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Obama and Christie Rekindle Romance; Two U.S. Embassy Workers Shot; Fiery Derailment Sparks Hazmat Scare; Massive Cyber Money- Laundering Case; West, Texas Fire Damage; Teen Accused in Bomb Plot Appears in Court; Camilla Steps Out as Queen-in-Waiting

Aired May 28, 2013 - 17:00   ET


WOLF BLITZER, HOST: Happening now, President Obama and Governor Chris Christie, they are together again on the Jersey Shore and they both have something to gain from this visit.

House lawmakers now investigating the attorney general, Eric Holder, and whether he lied to Congress.

Plus, a truck and a train collide and the resulting derailment sparks a possible HAZMAT crisis.

I'm Wolf Blitzer.


They were first brought together by super storm Sandy last October. Today, the president and the New Jersey governor, they both teamed up once again, seeing the results of billions of dollars in federal disaster aid and rekindling what you could call their Bromance.

Our chief White House correspondent, Jessica Yellin, travels with the president today to New Jersey.

She's joining us now live -- Jessica, how did it go?

JESSICA YELLIN, CNN CORRESPONDENT: Wolf, the reunion was short and sweet, with a short-term up side for both men.


YELLIN (voice-over): The political odd couple together again.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Let me, first of all, say thank you to Governor Christie for that introduction and the great work he's done here.

YELLIN: Visiting a reopened boardwalk and facing off at an arcade game, where the president went 0 for 5.

OBAMA: Oh, too high.


YELLIN: But no worries -- the governor won him a stuffed bear.

The Obama/Christie political Bromance started days after super storm Sandy devastated New Jersey and the president promised...


OBAMA: We will not quit until this is done.


YELLIN: Since then, the federal government has poured more than $3 billion into the state. For a governor facing re-election, this visit is a chance to highlight progress rebuilding after the storm.

ANDY MCDONOUGH, NEW JERSEY RESIDENT: It's pretty amazing, what they've done.

YELLIN: And win some free media for the shore.

GOV. CHRIS CHRISTIE (R), NEW JERSEY: Welcome back to the Jersey Shore.

OBAMA: The Jersey Shore is back and it is open for business.

YELLIN: That's got to be a plus for Christie, who was slammed for spending $25 million in federal funds on this ad campaign.


CHRISTIE: Because we're stronger than the storm.


YELLIN: The president's return is not without long-term political risks for New Jersey's Republican governor. Just months after he welcomed the president last time, he was not invited back to the annual gathering of conservatives known as CPAC, important to GOP presidential hopefuls. And the latest visit showed off plenty of fresh material for future GOP attack ads.

But so far in this blue state, his bipartisan approach has been a political plus.

WILL WRIGHT, NEW JERSEY RESIDENT: I really admire the fact that him and the president are working together. And that's the way they should be working together in Washington.

YELLIN: Since Sandy, Christie's poll numbers have risen 15 points, now at 69 percent approval in the latest survey. The governor told NBC News when the president wants to visit...

CHRISTIE: I'm the governor. I'll be here to welcome him.

YELLIN: This resident, who is also a Little League coach, says the dieting Mr.

Christie should apply his governing principles to his waist line.

WRIGHT: I would suggest to him that he's just got to get into a training program and just stick to it, like he's sticking to his promise of helping the people here in New Jersey.


YELLIN: Wolf, the president had something to gain from this visit, too. It gave him a chance to pivot away from the controversies in Washington and to focus on an example of government working -- Wolf.

BLITZER: What does it look like to you over there along the Jersey Shore, Jessica?

Business back almost to normal?

YELLIN: Well, here where I am on the boardwalk, it is remarkable. And the people I've talked to said it was -- places that were completely decimated have been brought back to full functioning order. You wouldn't know a storm has hit here, Wolf. It was open for business all day long.

There are other parts of the state where there is real devastation still and the governor acknowledges that and says more work is yet to be done, but they're on their way.

BLITZER: I'm sure there's a lot of grateful people in New Jersey right now, grateful to the federal government for stepping in with those billions and billions of dollars.

Thanks very much.

Jessica Yellin traveling with the president.

Let's dig a little bit deeper right now with our chief political analyst, Gloria Borger, and our chief national correspondent, John King -- John, who gets more out of this visit today, the president -- politically, we're talking about -- or Governor Christie, who's up for re-election, as we all know?

JOHN KING, CNN CORRESPONDENT: Yes, I think it's a win-win for both men.

Who gets more?

I'm going to be a little contrarian and say Governor Christie, in the sense that he's way ahead of his Democrat opponent. No Democrat thinks he can be beat. But he's in a blue state, why not play it extra safe?

So you spend some more time with the most popular Democrat in the country.

Does it hurt him in 2016? Maybe. But it fits Chris Christie's DNA.

What does the president get?

It just note, he's out of Washington. If you look at the IRS controversy, if you look at many of the other things, his critics say can't run a lemonade stand, essentially, that they -- Obama critics say they don't manage the government very well.

Well, FEMA -- I was just in Oklahoma. You have a Republican governor there. You have a Republican governor, Chris Christie. All across the country, FEMA gets high marks. And the president deserves some credit for that.

BLITZER: He certainly does -- you know, and Gloria, Alex Castellanos, the Republican strategist, our contributor, he wrote this. And I'm going to put it up on the screen. "Some Republicans will not only never forget, but never forgive.

Christie's embrace of Obama is much like Florida Governor Charlie Crist's Obama love. After jumping in bed with Obama, Crist eventually had to leave the GOP."

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Oh, come on, Alex. I don't think so. I don't think so.

Look, Chris Christie has a problem in his own party. But if you look at the national polls, he's also the only one who can give Hillary Clinton a run for her money. The Republican Party right now is split. You see John McCain fighting with Republicans in the Senate. And you're going to see the same issues with Chris Christie.

But I would argue that the visit from the president doesn't hurt him any more than he already has been hurt, because people believe he's moderate and if you don't like a moderate Republican, you're just not -- you're not going to support him.

KING: He has made this calculation...

BORGER: Yes, totally.

KING: -- that he is who he is and that he's going to call it like he sees it and he's going to stand with a president who helped his state, who answered his phone calls, who has checked back to see how you're doing. Chris Christie's calculation is there are some Republicans who will never forgive me, they'll still blame me for Mitt Romney's loss, they'll blame me again now. I'm not going to get their votes anyway.

His take is if the party doesn't grow up, if you will -- using his words...

BORGER: Right.

KING: -- that he's going to lose anyway, but that he...

BORGER: And... KING: -- that if he can win a broader group of Republicans who say this is a -- absolutely no pun intended -- here is a larger than life personality who has a chance to be somewhat of a different politician, a different kind of Republican, like Bill Clinton was a different kind of Democrat, if he can make that argument, then that little fringe will get left behind.

BORGER: And I'm going to make a prediction here that the truth teller will be the most appealing kind of politician we're going to have in 2016, because people are waiting for one. And that's exactly Chris Christie's brand. So embrace a Democrat if you're telling the truth and embrace a Republican if you aren't, I think that's got a lot of appeal.

BLITZER: I think Christie actually looked better today than he did seven months ago...

BORGER: Weight-wise...

BLITZER: -- the last time he was with the president. He clearly has lost some weight.

Take a look before what he looked like. That's seven months ago, right in the height, in the aftermath of that storm. And now look at him and the president. Clearly, his face looks thinner. He's lost some serious weight. He's had a procedure, John. But I think it's paying off. He's got a long way to go, but he clearly looks a lot better.

BORGER: Do they always dress alike, those men?


BORGER: Look at them.

KING: They seem to almost match their ties up there.

BORGER: And their jackets.

KING: Look, set politics aside for a minute and take the governor at his word that his top priority was his wife and children and his family...

BLITZER: I believe him.

KING: -- that he wants to be there for them. He does have a long way to go.


KING: But he's made some key steps. He's about 40 pounds lighter right now. God bless him. Good luck.

BORGER: Yes, I feel exactly the same way. Of course, standing next to President Obama, anyone can look a little hefty, right?

KING: Yes.

BLITZER: Yes. The president is tall and thin.



BORGER: But he looks great.

BLITZER: He's got some ways to go...

BORGER: Good luck to them.

BLITZER: -- but I'm very impressed.

BORGER: Right.

BLITZER: All right, guys, thanks very much.

Two men assigned to the United States embassy in the Venezuelan capital have been shot, but the State Department is staying very tight-lipped about the incident, raising even more questions about what really happened.

CNN's Lisa Sylvester is looking into this story for us.

What are you finding out -- Lisa?


Well, we know that the two officials worked at the U.S. Embassy in Venezuela and that this occurred after hours in Northeast Caracas.

But we don't know what led up to that shooting.


SYLVESTER (voice-over): The shooting happened early Tuesday morning outside of a nightclub in Caracas. Two members of the Defense Department assigned to the U.S. Embassy in Venezuela were hit, one in the abdomen, the other in the abdomen and the leg.

The State Department confirmed the shooting took place, but provided few details.

PATRICK VENTRELL, ACTING DEPUTY STATE DEPARTMENT SPOKESMAN: I don't have any more information about the extent of their injuries, other than to say that they're -- we don't believe they're life-threatening at this point. This did not happen at the U.S. Embassy compound. This was off site.

UNIDENTIFIED MALE: Where did it happen?

VENTRELL: Again, my understanding is this was at some sort of social spot or somewhere outside of the embassy grounds. But in terms of the exact location of it, I don't (INAUDIBLE). UNIDENTIFIED MALE: A social spot?

Do you care to be a little bit more...

VENTRELL: Again, I'm not aware of...

UNIDENTIFIED MALE: -- (INAUDIBLE) a drinking establishment?

VENTRELL: I'm not sure if it was a restaurant or a nightclub or what the actual establishment was. But that's why we're in touch with...


VENTRELL: -- both our personnel and...

UNIDENTIFIED MALE: Was it, in fact, a strip club...

VENTRELL: I have...


VENTRELL: -- no information on the site and that one way or another.

SYLVESTER: CNN has confirmed the shooting happened here, at the Antonella Club 2012, located in the basement of a mall. Local police are investigating and we're told family members of the men have been contacted.

DOUGLAS RICO, CRIME SCENE INVESTIGATION TEAM: But like I say, we're going to wait until all the information comes out to establish what occurred there. Right now, two people are injured. Information is being accumulated at the site of the incident. Once everything is mapped out regarding the offense that took place there, we can provide an official version of the events.


SYLVESTER: Now both men were taken to the hospital and they are both expected to make a full recovery. And we are waiting for more information from the Department of Defense -- Wolf.

BLITZER: When you get it, let us know.

Lisa, thank you.

Up next, a collision, a derailment and a fire. They sparked fears about hazardous materials. We're going there live.

And what's possibly the largest U.S. money laundering case, an alleged $6 billion scheme involving theft, fraud, child pornography and drugs, all of it based on lying.

Stand by.

(COMMERCIAL BREAK) BLITZER: We're following an ongoing emergency near Baltimore. Look at this -- a collision between a truck and a train that led to a fiery derailment and giant plumes of smoke that prompted fears about toxic chemicals.

CNN's Shannon Travis is on the scene for us.

What are you finding out -- Shannon?

SHANNON TRAVIS, CNN CORRESPONDENT: Yes, I mean, Wolf, the fire is still burning. Just take a look over my shoulder here, just thick plumes of black smoke just literally belching into the air.

We're told by officials on the scene, two of the train cars are still burning right now. They have about 60 fire emergency crews on the ground. And we're also told that the NTSB, that they're launching a go-team to investigate what happened.

Let's talk about what happened. Officials say that at about 2:00 today, about three hours ago, a train collided, essentially, with a truck, Wolf, that was pulling a massive dumpster. That collision caused a derailment and a massive explosion that we're told shook and damaged buildings in the nearby area.

Fortunately, only one injury, no fatalities at all, fortunately, and only one injury. But we are told that that person -- he was the driver of the truck that was pulling the dumpster, Wolf, that he is in serious but stable condition.

Also, there is a concern about what was actually on the truck. CSX, which is the train line responsible for train itself, says that there were chemicals, there were chemicals on the train. But officials are talking about how dangerous they might be or might not be. Take a listen at this, Wolf.


CHIEF JOHN HOHMAN, BALTIMORE COUNTY, MARYLAND, FIRE DEPARTMENT: There is a concern that because some chemical is burning, but CX Access informed us that there were no toxins or inhalants which would be some cause for concern if they were.

UNIDENTIFIED MALE: So, does that mean that the evacuation order that you guys have is in really --

HOHMAN: No, the evacuation would be much more significant if there were toxin inhalants.

UNIDENTIFIED MALE: So, right now, the evacuation is because --

HOHMAN: From the incident to here and mainly commercial areas.


SHANNON TRAVIS, CNN CORRESPONDENT: Now, Wolf, that's a serious concern. Wolf, that's a serious concern. No toxic inhalant we're hearing from the chemicals but any kind of chemical spewing on fire and spewing the way that they are right now. Obviously, concern officials are saying that there's an evacuation order for 20 block radius, but that essentially means that they're asking people to stay inside to close their doors, to close their windows.

They're not going door-to-door and telling people to get out. Also one last thing, Wolf. Fire officials are saying that this fire will essentially, for now, the plan is to let it burn into the night. Why? Because they just don't know what these chemicals are just yet. So, they don't know where to attack, whether to attack with foam or with water or anything else -- Wolf.

BLITZER: They don't want to make a bad situation potentially even worse. What about Amtrak service along the corridor between Washington and New York? It goes right through Baltimore. Any impact?

TRAVIS: That's right. I mean, it's obviously a good question. We're not hearing about any service interruptions just yet. Obviously, this was a hazardous materials train, a materials train, with just two people onboard essentially an engineer driving the train and another engineer in the back. So, only those two people on the train, itself. We're hearing that those two people are unhurt, Wolf.

BLITZER: All right. Thanks very much, Shannon. We'll stay on top of the story for us.

Another story we're following, an online money laundering scheme of staggering proportions. Get this. Six billion, that's with a B, billion dollars. The justice department says a major internet cash transfer business was a cover for crimes ranging from credit card fraud and identity theft to child pornography and drugs. Our business correspondent, Zain Asher, is working the story for us. Zain, what are the charges they're facing?

ZAIN ASHER, CNN BUSINESS CORRESPONDENT: Hey, Wolf. Money laundering and trafficking charges among others. The justice department and the U.S. secret service have taken down what is being called one of the largest international money laundering cases ever. Officials shut down payment process at Liberty Reserve over the weekend. Charges filed in New York Tuesday, call liberty a financial hub of the cybercrime world.

It works by allowing users to anonymously purchase Liberty's online currency and transfer it to another anonymous account. According to a justice department, the merchant who accepted the currency were overwhelmingly criminal in nature. They included traffickers of stolen credit card data, peddlers of various Ponzi schemes, computer hackers for hire, unregulated gambling enterprises, and underground drug dealing websites.

The government has arrested five defendants, including the company's founder, Arthur Budovsky, and co-founder, Vladimir Kats. Two more defendants are still at large in Costa Rica -- Wolf.

BLITZER: How did the government catch these guys? ASHER: Well, firstly, the biggest red flag was the fact that the company never registered with the treasury department any business that transmits money is required to do just that. Secondly, Liberty Reserve allowed accounts to be anonymous and unverified and that is precisely how the justice department caught them in the act.

A law enforcement official opened and executed transactions through an undercover account at Liberty Reserve in the name of Joe Bogus and with the address 123 Fake Main Street in a completely made up city in New York. And Once Joe bogus had an account, he was able to accept payments for all sorts of illegal activity, and basically, the feds took it from there. So in a sense, they were kind of their own worst enemy -- Wolf.

BLITZER: Allegation of $6 billion of money laundering. All right. Zain, thank you.

When we come back, House lawmakers now questioning whether the attorney general, Eric Holder, lied under oath. We have details of a Congressional committee nvestigation now under way.

And a 17-year-old accused of plotting to bomb his high school in an attack deadlier than Columbine makes his first appearance in court. Stay with us.


BLITZER: Another vicious and deadly day in Iraq. Lisa Sylvester is monitoring that and some of the day's other top stories here in the SITUATION ROOM. So, what happened today, Lisa?

LISA SYLVESTER, CNN CORRESPONDENT: Wolf, seven people are dead and dozens injured after a car bomb exploded in Eastern Baghdad while a local intelligence official was gunned down in a drive by shooting in the northern city of Mosul. The deadly attacks are just the latest in a recent surge of violence sweeping Iraq largely tied to the growing conflict between the Sunnis and Shias. Yesterday, 57 people were killed and nearly 200 wounded in attacks across the country.

And a big loss for George Zimmerman in the upcoming Trayvon Martin murder trial. A judge ruling today that the defense is barred from admitting any information about Martin related to his familiarity with guns or alleged marijuana use in court, although that could change if it's proven relevant. The trial is set to begin June 10th and Zimmerman is charged with second-degree murder in the February 2012 shooting and is currently out on bail.

New questions about whether Brazil is ready and prepared to host next year's prestigious world cup soccer tournament after a partial (ph) roof collapsed under heavy rain at one of its host stadiums. Workers used buckets to remove water from other sections of the roof in the hopes of preventing further collapses.

Owners of the stadium say human error is to blame for that tear that you see there. The stadium is also set to host matches in less than two weeks at the Confederations Cup in June. And it was a huge day on Wall Street. The Dow surging to another record high, adding more than 100 points on the heels of more positive economic news. A new report shows housing prices had their biggest increase since 2007 and a separate May reading on consumer confidence hit a five-year high jumping much more than expected.

The NASDAQ and S&P also have good days today. So, all good news all the way around as far as the markets are concerned, Wolf.

BLITZER: Investors are at play (ph) in the market. They're pretty happy right now. We'll see what happens next. Thanks very much for that, Lisa.

Up next, House Republicans investigate the attorney general of the United States, Eric Holder, for possible perjury.

And CNN catches up with the parents of the Boston bombing suspects as they emerge from weeks of seclusion.


BLITZER: Happening now --


BLITZER (voice-over): House lawmakers questioning whether the attorney general of the United States, Eric Holder, lied under oath. We have details on a Congressional committee investigation now under way.

Plus, six weeks since the Boston marathon terror attacks, we go back to the bombing suspects' Russian town (ph) where many questions still remain unanswered.

And royal first for Camilla stepping out as a queen in waiting in a city steep in memories of Princess Diana.

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


BLITZER (on-camera): Fresh trouble brewing on Capitol Hill right now for the Attorney General Eric Holder. Republican sources telling CNN the House Judiciary Committee is investigating whether he lied to lawmakers under oath. Our chief Congressional correspondent, Dana Bash, is here on the SITUATION ROOM with details. House Republicans, they are moving forward on this. They're not holding back at all.

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: That's right. It's the first day of summer unofficially and it sort of like welcome to the summer of your -- first summer of your second term, Mr. President. They are really pursuing on a lot of fronts. Let's start with Eric Holder, the attorney general. What they're looking at is whether or not he may have lied to Congress.

And according to testimony two weeks ago, before the House Judiciary Committee, when Holder said he's never been involved in potential prosecution of the press. Now, ironically, Holder was responding to a Democrat who was lobbying him a softball question. Watch this.


UNIDENTIFIED MALE: We need to protect the ability of the first -- of the press to engage in its First Amendment responsibilities.

ERIC HOLDER, ATTORNEY GENERAL: I would say this. With regard to the potential prosecution of the press for the disclosure of material, that is not something that I've ever been involved or heard of or would think would be a wise policy.


BASH: Now, the reason Republicans are looking into whether that statement was misleading is because it turns out Holder actually had approved a warrant for Fox News reporter, James Rosen's, private e- mails. And that warrant said that there was probable cause Rosen had broken the law which could mean potential prosecution.

Now, legally, there are lots of shades of gray here on both sides, but of course, politically, especially, Wolf, as you know when it comes to Eric Holder, Republicans have disdain for him, so they pounced on the ability to try to go after him particularly on something as dire, potentially, as lying to Congress.

BLITZER: Another House committee, the Government Oversight Committee, Darrell Issa's committee, they're moving forward on a separate front as far as the Benghazi attack is concerned.

BASH: That's right. And he used one of the sharpest tools he has, and that is the power of subpoena. He sent a subpoena to the State Department today in order to try to get e-mails from some of Hillary Clinton's top advisers -- you see them there -- with regard to those infamous Benghazi talking points.

Now the administration you remember just recently turned over a hundred pages of internal e-mails, but what Issa says is he wants more because those raised even more questions, especially about the involvement, Wolf, of some of those top Hillary Clinton aides. Of course the aides of somebody who may run for president in 2016.

BLITZER: Here's a political question, because I know a lot of people are asking this question. The polls so far show that none of these controversies really has had much of an impact politically as far as the president's job approval numbers are concerned. So are Republicans responding to what the polls are showing?

BASH: You know, I talked to several Republican sources, senior Republican sources in the House today about that, asking why are you guys still pursuing this so heavily when it looks like it is not penetrating at all? The answer was, they say it's been a few weeks since this has really bubbled over, and they think there could be time especially if they get something salacious or even worse from their perspective. But it is very interesting. Republicans admit, Wolf, that they are walking a fine library. They have tremendous pressure from the Republican base to use the majority in the House for oversight of the Obama administration. But they also remember, and you remember very well the last time Republicans investigated a second-term Democratic president, Bill Clinton. They went too far, and it didn't go very well. So, that's why the speaker and other top Republicans, I'm told in private, are very clear with the chairman, the rank and file, stick with the facts. Don't get too heated in rhetoric.

The other thing I think is really fascinating is that this is the packet they sent home with members of Congress -- for the Republicans for recess. So many issues on here. Mostly dealing with the economy. Oversight is the very end. They still understand that jobs and economy are what people will vote on issue

BLITZER: Yes, that's issue number one, and always will be. Thanks very much for that. All right, Dana. Good reporting.

We'll get a little bit more on this controversy involving the attorney general of the United States, Eric Holder. As we said, he's being investigated by the House Judiciary Committee for possible -- repeat, possible -- perjury. This is an investigation that could go on for a while.

Daniel Klaidman is the national political correspondent for "Newsweek" and "The Daily Beast." He has an excellent, excellent article that just came out about Eric Holder, which I read. Dan, thanks very much for coming in. What's your reaction to this investigation now that he may have committed perjury, that he lied under oath?

DAN KLAIDMAN, NATIONAL POTITICAL CORRESPONDENT, "NEWSWEEK/THE DAILY BEAST": Well, I think this would be an almost impossible case to make. You know, the issue here is did Eric Holder sign on to the prosecution of a reporter? He didn't. What he did was sign on to a pretty hard- nosed tactic, legal tactic, to try to get a search warrant approved. That's very far from -- there was never any intent to actually prosecute James Rosen --

BLITZER: Even though they used the words "aiding or abetting" -- or they used some other technical terms. Co-conspirator --

KLAIDMAN: Co-conspirator. That's right.

BLITZER: -- to make it sound like James Rosen was being investigated for espionage.

KLAIDMAN: That's right. But at the end of the day what Eric Holder said was, I would not support and have not been involved in the prosecution of journalists. That was never the intent here. The intent was to get this search warrant approved by a judge. Sometimes prosecutors say things as legal tactics. I think that is what was going on here.

BLITZER: What came across in the article that you wrote -- very good article - was that Holder, though, himself would acknowledge that politically, he was sort of tone deaf as far as the potential fallout from this -- these actions going after the news media.

KLAIDMAN: Yes. I think that's right. I think there are a lot of reasons that the Justice Department officials throw out as to why this was approved by the attorney general. One is that the attorney general and Justice Department was under enormous pressure from both within the administration from the intelligence community but also from Congress to crack down on national security leaks.

But at the end of the day, I think it really was the sort of cultural factor that prosecutors are trained to cast a wide net, get as much evidence as they possibly can, so that at the end they can sustain a conviction in court. And Eric Holder is a lifelong prosecutor. And I think to some extent looking back on this he probably thinks that he had that same kind of tunnel vision that prosecutors all the way down the line who are in court every day have, and that that may have influenced him, may have colored his views of this case.

BLITZER: He had an exchange with a reporter today on your article in "The Daily Beast." I'll play it right now. Listen to this.


ERIC HOLDER, U.S. ATTORNEY GENERAL: Yes, you're going to be working with you guys. We're going to have a real frank, good conversation about this. And I think we're going to make some changes because I'm not satisfied with where we are.

QUESTION: Is it right that you have regrets? Was that a right term at the time, "Daily Beast"?

HOLDER: I'm not satisfied. Not satisfied.


QUESTION: Are you going to have meetings this week?

HOLDER: I hope so.


BLITZER: Meetings with news media executives because the president has charged him with coming up with a new plan, if you will. He acknowledges -- based on what that exchange, your article is right. He does have regrets.

And I'm sort of surprised because he is not a newcomer to the world of politics. He was the deputy attorney general during the Clinton administration. I got to know him during that time. He is a pretty sophisticated, hard-nosed political guy in addition to being a prosecutor and the attorney general of the United States.

KLAIDMAN: Yes. And I think he probably would say that in this particular case, his political antennae was not sharp enough. It's not politics in the crude sense. In the larger sense that you have to understand when you're prosecuting cases, when you're investigating people, that there are larger implications or larger policy questions that you have to consider. And one of those is you have to find that balance between cracking down on leaks and national security leaks, which the administration and others take very seriously, and what that does in terms of the free flow of information in a democracy.

I think his view is he didn't strike that balance properly, which is why he's now going back to look at these guidelines and see how they might be able to avoid these kinds of problems in the future.

BLITZER: If he had a do over, I'm sure he'd be happy to do it a little bit different.

KLAIDMAN: I think he plays a little golf. I think it would be a mulligan.

BLITZER: Yes, all right. Thanks very much for that. Dan Klaidman of "The Daily Beast."

When we come back, six weeks since two deadly U.S. tragedies. CNN catches up with the parents of the Boston bombing suspects in their native Russia. We're in Dagestan.

And we're also in West, Texas, where survivors of that horrifying plant explosion are now struggling to put their lives back together.


BLITZER: It's been about six weeks since this country was hit with two massive and deadly tragedies within days of each other. The worst terror attack on U.S. soil since 9/11 over at the Boston Marathon and a fertilizer plant explosion in Texas that killed 14 people. CNN isn't leaving either one of them as the search for answers goes on.

We begin with our own Nick Paton Walsh in the Boston bombing suspects' ties to Dagestan, Russia.


NICK PATON WALSH, CNN INTERNATIONAL CORRESPONDENT (voice-over): It's been awhile since the parents of the alleged Boston bombers were in the public eye. Now they're back in Dagestan and tired of questions.

(on camera): Good morning.

(voice-over): Collecting the sick father's medicine, they are distraught.

UNIDENTIFIED FEMALE: (INAUDIBLE) we're talking about, they're not here now. OK? They see everything. They see all the evidences that are, you know, right there.

WALSH (voice-over):: They and a group of Internet supporters insist the Tsarnaev brothers are being framed.

Unanswered questions remain about Tamerlan's six months here. Relatives saying he innocently prayed, went to the beach, even as radical Islamist militancy swirled around him. (on camera): Now, I've been shown a rare video of Tamerlan Tsarnaev when he was here in Dagestan last summer, playing around with three to four friends of his on a beach like this just outside of (INAUDIBLE). The people who showed me the video wouldn't let me hear the audio or broadcast it, but it shows Tamerlan Tsarnaev with a thick, black, bushy beard and silver-rimmed aviator sunglasses in the characteristic slicked-back hair. His friends and him were wearing swimming trunks, and some are buried up to their necks in the sand. The demeanor of relaxed, playful men at a time when in the city and its outskirts just behind me, police were regularly in clashes with radicalized militants.

(voice-over): But U.S. officials have one question. Did Tamerlan meet with a key militant, Mansoor Nidal (ph)? The half Palestinian 19- year-old was killed in this standoff with Russian special forces last May. Police video shows women and children allowed out, but negotiators told us he didn't want to give himself up. So Russian troops moved in.

Among the ruins, neighbors asked why.

He was afraid to get into their hands, this man says, afraid that something worse than death awaited him if they got him.

(on camera): It may be the violence that engulfed this house, the victims of the Boston bombings lost the clearest chance they had of learning whether or not one of the alleged bombers, Tamerlan Tsarnaev, had key meetings with a militant here in Dagestan.

Answers that may in the cycle of violence here never be heard.

Nick Paton Walsh, CNN, (INAUDIBLE).


BLITZER: Now to the town of West, Texas where our Ed Lavandera is standing by live with a closer look at how folks there are struggling to recover from that horrific blast. What is the latest?

ED LAVANDERA, CNN CORRESPONDENT: Wolf, here in the town of West, a lot of work. It was the first responders who responded to the fire at the fertilizer plant who really took the brunt of the casualties, 12in all that were killed.

But there were a handful of them who raced to the scene and somehow are still alive today to tell their story.


LAVANDERA (voice-over): Right in the middle of that chaos was firefighter Robert Payne which makes seeing him now six weeks later all the more remarkable.

(on camera): The explosion, do you remember it?

ROBERT PAYNE, WEST, TEXAS FIREFIGHTER: Don't remember it at all. No. Watched it in video and you see how violent it is and how loud it is. No, I don't remember any of that at all. I don't really remember anything until the next morning waking up in ICU.

LAVANDERA (voice-over): This was the blast site. Payne was trying to retreat and made it about 35 yards away behind a fire truck which apparently shielded him just enough. The truck was left a mangled ruin. Somehow Robert Payne survived.

PAYNE: When I visited with the guy that rescued me, Brad, he filled me in on a few things about where I was found and about the fact that I was blown out of my boots. My boots were in one place and I was -- he described, I think, it's about 35 feet away.

LAVANDERA: Payne has nerve damage in his right arm, broken ribs, broken facial bones, and bone chips in his leg. And he needs surgery to repair his right eardrum. But he's alive.

Twelve other first responders weren't so lucky.

MAYOR TOMMY MUSKA, WEST, TEXAS: Those are some of the firefighters we lost.

LAVANDERA: West Mayor Tommy Muska took us to the fire station. The names of the firefighters who died are still on the lockers. There are two new donated fire trucks and West firefighters just resumed handling calls again this past week.

(On camera): It's going to be hard for these guys to come in here.

MUSKA: They may not want to get back on that horse but they're going to have to get back on that horse. That whistle blows we're in charge of this place now and we got to get on the trucks and you go.

LAVANDERA: You got a call, you come in, right?

MUSKA: They don't quit.

LAVANDERA (voice-over): But the hard work is just beginning.

(On camera): This is the foundation from the building that blew up.

MUSKA: Yes. There's pieces all over this place.

LAVANDERA (voice-over): Mayor Muska needs $4 million just to fix sewer and water lines and several hundred homes need to be rebuilt. But he does say one building won't be welcomed back. The fertilizer plant.

MUSKA: We don't have the ability to say you can't build here.

LAVANDERA: And what do you think the town reaction would be?

MUSKA: Their reaction would probably be to the point where they wouldn't want to rebuild anyway.

(END VIDEOTAPE) LAVANDERA: A spokesman for the plant owner said that it is highly unlikely that he will rebuild himself that fertilizer plant but this community needs one so it's a question as to where it will go.

And, Wolf, you know, many people here saw the latest investigation information that said that so far the cause of the fire that led to the explosion is officially listed as undetermined and many people right here are kind of resigned to the fact that perhaps they will never know what caused the fire that triggered that deadly explosion -- Wolf.

BLITZER: All right. Thanks very much. Ed Lavandera on the scene in West, Texas.

Coming up, an Oregon teenager accused in a high school bomb plot appears in court. Now his family says a rare illness may be the cause of his actions.

Plus, details of a very troubling report. It says Chinese hackers have compromised some of the Pentagon's most advanced weapons systems.


BLITZER: All right. This just coming in THE SITUATION ROOM. Only moments ago, an Oregon teenager accused of planning to bomb his high school in an attack even deadlier than the Columbine shootings faced a judge for the first time. And we're now learning some new chilling details about the alleged plot.

CNN's Miguel Marquez is joining us from Albany, Oregon, right now.

You were in court, Miguel. What was going on?

MIGUEL MARQUEZ, CNN CORRESPONDENT: Yes, this was a video link where he is being held. And I can tell you that he looked like a scared, gawky, 17-year-old teenager, basically, you know, slumped over in the chair. When the judge came in, he sort of popped to attention, wasn't sure exactly. what to do.

We have a little bit of -- didn't say much during this hearing, but we do have a little bit of sound of him talking to the judge during it.


UNIDENTIFIED MALE: We're setting bail at this time at $2 million and if you are released, there are some other conditions. You don't have contact with West Albany High School. You also would require 24 supervision if you are released. And you are not to possess any weapons of any kind upon released.

Do you understand those terms?

GRANT ACCORD, SUSPECT: Yes, your honor.

(END VIDEO CLIP) MARQUEZ: It was pretty extraordinary to see, Wolf, this very young man clearly now under extraordinary circumstances, 19 counts the D.A. announced against him today. There was no plea from his attorney. The next hearing is June 4th -- Wolf.

BLITZER: What was the plot, Miguel?

MARQUEZ: Yes. This is laid out in the documents that the police released today. And part of this is just -- it's harrowing. Let me just read you a little bit of it. "AKA Worst-Case Scenario," he calls it. "Leave home with stuff in trunk at 7:30. Wait in parking lot until 11:00 a.m., drive to smoke spot to gear up. Move to parking lot near the third exit."

He had planned out the exits here, "Parked backwards at 11:10. Get gear out of trunk, carry duffle bag in one hand, napalm fire bomb in the other. Walk towards school with 'Airport Stack,'" that's music from "Call of Duty." "Blasting out of car. Drop duffle, light and throw napalm, unzip bag and begin firing, cooly state," he says, in quotes, "'The Russian Grim Reaper is here.' If third exit is blocked by napalm fire or is locked, run to first entrance."

This was all part of his plan. "In either entrances throw a smoke bomb prior to walking in, proceed to enter the school, then throw bombs throughout the school. Kill myself before the SWAT engages me" -- Wolf.

BLITZER: Was he very far off from doing this?

MARQUEZ: It appears that he may have been a little farther off than authorities are saying. In this he did not seem to possess any handguns or rifles, he did want a highpoint 995, it was on this wish list as well as a Mossberg pump action shotgun. The highpoint is what we come to use as sort of assault type of weapon. It's a 9-millimeter based weapon.

He wanted those things. He also wanted to build many more bombs before he carried out this attack. Well, it seems he was a little ways off. Back to you.

BLITZER: All right. Thanks very much, Miguel.

When we come back, online espionage by Chinese actors. We're taking a closer look at a new report that says they've stolen information about critical American weapons. We'll be right back.


BLITZER: It's a royal first for Camilla the Duchess of Cornwall, stepping out on her own as a queen-in-waiting. But she's doing it in a somewhat unlikely city.

Here's CNN royal correspondent Max Foster.

MAX FOSTER, CNN ROYAL CORRESPONDENT: Well, Wolf, it was a very bold decision for Camilla to come to Paris, a city so closely associated with Diana. But this is all part of Camilla defining herself as a future queen.


FOSTER (voice-over): The Duchess at Dior. An iconic French brand, also coveted by her husband's first wife. There are obvious parallels between Diana, Princess of Wales and Camilla, Duchess of Cornwall, but also stark differences. These are Camilla's first steps tentative steps towards defining herself outside the UK. And luckily there are horses at hand, Camilla's big passion. This is the Duchess in her element.

She also showed her down-to-earth approachable side at a Parisian market. Traders getting a glimpse into Camilla's legendary sense of humor.

(On camera): So this is the piece of meat that she actually tried.


FOSTER (voice-over): "I thought she was very nice," he tells me, very agreeable. Very in line to her status.

(On camera): So the Duchess came here and bought some dresses for her grandchildren. What did you think of her?

(Voice-over): "She was very nice, polite. She loved everything I sold. She was very respectful."

And before she heads home, a must-do for all visitors to Paris. She went to see the Mona Lisa. All this part of a long, slow emergence for a queen-in-waiting.


FOSTER: Well, that visit to the Louvre really did cap a very successful tour as it's being seen at least by the French and international media -- Wolf.