos Aires by former President Bill Clinton, members of the detail went out for a late night of partying at strip clubs. Now the Secret Service tells CNN it has no comment on that story, but a source says, quote "the reaction by our leadership speaks for itself." Now Ronald Kessler is the author of "In The President's Secret Service" the reporter who first broke the story on the prostitution scandal in Colombia two weeks ago he told us today "this is a symptom of larger problems in the Secret Service. It's a culture of winking and nodding and cutting corners.

It's a significant allegation and Kessler also tells OUTFRONT that Director Mark Sullivan is not the only one to blame and that according to the agents that he talks to, "this culture endangers the president." For now the White House and Secretary Napolitano are standing by their man and the agency.

(BEGIN VIDEO CLIP)

NAPOLITANO: Director Sullivan has the president's and my full confidence as this investigation proceeds. The investigation will be complete and thorough and we will leave no stone unturned.

(END VIDEO CLIP)

BURNETT: Senator Chuck Grassley is the top Republican on the Judiciary Committee. He was in the hearing with Secretary Napolitano today and he is calling for an outside investigation to determine whether any White House staff members were involved in the scandal in Colombia. Senator Grassley is OUTFRONT tonight.

Good to see you, sir, as always. I know you've been critical of a lot of the investigations that we have seen so far. What questions do you have that are not getting answered?

SEN. CHARLES GRASSLEY (R), IOWA: Well, right now, none of this stuff is given to us. We told it's been investigated, there's no problem with the people in the White House. We're told that the -- so that needs to be clarified. The inspector general is he doing his own investigation or is he just overlooking and kind of reviewing what the -- Director Sullivan is doing. And then we have the incident that was -- that came to our attention today where some top people on the Armed Services Committee asked to be briefed on how the -- it's being handled within the Defense Department.

And the vice chairman of the Joint Chiefs of Staff couldn't even answer their questions. So what's the big mystery? You know, we ought to get this out in the open. This is the public's business and protection of the public -- or protection of the president ought to be a top priority.

BURNETT: As you know, sir, we've learned the identity of one of the alleged prostitutes, Diana Suarez (ph). Some of our viewers may be familiar with the pictures that we have from her. It's really her in a bikini, that's what we've got, 24-year-old single mother who studies English. And I know that you did a radio interview in Iowa yesterday in which you said the prostitutes could have been Russian spies.

You said who knows who might be using prostitutes? The Russians are famous for that to get information out of us. Do you think that these women could have been spies for Russia or anyone else or were you just making sort of a rhetorical point?

GRASSLEY: A rhetorical point because that's what the Russians did during the Cold War and they still may be doing it today. But it was very much a tool that they used. And of course I was just saying with that history, we've got to be very, very certain that things like this aren't happening again and our national security being compromised in some way that we don't even know about. That's what -- that gets back to what was already discussed in your program. Is this part of the culture of the Secret Service, et cetera, or is this just 22 people -- or maybe 12 people in the Secret Service that just screwed up once?

BURNETT: Right.

GRASSLEY: And if it's part of the culture, we've got to get to the bottom of that.

BURNETT: And Senator one of the -- Greg Stokes is one of the agents allegedly involved, was in a canine unit. Apparently he has been in touch with the House Oversight and Reform Committee said there's speculation that he may want to testify. Do you plan to have him testify at a hearing you're going to hold? And if you're able, would you offer him immunity so that he could speak more freely?

GRASSLEY: Well, if I were in control of the Senate Judiciary Committee, I'd be having a hearing on that. All I can tell you is right now it's going to be up to Senator Leahy whether or not he decides to call a hearing and subpoena and give that sort of protection you're talking about. Senator Leahy and I have been talking at the staff level about what ought to be done, but there's no conclusions at this point.

BURNETT: All right, well Senator Grassley, thank you very much. Appreciate your taking the time tonight, sir. And now let's go to Fran Townsend, of course President George W. Bush's homeland security adviser. Fran, you just heard Senator Grassley and John McCain today also complaining along the same lines as the senator there, saying that the briefer sent by the Department of Defense were -- in John McCain's words -- "woefully unprepared to answer even the most basic questions about what happened in Cartagena, Colombia." What's happening here?

FRANCES FRAGOS TOWNSEND, CNN NATIONAL SECURITY CONTRIBUTOR: Pretty shocking. I mean there are two separate investigations. It's pretty clear that the Secret Service, while Senator Grassley isn't satisfied with all the answers he's gotten, he's gotten a lot more information on the Secret Service investigation as it's gone along, as has judiciary. Mark Sullivan has spent a lot of time on Capitol Hill.

BURNETT: Right.

TOWNSEND: And as a result of that, you don't hear many calls for Mark Sullivan to resign, because he's handled it pretty well with the Hill. Now the Defense Department made a mistake. One, they waited way too long to go up there to even start these briefings. Today was the first one. This incident happened almost two weeks ago. BURNETT: Right.

TOWNSEND: And two, they were unprepared. I find it surprising because, you know, I sit on the CIA's External Advisory Board and when (INAUDIBLE) Leon Panetta was the director of CIA, he rebuilt the CIA's relationship with Capitol Hill because I've heard him speak many times about the need for transparency with your Oversight Committee.

BURNETT: Right.

TOWNSEND: He's out of the country right now when they went up to Capitol Hill and I suspect that when he gets back, he will have to personally address the deficiency and deal with this.

(CROSSTALK)

TOWNSEND: That's right.

BURNETT: What do you think about what Senator Grassley was saying? I know he said he was making a rhetorical point but he was -- it also seemed to be more than that. Prostitutes have been used throughout I'm sure human (ph) history --

TOWNSEND: Right.

BURNETT: -- as spies and agents. Now, if this is -- it could have been that case in Cartagena or not, but that's almost not even the point.

TOWNSEND: Right.

BURNETT: The point is this is more common within the agency this could be happening and it could be something that's threatening the president.

TOWNSEND: Absolutely --

BURNETT: Is that is too paranoid or --

TOWNSEND: No, no, no, I mean -- it's a worthwhile point. Look and they get trained. Erin, the thing about this that's so astounding is the agents are trained in counterintelligence. That is to look for people who may be trying to approach them for just that reason.

BURNETT: Right.

TOWNSEND: And so they know better than this. They know better than to put themselves in a vulnerable position like that, which is what makes it so astounding. Look you have a large number of agents for a short period of time on the ground caught up in this --

BURNETT: Right.

TOWNSEND: -- and it's a natural question, is it a cultural problem. First we have to understand this incident and then you need to take it further and say is it a broader problem and I suspect that Mark Sullivan is committed to doing that.

BURNETT: All right, well Fran Townsend, thank you very much.

(CROSSTALK)

BURNETT: -- Secret Service investigation broadens and continues.

Next a student in Iowa was raped and held captive, but police say the suspect's family tried to buy her silence. We have a special in- depth report on that.

And the wooing of Mitt Romney begins. Who wants to be Mitt's running mate? Maybe you should look at who is you know most saying no, no, no, no, no, right? I mean isn't that how it works?

And a new twist in the disappearance of Madeleine McCann (ph). Are we close to finding that little missing British girl?

(COMMERCIAL BREAK)

BURNETT: So Las Vegas Sands reported revenue of $2.8 billion after the markets closed today and it was an industry wide record, but here's the thing. The name is Las Vegas Sands but the story is not about Vegas anymore. It's about Asia and that's our number tonight, 87. That's the percent of Las Vegas Sands earnings that came from Macao and Singapore. Asia is well the be all and end all for casino operators right now.

Sands just opened its fourth casino in Macao, the only place in China where gambling is legal and you know I've been there. People just get off the plane and the boats, the ferries and go in and gamble. It's crazy. The hotel in Singapore, the occupancy rate of over 98 percent and it's a stunning place to visit. In Vegas, the rate is only 83 percent. So in case you're wondering why you might have heard a lot about Las Vegas Sands recently, it's actually not anything to do with casinos. It's because of who runs the company, Sheldon Adelson, the billionaire that donated all that money to Newt Gingrich. We're going to have much more on Newt coming up.

But now a story some are calling an extreme example of culture shock. Police say 21-year-old Penn Tang (ph), a Chinese national and former student at the University of Iowa sexually assaulted a woman who was showing him an apartment to sublet. Now before he was arrested, he tried to cover his tracks and bribe his victim. You may say really? It's ridiculous, but here's the thing.

In China, a bribe is not so uncommon. In fact it's how business gets done a lot of the time. Tang's (ph) parents even flew to the United States from China and tried to buy the victim's silence. Well, tonight Tang (ph) is behind bars for first-degree kidnapping and bribery. Our Jim Spellman is in Iowa City. He's been looking into this story. And Jim, it sounds like what may be normal in China is going to be very bizarre in Iowa. Tell us a little bit more about this strange case.

JIM SPELLMAN, CNN CORRESPONDENT: Sure. So Erin this woman wanted to sublet her apartment. Instead of using Craigslist or something like that, she used a Chinese language Web site called Ren- Ren (ph). It's very common here for the Chinese students to deal amongst themselves from one apartment to go to one student to the next. So this man, Tang, shows up. Instead of wanting to sublet the apartment, he comes with handcuffs, forces her into her bedroom, stuffs a towel in her mouth and sexually assaults her. Not only that, he wants to record the moment to be able to influence her from going to the police. Take a listen.

(BEGIN VIDEO CLIP)

SPELLMAN: Took photographs?

UNIDENTIFIED MALE: Yes, he ended up taking photographs of her in compromising positions under the premise that if she made a report to the police department, that he would put those out on the Internet.

(END VIDEO CLIP)

SPELLMAN: And so what he wanted to do, Erin, was take advantage of this trust that exists amongst these students from China here in Iowa City. He knew that everybody knows each other in this community and he felt that maybe he could shame her into not going to the police.

BURNETT: That is just -- it's unbelievable just to even hear that, but I know his parents, beyond just himself, his parents got involved, flew to the United States, tried to bribe her as well. Where are they? Are they going to be prosecuted?

SPELLMAN: Sure. Well, listen, you know I think any parent can understand wanting to come and help their child, but instead of using their money to try to hire an attorney perhaps, they were prepared to pay this woman off, to try to influence her to not go to the police. Initially police charged them with witness tampering. They have since dropped the charges against them but they've charged Tang himself with witness tampering because inside jail he's been contacting a friend, trying to get that friend to go to her and convince her to change her story, telling him promise her anything. So police have added witness tampering as well as the kidnapping charge to Tang.

BURNETT: Wow, thank you very much, Jim Spellman. This is a bizarre tale. With all the talk on how business gets done in China and corruption and we heard about the businessman who got murdered, it's a very strange story indeed right here in the United States.

Well did Marco Rubio make his case to be Mitt Romney's number two? He may have done so just by saying you know it's the case that he doth protest too much, you know no means yes.

And should we be allowed to bring weapons on planes? A former head of the TSA OUTFRONT to say yes.

(COMMERCIAL BREAK)

BURNETT: Florida Senator and GOP darling Marco Rubio talked to Russia, Syria and Kony 2012 today in a speech that looked well sort of like a VP tryout. Rubio has repeatedly denied he'll join Mitt Romney on the ticket but of course so has well pretty much anybody who's been considered to be on the ticket but not all have been as convincing.

(BEGIN VIDEO CLIP)

GOV. BOB MCDONNELL (R), VIRGINIA: Anybody that asks me to help the party or help the ticket in some way so we can get Mitt Romney elected, you know I'm willing to consider doing.

JEB BUSH, FMR. GOVERNOR OF FLORIDA: Well I'd consider it, but I doubt I'll get a call.

UNIDENTIFIED MALE: What do you think about running for vice president with this guy?

SEN. ROB PORTMAN (R), OHIO: You know I'm happy representing these folks in Ohio.

REP. PAUL RYAN (R), WISCONSIN: If I wanted to be president or vice president so badly, I would have run for president. You know I don't so I didn't.

GOV. MITCH DANIELS (R), INDIANA: I think I would demand reconsideration and send Mr. Romney a list of people I think could suit better.

SEN. MARCO RUBIO (R), FLORIDA: And I know people keep asking but my answer hasn't changed.

UNIDENTIFIED MALE: It's still under no circumstances.

RUBIO: Yes, I'm not going to be the vice president.

(END VIDEO CLIP)

BURNETT: All right when it comes to the veep stakes it only -- it seems a safe assumption is that no means maybe. I mean remember this?

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Vice president?

JOSEPH BIDEN, (D-DE) VICE PRESIDENT OF THE UNITED STATES: No. No. I promise, no.

(END VIDEO CLIP)

(LAUGHTER)

BURNETT: You know what? See here's the thing, Joe Biden. You can't promise. You can say no, never. But you can't promise. I mean -- all right, John Avlon is here. Of course Reihan Salam is here. Democratic strategist Jamal Simmons is in Washington. Good to see all of you. (CROSSTALK)

BURNETT: John Avlon, this is a case of sort of like oh, no, no, no, no, no. Yes.

(LAUGHTER)

JOHN AVLON, CNN CONTRIBUTOR: You just turned them all into Mary Pickford or something. I mean look, the secret is never as popular as the sought and all these folks know that. If you're lobbying for VP, you're not going to get the gig and all those people that were put up there --

BURNETT: This is like they're playing hard to get?

UNIDENTIFIED MALE: It's like dating. It's like dating --

(CROSSTALK)

AVLON: Yes, pretty much, yes. Yes, high school rules still apply, even at presidential level politics. It's sad but true. But look, all those folks will be on the short list, you know. I mean I think you know Chris Christie and Bobby Jindal, but we're going to spend a lot of time in the next couple of months playing this parlor game. It actually has less to do with the really substantive debate of the presidency but it's an important first decision --

UNIDENTIFIED MALE: Don't knock the parlor game, John. I love it.

BURNETT: Chris Christie you know was an adamant no and now seems to be sort of a no but yes.

AVLON: No, but yes.

REIHAN SALAM, COLUMNIST, THE DAILY: And also I've got to say I know that John doesn't agree with me on this, but if you say Christie versus Rubio to me, I think it's a no-brainer that Christie would be a stronger add to a Republican ticket because a lot of people talk about Latino voters. But Erin, a really key constituency are affluent voters. If you look at a state like Colorado, they're over 30 percent of the electorate. That was true in 2008. If you look at Virginia, over 30 percent of the electorate. Pennsylvania, they're right around 30 percent. Less so in Ohio, less so in Florida, but this is a key swing constituency that Obama won big in 2008 and that Bush won big in 2004.

BURNETT: I want to get Jamal to weigh in here, but John Avlon, first, we sort of have stopped talking about the issue that Marco Rubio is not -- Cuban and Latino is not the same thing.

AVLON: That's true.

BURNETT: And this kind of oh it's the same thing. They're all going to flock and vote for him is at best simplistic. AVLON: It is incredibly simplistic because it is a very diverse community. But look I mean the symbolism of having a Hispanic on the ticket, adding youth and diversity to the ticket even if it's a Cuban American as opposed to a Mexican American that still could be a game- changer.

BURNETT: Yes.

AVLON: Because -- and it does move certain states in play. I think it would cause a reassessment and the Republican Party and Mitt Romney in particular has a lot of ground to make up when it comes to a Latino gap and a youth gap.

BURNETT: Yes.

AVLON: And that's why Rubio gave a very responsible, mature, thoughtful speech today on foreign policy at Brookings.

BURNETT: Jamal, who's better for the president to be put on this? I would imagine he doesn't want Marco Rubio on this ticket at all.

JAMAL SIMMONS, DEMOCRATIC STRATEGIST: I think you know the president and his team thinks that they can take whoever gets put up against him. I don't know if they spend that much time thinking about it, but to get to John's point that he just made a second ago, I think you can get youth and you can get diversity -- (INAUDIBLE) just a little bit from David Frum -- but you can get youth and diversity with somebody like the governor of Louisiana, Bobby Jindal, because I think he's also a tested person, politician.

He's been out there for a long time. Conservatives like him a lot. All those things may matter for that. But you know it's interesting, when you think about the vice presidency -- the vice presidential nomination, you know why everybody is running from this, because if you actually want to be president, it's probably the worse job to get. Think about Dan Quayle, Jack Kemp, Sarah Palin --

BURNETT: Yes.

SIMMONS: You know you can go down the list, (INAUDIBLE) Dick Cheney, how many of those guys actually became president or the presidential nominee --

BURNETT: Can I just say what I would like to watch just as a bystander? Forget politics and -- but Joe Biden and Chris Christie.

SALAM: Oh yes.

AVLON: Fun debate.

(CROSSTALK)

SALAM: (INAUDIBLE) youth and diversity.

AVLON: Yes. BURNETT: That has to go on late-night television in fact. I don't think (INAUDIBLE) --

SALAM: Youth voters are not going to turn out in the same numbers they did the last time. Elderly voters turn out. Affluent voters turn out and those are voters that Republicans need. They need to excite them. They need to turn them out in very large numbers.

(CROSSTALK)

SALAM: If you can --

(CROSSTALK)

SALAM: If you can run up the margins there, though, that actually can make a big difference. I definitely get the idea that you want to improve your margins with Latinos, but they're going to respond to an effective economic message.

BURNETT: Newt, what's going on? He's out but he's not out --

AVLON: He's out but -- he just wants one more day all to himself. He wants that news cycle to -- look, this was always a bucket list presidential run. It just did a lot better than he ever dreamed. So one more day, one more negotiation where it's all Newt all the time.

BURNETT: I'm going to play just one sound bite here before we go of Marco Rubio because I -- because I just have to. Because you know everybody, you know they make fun of people for prompters, but everybody learns the hard way. Here it is.

(BEGIN VIDEO CLIP)

RUBIO: A world where more people are free to grow their economies, free to pursue their dreams, free to become prosperous. I left my last page of the speech. Does anybody have my last page? Did I leave it with you?

(END VIDEO CLIP)

BURNETT: Hey, he handled it with aplomb, but --

UNIDENTIFIED MALE: He did --

SIMMONS: He did, but that's tough.

(LAUGHTER)

BURNETT: All right, thanks to all of you.

All right, up next --

(BEGIN VIDEOTAPE)

BURNETT: Still OUTFRONT -- (SOUNDS)

BURNETT: Arizona face-off.

UNIDENTIFIED MALE: We'll be laying out a whole series of policies that relate to immigration.

BURNETT: TSA under fire.

UNIDENTIFIED FEMALE: Don't I look like a terrorist?

BURNETT: All this OUTFRONT in our second half.

(COMMERCIAL BREAK)

BURNETT: We start the second half of our show with stories we care about, where we focus on our reporting, do the work and find the "OutFront 5".

And number one tonight, talk of winks and nods in the Secret Service, the agency's culture under fire today. More questions about whether there's a pattern of bad behavior. Homeland Security Secretary Janet Napolitano testified in front of Congress saying this was a one-time occurrence. But Ronald Kessler, the author of "In The President's Secret Service" and the reporter who first broke the Colombia story on prostitution told us this is a symptom of larger problems in the Secret Service, a culture of winking and nodding and cutting corners. He also told OUTFRONT that Director Mark Sullivan is not the only one to blame and that according to agents he speaks to, the culture endangers the president.

For now, the White House and Secretary Napolitano are standing, by the agency and its director.

Number two: Sergeant Gary Stein discharged from the U.S. Marine Corps over his Facebook comments about the president. Stein had posted on Facebook that President Obama was a domestic enemy and that he would not obey orders given by the president. He argued his comments should be protected under free speech.

After the decision, Stein posted on Facebook, and I quote, "I have spent the last nine years honorably serving this great nation and the corps. Even though I will be discharged, no one can take the title of marine away from me."

Number three, the youngest son of Bo Xilai is trying to separate himself from the political scandal and murder investigations in China involving his parents. Bo Guagua, a grad student at Harvard has broken his silence and he sent a written statement to the "Harvard Crimson," which is the paper there. He declined to talk about his father's fall in China or his mother being a suspect in the murder of a British businessman, Neil Heywood. But the 24-year-old did downplay reports of his lavish lifestyle. He said scholarships pay for his tuition and living expenses and denied infamously driving a Ferrari.

The paper's president, Ben Samuels, told OUTFRONT his reporters spoke to Bo on the phone last night, but he didn't answer their questions. Samuels says Bo's whereabouts are unknown.

Number four: the Federal Reserve believes the economy is improving but not enough to start raising interest rates, which means refi now, people. The Feds announced today its leaving its key interest rate near zero, then leave it there through late next year. That's what they say now.

The Central Bank also cut its forecast of unemployment, saying it could go down to 7.8 percent by the end of the year. Just so you know, it's 8.2 percent right now.

The Fed Chief Ben Bernanke added the bank cannot offset the economic effect if Congress fails to stop tax increases set to take effect early next year.

Well, it has been 265 days since this country lost its top credit rating. What are we doing to get it back?

Well, the slowdown in Europe is really not going to help. Today, we found out Britain slipped back into recession. Economic growth down 0.2 of a percent the first three months of the year. That's the second decline in a row.

Arizona's controversial immigration law in the spotlight at the Supreme Court today. Now, justices are considering whether it goes too far in cracking down on illegal immigration. Now, at the same time, news of a monumental shift in that very issue according to the Pew Hispanic Center, it's actually formal now. Immigration from Mexico, which was the largest wave of immigrants from a single country in this nation's history, dropped for the first time in more than two decades.

Now, the U.S. government says it's because of increased border security. Of course, it also coincided with the great recession and it is a fact that a lot of people didn't think there were job opportunities and stopped coming over the border.

It was a 50 percent decline in annual housing starts, unemployment rate doubled over the past five years. Let's call it out like it is. A lot of construction in this country is done by illegal immigrants from Mexico. They were crushed by that plunge.

CNN contributor John Avlon and our legal contributor Paul Callan are both here.

Let's just start with this Pew study, John. This is a sort of thing we've been talking about for a while. We've seen these numbers dropping and dropping.

The economy is certainly a part of it. They are trying to take credit for border security. What's the truth?

JOHN AVLON, CNN CONTRIBUTOR: Well, look, it's a little bit of both. The laws of supply and demand do apply here. We've had a rough spot in the economy and as opportunities decline, they are less people risk their lives to get across the border. But just to say it's solely a measure of the economy isn't accurate. This is a problem that's been going on four decades.

BURNETT: Right.

AVLON: It's a serious problem with the southern border. There is good news to report not just because of the economy, but also of increased border enforcement.

And the numbers are actually staggering. We've seen an 85 percent increase in border patrols since 2004.

BURNETT: That's amazing.

AVLON: We've seen arrests up more than 14 percent in the past two years, including a 70 percent increase in deportation of criminals who are illegal here in this country. Thirty-one percent more drugs confiscated, 64 percent more weapons, and a record high number of deportations in all, 1.5 million.

So this is an enforcement success story as well. It is not simply buoying on the back of an economy. It's about border security and it's a strong security.

BURNETT: It's important to remember, I was always so critical about things like that. But it is important to give credit.

Now, let's talk about this Arizona law because ironically, of course, it's coming to the Supreme Court as immigration has plunged.

But, Paul Callan, can you explain what it is? This isn't just that you can stop anybody. This is stopping anybody who's doing something wrong, and then being able to ask them their immigration status. But, of course, it's raised concerns of racial profiling.

PAUL CALLAN, CNN LEGAL CONTRIBUTOR: Exactly. And it does something very unusual, because, usually, immigration policy is handled by the federal government. And now all of a sudden, you have the state of Arizona saying, well, they're not doing their job, so the local police are going to be mandated in certain situations to check to see if they're dealing with an illegal alien or an American citizen.

And essentially that's the beef in this law. I mean, why should the local cops be getting involved in immigration policies that's federal? That's what they're really arguing about.

(CROSSTALK)

BURNETT: So this is just who has jurisdiction, not actually addressing the issue that Americans are fighting over, which is racial profiling or when can I know someone's status?

CALLAN: What was interesting in the argument before the Supreme Court today was the solicitor general who represents the government, the Obama administration, kind of walked away from that argument. That was a big part of the original argument, it discriminates against Hispanic Americans, they're going to be singled out. But he walked away from that and said, no, that's really not a big part of our claim.

AVLON: In some ways, this law has been mischaracterized and misunderstood. But it's really been a fascinating political catch-22. The irony here is that the presence of the law has hurt the GOP politically. It is one of the things that has helped turn Arizona possibly into a swing state this election. But it has had no effect on reducing illegal immigration because it hasn't taken effect.

The improving economy has done that as well as increased border security under the Obama administration. And the headline here is amazing, right? We have basically stopped illegal immigration from Mexico, along the southern border, in its tracks. If a Republican was president and this happened, there would be celebration in the street by conservatives. But instead there's just awkward silence.

Nobody wants to deal with it because it doesn't fit the narrative, including liberals.

BURNETT: Yes, both sides would dodge it.

Paul, let me ask you a question. Elena Kagan, the justice of Supreme Court, has recused herself because she was a solicitor general, but what happens if the ruling here is for it?

CALLAN: Well, it's interesting because when the U.S. Supreme Court is in a tie vote, then the ruling of the lower court is upheld. The lower court threw out the Arizona law and said many of its provisions were illegal. So you'd really have that ruling as the ruling that would stand.

BURNETT: Is that likely, do you think?

CALLAN: Well, it's a possibility. Although many observers today were surprised at the fact that some of the more conservative justices were willing to go along with some of the provisions of the law. So I think it's up in the air. It's always hard to decide based on oral argument before the Supreme Court. Sometimes they answer questions in a way that's very different from the way they decide in the end.

BURNETT: Right. And it's always confusing too as a layperson. They make a decision that people think is a decision about this, when it's really a decision about that.

CALLAN: But talking politics, you know, in the end, it really says is that the court decides major political issues in the end, sometimes, when you have a split court, which is why it's so important as to which president is appointing the justices because that determines what laws get upheld.

AVLON: Yes, sure. Polarized politics and polarized court.

BURNETT: All right. Thanks to both.

Well, the first case of mad cow disease in six years was found in a dairy cow in California. Now, this is the fourth case of a mad cow disease found in the United States since 2003. And the USDA stresses this cow was never part of the human food chain. It's perfectly safe to eat beef and drink milk.

Now, we're just talking about a few cows. Obviously, this is something that causes more widespread concern. Think about this: the U.S. government only tests 40,000 cows a year for diseases. Now, according to the USDA, about 35 million cattle and calves are slaughtered in the United States.

So, is 40,000 the right ratio?

Michael Hansen is a senior staff scientist with the policy and advocacy at the Consumers Union.

And what do you think? I mean, and just to take a step back. I mean, the American food supply has got to be, despite all the criticisms people have, some of them probably very fair, the safest in the world?

MICHAEL HANSEN, SENIOR SCIENTIST, CONSUMERS UNION: Well, there would be some people that would dispute that. It's our view that this is completely inadequate level of testing.

As you said, it comes out to between a tenth of a percent and two-tenths of a percent, the cattle that go to slaughter every year.

And other countries that have dealt with this problem test far more cattle than we do. In Japan, for example, all cattle above the age of 20 months are tested before they get slaughtered. In Europe, in many countries, all cattle above the age of 30 months get slaughtered.

So in Europe, that testing turns out to be 10 percent to 20 percent of all the cattle that go to slaughter and we're testing less than 1 percent and less than 1/2 percent and that's just not adequate.

BURNETT: They had a much bigger issue. I mean, I remember living over in Europe briefly during the time when they had issues with mad cow and certainly Britain did, and the United States didn't, even though we test less. So maybe we just test smarter?

HANSEN: Well, I think what the problem is, is what they found out the hard way in Europe is if you don't take strong actions, the problem continues on until you take those stronger actions. And it wasn't until you didn't start to see the BSE epidemic start declining in Europe until they started to take strong actions and ban al these unsafe animal feeding practices, many of which we still allow in the U.S.

BURNETT: Are we focusing on the right thing, though? Because, I mean, the bovine encephalitis is obviously a scary thing. But there are other diseases we could get from animals that could be much more frightening, spread much more quickly than this one, which causes a lot of fear but isn't even actually that easy to contract from a cow.

Are we even focusing on the right thing here?

HANSEN: Well in, a certain sense we are because the potential risk -- this has a very high what's called dread factor. Since the potential downside is that you could get a fatal brain-wasting disease, this should be a wake-up call for the government to take stronger action. That doesn't mean that people have to be fearful and not eat meat, but it does suggest that the government needs to take much stronger action.

BURNETT: All right. Let me just give you the response from the USDA. We did call them. They said, that I just throw it up here, that "We test for BSE at levels 10 times greater than World Animal Health organization standards." They talk about the 40,000 animals a year that they test. But then say, "We focus on groups where the disease is more likely to be found, targeted for surveillance includes cattle exhibiting signs of central nervous disorders or signs associated with BSE, including animals that can't walk and dead cattle."

Again, I simply ask the question because it does appear to show in the animal's activity when they are sick, but we've only had four cows that have been tested for this in the United States since 2003. So you're talking about spending a lot of money on testing for something that doesn't seem to be a prevalent problem?

HANSEN: Well, it doesn't actually cost that much to test. I would point out that at least the second cow that we tested, it took them eight months and they were forced to retest it before they finally admitted that that was a case of BSE. It's still unknown how many cases we have in this country, and this should be a wake-up call that we need to test more. Because this testing is far, far smaller than the level of testing that is done in Europe and in Japan and also even in Canada.

BURNETT: All right. Well, thank you very much, Michael Hansen, making the case for more testing for cows with mad cow disease.

Next, we've got a new development in the child that was missing, a British girl that went missing I believe in Portugal. This is a story that's been going on for years, but now they think Madeleine McCann is still alive.

And the former head of the TSA thinks the rules must change and that you should be allowed to bring your knife on a plane.

(COMMERCIAL BREAK)

BURNETT: We're back with tonight's "Outer Circle," where we reach out to our sources around the world. And we go to Portugal tonight where a young British girl, Madeleine McCann, went missing five years ago.

You may remember her story. It captured worldwide headlines. Her parents went out for dinner while on vacation. They returned to their rental home and Madeleine was gone.

Now, British police say that she may still be alive.

Max Foster is covering the story. And, Max, what clues do they have?

(BEGIN VIDEO CLIP)

MAX FOSTER, CNN CORRESPONDENT: Erin, 37 police officers trolling through 100,000 pages of evidence and they say they have come up with nearly 200 new leads. And they say that's enough to convince them that Madeleine McCann might still be alive. You've got to consider they have only gone a quarter of the way through all of the evidence that they have got.

So, British police certainly hoping that this is enough to convince the Portuguese police to reopen the case. In the meantime, they have come up with an image that they say is a likeness for Madeleine as she would look like heading into her ninth birthday. And certainly, the McCann family have worked closely with the police on this image.

But that's an update on the case. But it's still not reopened, Erin.

(END VIDEO CLIP)

BURNETT: That would be a miracle and something that would just be amazing.

And now to London and a rare sight. Media tycoon Rupert Murdoch, the head of the News Corp, testified before parliament. Now, he was grilled about his influence over Britain's media and political landscape.

And Dan Rivers was there following the story in London.

And, Dan, how did Rupert do in the hot seat?

(BEGIN VIDEO CLIP)

DAN RIVERS, CNN SENIOR INTERNATIONAL CORRESPONDENT: Erin, I don't think Rupert Murdoch was particularly stumped at any point. There were a number of occasions when he paused, sometimes for about 10 seconds or more, thinking about his answer. He was often quite curt, tacit and monosyllabic at times. But it was a combative performance, I think. His overall message draws that he's alleged influence over various political figures for the past 30 years or more has been grossly exaggerated and he angrily denied the suggestion that he had swapped political influence, favorable coverage in his newspapers to further his own business interests there -- Erin.

(END VIDEO CLIP)

BURNETT: All right, thank you.

And now to North Korea where leaders have threatened to test an underground nuclear weapon any day. Just today, a top military official boasted the country is armed with, quote, "powerful modern weapons that could reach the U.S." Elise Labott is covering the story. And, Elise, what do we actually know about North Korea's real nuclear ambitions?

(BEGIN VIDEO CLIP)

ELISE LABOTT, CNN CORRESPONDENT: Erin, for North Korea, its nuclear program has always been a sort of bargaining chip in diplomatic negotiations, and it uses it as blackmail to extract aid from the U.S. and its allies. Now, Pyongyang, who has already conducted two underground nuclear tests in 2006 and 2009, and it's believed that they're going to conduct a third after that failed missile test in April.

Nuclear experts don't believe North Korea has mastered the miniaturization of a weapon that is fitting a nuclear warhead on a missile and having the means to deliver it, but they're afraid that this third nuclear test could help them master the technology. That's why the United States is warning North Korea against that third nuclear test, saying there will be serious consequences -- Erin.

(END VIDEO CLIP)

BURNETT: All right. Thanks to Elise.

Now, let's check in with Anderson. What's coming up on "A.C. 360"?

ANDERSON COOPER, HOST, "A.C. 360": Hey, Erin, we're keeping them honest with the program, with the question: where does Mitt Romney stand on illegal immigration? We'll lay out his record and let you decide. It's an important question and one that could decide the presidency. Paul Begala and Bay Buchanan weigh in on that as the Supreme Court is weighing in on Arizona's law.

Also crime and punishment tonight, a wealthy D.C. socialite found dead in her Georgetown home. The suspect is her husband. He's been charged with first-degree murder, but he may never actually have to face a jury. We'll talk to Jeff Toobin about why that is.

Those stories, also tonight's "Ridiculist" and a lot more at the top of the hour, Erin.

BURNETT: All right. Anderson, looking forward to seeing that.

Well, I just flew back from Israel. And when it comes to flying, Israel takes security very seriously. If you've experienced it, you know they ask you all sorts of questions. They go through your bags. They take nothing for granted. They do a lot more than what we go through here in the United States.

Now, some of the more extreme examples of what we've seen recently here at home, the little boy in the wheelchair, the TSA agent was checking him for explosives, or a woman sobbing uncontrollably as she submitted to a very public pat-down. Then there's our recent favorite.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I have no problems with my body. And decided that this was the most --

(END VIDEO CLIP)

BURNETT: Yes, well, I do, because no one wants to se anybody naked at the TSA, no matter how you look.

Fed up with what he believes was an invasion of his privacy, he stripped down all the way to prove that he wasn't dangerous.

Now, the former head of the TSA said this is all for nothing, and the agency has its focus on.

Kip Hawley has lots of ideas, trying to take the sometimes unpopular TSA in his new book "Permanent Emergencies," he comes OUTFRONT tonight.

Kip, thanks very much. And good to see you, sir.

KIP HAWLEY, FORMER TSA ADMINISTRATOR: Glad to be with you, Erin.

BURNETT: It would be nice, you know, to avoid people stripping down naked at the TSA line. I'll start there. But you think that we just have gone way too far, that knives, liquids, all of it should be OK?

HAWLEY: Well, I think that right after 9/11 we jumped in to put security arrangements that would prevent that happening again. And as life has gone on add the security measures have taken effect, a lot of them are no longer really needed. And for instance, the prohibited items, Swiss army knives, baseball bats, things that could in fact injure somebody, really are not a threat to take over a plane at this point.

And so it takes so much time for these officers to be looking around for, I call an Easter egg hunt for whatever the small item is, and they really need to focus on bombs, guns, toxins that could take down a plane.

BURNETT: I guess with the recent examples that we've seen, which partially seem just examples of the stress, fatigue of the people that work in our air system, with the pilot who lost control, and potentially could have tried to bring a plane down that his co-pilot locked him out. And it was members -- people who are flying there who subdued him, the flight attendant.

I mean, it seems that people who fly now are much more vigilant and aware, as opposed to 9/11, when no one had any clue.

HAWLEY: Totally. And really, even on 9/11, it was the fourth aircraft, they were not able to -- the terrorists were not able to take that to completion. And that was just an hour or so after the first one had ever happened. So I think that type of hijacking is gone. And the threat is explosions on the plane, or something of that sort.

BURNETT: And let me just ask you a question, because I read with great interest your article in the "Wall Street Journal" recently about when you were talking about your book, and you said this: "The TSA's mission is to prevent a catastrophic attack on the transportation system. Not to ensure that every single passenger can avoid harm while traveling."

HAWLEY: Right.

BURNETT: I'm trying to ups what you mean by that. Is that in order to save the system, that we may need to accept some casualties?

HAWLEY: Yes. Walking down the street, you can get knifed. And we have this attitude that we don't want to let any harmful objects on a plane, and what I'm saying is, it's very similar to the question you asked just a few minutes ago about mad cow disease. What is the cost of doing this measure versus the benefit to society?

And it's horrible if somebody commits murder anywhere, including on an airplane. But it is not worth going through every bag, looking for possible implements of damage, when you can take a coke can, twist it, and turn it into a 13-inch razor.

So it really is not necessary from a security point of view. I think it's a distraction both to the TSA and drives passengers further apart.

BURNETT: What is the TSA not ready for, because they've been, as you describe it, sort of on these Easter egg hunts? I mean, I was with the Secretary Napolitano recently, going through the TSA. And, of course, they show all the bomb parts of things that they found, drugs that they found.

What is it that they are not prepared for? What are you most afraid of that somebody could get through with right now?

HAWLEY: Well, the biggest problem, you mentioned coming back from Israel. Israel's strongest security point is the fact that their public and their security services are one, that they are together. And that way when somebody is outside that system, it sticks out more. We have the same technology. We -- the process and the items are the same. It's the attitude that's different.

And I think what happens is, that bombs, I mean, really, if you just want the short answer to the question, it is somebody entering in an offshore airport with explosives that is able to take it onto the cabin and take a plane down, that's the number one threat. It has been for years. And it will continue to be.

BURNETT: All right. Well, thank you very much, Kip Hawley. As we said, former chief of the TSA.

Well, it's hump day. You know what that means. I was in the Middle East, right? Well, camel report time.

(COMMERCIAL BREAK)

BURNETT: So, it just wouldn't be hump day, you know, without the camel report. And I spent a lot of time in the Middle East lately. And one of the best parts of traveling there is that I always run into a camel. Like I stumbled on this girl at a camel market in Dubai. She was going to a new home in Abu Dhabi. This is just last week. She was led to a track, she was angry. I was learning to focus. She was angry, in fact, about the move. And you'll see why in a moment. I was worried and upset that she might be headed to a fate that I couldn't bear to contemplate.

You see, I just learned about camel leather. Now, all camels perish one day, so leather may not be the end of the world. Al Khaznah Tannery is just up the road. The Al Khaznah Tannery has developed a new way of preserving skins that avoids polluting. They even have a water recycling system. The product is high quality camel leather in every color and finish. And the buyers are some of the world's most famous fashion houses.

Now, I am not sure that I could ever wear leather made from camels, because I love them. But that brings me back to my girl at my market in Dubai.

Yes, she was having none of that flat bed. And, by the way, that was just some of her yelling. And I thought she was tied down. I was worried about her.

But, see, look, the second thing shut at her, three straight minutes of yelling, it turns out it was all an act. Such a diva.

We're back tomorrow at 7:00.

"ANDERSON COOPER 360" starts now.