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JP Morgan Chase Loses $2 Billion in Complex Trade; NYPD Accused of Racially Profiling Muslim Centers; "Newsweek" Cover Calls President Obama First Gay President; Defense To Begin Case In Edwards Trial; Senate To Hold Secret Service Hearing; Kony Commander Captured; "Enterprise" Separated From Transport Plane; Going To The Dogs; The Weight Of The Nation

Aired May 14, 2012 - 06:59   ET


BROOKE BALDWIN, CNN HOST: It is A to Z with a little B. Hi, everyone. Good morning. I'm Brooke Baldwin in for Soledad O'Brien who very much so deserves a vacation this week. Good to be up and on it (ph) with you this morning.

Our "Starting Point" this morning, things are about to get ugly at JPMorgan Chase after the firm's shocking $2 billion loss. Top executives could be stepping down as early as today, and one prominent politician is now publicly calling on the firm's CEO to step down from his position with New York's Federal Reserve.

Plus, Yahoo!'s CEO is out, but it may not have been a resume scandal that actually forced Scott Thompson to step down. We're going to tell you about this bombshell he dropped on the company's board of directors right before he resigned.

And check this out. The cover of "Newsweek" has a lot of you readers doing a what? A double-take this morning. Got the picture of President Obama with a rainbow colored halo over his heads and the words "The First Gay President."

Here we go, Monday, May 14. STARTING POINT begins right now.


BALDWIN: Good morning, good morning to you. Soledad is off for the week. I'm Brooke Baldwin, welcome, bright and early on this Monday. Our starting point really lead story this big shakeup and calls for congressional hearings this morning after JP Morgan reports this stunning $2 billion loss. So this al actually happened late last week when the financial giant revealed it had made this risky credit bet in the European market. So now, we're hearing three executives are expected to resign and Bloomberg is now reporting Morgan's entire chief investment office of London could be cleaned out.

The trades are raising some very, very serious questions this morning about whether the country's biggest bank learned anything from that financial crisis. Let me remind you, that was merely four years ago. And what happened to the laws that were supposed to stop all of this? That's one of the big questions we're asking this morning. Many of the rules created by the Dodd-Frank bill still aren't in place two years later. CEO Jamie Dimon acknowledging this new mess could give regulators and members of Congress more reason to tighten any loopholes.


UNIDENTIFIED MALE: Have you given regulators new ammunition against the banks?

JAMIE DIMON, CEO, JP MORGAN CHASE: Absolutely. This is a very unfortunate and inopportune time to have this kind of mistake.


BALDWIN: I want to welcome Sheila Bair, former chair of the FDIC and has called for closing some of those said loopholes. So welcome, Sheila, to you.


BALDWIN: Welcome to Christine Romans and Ali Velshi.

Sheila, really just right out of the gate this morning as we mentioned 2008 not too long ago is this deja vu? Is this just as egregious and risky in terms of the betting do you think?

BAIR: Well, no, I don't think that this is as bad as some of the really system-wide idiotic things that were being done leading up to the crisis, and to Morgan chase's credit they avoided a lot of that nonsense. But this is still a very serious issue. I think it does underscore that even with very good management these institutions are just too big to manage, and especially when dealing with very complex derivatives instruments trying to hedge risk in large securities trading books, even the best of managers can stumble.

And so it does I think require, suggests smaller, simpler institutions, ones that have more focused management on particular business lines.

BALDWIN: I want to get to that point because that is one of the concerns that these banks are too massive and perhaps one boss in one section has no idea what the other arm is doing at all.

BAIR: That's true.

BALDWIN: One of the questions as we talk about this, the Dodd- frank, the regulation --

BAIR: Right.

BALDWIN: -- passed in 2011 but a lot of it is still being drafted and part of that is this Volcker rule. Do you think it would have stopped this?

BAIR: That's not clear. We're learning it appears it was a bona fide hedge. People say you're hedging against an economic downturn as opposed to hedging against a significant credit risk exposure. We're learning more about that.

Certainly regulators need to use the powers they already have. And JP Morgan Chase is a heavily regulated bank holding company, always has, the Office of the Comptroller of the currency, the New York fed are its primary prudential regulators and this certainly presents safety and soundness issues. They changed the model they use that determine what risk is, and regulators know about that. First of all regulators need to use the powers they have already. And second of all, you're right, we need to strengthen rules. Volcker suggested higher capital. At the end of the day capital protects banks from unexpected losses and we have higher capital at the banks.

BALDWIN: I want to get to the point that Americans are frustrated with Wall Street in 2008.

BAIR: They are.

BALDWIN: You have Senator Bob Corker, Republican from Tennessee, some of the regulation according to "The Wall Street Journal" saying Congress needs answers. I thought we needed answers a couple years ago, yes we apparently need answers again and calling on questions specifically what triggered this loss, this $2.3 billion loss. Obviously that must be a bad sign for Morgan, right?

BAIR: It is. And I think their CEO to his credit acknowledged they have a lot of egg on their face. This is a serious misstep, not one that threatens the institution or profitability but still a sizeable loss and one that should not have happened. So a lot of people are going to be wanting answers and legitimately so, and I think again as we said it earlier, can anybody really manage these very large, complex institutions, big, big question.

BALDWIN: Jump in, guys.

ALI VELSHI, CNN ANCHOR: Sheila, it's Ali Velshi. Good to see you again. We spoke on the weekend about this.

BAIR: We did.

VELSHI: Here's the thing, as you said, this may or may not have been involved by the Volcker rule. You are a Republican, we normally associate Democrats with wanting to regulate wall street. There is a culture of regulation missing and a quality of regulator that is missing because it's hard to compete with the highest paid minds in the world. That could be more of the issue here.

BAIR: I think that's true. This is a basic question of prudential supervision. We've had safety and soundness regulation for banks and bank holding companies for a long time and putting the Volcker rule aside this was terrible risk management, a very bad model, one they stopped using and went back to their old model, expected losses doubled. What was going on there? Regulators have a lot of tools right now to deal with basic safety and soundness issues and we need new rules, I support that but also need to use the powers we already have. CHRISTINE ROMANS, CNN ANCHOR: Morgan made $19 billion last year so a $2 billion loss in the scope of earnings, could it be this is just a bad bet, a bad move, maybe Volcker wouldn't change it, nothing in Dodd-frank changes here and what is lost is a reputational hit for Jamie Dimon, someone saying we don't tell us what to do because we don't need to be regulated more.

BAIR: Right, that is true. That is part of it. I do think this is a pretty serious loss. Again it's nothing compared to the idiotic things we were seeing in 2008, but nonetheless this shouldn't have happened. I think there's probably more piling on than there should be but it raises legitimate issues about risk management and the ability to manage and regulate the complex several trillion-dollar institutions.

BALDWIN: Here is my final question because this is incredibly complex.

BAIR: Yes.

BALDWIN: And bottom line, tell me why Americans need to care, we're talking about proprietary trading and JP Morgan, and Ali, you and I were talking about earlier, this is the bank's money but ultimately they're a government-backed bank so ultimately it's our money. Why do Americans need to care about this?

BAIR: For a couple of reasons. I think there are broader issues of system stability. We want a safe and sound banking system and the deposit insurance fund, JP Morgan Chase has a lot of insured deposit as do to the other mega banking institution. There's a guarantee for insured deposits and there are good reasons to are that but it creates exposure and risk, so from the government exposure standpoint folks should care.

They should also care about a banking system that serves credit needs not just geared toward arbitraging with higher paying securities. We want lending and credit intermediation and want support for the real economy and it's everyone's interest to have a banking system that delivers that.

Finally, from a narrow perspective if you own shares in large banks --

BALDWIN: You care.

BAIR: Should you wake up --

BALDWIN: You felt it Friday for sure. Ouch.

BAIR: Absolutely. They don't have it good, even before the crisis they did not deliver good value. Just too big and complex.

BALDWIN: Sheila, I want to you weigh in on this, we're talking to Elizabeth warren, she's running for Senate in the state of Massachusetts she's calling on Jamie Dimon to step down not from his post at the head of Morgan but from his board seat on the New York Fed. Do you agree with that? Where do you see him falling in this mess?

BAIR: Right. I think the governance structure of the fed's regional banks is a real issue. The New York fed is the primary regulator of the large institutions, yet they have industry people sitting on their boards and that's true with the other regional banks so I think this is a larger issue than Jamie Dimon, one that tried to get fixed in Dodd-Frank and didn't quite make it.

I think Jamie Dimon is a good manager. I think he stumbled badly here, and he's acknowledged that. My sense is the focus should be on simplifying the structures and getting better intermediate management. If we can't break them up outright so we have better focus on what's going on in each individual component of the bank.

BALDWIN: Sheila Bair, I appreciate it, thank you so much Ali and Christine, appreciate it very much so.

The revolving door the corner office at Yahoo! still swinging this morning. I'm talking about Scott Thompson, the fifth company chief executive to be bounced in the last decade. He resigned after just four months. He, remember this, fudged his resume, claiming to have a degree in computer science even though he didn't have one. If you read this morning's "wall street journal" they report before resigning Thompson told his board of directors we thyroid cancer and was beginning treatment.

Meantime a top Yahoo! executive Ross Levinson has been named to replace Thompson as the company's interim CEO.

Now back to Miss Romans for a look at the rest of the day's stories. Good morning again.

ROMANS: Good morning again, Brooke. A manhunt is underway for an FBI agent, and 100 FBI agents and dozens more law enforcement officers searching southern California this hour for one of their colleagues. And 35-year-old Steven Ivans has been missing since last week. Police describe him as suicidal and possibly carrying a gun.

Authorities in Mexico trying to calm the public, assuring them civilians are not being targeted there after the gruesome discovery of 49 decapitated and dismembered bodies littered along a Mexican highway. The killings believed to be the work of the Zeta drug cartel, the bodies discovered near Monterey just 80 miles from the U.S. border near Texas.

A woman who contracted flesh eating bacteria and had to have her leg amputated now in danger of losing her fingers as well. And 24- year-old Amy Copeland lost her left leg and part of her abdomen after she was infected two weeks ago. She was zip-lining over the Tallapoosa River when the line snapped. Copeland's parents are optimistic about her recovery. We'll talk with them about how she is doing and how all this happened coming up next hour.

The Dalai Lama warning of a possible plot to poison him. He had an exclusive interview with the newspaper "the telegraph." he's been told Chinese agents have trained Tibetan women to pose as devotees and approach him for a blessing and they'd carry poison in their hair or scarves. The Dalai Lama says the plot is not confirmed but highlights his need for tighter security.

"The Avengers" crushed the competition in box office records taking in more than $103 million in its second weekend. "The Avengers" has made, wait for it, now more than $1 billion, billion dollars worldwide.

Will Ferrell returned to "Saturday Night Live" this weekend, and his infamous role as George W. Bush, here he is commiserating with Joe Biden as an angry teenager lashing out at President Obama for stealing the spotlight on same-sex marriage.


WILL FERRELL, COMEDIAN: I used to catch grief all the time from president Cheney.


FERRELL: I'd be in the oval office hooking up the Slurpee machine, settling into a "Charles in Charge" marathon, and that penguin would come waddling in and yell "Get your damned pants on, we're about to bomb blah, blah, blah."



ROMANS: Will Ferrell, one of the funniest men ever.

BALDWIN: I love he came to "SNL" this weekend. Love him, love him. Christine, thank you so much.

Still ahead on STARTING POINT, the NYPD under fire for infiltrating mosques and spying on Muslims. Why New York Congressman Peter King thinks lawmakers should be giving the department a medal. He's going to join us live, next.

Also, take a look at, this the cover of "Newsweek" getting all kinds of buzz this morning, the good, the bad, for calling President Obama the first gay president. Our panel walking in to talk about this and that and everything in between, Ryan Lizza, Abby Huntsman, and Will Cain. Hello, good morning. So we got a little music. I love this show for the use music. This is Abby's playlist, Third Eye Blind. You're watching STARTING POINT on a very early Monday morning.


BALDWIN: Welcome back. Legislation introduced that would punish the New York police department for its controversial surveillance of Muslim-Americans. New Jersey representative Rush Holt introduced this legislation and now it has several Democrats under fire.

(BEGIN VIDEO CLIP) REP. RUSH HOLT, (R) NEW JERSEY: These Muslim communities were mapped, infiltrated, and surveilled simply because they were Muslim. Profiling is wrong. Profiling on the basis of race, ethnicity, and religion is a violation of core constitutional principles.


BALDWIN: The amendment was rejected in a party line vote, and now two New York Republicans, Representatives Peter King and Bob Turner, they are demanding an apology. They want an apology for the criticism against the NYPD. I want to welcome Congressman King here this morning. Nice to see you. Can we just be specific, you want this apology. What specifically do you want?

REP. PETER KING, (R) NEW YORK: First of all the NYPD is the most effective counterterrorism force in the country, there's 1,000 police working day and night, fighting Islamic terrorism and the threats against New York and stopped 13 plots against New York city. To have anyone on the floor of the House of Representatives introduce legislation which accuses the NYPD of unconstitutional or illegal behavior is absolutely wrong and the fact that the entire democratic leadership of the United States Congress voted for that, voted against the NYPD and voted for this reckless amendment, to me they owe the NYPD an apology.

All these politicians come to New York, want their picture taken with Ray Kelly and say how good they're doing, and when the money is on the line they vote against the NYPD.

BALDWIN: This is what Representative Holt said yesterday, part of his statement, "History has demonstrated that profiling is an ineffective policing tactic that generates resentment rather than cooperation in targeted communities." I just want to point to something else, Representative Keith Ellison, the first Muslim elected to Congress, he testified on the House floor last month about specifically this surveillance tactics, specifically of college students. Take a listen.


REP. KEITH ELLISON, (D) MINNESOTA: I was very proud when my son was elected president of the student, Muslim student association of his college but I wondered, was my 18-year-old son subject to surveillance, like the kids were at Yale, Columbia and Penn? He's a good kid, never done anything wrong, and I worry to think that he might be in somebody's files simply because he wanted to be active on campus.


BALDWIN: Simply because he wanted to be active on campus, he's concerned about his own 18-year-old. Can you understand that concern, understand that perspective, congressman?

KING: Absolutely not. First of all, Keith Ellison, I get along with Keith Ellison. He's a very active spokesman for the Council on American-Islamic Relations, which is named as a conspirator in the largest terrorist financing case in this country.

Secondly, it's not just me defending Ray Kelly. It's the president's own homeland security adviser, John Brennan, the director for the FBI Bob Muller, the director of the CIA, General Petraeus. There's not one constitutional or legal violation anyone accused of NYPD of.

What Keith Ellison is talking about with the Muslim student association, that and other groups, when there's any instance or evidence at all there could be an infiltration, somebody in those ranks who is working against the United States, then the NYPD has an obligation to look at the groups. This is open surveillance. This is the type of thing which is good police work.

And I said this before when the justice department was going after the mafia, they went to an Italian social clubs. When they went to the Westies, the Irish gang, they went to the west side of Manhattan. It's good work, entirely legal, and we're catering to politically correctness. That's why I'm saying the Democratic side should apologize. All of the people are alive in New York today because of the NYPD.

RYAN LIZZA, "THE NEW YORKER": What is your position on profiling in general? Do you have any problem with it? And two, you're saying that the NYPD, the problem with what happened in the house is that the NYPD was criticized. Is your position that the NYPD is completely above criticism, and that they simply can do no wrong? It seems to me that the media has brought some pretty legitimate issues up and that it's not quite right to defend the NYPD just unilaterally. It sounds like what you're doing. So could you respond to that?

KING: First of all there is no profiling. That's the nonsense people like you and others are propagating.

LIZZA: I'm not propagating anything. I'm saying there are questions raised about what the NYPD is doing.

KING: I'm telling through is no profiling. So I want you to take that back. There is no profiling. You have no evidence. They use terms like profiling, spying casually and cavalierly, and you don't know what you're talking about. I'm saying it would be a legitimate criticism of the media is very warranted, but to have this broad-based attack accusing him of profiling, racism, bigotry is absolutely wrong. That's the irresponsible conduct.

LIZZA: I'm not saying that.

KING: You're passing it on as if it's legitimate.

LIZZA: Sir, I'm just saying the media is bringing up issues about profiling.

KING: They're not legitimate. They're illegitimate. They're irresponsible to make.

BALDWIN: You bring up very valid points, Ryan Lizza. KING: They're not valid points. They are not valid points.

BALDWIN: We're going to agree to disagree here.

KING: They're not valid. He can say whatever he wants. He's wrong.

BALDWIN: There you go.

Let me ask you about what's happened recently in Afghanistan, this former member of the Taliban now trying to help with the peace process, he was shot and killed in the middle of traffic. The Taliban absolutely not denying responsibility but just bigger picture here, what does that say about the peace process they're trying to forge?

KING: Yes, it shows how difficult it is to deal with the Taliban. Obviously there can be elements of the Taliban that we can try to deal with but it shows the hard core and leadership of the Taliban does not want a peaceful agreement which I think then makes it more difficult for the president, who says we're going to leave by a certain date, withdraw troops by a certain date, and that encourages more radical elements of the Taliban not to cooperate and seek peace. So no, this is a bad sign and it's unfortunate because here was a person who was trying to do the right thing and he was ineffectual by his own people.

BALDWIN: Finally, we heard about this and I thought I have to ask but this, the prostitute, the Colombian prostitute at the center of this whole secret service scandal, I hear you laugh so I'm going to ask, Daniella Ludanos-Suarez, I hear she wants to meet with you in your office. I hear you said no. Do you have any idea why she wants to meet you, congressman?

KING: First of all, Brooke, there's women all over the world want to meet with me.

BALDWIN: That's why I'm here, I'm asking, but this one --

KING: I have to fight them off.


BALDWIN: Let the man answer -- 30 seconds, Congressman.

KING: I assume, I'm chairman of the homeland security committee, we are doing an investigation with secret service and her lawyer claims she has information to give me. The fact is it would be a publicity stunt. We checked everything out she's been saying both publicly and privately and she has nothing to offer at all. There's been enough cheap publicity over this entire incident so I'm not going to give her another forum. But again, this is something I've had to come to terms with my entire life, beautiful women trying to track me.

BALDWIN: I'm sure your wife is saying, honey, nix on this happening in your office please. Thank you so much. KING: My wife is saying I'm delusional.

BALDWIN: Congressman King, good seeing you.

KING: Thank you.

BALDWIN: We'll leave it there. Congressman King, thank you, a pleasure. Love we got a laugh out of you on an early Monday morning and great questions by the way, guys.

Still ahead, "Newsweek" magazine, have you seen this cover? It's getting a lot of heat this morning. They have officially dubbed President Obama the first gay president. Did they cross the line? We're going to go there.

And don't forget, watch CNN live on your computer, mobile phone, working out, tune in, Ryan's playlist, Flaming Lips. You're watching STARTING POINT.


BALDWIN: Love me some Pearl Jam. Nice job Will Cain.


BALDWIN: We'll get the mood a little mellow on this Monday, not so upbeat, but we'll take it.

Good morning. Welcome back here to STARTING POINT. So this is the part where you all choose your favorite stories that catch your eyes in the papers this morning. Abby Huntsman, let's begin with you.

ABBY HUNTSMAN, POLITICAL COMMENTATOR: I'll start with, we were joking about this earlier, my matching green phone cover. I plan my phone cover with my outfit every day.

BALDWIN: You coordinate these of course you do.

HUNTSMAN: It's very embarrassing, actually.

CAIN: It is.

HUNTSMAN: So I found "The Wall Street Journal" today, there was a Kumbaya moment between Romney and the evangelical group, he spoke at Liberty on Friday and evangelical leaders praised him this weekend. I grew up Mormon, and in 2008 it was a big problem for him. This is a big deal for him. I thought why is this happening now? And then we were talking about it.

And now that Obama has wrapped his arms around gay marriage it's kind of like religion is no longer of much importance I think. And it doesn't really matter. Romney is the voice for traditional marriage that goes above and beyond religion.

BALDWIN: Why are you rolling your eyes, Will Cain? WILL CAIN, CNN CONTRIBUTOR: I think she's gone a bridge too far. I think it's interesting that we do have the Republican nominee for president that's a Mormon and that seems to be a non-issue. But I also think it's a little too far to say that religion might not that be a big a factor in American politics.

BALDWIN: I don't think she fully said that.

HUNTSMAN: I'm not fully saying that. I'm just saying now it's a choice between someone that believes in traditional marriage and someone that is for gay marriage it's a lot easier for them to say, you know what? Let's push the religion aside a little bit. It may still be important, but at the end of the day, we're voting for someone for traditional marriage.

RYAN LIZZA, "THE NEW YORKER": And it shows up in the polls conservative base of the Republican Party has rallied around Romney, very strong.

BALDWIN: What do you have, sir?

LIZZA: So the story that caught my eye this morning on the front page of "The Times" is trees killing people in New York City, literally trees killing people. So "The Times" said --

HUNTSMAN: Hang onto your seats, guys.

BALDWIN: Trees are killing us.

LIZZA: This massive investigation into the fact that in the last decade about 10 people have been struck by tree limbs from rotting trees.

And frankly, it just struck me as sad as it is and as awful as that incident might be, this is not exactly a huge number of incidents, considering there are several million trees in New York City, but --

CAIN: Dangerous, old trees.

LIZZA: -- investigative piece.

BALDWIN: Philosophical question or joke falls here.

LIZZA: If you're hanging out in Central Park next to a rotting tree.

CAIN: I'll talk about Evelyn Brian Johnson who died at the age of 102, but they called her "Mama Bird "and they did for a reason, because she logged the second most hours of any pilot in American history, 57,635 hours, the equivalent of six and a half years in the air. She made 5.5 million miles worth of trip, which equivalent to 12 round trips to the moon.

BALDWIN: Mama Bird.

CAIN: Mama Bird, 102, flown on to greener pastures. That wasn't scripted. I didn't script that. You like how I did that?

BALDWIN: Thanks, you guys.

Still ahead on STARTING POINT, watch out, because you can get a ticket in one New Jersey town. Listen to this, we all text, right? You can get a ticket for careless walking. That's what they're calling it. How is that defined? That's coming up in our "Get Real."

Also children of today may become the first generation to die younger than their parents, yikes, because we're too fat, let's be honest. A new 4-hour HBO documentary all about obesity, but what's new about this? We're going to talk to the creator coming up. You're watching STARTING POINT.


BALDWIN: Good morning, just about half past the hour here. Let's see what other stories are percolating on this early Monday. Hi, Christine.

CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Good morning again, Brooke. The defense begins presenting its case this morning in the corruption trial of John Edwards.

Lawyers for the former North Carolina senator argued for a mistrial Friday claiming prosecutors failed to prove their case. The judge denied that motion. It's not clear which witnesses will be called today, but Edwards is not expected to testify.

The Senate Homeland Security Commission plans to hold a public hearing later this month to investigate the prostitution scandal at the Secret Service. It will take place on May 23rd.

Secret Service Director Mark Sullivan is expected to testify. The incident in Colombia has already cost nine members of the agency their jobs and 12 members of the military are being investigated.

Uganda says it's one step closer to catching Joseph Kony. His top commander was captured this weekend in the Central African Republic. That's where U.N. officials believe Kony is hiding.

Kony is the leader of the Lord's Resistance Army and the subject of that viral video Kony 2012. Kony's accused of recruiting children as soldiers and sex slaves.

Two weeks after its celebrated arrival in the sky above New York City, the shuttle "Enterprise" has been separated from the 747 jumbo jet that carried it here from Washington.

It remained at Kennedy Airport for a few more weeks before moving to its new home at the Intrepid Sea and Airspace Museum. That exhibit is expected to open to the public in July.

Let's get a quick check of the weather, meteorologist Alexandra Steele joins us. Good morning.

ALEXANDRA STEELE, AMS METEOROLOGIST: Hi, good morning. Well, Christine, you're along the rain train. That is the story today really kind of the biggest story around the country all the way from the southeast into the mid-Atlantic and the northeast.

We're going to see between half inch of rain and up to three inches from the Catskills down to the Smokey that's where the heaviest rain will be and the biggest delays around the country with the biggest rain issues, places like New York, Philadelphia, Atlanta, low clouds.

And even into San Francisco and of course, around Phoenix as well where the fires are a factor and the temperature today will be in the 100s. That's a quick look at the weather. Christine, back to you.

ROMANS: All right, thank you.

A growing number of U.S. universities have come up with a unique way of helping students deal with stress at exam time, puppy therapy. Schools like Emery University in Atlanta are bringing dogs on campus during finals.

It seems to be working. And pet-friendly dorms, pet friendly dorms are becoming more common at schools, too. Get this, Harvard medical school and Yale law school both have resident therapy dogs in their libraries and you can borrow them, Brooke, just like a book.

BALDWIN: I mean, look I'm the biggest dog lover of them all. I have a pug. I love him but really, come on, kids. Study hard.

ROMANS: The best thing to do well on an exam is not go out the night before.

BALDWIN: Forget the dogs. Christine, thank you.

Still ahead this morning here on STARTING POINT," children of today, may be the first generation to die younger than their parents. All because, Americans, we keep packing on the lbs, we're overweight.

Coming up next, sizing up this new HBO documentary, 4-hour doc, it's called "Weight of the Nation."

But up next, the big talker this morning, "Newsweek's" controversial new issue, take a look yourself, declaring Barack Obama the country's first gay president. See the halo? What do you think? You're watching STARTING POINT.


BALDWIN: That will get you going this morning, a little Beastie Boys, "Intergalactic" that's part of my music library for you on this Monday morning. So let's talk about this big controversy surrounding President Obama's appearance on the cover of the latest "Newsweek." Take a good, long look with me. What do you think?

The headline there at the bottom, declares, quote, "The first gay president." I just want to read just a couple of comments here on the magazine's Facebook page and you can see what they're saying.

Quote, "very weak, Newsweek. You stole one from the tabloid playbook." another one, "worst cover ever. When did "The National Enquirer" purchase Newsweek." "You are definitely going to go under for this Newsweek. Canceling my subscription ASAP."

HUNTSMAN: I kind of agree though. I feel like "Newsweek," there's a certain standard that they need to uphold -- I mean, their audience wants not necessarily totally balanced, but this is a bit extreme I would say.

BALDWIN: They're looking to evoke and they want to sell.

CAIN: Abby, do you mean that this is too far into the corner of Obama? Is that what you're saying? No, I'm serious.

HUNTSMAN: Just a little bit. Yes, well, obviously.

BALDWIN: So you don't like it?

LIZZA: The first law of "Newsweek" covers is there's no such thing as bad publicity.

BALDWIN: They like it. We're sitting here talking about the cover of their magazine.

LIZZA: Of course, and Tina Brown, the newish editor of "Newsweek," one of her skills is extremely provocative covers and she's been doing it for decades and various magazines she edited at "The New Yorker" and others, it's very hard, you know, sales are not exactly --

BALDWIN: "Time" magazine is getting all kinds of buzz for the latest cover.

HUNTSMAN: It's like a tabloid?

LIZZA: It's not a tabloid. This is a way to break through the clutter of the media and it's not very easy if you're "Newsweek."

CAIN: I would say this. First of all, "Newsweek" is basically a partisan magazine into the left corner, but "the first gay president" doesn't make sense to me. James Buchanan, by the way, according to historians may have a claim on that.

BALDWIN: President Clinton called the first black president. Do you think "Newsweek" will get pushback from the White House?

CAIN: No, I don't think so, but it is absolutely tabloidish move to try to sell magazines. Ryan said before this it's like a battle between "Time" and "Newsweek." I'll tell you this, "Time" wins.

BALDWIN: You had Friday morning the cover and they called it "The Spectrum of Light" cover.

LIZZA: In my humble opinion I think our cover is a little, better, a little more --

BALDWIN: Not that you're biased or anything.

LIZZA: A little more subtle.

BALDWIN: Why do we think the halo? It's almost --

HUNTSMAN: That's when I feel it goes too far.

BALDWIN: It's evoking religious --

LIZZA: It's a statement from "Newsweek" saying this is a great achievement.

HUNTSMAN: Glory moment.

LIZZA: They like that being provocative to people. People will be offended by the fact that there's a halo. If you're not a little offended by the cover then you didn't do it right.

BALDWIN: They want to evoke emotion, whichever way.

HUNTSMAN: I think they did so they were successful.

BALDWIN: Still ahead this morning here on STARTING POINT, the first images released of Ashton Kutcher, have you seen these? These pictures of Ashton Kutcher as Apple co-founder Steve Jobs in this new movie. You can tell me if you think they look alike.

Also a CNN exclusive coming up next, a stunning new HBO documentary. It's called the "Weight of the Nation" how the obesity crisis will change Americans' lives forever. How do you size up?


UNIDENTIFIED MALE: We don't now take this as a really urgent national priority. We are all going to pay a really serious price.

UNIDENTIFIED FEMALE: Obesity will crush the United States into oblivion.



BALDWIN: The numbers are absolutely startling, 34 percent of Americans are obese, not just overweight, obese, and that number is expected to grow to 42 percent by the year 2030. So this new documentary, this four-part, 4-hour documentary really issuing this wake-up call. It's called "The Weight of the Nation." There's a book as well, but this four-part series begins airing tonight on HBO.


UNIDENTIFIED MALE: If we don't now take this as a really urgent national priority, we are all going to pay a really serious price.

UNIDENTIFIED FEMALE: Obesity will crush the United States into oblivion.


BALDWIN: Joining me is John Huffman, vice president of HBO Documentary Films and the executive producer of the series. And Dr. Judy Salerno from the Institute of Medicine also helped write the book as well. Welcome to both of you.

I just have to ask, you know, there are so much out there about obesity and you have Americans sitting, you know, in their chair with the remote control eating their Twinkie and thinking why do I need to watch this? I mean, so many people's eyes glaze over when you say obesity. Why should we care about this?

DR. JUDITH SALERNO, INSTITUTE OF MEDICINE: We should care because it's a crisis in this country. We are telling people to lose weight. We know what to do. People know that they should move more, eat less, but it hasn't been working and there are reasons why it wasn't been working.

BALDWIN: One thing as I'm sitting and eating my chicken sandwich last night with my fries that take up three fourths of the plate, I'm thinking portion size, right? I mean, over the years, our portion -- even the size of the plate has evolved to be larger and we want to eat it all.


JOHN HOFFMAN, VICE PRESIDENT, HBO DOCUMENTARY FILMS: We have an economic system that enables that.

BALDWIN: How do you mean?

HOFFMAN: Well, we're subsidizing a few primary crops, corn, soy, wheat, rice. And the price --

BALDWIN: The bad stuff.

HOFFMAN: The bad stuff, and we're producing way too much of it, and that's what's shaping the American food economy. It's shaping what we're eating and then it's shaping us.

BALDWIN: They are also shaping us and in the documentary, we talk about kids these days, right? We're walking around with our phones. We have multiscreens while watching television on your phone, your iPad, what have you.

And we're all getting these messages and it absolutely affects our behavior, these toxic ads that often times are undermining what -- the parents are saying don't even eat this. Here is just the piece of the documentary that illustrates that.


UNIDENTIFIED FEMALE: Our generation is grown up craving a Big Mac.

UNIDENTIFIED MALE: We have built a cheap food model and that's the one we're dealing with right now.

UNIDENTIFIED FEMALE: It's hard to combat against what the TVs is telling to you buy your kids.

UNIDENTIFIED MALE: The kind of food that we eat is the kind that's most profitable.


BALDWIN: Where does the parents, you know, making sure the kids don't grab whatever is bad for you, cereal because of the ad here she saw or the advertisers? What?

HOFFMAN: Well, the advertising shapes are desires and cravings, but the parents are the gatekeeper what should be coming into the home. Ninety eight percent of the ads that children see are for foods that have been deemed unhealthy for them.

So we're not promoting health and we're not helping parents when we're just saturating the children's viewing experience and they are watching on average 7.5 hours of television on their screens a day.

BALDWIN: These two gentlemen have little ones at home. Are you ready for this?

CAIN: Yes, absolutely. My wife has done a wonderful job of putting the right foods into our kids' mouth. In the end that seems to me to be the major factor.

Sooner later, someone does this. They pick something up and bring it towards their mouth and it's a personal responsibility. I'm curious from bong both of your perspectives.

Do you think personal responsibility has been almost attributed as the final factor in this?

SALERNO: I think we need to start thinking about the obesity crisis as more than a failure of personal will. It's really an issue where everybody, rather than thinking about blame, everybody has to take responsibility for solving it. So we have -- you might feed your kids good foods at home and they go to school and can go to a vending machine and get a coke. BALDWIN: It's like the whole picture.


BALDWIN: We all have to be responsible at all points in time. I like how you say your wife is feeding them nicely but not you.

HUNTSMAN: I have a 12-year-old sister and 6-year-old sister. And same thing, they go to school and who knows what they are getting at school.

How do you change their mindset when they go to vending machine they think I don't want to get that because I know that's unhealthy for me or I know that long term that is going to be bad? But what will we see in this documentary will ingrain in their minds when the kids go to school it's beyond just feeding them something healthy?

SALERNO: Well, you have to change the environment. I think that is one of the key messages. That it's not enough to change one thing. We have to attack this on many different levels and they are all important in order to really conquer this problem.

HOFFMAN: This happened over the past 30 years. It's come on fast and it's come on quite furiously. And I think that when we look at the health care costs, right now, $192 billion a year.

In six years, $300 billion a year. Really we have to really ask our questions, ask ourselves this question -- are we really better than this as a society? Do we have the capacity to think our way out of it? And it's going to require really a renovation of our lives and the world we live in.

BALDWIN: And our thinking. It's also where you live. I thought it was interesting in the documentary a correlation between your weight and your life expectancy. Not just your genetic code. It's your zip code as well. Roll this clip.


UNIDENTIFIED MALE: This is (inaudible) Cleveland where we thus far have found the greatest disparity in life expectancy. This is an inner city neighborhood and eight miles down the road is a city with the life expectancy close to 90 years.


BALDWIN: So is that saying with if you live in the city you're up against some pretty tough odds?

SALERNO: Clearly, those are related to health and the obesity issue, but it's not -- used to be much more in low income neighborhoods. Not anymore. It's affecting all levels of our society.

LIZZA: You guys are really taking on the food and beverage industry in this documentary. I mean, right? That is at the core of this? The advertising and the crops that were subsidizing, right? That is the root cause you guys are starting with. What was it like taking them on? What was the blow-back from that industry when you're doing sort of an investigative piece about them?

HOFFMAN: Well, we have a key person who is part of the film. His name is Phil Marino. He's the former chairman and CEO of Quaker Oats and Pepsi Co. He released a report making a whole series of recommendations about all of the sectors that really need to be looked at if we are going to solve the problem.

Phil Marino is the first to say that you have to engage in industry and have to be at the table. If they don't have skin in the game we are not getting anywhere because we are eating far more than we can exercise our way out of the problem.

The overconsumption, 300 calories a day is a lot of exercise to exercise away those 300 calories that, on average, we're over consuming. So industry has to be at the table. But they have got to recognize that the long-term costs for the nation are really significant. One interesting --

BALDWIN: And our children. Our children as well which is a huge point you make. It's comprehensive and you also tackle solutions. The consequences of children ask the solutions and I like how it ends on a sense of optimism and how we get there, how we get there.

Let's remind everyone the four-part documentary series. IT's called "The Weight of the Nation" debuts on our sister network HBO. You can also watch on tonight the first two hours and then tomorrow night are the final parts three and four. So watch that, HBO. We thank you both.

It's frightening certainly. Still ahead this morning here on STARTING POINT, her name is Amy Copeland. She is a Georgia graduate student who went ziplining with a friend and, somehow, contracted this deadly flesh eating bacteria. She has also lost her leg and fears this morning she may lose more limbs. We will talk to her parents coming up.

Also he said what? Did you hear this over the weekend? Senator Rand Paul under fire this morning after saying he wasn't sure President Obama's views on marriage, quote, "could get any gayer."

Yes, that's what he said. Was it a joke? What did he mean by that? We will play that for you and let us know what you think. You're watching STARTING POINT here on this Monday.