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ERIN BURNETT OUTFRONT

Interview with Rep. Howard "Buck" McKeon; Defense Cuts; Mitt Romney's Overseas Trip; "I Will Never Use Drugs"

Aired July 31, 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: OUTFRONT next, the fight over the automatic defense cuts heating up but just how many jobs are really being cut? A lot of numbers have been thrown around, but do they add up?

And Mitt Romney, his foreign trip seemed to be higher on gas headlines than policy proclamations. Should he have stayed home? You're going to be shocked at the answer to this because we've got one.

And a warning the number of al Qaeda affiliated groups are rising right now. Let's go OUTFRONT.

Well, good evening, everyone. I'm Erin Burnett. OUTFRONT tonight is the president hiding up to two million layoffs. Well Assistant Labor Secretary Jane Oates (ph) posted this update to a federal law requiring worker notification of mass layoffs. Now, it was quietly posted to the Labor Department's website late yesterday. And as we first reported 46 days ago the law called the Warn Act requires that mass layoffs be announced to employees 60 days beforehand.

Now we're talking about mass layoffs like the ones threatening the defense industry thanks to the $1.2 trillion in sequestration cuts. Now since the sequester cuts take effect on January 2nd, here's a calendar, really makes it clear. What that initially meant was that layoff announcement at the big defense contractors would go out November 3rd. As you can see, that's three days before the presidential election.

Obviously those are not headlines that Barack Obama wants, so enter the Labor Department. Here's the letter. Oates (ph) writes, the assistant labor secretary, quote "The Warn Act notice to employees of federal contractors including in the defense industry is not required 60 days in advance of January 2, 2013 and would be inappropriate."

Yes, the administration is reinterpreting the law on the sly because after all this guidance was sent out quietly by the Labor Department posted on their website and they declined to make anyone available to us to interview tonight. Of course this was manna from heaven for the Republicans.

(BEGIN VIDEO CLIP)

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: The president doesn't want people reading about pink slips in the weeks before his election. So the White House is telling people to keep the effects of these cuts a secret, don't tell anybody, he says, keep it a secret, until, of course, after the election.

(END VIDEO CLIP)

BURNETT: All right. His frustration makes sense except for one fact that's rather unpleasant for the Republican side of things and that is the layoffs don't add up. The defense contractors for all of their extensive complaining about layoffs cannot seem to come up with how many people would actually lose their jobs at the beginning of the year. Here's the CEO of Northrop Grumman OUTFRONT.

(BEGIN VIDEO CLIP)

BURNETT: So how many people will you have to lay off at the beginning of next year due to the sequestration specifically?

WES BUSH, CEO, NORTHROP GRUMMAN CORP.: It's hard to tell exactly today and that's part of the challenge that we're all dealing with, with sequestration. Now the law that was implemented specifies a percentage cut and has some description of how that gets applied. We sought guidance from the federal government to be more clear about how sequestration would actually be implemented.

(END VIDEO CLIP)

BURNETT: It's hard to tell, he says. OK, here's the cold hard truth. With half a trillion dollars in defense cuts spread over 10 years it is not right to claim that 100 percent of the job cuts linked to that spending cut will come on day one. It just doesn't make sense. It doesn't add up. So the president's rule change may not save that many votes, sorry, pink slips. Anyway, there's one other thing that doesn't add up from the Republican side of the sequester and that is Speaker John Boehner blaming the president for the fact that the $1.2 trillion in cuts are set to take effect in the first place.

(BEGIN VIDEO CLIP)

REP. JOHN BOEHNER (R-OH), HOUSE SPEAKER: (INAUDIBLE) the president who came up with the sequester because he didn't want the debt limit to get in the way of his campaign. Now these arbitrary cuts are looming and frankly he's nowhere to be found on the issue.

(END VIDEO CLIP)

BURNETT: This is deeply ironic since Speaker Boehner voted for the bill that said sequestration is what's going to happen if the super committee fails. Now anyone who's been watching this show knows that the super committee failure has been a great tragedy from our point of view but there's been one man who's been very up front about his vote. He wrote today in "The Washington Post" that quote, "If I am among those -- I am among those who voted for the Budget Control Act and I am obligated to resolve the crisis it created." Here is the man at the center of this entire debate Buck McKeon, the chairman of the Armed Services Committee. He is OUTFRONT tonight. Chairman, good to see you, appreciate your taking the time.

REP. HOWARD "BUCK" MCKEON (R), ARMED SERVICES CMTE. CHAIRMAN: Thank you, Erin. Thanks for having me.

BURNETT: Let me just start with this issue of job cuts because I'm still very confused over what's really happening here. You know there's a number out from the aerospace industry saying there's going to be two million jobs lost next year in 2013 alone just in defense. Then there's a number out from the National Association of Manufacturers saying 1.2 million jobs by the end of 2014 in defense services all the way across the board. I get the sense nobody has any idea.

MCKEON: Well, they know it's going to be huge. They just don't know the exact number. We've seen studies from 1.1 million jobs to Secretary Panetta told me last week, 2.1 million jobs, and I don't know if they're looking at just the defense side or the other side of the issue, but they're talking the sequestration is $1.2 trillion of cuts that kick in January 2nd. Actually those cuts are already taking place right now. People are being laid off. People are not being offered jobs because of the uncertainty.

BURNETT: I'm wondering though on this sort of existential but it's at the heart of this entire debate. The question is you know look at -- we look at the OMB (ph) numbers for the budget for what this country spent in 2012, $902 billion in defense, $846 billion on health care, Medicare and Medicaid. How can you defend spending more money on defense than on health care when we have a debt crisis?

MCKEON: I'm not saying we shouldn't cut defense. I'm saying we've already cut almost half a trillion. That's already in the budget. We understand that. What I'm saying is the Joint Chiefs had a year to prepare for that.

BURNETT: But a lot of those cuts -- I'm sorry -- I don't mean to interrupt. But a lot of those cuts weren't really cuts, right? They were just -- we're just not going to get the increases that we thought we were going to get. I mean in an absolute value that cut was about only one percent.

MCKEON: If sequestration kicks in, there are real cuts, and if people could -- if I had the charts here I could show you how in real dollars they are major cuts.

BURNETT: So let me ask you a couple of questions in your op-ed today that I wanted to clarify.

MCKEON: Sure.

BURNETT: You said that in your frustration about the guidance on the layoffs that hundreds of thousands of Americans including those fighting our wars should find pink slips in their mailboxes only a few weeks before Election Day. I was very curious about that line. People actually fighting could get pink slips. We called the Defense Department and read them your sentence. They said that that's just pure speculation, but the chairman of the House Armed Services Committee can prevent it by stopping sequestration. Can you tell me where you got that because that was new and very damning that people who are actively serving in the military could be fired? MCKEON: There are -- in the government guidelines in the Warn Act it says you have to give 60 days' notice. That's for the defense contractors. And in some states it's 90 days. But if you work for the government, they call for 115 days' notice. That's why I'm talking it could be -- it's already happening in the military. I was visiting with troops and they told me, you know I've been 10 years in the military. I can't re-up. I've had people outside the military saying I'm trying to get in.

They won't take me. They are already cutting back, I guarantee it. The first half trillion dollar cuts are going to take a hundred and -- let's see -- it's going to take 80,000 out of the Army, 20,000 out of the Marines. The sequestration takes another 80,000 out of the Army and 20,000 out of the Marines. That's 200,000 people in the military, uniformed people that are going to lose their jobs. That's where I get it.

BURNETT: That's where you get it. And that means that would be people who are actively fighting our wars as you said, right?

MCKEON: Well, they'll have to determine that. You know, whether they're in Afghanistan, whether they're in Iraq, whether they're in Korea, they will determine -- they, being the chain of command -- who actually gets the pink slip or who -- they don't probably send pink slips. They just don't let them re-up and then they may have to riff (ph). It depends on how cuts -- how deep the cuts go.

BURNETT: All right John Avlon joins me now. And John what amazes me about this whole debate is here we are just months away --

JOHN AVLON, CNN CONTRIBUTOR: Yes.

BURNETT: -- and nobody has planned for this.

AVLON: Nope.

BURNETT: And nobody has any idea how much it's going to hurt and therefore I see little impetus to actually prevent it from happening.

AVLON: And Congress is planning for its summer vacation and that's the important thing --

BURNETT: Well yes that is at the end of the week --

AVLON: Yes, so --

BURNETT: And they will be taking it.

AVLON: That's the artificial urgency here. Look, it is insane. First of all, let's remember this is a self-inflicted problem.

BURNETT: Yes.

AVLON: We've had a number of chances to avoid these painful sequester cuts. This was always the carrot -- stick if they didn't take the carrot, the deal for the super committee, Bowles/Simpson, the grand bargain. This was the backstop. Well this big poker game in Washington they had their bluffs called and now they don't want to take their medicine.

BURNETT: All right.

AVLON: They (INAUDIBLE).

BURNETT: It's amazing. As you were saying earlier today, I mean both sides have had their bluffs called. The president clearly is playing politics because he doesn't want pink slips to go out.

AVLON: Sure.

BURNETT: The Republicans say this is dire and horrific but can't seem to come up with anything measurable that would indicate that it is.

AVLON: That's right and look I mean these are serious. These kinds of cuts with a --

BURNETT: Yes.

AVLON: -- hatchet instead of a scalpel can cause real problems.

BURNETT: Yes.

AVLON: Which is why the rhetoric of massive cuts without the context of a larger deal has always been a loser's bet frankly and look here's the good news. There's still time to avoid this. If folks in Congress are this upset not just because the lobbyists of the defense industry want to put the fear of God in them but they're really concerned about the implications of this for the economy, guess what, make a deal. There is still time.

BURNETT: Yes.

AVLON: Make a balanced deal and we can avoid all this pain. And guys like John McCain have said you know what, to avoid sequester, I'll accept some revenue increases. So there are some voices of sanity out there, but we really need them to step up and not just try to fear monger through op-eds in the pages of "The Washington Post" and other places.

BURNETT: All right. Well John Avlon thank you very much.

Well Mitt Romney's trip to Europe has been a rather memorable one not really for grand speeches but for avoidable gaffes. There was one particularly bizarre one today, but the question is would he have been better off staying at home -- some terribly practical takes on that ahead.

And Chick-fil-A executives, they've received a lot of criticism and some praise for taking a stand against gay marriage, but just how much money do they have -- an investigation and an answer -- a pretty shocking one and a Chinese female swimmer who was faster than the men now facing accusations of doping -- hey sexist or true?

(COMMERCIAL BREAK)

BURNETT: Our second story OUTFRONT should Mitt Romney have stayed home? So he's now back in America. He landed in Boston this morning after an overseas trip filled with some less than ideal headlines.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: In what's being called Mitt Romney's golden gaffe.

UNIDENTIFIED MALE: London, the trip started with a difficult stop for Mitt Romney I think it's fair to say.

UNIDENTIFIED MALE: What was supposed to be a low impact, upbeat, good will three nation overseas trip turned into quite a challenge today for the traveling Romney campaign.

UNIDENTIFIED MALE: And this unfortunately reinforces the kind of the Mitt Romney image kind of aloof and not always kind of understanding the situation.

UNIDENTIFIED FEMALE: Romney's audition as an international statesman is quite honestly off to a rocky start.

(END VIDEO CLIP)

BURNETT: The latest episode courtesy of a press aide who -- well here's what he did in Poland this morning.

(BEGIN VIDEO CLIP)

UNIDENTIFIED REPORTER: Governor Romney, do you feel that your gaffes have overshadowed your foreign trip?

GORKA: This is a holy site for the Polish people. Show some respect.

UNIDENTIFIED REPORTER: Governor Romney --

GORKA: Show some respect, Jim.

UNIDENTIFIED REPORTER: We haven't had another chance to ask him questions.

GORKA: (EXPLETIVE DELETED). This is a holy site for the Polish people. Show some respect.

(END VIDEO CLIP)

BURNETT: Now he continued to say, shove it up something later. Now he later apologized. That's important to say but it followed statements by Romney made at a fundraiser in Jerusalem in which he credited Israel's culture for its economic success, stocking it up against the Palestinian Authority's economy. Palestinian leaders called those comments racist and days ago in London questioned whether our ally was prepared for the Olympics.

(BEGIN VIDEO CLIP) MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: You know, it's hard to know just how well it will turn out. There are a few things that were disconcerting.

UNIDENTIFIED MALE: I hear there's a guy -- there's a guy called Mitt Romney who wants to know whether we're ready. He wants to know whether we're ready. Are we ready?

UNIDENTIFIED GROUP: (INAUDIBLE)

UNIDENTIFIED MALE: Are we ready?

UNIDENTIFIED GROUP: (INAUDIBLE)

UNIDENTIFIED MALE: Yes, we are.

(END VIDEO CLIP)

BURNETT: Where's that guy with a bat going to go hit Mitt Romney? I don't know. But the question is would he have been better off staying home. We asked our "Political Strike Team" of Independents. Nearly evenly split, 48 percent said yes, but 52 percent said no, he should have gone ahead.

OUTFRONT tonight retired general and Obama campaign surrogate Wesley Clark and Rick Grenell, former foreign policy spokesman for Mitt Romney. All right let me start with you, General Clark. Do you think that he did the right thing? I mean obviously there were gaffes. There's no denying that but did he get more out of this than he lost from some of those hits?

WESLEY CLARK, FMR. NATO SUPREME ALLIED COMMANDER: Well I think that's ultimately something the American people are going to have to decide. When something like this is done in a campaign in foreign policy, most of the people said no big issue, so then there must be some horse race reason why he's leaving the country. So there are a lot of discussions about taxes and did he pay the right taxes and so forth and why he won't release his returns.

BURNETT: Right.

CLARK: And there was a Bain campaign, so probably the way (INAUDIBLE) and I've been involved with these campaigns for a few years now, and somebody said, hey, you know you need -- credentialize (ph) yourself. Go out there, see some allies, have a great trip. You know you're going to go to friendly countries, there's Britain, Israel, Poland. Poland (INAUDIBLE) freed themselves. You made the comment about the Russians.

You can go to Poland. They don't like the Russians that much historically. You can -- you can make a lot of money on this trip for yourself. Go out there, look presidential, don't say anything too controversial, come back and it will all have blown over. It's the kind of horse race strategy --

BURNETT: Right. CLARK: -- that the American people don't -- hey don't -- when you don't follow politics that closely you might not see it, but when you follow it, you say, OK, that's the strategy.

BURNETT: That's what -- so Rick, did he succeed in that? I mean he had fundraisers. Did he raise the money from the people he needed to raise the money from and convince -- maybe some people in our "Strike Team" were saying the core evangelicals who were nervous about the whole quote/unquote "Mormon thing" that he is a deeply conservative Christian?

RICHARD GRENELL, FMR. FOREIGN POLICY SPOKESMAN FOR MITT ROMNEY: Well you know I want to pick up on one thing that General Clark just said. He used the word political and I think he's exactly right. This is what happens when political reporters go overseas to cover a foreign trip. These guys were bored from the beginning. If you look at the Twitter feed one reporter absolutely tweeted "why are we here". She had no idea. I think in the clip that you just showed you have a reporter screaming at the top of her lungs and I believe that's "The New York Times" reporter.

She's screaming trying to yell a question when she's in a holy place. I mean I don't think they understand where they are. If you take England and you take Israel and you take Poland and you see exactly what Mitt Romney did and how these political reporters all said that these were gaffes, each one of those, Erin, that's not that big of a gaffe. When Mitt Romney says that it's disconcerting that the news reports of the security situation in England and he's the guy who ran the Salt Lake City Olympics?

BURNETT: Well he may have been right about that --

GRENELL: That's an expert saying that he's -- well he was reiterating the news, Erin. He wasn't giving an opinion other than saying these news reports are disconcerting and the British media go crazy.

BURNETT: OK. But don't you think that he wanted it? I mean just being honest that he would like the headlines to be different. Presidential Mitt delivers moving speech?

GRENELL: Oh, sure. Of course. That goes back to my point that when you take political reporters who really don't understand these issues that's what you get, politics. Let me just say one last thing. I've been on a lot of trips, a lot of foreign trips. When you take a State Department reporter or a U.N. based reporter on a trip you get substance. You actually get issues like the former Polish president endorsing Mitt Romney who understands what Barack Obama is doing in Syria by not helping the opposition. You get substance. But, you know, the silly stuff of somebody shouting, that's a "New York Times" reporter, I would be embarrassed if I was "The New York Times" reporter screaming at a holy place.

CLARK: Well except that the trip really was for political purposes not for foreign policy purposes --

BURNETT: Right, as Mitt Romney said himself -- GRENELL: That's not true --

(CROSSTALK)

CLARK: If you had been an editor of a newspaper and you'd --

(CROSSTALK)

CLARK: -- OK, what's Governor Romney said so far about foreign policy, it's not a strong track record. It's, you know, a lot of waffling --

GRENELL: Oh, General, that's not true.

(CROSSTALK)

GRENELL: That's absolutely not true.

CLARK: It's some very -- it's some very hacking (ph) phrases --

GRENELL: I think --

CLARK: -- that come out of the Cold War. So then you wouldn't expect big announcements --

GRENELL: Oh, those are from surrogates. Those are from surrogates.

(CROSSTALK)

GRENELL: Those are not from Mitt Romney.

CLARK: You know I'm not sure if you'd say that Russia is the greatest foreign policy challenge that the United States has today.

GRENELL: He didn't say that.

CLARK: Well --

GRENELL: He said it's a geopolitical challenge.

CLARK: OK.

GRENELL: That's much different and I think that you should understand the difference --

CLARK: That's a geopolitical challenge -- I think I do and that's why --

GRENELL: That's not a foreign policy --

CLARK -- I conflate the two because that's a distinction without --

GRENELL: Well you're spinning the two.

CLARK: The truth is that when you're in the middle of a presidential campaign and you've been under a lot of political attack at home and you go abroad and it seems pretty obvious what the purpose is, of course, you're going to bring the political press with you. When I was running as a candidate for the Democratic nomination --

BURNETT: Right.

CLARK: -- I had to testify in the war crimes trials at The Hague. And I had this -- against Milosevic -- and I had this thought somewhere in my mind maybe someone will look at this and say boy that guy's testifying maybe that will help him political. I thought be careful, be careful. This has nothing to do with politics. This is what you came from your previous military aggression. Don't expect anything.

Don't look for anything from it (ph). And sure enough the day I testified was the day we captured Saddam Hussein in Baghdad. So there wasn't a word about it and it was just fine. But when you go in the middle of a campaign and you load it with people who could report good things, they're going to report something. If you don't talk to the reporters --

(CROSSTALK)

CLARK: -- if you don't give them stories --

BURNETT: Right.

CLARK: -- they've got to do something.

BURNETT: And a quick final word Rick, do you think that maybe in retrospect Mitt would have said you know what, I should have answered more questions. Giving people more to talk about other than just trying to say hey you know what you're not talking to us, so we're going to throw tomatoes, essentially, right.

GRENELL: Of course, you should always absolutely give out information. But, again, I go back to the fact that there were stark differences on this trip between Obama and Governor Romney on foreign policy issues, very substantive issues and the media, the political reporters missed it.

(CROSSTALK)

BURNETT: The capital of Israel, all right, we'll leave it there. I know that's a whole another area of debate and we're going to have that. Hopefully you'll both come back for it.

Well the deadly Ebola virus is spreading in Uganda. Why, we went out and got answers today in Uganda on the ground and we found some good news out about American cars.

(COMMERCIAL BREAK)

BURNETT: So Americans are a little bit more optimistic about the economy. This is according to the independent research group called the Conference Board (ph). They come out with a number every month and July numbers came out today and optimism about the economy rose to a 65.9 rating. Now that's up 3.2 points from June, so that's pretty good. But it's hard to see what's fueling the optimism because when you look at the actual numbers, annual income dropped. It dropped about 1.6 percent. The number of people claiming business conditions are good also was down and the number of people who claimed jobs are plentiful also dropped.

So you would think given all of those negative numbers, and by the way the overall headline number even though it was up from last month was still bad. So you think people aren't going to be buying anything, well, OK, that's kind of true. If you look at housing, the number of people who plan to buy a home in the next six months dropped by a full percent. But this is what's really amazing. People seem to be excited and optimistic about one specific thing and that is cars, so look at cars. The one green arrow we could find. People who planned to buy a car within six months that number was up 2.1 percent, which brings me to tonight's number, 1967. That is the year the very first consumer confidence index was released 45 years ago and more people want to buy a new car now than then, than ever, than ever on record, back to 1967.

You know there have been some amazing cars over the past 45 years. I just thought it was kind of fun to look at cars and you know back in 1967, for some reason this July though was really, really special. So could it be that Americans consumers see something good in the distance, some light over the horizon or do they just figure that like "Thelma and Louise" and their 1966 Ford Thunderbird, if you have to drive over the fiscal cliff, you might as well look good doing it.

Well next a warning from the U.S. government, al Qaeda is rising, a report late today, we have that for you. And Chick-fil-A, we're going tell you how much the bosses are worth, which issues they're actually giving a whole lot of money to, even more than gay marriage.

(COMMERCIAL BREAK)

BURNETT: Welcome back. We start the "Second Half" of our show with stories we care about, where we focus our reporting on the front lines.

We begin with new sanctions on Iran. The president signed an executive order today that imposes new sanctions on Iran's oil and energy sectors. We're told the, quote/unquote, "new sanctions" are intended to prevent Iran come back during the old sanctions.

The Treasury Department meanwhile has imposed sanctions on a Chinese bank and an Iraqi bank for helping Iranian banks.

Well, if you want to learn more about how the U.S. is consistent and frankly in many cases hypocritical in enforcing sanctions, please go to our blog at CNN.com/OutFront to see our breakdown on Samsung and its hottest new phones in Iran.

Well, Defense Secretary Leon Panetta wrapped up a meeting with the new Egyptian President Mohamed Morsi today. Morsi, of course, was the Muslim Brotherhood candidate in the Egyptian elections. But when asked about Morsi's relationship the organization, Panetta said the new president is, quote, "his own man" and added he believes Morsi and the country's top military chief are committed to working together to implement democratic reforms.

Some people may say that's way too optimistic but Hani Sabra of the Eurasia Group tells OUTFRONT there is no single group actually ruling Egypt at the moment, and things will probably stay that way for the median term. Also added that the U.S. can do little to influence what happens there anyway.

Well, the countdown is on. The U.S. Postal Service has $5.5 billion bill due tomorrow. This is money that they owed to the federal government to pay for health care benefits for retirees. In a statement, the post office says they're not going to make the payment and frankly they're going to make the next $5.6 billion due September 30th.

So in order to avoid default, the postal service needs Congress to pass legislation to allow for reforms. The Senate passed a bill in April that the house has not yet acted.

Well, today, we got a key report on housing. It was the Case-Shiller index, which tracks home prices. It was 2.2 percent in May. So, yes, that's backward looking, but it's an important index and it was better than economists were looking for. Prices are still down from a year ago, but they had the smallest decline in 18 months.

Peter Nolan (ph) of Barclays tells us the fact that most regions, particularly those in hardest hit areas like Florida and Arizona have seen gains in recent months is actually the most important sign, shows that the housing market recovery is becoming broader based.

Well, it has been 362 days since the U.S. lost its top credit rating. What are we doing to get it back?

Well, congressional leaders working together obviously would solve the whole problem. Today, Senate Majority Leader Harry Reid and House Speaker John Boehner did do something together, despite the sequestration war we talked about earlier. They signed a deal on a continuing resolution that will fund the government through March of next year.

Well, our third story OUTFRONT: al Qaeda rising. The State Department warned today that despite the killing of Osama bin Laden, al Qaeda affiliates are more powerful than ever. This is something we reported on last week on Mali where extremists linked to al Qaeda has taken over the northern part of the country in a coup. You're looking at Tuareg fighters there who have been defeated by al Qaeda-linked groups.

Al Qaeda-related groups are also focusing their efforts in a lot of countries. When you look at this lit up map, this is pretty powerful and we're not even lighting up Algeria, which we should be.

Syria, Yemen, Somalia, Niger, Mauritania, Nigeria and Egypt and if you lit up Algeria, that'd be pretty much the whole top of Africa there.

OUTFRONT tonight, Seth Jones, author of "Hunting in the Shadows: The Pursuit of Al Qaeda Since 9/11."

And, Seth, good to see you. Appreciate your taking the time.

So, you know, the greatest terrorist threat used to be Afghanistan and Pakistan and people have become accustomed to that. Why are we now seeing such a significant rise in al Qaeda-linked groups in northern Africa and the southern part of the Arabian Peninsula?

SETH JONES, AUTHOR: Well, I think there's a bit of a supply and demand issue here. On the one hand there's a new demand for justice. We've seen the fall of multiple regimes in Yemen, weak regime in Somalia. Now, we've got falling regime in Syria.

Al Qaeda has pushed fighters in to help fill the vacuum. At the same time, we also have a supply again of fighters. We've seen money coming from the Levant and the Gulf to fund some of these efforts. So, a bit of basic supply and demand here.

BURNETT: Right. Obviously, what we are hearing in Mali and I've heard again talking to people there after I spent a few days there is that they obviously are very adamant that countries like Qatar are involved in terms of funding. But in terms of what's happening in Syria, these are crucial questions because Assad has been saying, the dictator there, that it's been al Qaeda-linked groups that have caused the problem. And now, you're reporting that there are dozens of suicide attacks in Syria that have been the work of al Qaeda.

Is it possible Bashar al Assad is right?

JONES: No, I think he's wrong. It appears to be local Syrians, members of the Free Syrian Army. The al Qaeda element is very small but it does appear to be growing, upwards now of 200 or more fighters and they're very sophisticated, can do a range of improvised explosive devices. That is very disturbing, though, because these are very dangerous people.

BURNETT: And so, how significant is the al Qaeda presence in Syria right now? I mean, as the U.S. debates whether they should be arming the rebels or getting involved, how significant is al Qaeda?

JONES: I think it's fairly significant and the real concern is if we go back to 2003 and 2004 and 2005, the primary foreign firefighter network in through Iraq was through Syria, through cities like Damascus. Now that follow is reverse. We're seeing fighters moved from Iraq, as well as other counties like Turkey, into Syria, to conduct jihad.

So, we should be seriously concerned about -- this is prime territory for al Qaeda. This is a Sunni-dominated country.

BURNETT: So, what should the United States do? I mean, you know, in the country of Somalia, there were no borders that I could observe. Everyone was talking about al Qaeda and telling horrible stories about what was happening in their villages, villages abandoned.

What -- I mean, is there anything the U.S. can do? JONES: I think there is. I think we know over the last several years what we shouldn't do, and that is put large numbers of boots on the ground. I think this kind of work is really the work of Special Operations forces and intelligence units which have a capacity to work with and by and through local government actors, that's -- whether that's through Mali, whether that's through the Free Syrian Army in Syrian, but it's working with locals.

BURNETT: All right. Seth Jones, thanks very much. We appreciate it.

And now, our story OUTFRONT: Chick-fil-A. CEO Dan Cathy has been in the news a lot lately over his recent remarks against same-sex marriage. But it's his personal wealth and political contributions that made headlines tonight. Dan Cathy and executive vice president Donald Cathy have joined the ranks of the world's richest, according to financial research firm Frebco.

OUTFRONT tonight Matt Miller, editor of "Bloomberg Billionaires", a man who tracks this and knows everything there is to know about these guys who has suddenly emerged on the national stage as important power players.

So how much are Dan and Donald worth?

MATT MILLER, BLOOMBERG BILLIONAIRES: They're each worth $1.5 billion. They own Chick-fil-A with their father Truett Cathy, who founded the company decades ago and essentially invented the chicken sandwich. They split it three ways --

BURNETT: Is that like inventing the Internet?

MILLER: You can say invent the chicken sandwich. I mean, in the South, very much so. Chick-fil-A is sort of a staple in life in terms of their chicken sandwich, and a big deal in the South.

BURNETT: All right. One and a half billion dollars for each of these guys. How unusual is it when you look at other fast food chains, McDonald's, et cetera -- are these the richest of the rich, or is this standard operation procedure?

MILLER: It's not standard. Some of the richest in fast food, that's for sure. The richest people in fast food actually are the three resilient billionaires who were able to take Burger King publicly, but this is certainly the richest family in the fast food at $4.5 billion.

BURNETT: And why haven't we heard of them before that? I mean, it sounds like they've been active in causes.

MILLER: They certainly have. I think it's a hot button issue, and I think -- they haven't really given a tremendous amount of money to this, but it's such a hot button at this point in this time, same sex marriage, and people who are anti-same-sex marriage, you can get a lot of advocacy groups to talk about it and get upset and boycotts chicken sandwich shops and so, we're talking about it right now.

BURNETT: I guess that's true. When Dan Cathy was the one who took the position on same sex marriage in the radio interview, he said the company is guilty as charged for backing the, quote-unquote, "biblical" definition of marriage. So, I know you've about looked into how much time they're giving a way. Is this sort of like another Koch brothers sort of a family in terms of conservative causes?

MILLER: It certainly is in terms if you look -- they have something called WinShape, which is the family foundation, Chick-fil-A gives millions of dollars through WinShape, to have assets in 2010 of about $62 million, $63 million. They gave away $4 million in 2010. A lot of the group that they gave to, $4 million, were to pro-family, pro- marriage, pro-foundation. That's kind of thing.

But if you look at it in terms of scale -- Warren Buffett gave $2.8 billion or something like that to Bill and Melinda Gates foundation last week or a couple of weeks ago in terms of Berkshire Hathaway stuff.

BURNETT: Right.

MILLER: When you look at their net worth it's less than the a tenth of their percent that they're giving away from the foundation. So it's not in terms of scale or billionaire giving, it's not an astronomical number.

BURNETT: Right. It's certainly people like Mitt Romney are giving away vast amounts of their wealth. It's a small percent.

MILLER: In terms of dollar figures, it's a small in billionaire terms and it's also from a percentage of net worth. It's not at the most ginormous number out there. If you look at Sheldon Adelson, Sheldon Adelson, the casino mogul, gave more away than they did just to Mitt Romney and Newt Gingrich in the past six months.

BURNETT: I guess that puts it all in perspective. But they are, like it or not, now on the national stage.

MILLER: Yes, they are.

BURNETT: Right. Thanks to Matt Miller. We appreciate it.

Well, authorities have received hundreds of millions of dollars of meth and heroin. It's a massive drug bust. We're talking about half a billion dollars. And a hot Chinese phenom will beat the men. Did she dope?

(COMMERCIAL BREAK)

BURNETT: We're back with tonight's "Outer Circle", where we reach out to our sources around the world.

We begin in India where 600 million people were left in the dark today after a massive grid collapse. Of course, that's 600 million, twice the size of this country. About the same as if power went out across all of Europe.

Harmeet Singh is in New Delhi and I asked him how it happened. (BEGIN VIDEO CLIP)

HARMEET SINGH, CNN CORRESPONDENT: Erin, on Tuesday afternoon, a large part of India from the desert start of the rising sun in the west to the Himalayas in the northeast had their electricity supplies cut off because of massive grid failure. This massive land is home to more than 600 million people who are affected and the worst hit were rail and road transport uses. Power was restored later in the night, but before that, it was a difficult time for many Indians. Erin.

(END VIDEO CLIP)

BURNETT: All right. Thanks to Harmeet.

Now we go to Uganda where officials say a fast-moving Ebola outbreak has killed 14 people, appears to have actually started with just one family.

David McKenzie went on the ground to find out what happened for us today and we asked him how doctors are trying to fight it.

(BEGIN VIDEO CLIP)

DAVID MCKENZIE, CNN CORRESPONDENT: Erin, there are at least six new suspected cases of the dreaded Ebola virus here in Uganda, bringing the total amount infected to more than 25, according to health officials.

This outbreak started 10 weeks ago. At first, it wasn't detected and it centered in the west of the country. Health officials and groups like the Center for Disease Control are scrambling to the region to try to isolate the patients to stop the spread of this disease.

There's no known cure to this virus and it could potentially spread panic through populations. That's why Uganda's president got on national television and asked people to stay calm but to avoid fiscal contact. The next few days up to a week will be crucial in trying to stop this outbreak before it spreads -- Erin.

(END VIDEO CLIP)

BURNETT: All right. Thanks to David McKenzie.

Now let's check in with Anderson with a look at what's coming up on "A.C. 360." Hey, Anderson.

ANDERSON COOPER, "A.C. 360" HOST: Hey, Erin.

We're keeping them honest tonight in the program. An early look at a yet-to-be-released report blasting the people who are supposed to be keeping firearms out of the hands of criminals, the Bureau of Alcohol, Tobacco and Firearms. Specifically it takes the ATF to task for launching and failing to properly weapons during that Operation Fast and Furious.

Now, we'll detail what the report says that went so badly wrong. As people can remember, the committee investigating Fast and Furious, Utah Republican Jason Chaffetz.

Also a survivor story from the massacre in theater nine in Aurora, Colorado. Petra Anderson took a gunshot to the brain. It could have killed her instantly. Not only did she survive. She's already walking, telling jokes, going to grad school for a degree in music this fall.

We'll talk to neurosurgeon, Dr. Sanjay Gupta, about how much had to go right for her to beat the incredible odds against her.

Those stories and report from the front lines in Syria and tonight's ridiculous all at the top of the hour, Erin.

BURNETT: All right, Anderson. See you in just a few moments.

And now our fifth story OUTFRONT: A strong denial from the 16-year- old who has shocked the swimming world after a series of record- breaking swims. Her name is Ye Shiwen. She's from China.

She told the reporters, quote, "My achievements derive from diligence and hard work. I will never use drugs. Chinese athletes are clean."

But that has done little to more suspicion. Look, there she is. I mean, I know her arms kind of resting up on something, but you can see how ripped this girl is. You look at her face. She looks like a child but she is ripped.

She placed first today after setting an Olympic record in the 200- meter individual 200 medley yesterday.

On Saturday, she won the gold in the 400-meter individual medley. In that race, in the last 50 meters with the freestyle leg, Ye logged a faster time than the U.S. champion Ryan Lochte.

OUTFRONT tonight, Maggie Gray, an anchor with SportsIllustrated.com.

It is pretty stunning. I mean, just before we talk about drugs/no drugs. I mean, what do you make of the performance of the 16-year- old, beating the top American man?

MAGGIE GRAY, SPORTSILLUSTRATED.COM: OK. So we have to put a few things in perspective. First of all, she was trailing. This was her opportunity to make up ground and put herself in position to win a gold medal. Whereas Ryan Lochte was ahead by three body lengths. He did not have to try hard in those last 20 to 30 meters of the pool.

BURNETT: Right.

GRAY: So that's one thing.

I do want to believe that if someone really has been training their entire life, that they could put together one length of the pool where they do swim --

BURNETT: Just a sprint, 100 percent?

GRAY: Tenth of a second better than a man could.

BURNETT: All right. So you think that's reasonable. What about this whole issue about doping? A lot of people are saying, you know, in 1994 China dominated in swimming, 12 of 16 gold medals at the worlds. But seven Chinese athletes later tested positive for banned substances.

So, she says Chinese athletes don't dope. Obviously, that's not true historically. What do you think now?

GRAY: And as recent as a 2009, there were some Chinese athletes in the junior championships that got caught dope. But it's really dangerous to make that correlation right to Ye Shiwen. That's not really fair to her either.

I mean, look at baseball, such a huge problem with steroids for decades. You wouldn't say one person, just because the first baseman is doping means the entire time is doing it too. I think we need to give her the benefit of the doubt now because she will be tested. There's no doubt that she will tested. She probably already has been.

We'll see the results from that.

BURNETT: OK, so does that -- I know there's about 10,500 athletes. Just over half of them get tested. So, you've got a 50/50 chance. If she gets tested now after winning, would every possible substance actually show up?

GRAY: Absolutely. She will get tested. The top five athletes in every event, plus two other athletes who compete in that event, all get tested. So, if you win a medal, you're getting tested for every medal that you win. That's number one. She is definitely getting tested.

Secondly, they keep the test for eight years. As the technology of drug testing gets better and better, they will go back --

BURNETT: So they could rescind the medal?

GRAY: This happened before. This happened to Marion Jones, the sprinter from Australia in 2000. So, they can definitely go back and they can find out whether or not someone was cheating. They want to find the cheaters. That is definitely true.

But you also have to give her -- she's innocent until proven guilty.

BURNETT: Right, right. I mean, it is a stupendous performance.

I just want to ask you this question. There's an American, Missy Franklin, raced two swimming races 10 minutes apart and people are saying that's just so incredible, that performance. Why aren't people picking on her for doping? Is there some sort of an ethnocism (ph) going on here?

GRAY: Well, I hope not ethnocism. I think that we already talked about the reputation the Chinese have, unfortunately, which should not reflect on Ye Shiwen.

But what Missy Franklin did was qualify for one event and to get to a gold medal in the next, less than 10 minutes apart from each other. That is unbelievable.

But she didn't break any world records. No Olympic records in those races. I think the world record is really what raised people's eyebrows. And the fact that Shiwen really decimated the world record by a full second, that raised eyebrows.

But, you know, it could be just a phenomenal Olympic performance. I think that's what everyone should take it as, until we know more.

BURNETT: I hope that's true. To your point, it's unfortunate that these doping allegations hang over so many sports. I mean, people have become really jaded.

GRAY: It's the landscape of sports today, unfortunately.

BURNETT: All right. Thanks very much to Maggie. Appreciate it.

And next, so many people are saying that social media has made NBC a complete dinosaur by holding Olympic events until primetime at night. If you're one of those people, we're not sure your logic adds up and we'll explain.

(COMMERCIAL BREAK)

BURNETT: Now to Australia, where police have busted a major drug ring, seizing half a billion worth of meth and heroin and literally stuffing it into terracotta pots and then securing it with basically, essentially some sort of a goo. More than 674 pounds of crystal methamphetamine and 555 pounds of heroin were seized as part of an operation that began a year ago when the U.S. Drug Enforcement Administration tipped off officials in Australia.

Now, this is the largest seizure of methamphetamine in Australia's history. The third largest of heroin, and an important link is everyone starts to wonder where the drugs come from. A lot of them were coming from Thailand.

And now the spoiler fest that's going on out there. Twitter is ruining the Olympics. At least that's what you might believe from a lot of recent headlines.

Over the past week, headline after headline have blasted Twitter for, quote, "giving away" Olympic results before NBC has a chance to hold them for five hours and air them in prime time.

But is it true? Is twitter really a giant spoiler?

We took a look at the numbers. And while it's true there have been more than 10 million Olympic tweets sent during the games so far, about 100 times that of the Beijing Olympics, Twitter is not the worst offender. If you look at Americans who use social media, 96 percent of them are on Facebook, 28 percent are on LinkedIn, only 24 percent are on Twitter.

So the average person who's online in this country has a better chance of finding out results from some other site than Twitter. But then there's this. This is really the cold, hard truth. Social media is only a small part of the spoiler problem, because only about 56 percent of Americans actually have a social profile at all. That means half of us will not even see the spoilers on Twitter, Facebook, LinkedIn or anywhere else, which is pretty amazing. Considering everyone's been so complaining.

But every TV network, including this one, posts the networks on their Web sites. And despite the complaints about Twitter, most online users are getting their Olympic results from there. So, you know, if you didn't want to know who won the gymnastics tonight and you're like Brittany on our show, you don't go to CNN.com all day.

The people responsible for spoiling the Olympics for Americans who want to watch on TV is actually NBC. NBC is the network that decided to delay their coverage of the games until primetime and NBC is the worst offender of spoiling. They've been live-tweeting the events, updating their blogs and just yesterday, they ran a promotion that gave away who won just six minutes before they actually aired, breathlessly, the competition. It's killing old media killing old media. Can't blame for that Twitter, spoiler alert.

Anderson Cooper starts now.